Reporting Guidelines and State Exceptions

Use the following items as a general guideline for reporting payroll for Workers’ Compensation.

• Reporting Total Gross Payroll
• What You May Exclude
• State Exceptions

Notes:

- Asterisk (*) indicates there may be a State Exception.

- California Contractors, see dual wage construction classifications note.

Reporting Total Gross Payroll:

• Vacation Pay*
• Sick Pay - not paid by a third-party administrator
• Bonuses*
• Holiday Pay
• Employee contributions to a 401(k) or other deferred compensation plan
• Employee contributions to a Section 125 Cafeteria Plan*
• Auto Allowances*
• Market value of lodging provided, i.e. free or reduced rent apartment*
• Value of free meals provided by the employer*
• Travel or “Show Up” pay
• State Prevailing Wage fringe Benefits paid directly to an employee
• Davis Bacon Wage fringe Benefits paid directly to an employee
• Commissions
• Payments for hand tools provided by the employee, either directly or through a third party*

What You May Exclude:

• The increased or excess portion of overtime:*
• 1/3 of overtime when overtime is paid at 1.5 times the regular hourly rate (time and a half)*
• 1/2 of overtime when overtime is paid at 2 times the regular hourly rate (double time)*
• Severance Pay*
• Charges for the Personal Use of Company Vehicles
• State Prevailing Wage fringe Benefits paid to a third party administrator
• Davis Bacon Wage fringe Benefits paid to a third party administrator*
• Tips or Gratuities*
• Reimbursements for actual expenditures, to the extent they are substantiated in the payroll records

State Exceptions:

• Arizona -

  Does not include the value of lodging in payroll, except as specified in certain classifications. The value of meals is not included.

• California -

  Does not include employee contributions to a section 125 or the value of free meals as payroll.

  Note about dual wage construction classifications - see this PDF: California Time Record Requirements. If the auditor is unable to verify classifications at the time of audit, all payroll must be placed in the highest rate, regardless of the wage level.

• Colorado -

  Davis bacon Act fringe benefits provided separately by employer are not included.

• Florida -

  Does not include awards for employee achievements or discoveries, pure gratuities, or results of a voluntary profit sharing program.

• Kansas -

  Can exclude Vacation, Holiday or Sick pay if shown in records.

• Kentucky -

  Payments/allowances for hand tools are not included.

• Louisiana -

  Exclude bonuses paid if not part of an employment contract.

• Montana -

  Market value of lodging and value of meals are subject to minimum charges. Call for current minimums.

• New Mexico -

  Bonuses paid under a state approved safety program are not included.

• Mississippi -

  Include expense reimbursement if records do not confirm expense was incurred as a business expense.

• Nevada -

  Does not allow for the exclusion of overtime, tips, gratuities, or severance pay. Payroll limitation of $36,000 applies for all employees. You may report actual payroll up to the limitation and then discontinue reporting payroll for those employees, or you may limit each employee to $3,000 on a monthly basis.

• Oregon -

  Does not include Vacation pay or unanticipated bonuses.

• Pennsylvania -

  Does not allow for the exclusion of overtime.

• Tennessee -

  Includes bonuses only when paid in lieu of wages and specified as a part of a wage contract.

• Texas -

  Excludes safety awards paid in accordance with a written safety plan.

• Virginia -

  Exclude bonuses paid. Do not include employer contribution to café 125 plan.

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