If you're a construction business owner or contractor in California, understanding the dual wage system is essential for managing your workers compensation insurance costs. The dual wage system is a method designed to ensure insurance rates are fair and based on actual risk levels tied to employee wages. 

🔧 What Is The Dual Wage Classification System?

In California, certain construction jobs are divided into two wage categories: 

• High wage
• Low wage

This classification helps determine how much an employer pays for workers compensation insurance. 

💰 Why Does It Matter?

Higher paid construction workers are statistically likely to have fewer and less severe injury claims. If an employer pays more, they're seen as lower risk and as a result, get lower insurance premiums. This encourages fair pay and promotes workplace safety. 

🧱 How the Dual Wage System Works

Each construction job classification (like roofer, electrician, carpenter) has a specific hourly wage threshold set by the California Workers Compensation Insurance Rating Bureau (WCIRB). Here's how it works:

• If a worker earns above the threshold → they fall into the high wage class → lower insurance rate.
• If a worker earns below the threshold → they’re in the low wage class → higher insurance rate.

📊 Example: Dual Wage Threshold in Action

Let’s say the wage threshold for a carpenter is $35/hour:

• A carpenter earning $38/hour is classified as high wage, qualifying the employer for reduced workers compensation premiums.
• A carpenter earning $30/hour is classified as low wage, leading to higher insurance costs.

📅 Annual Updates to Wage Thresholds

The WCIRB updates thresholds annually to reflect changes in the construction labor market and ensure fairness across the board. Staying current with these updates is crucial for accurate employee classification and avoiding costly audit penalties. Confirm with WCIRB for the latest information.   

🚧 CA Dual Wage Thresholds

Shown below are the wage thresholds for all dual wage classifications. If the employee wage is equal to or greater than the threshold, it is classified as high wage. The 2024 thresholds listed below are for policies with an effective date of September 1, 2024 or later. These thresholds may change year over year, so please confirm with WCIRB for the latest information. 

For a complete list and more information, visit the WCIRB website. 

Prepare for Audit & Check Your Class Code

If any of the classes on your policy fall into a dual wage category, ensure you're prepared for your premium audit by maintaining:

• Timecards with start and stop times
• Paystubs that reflect the timecards 

If we don't receive the above, you'll be charged at the lower threshold which has a higher rate. 

🔍 Find your BNET Policy Class Code

To find your class code, log in to portal and check your policy documents, or check with your agent. Your class code(s) will be located under the "Schedule of Classifications" from your Policy Issue Documents.