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Workers' Compensation

Worker's Compensation in Construction: PEO Risk Management

Kathryn Butkus
by Kathryn Butkus on October 20, 2023

In the high-risk construction industry, worker's compensation is not just a legal requirement but a lifeline for employees in the face of accidents or injuries. Managing this crucial aspect of workforce safety can be complex, where the right strategies can make all the difference.

This article explores the vital role of Professional Employer Organizations (PEOs) in helping construction companies navigate these challenges. We will explore how PEOs help construction businesses by providing necessary support, such as getting workers' compensation insurance and promoting safety.

Understanding Worker's Compensation in Construction

Understanding workers' compensation is crucial for both employers and employees in the construction industry. Worker's compensation, often referred to as workers' comp, is a specialized insurance program designed to provide financial protection and medical benefits to construction workers who sustain injuries or become ill while on the job.

Worker's comp is essential in construction, as it protects workers from physical labor and risks, ensuring their well-being. It covers medical expenses, rehabilitation costs, and a portion of lost wages for workers who suffer work-related injuries or illnesses.

Employers are typically required by law to provide workers' comp coverage, and understanding the intricacies of these policies, including compliance with Occupational Safety and Health Administration (OSHA) regulations, can help construction companies create safer work environments and effectively manage the associated risks. Maintaining OSHA compliance in construction can help lower the likelihood of accidents and injuries. Additionally, a solid understanding of workers' comp can assist workers in asserting their rights and securing the support they need in case of workplace accidents.

Common Risks in Construction Worker's Compensation

Construction workers face a variety of on-the-job risks that can result in workers' compensation claims. Some common risks in construction workers' compensation include:

1. Falls: Construction sites often involve working at heights, making falls a significant risk. Falls from ladders, scaffolding, roofs, or elevated platforms can lead to serious injuries.

2. Struck-By Accidents: Workers are at risk of being struck by heavy equipment, falling objects, or vehicles on construction sites, which can cause severe injuries.

3. Electrocution: Electrical work and exposure to live wires can lead to electrocution accidents, resulting in burns, shocks, or other injuries.

4. Caught-In or Between: Workers can get caught in machinery, equipment, or materials, leading to crushing injuries, amputations, or even fatalities.

5. Repetitive Stress Injuries: Prolonged and repetitive tasks can cause musculoskeletal injuries like carpal tunnel syndrome or back pain.

Other common risks include chemical exposure, heat and cold stress, slips and trips, transportation accidents, and falling objects.

The Role of PEOs in the Construction Industry

Managing workers’ compensation concerns in the construction industry can be overwhelming. PEOs offer a wide range of valuable services to the construction industry, including assistance with workers' compensation. PEOs serve as strategic partners to construction companies by managing various HR functions, payroll, and employee benefits.

When it comes to workers' compensation, PEO services aid in ensuring that construction firms have appropriate insurance coverage that complies with legal requirements. They help with policy procurement and handle the administrative aspects of claims processing, reducing the burden on construction companies.

PEOs also contribute to workforce management by offering compliance support, which is especially crucial in an industry subject to ever-changing regulations. They help construction companies remain up to date with labor laws and safety standards, ensuring that workers are aware of their rights and that your company remains in compliance with health and safety regulations.

Benefits of PEOs for Risk Management in Construction

Professional Employer Organizations (PEOs) offer several benefits for risk management in the construction industry. Here are some of the top advantages of handling risk management with a PEO:

1. Expertise in Workers' Compensation: PEOs specialize in workers' compensation insurance and bring extensive knowledge and experience to help construction companies secure the right coverage. They ensure that policies are tailored to the unique risks in the construction industry, reducing the chances of gaps in coverage.

2. Safety Training and Programs: PEOs often provide safety training and implement safety programs specifically designed for construction companies. These programs can help reduce workplace accidents, injuries, and claims, leading to a safer work environment.

3. Claims Management: PEOs have the resources to manage workers' compensation claims efficiently. They handle paperwork, communicate with insurance providers, and ensure injured workers receive prompt medical attention and benefits, reducing administrative burdens for construction firms.

4. Cost Control: PEOs assist construction companies in controlling their workers' compensation costs by identifying areas for improvement and implementing risk mitigation strategies. This helps minimize the financial impact of claims and insurance premiums.

5. Compliance Assistance: Construction companies often face complex and evolving regulatory requirements. PEOs offer compliance support, helping businesses stay current with labor laws, safety regulations, and industry-specific standards to avoid penalties and legal issues

6. Risk Assessments and Mitigation: PEOs may conduct risk assessments and recommend mitigation strategies. They can identify potential hazards and propose proactive measures to prevent accidents, which can be invaluable in the construction industry.

Overall, partnering with a PEO can significantly enhance risk management in the construction industry, helping businesses maintain safer work environments, reduce costs, and ensure compliance with legal and safety standards. 

Why FrankCrum

The benefits of working with a PEO like FrankCrum are numerous. FrankCrum's comprehensive Workers' Compensation Process offers several advantages over relying solely on an external vendor for workers' compensation in the construction industry:

1. Immediate Response and Expertise: We offer immediate assistance upon the reporting of a workplace injury or incident. This quick response is crucial in the construction industry, where accidents can be frequent. Our Workers' Comp Processing team specializes in workers' compensation, ensuring that clients receive expert guidance right from the start.

2. Streamlined Claims Process: We manage nearly the entire claims process in-house, from reporting to investigation, and return-to-work planning. This in-house approach ensures seamless communication and efficient claims management, reducing the administrative burden on clients.

3. Third-Party Administrator (TPA) Coordination: We also collaborate with a TPA to handle the claims process, providing the benefits of both in-house expertise and external TPA resources. As part of our partnership, the TPA processes and issues all payments resulting from the claims process. This comprehensive approach ensures that clients receive the best of both worlds in terms of claims management.

4. Nurse Case Management: Our TPA partners offer NCM as an added benefit, who acts as a liaison between the injured worker and healthcare providers. This ensures that injured workers receive appropriate care and support, which can lead to better outcomes and faster recoveries.

5. Return-to-Work Programs: Our Workers' Comp Process includes assistance with developing and implementing return-to-work programs. This support is essential for construction companies as it helps injured workers transition back to the workforce, reducing downtime and maintaining productivity.

6. Ongoing Support and Communication: FrankCrum emphasizes the importance of staying connected with injured employees during recovery. This ongoing support can help prevent misunderstandings and potential legal issues, promoting a more positive and constructive recovery process.

At FrankCrum, our mission is to help businesses become the best they can be. To learn more about our comprehensive services, contact us today.

Kathryn Butkus
Kathryn Butkus

Kathryn has been with FrankCrum, supporting PEO clients by managing workers’ compensation claims for 9 years. With 35+ years of experience in workers' compensation in multiple jurisdictions, Kathryn is a Board-Certified Compensation Litigation Adjuster (CWCL). During her career, she has been involved in financial and quality file control audits and has implemented a physician-preferred provider list. She also works closely with medical facilities, adjusters, and employers on return-to-work programs.