By Steve Key
Something’s wrong, and it’s costing newspapers a lot of money.
Indiana publishers are paying $2.94 per $100 in payroll for workers’ compensation benefits under the newspaper publishing (4204) classification.
That’s almost double what commercial printers are paying – $1.64 per $100 for employees under the printing (4299) classification.
It’s $130 more in workers’ compensation costs for every $10,000 in payroll for newspaper publishing employees, according to the Indiana Compensation Rating Bureau, which establishes the rates for insurance companies that sell workers’ compensation policies to businesses.
Ron Cooper, president of the rating bureau, said the rates are determined by the past five years of claims.
An analysis comparing newspaper publishing vs. printing shows room for improvement by Indiana papers.
The bureau shows 254 policies for newspaper publishing compared to 2,816 policies for printing, but the number of developed claims is 1,136 for newspaper publishing and 3,439 for printing.
Jeff Hiland, classification analyst for the rating bureau, pointed out the frequency of claims compared to the number of policies is the undoing of newspaper publishers.
The figures are 4.82 claims per policy for newspaper publishers compared to 2.23 claims for every printing policy.
So even though the average cost per claim for newspaper publishing is $2,940 compared to $3,852 for printing, when the number of claims are factored, an average newspaper publishing-category policy brings $14,171 in losses compared to the printer-category policy’s average losses of $8,590.
Cooper and Hiland agreed that the situation can be addressed by publishers.
Hiland said simple changes in the newspaper printing process might significantly impact the number of claims.
Adjustments could be simple, such as reducing the height from the floor where newspaper bundles must be lifted, he said. The change may reduce the number of back injuries.
Hiland suggested that publishers ask their workers’ compensation insurance carriers to have a loss-control expert inspect their printing facility.
Simple procedural changes might reduce the number of job-related injuries.
Such attention to safety not only can save the industry money, but individual printing operations can earn discounts if their claims history is better than the industry average.
For example, one Indiana newspaper chain saw its rate over five years drop from $3.20 per $100 in payroll to $2.65 per $100.
Publishers should also pay attention to which category individual employees are considered by insurance carrier.
Reporters and outside advertising sales staff should fall under category 8742 – salespersons. Page designers, editors and clerical staff should fall under category 8810 – clerical.
The Indiana newspaper chain mentioned above has a rate of 32 cents per $100 payroll for salespersons and 16 cents per $100 for clerical.
Hiland said a wall separating the printing operation from clerical workers may be all that’s needed to change the category for the non-printing employees from newspaper publishing to clerical.
In the Indiana example above, moving three $25,000 employees from a newspaper publishing classification to clerical would save $1,867.50 in premium costs.
Attention to safety, in addition to fewer employee injuries, will help the bottom line.
The Indiana Compensation Rating Bureau notes $3.4 million in losses over five years for the 254 newspaper publishing policyholders. Imagine if that total could be cut in half.
And if the newspaper industry could cut its hazardous rating significantly, the rating bureau might consider consolidating newspaper publishing with the printing category.
Then the risk and premium costs for newspaper publishers would be spread across about 3,000 policyholders rather than the current 254.
Steve Key is executive director and general counsel for HSPA.