Workers Comp Audit Response Checklist

Business: ________________ Policy period: ________________ Audit type: ________________ Insurance company: ________________ Audit due date: ________________ Internal contact: ________________

Use this checklist for the audited policy period shown above. Keep copies of what you send and save the final audit worksheet with your policy records.

• Payroll reports by employee and pay period for the audited policy period
• Gross wages, overtime, bonuses, commissions, vacation pay, and holiday pay detail
• Quarterly payroll tax filings for the audited policy period
• Federal payroll tax forms, such as Form 941 or Form 944, if requested by the auditor
• State unemployment tax reports, if requested by the auditor
• General ledger or accounting ledger that ties payroll and labor cost to the audit period
• Cash disbursement records for labor payments outside normal payroll
• Notes explaining any payroll corrections, voided checks, or pay period timing issues

Notes:

• 1099 records and vendor payment detail for labor, subcontracted work, or job-site services
• Subcontractor payment list with work performed, dates worked, and total paid during the audited period
• Workers compensation certificates of insurance for subcontractors that cover the dates they worked
• General liability certificates of insurance for subcontractors, if the auditor or contract asks for them
• Written subcontractor agreements, if available
• Notes for any subcontractor that had no workers compensation certificate for the audited period
• Copies of certificate follow-up emails or other proof that certificates were requested before work started

Notes:

• Job descriptions for each employee or role included in the audit
• Time records or payroll allocation records for employees who performed more than one type of work
• Notes identifying clerical office work, sales work, supervision, and job-site labor separately when records support the split
• Job lists showing new services, new states, new job sites, or discontinued operations during the policy period
• Original policy class codes and estimated payroll by class code
• Audit worksheet showing audited payroll by class code
• Notes for any class code added by the auditor or any payroll moved into a different class code

Notes:

• Owner, officer, partner, or member inclusion or exclusion forms for the audited period
• Payroll records for owners or officers who were included in workers compensation payroll
• Corporate officer or member records if the auditor asks for ownership documentation
• Notes showing when an owner or officer performed job-site labor, office work, sales, or supervision
• Prior endorsement or policy change showing owner or officer treatment, if available

Notes:

• Compare estimated payroll on the original policy with audited payroll by class code
• Compare the original policy class codes with the auditor's class codes
• Match added subcontractor payments to certificates that cover the audited dates
• Separate record errors from disagreements about classification or payroll rules
• Ask for the audit worksheet if you only received an invoice or summary bill
• Send the carrier written questions before the dispute deadline if the bill appears wrong
• Save the completed checklist, sent records, audit worksheet, and final audit statement in one audit file

Questions to ask the auditor or insurance company:

• Update payroll estimates at renewal when hiring, layoffs, or wage changes make the old estimate unreliable
• Collect subcontractor certificates before the subcontractor starts work
• Store subcontractor certificates by policy period so an audit can match the dates worked
• Keep payroll records that separate office, sales, supervision, and job-site labor when employees have split duties
• Notify your insurance contact when the business adds a new trade, state, job type, or operating location
• Keep prior audit worksheets so next year's estimated payroll and class codes can be compared before renewal

Renewal notes: