To accurately calculate member premiums, the NHADA WCT performs annual audits to determine members’ actual payroll figures for the previous year. We have decided to use a single auditing firm this year to ensure consistent audits. NEIS will be performing these audits beginning in January for NHADA Workers’ Compensation Trust members. You will have the choice of an in-person or virtual audit, and smaller members will be assigned a telephone audit. NEIS has a secure website for collecting your payroll information for virtual audits. This annual audit is critical and must be completed by March 25. Once all audits are complete, we can begin calculating rebates. Members can assist in this process by scheduling their audit in a timely manner and being prepared and on time for their meeting with their auditor. The firm charges NHADA by the hour, so if auditors are kept waiting or experience delays, the audit will cost more. This cost is passed directly to members through increased administrative costs, thereby adversely affecting rebates. During the audit, the auditor will need to review your general ledger, payroll records and at least three quarters of your filed quarterly tax returns (IRS Form 941). Gross overtime costs for each employee classification must be totaled. One-third of overtime is deducted from the payroll by classification for premium calculation purposes. The auditor must see gross overtime broken out by classification to exclude it. All employees, including executive officers and owners, should be identified by name and title. The auditors will also review all 1099 forms to ensure that “employees,” as defined by the workers’ compensation statute, NH RSA 281-A:2 VI(b)(1), are not misclassified as independent contractors. The workers’ compensation statute defines an employee in a seven-part test, and all seven criteria must be met to prove that a person is an independent contractor. The NH Department of Labor, the U.S. Department of Labor and the IRS are all concerned about employee misclassification. If an audit from one of these entities reveals a misclassified employee, severe civil penalties may be levied. Please remember that swap drivers are generally considered employees and not independent contractors unless they are employed by a company that provides that service to you and is covered by their own workers' compensation policy, or they hold themselves out to be a business unto themselves. The State and federal governments will always determine the employer-employee relationship under the applicable statutes. If you have questions, please contact Pete Sheffer or the NHADA Employment Law Hotline. Upon receipt of the completed audit, members’ 2025 premiums will be recalculated, and a final bill will be produced. If the net result is an overpayment, the overpayment will be applied to your 2026 premium. If the net result is an underpayment, a bill will be sent and is due within 30 days of receipt. All members will receive a copy of their audit, along with a bill or explanation of how overpayment will be applied to future premiums. If you have questions or concerns about the audit, please notify us immediately. Once the rebate checks are disbursed in May, an audit cannot be changed. The 2026 premium will be estimated based on the actual audit payroll figures from 2025. We understand that payrolls fluctuate throughout the year, particularly in the current economic climate. In June of each year, we send out a self-audit form that members can complete to adjust their payroll figures. Our collective goal at the end of the year is to avoid large premium adjustments. If you believe your payroll figures have changed at any time, please contact Marianne Gourgiotis to update them. Marianne will gladly recalculate your premium, and your monthly billing will be adjusted accordingly. Remember to prepare for your audit and have your materials ready. Please do not keep the auditor waiting. Accurate premium billing depends on accurate audits. Please contact Marianne Gourgiotis with premium questions at (603) 224-2369. Are You Ready for WCT Auditors? What to Expect and How to Prepare for Your Upcoming Audit 14
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