Capitalizing on the Construction Class Credit

January 1, 2021 marked the 30th anniversary of the Massachusetts Construction Classification Premium Adjustment Program (MCCPAP). For eligible employers in the construction industry, this program provides up to a 25% credit to standard Workers’ Compensation premiums. In order to qualify for the MCCPAP credit, employers must meet the following criteria:

  1. Be eligible for experience rating.
  2. Have employees classified under the eligible class codes.
  3. Pay said employees an average hourly wage of $30 or more.

Employers apply for the MCCPAP credit directly to the Workers’ Compensation Rating and Inspection Bureau of Massachusetts (WCRIBMA), who will in turn notify your insurance carrier of the applicable credit. In light of the ongoing pandemic, MCCPAP applications are submitted online. Please note the following when completing the application:

  1. The MCCPAP credit is calculated using payroll information from the third quarter of the year prior to the effective date of the policy term in question. For example: when applying for the MCCPAP credit for a policy effective 4/1/2021, use payroll information from July, August, and September of 2020.
  2. Payroll for all classification codes listed on your Workers’ Compensation policy must be included on the MCCPAP application – not just the applicable construction codes. While the credit level is determined by the rate paid to construction employees, the resulting credit is applied to the standard premium for all classes.
  3. Employee bonuses are not included as wages paid and overtime is converted to straight time on the MCCPAP application. Salaried employees are assumed to have worked 40 hours per week, or 520 hours for the quarter.
  4. Employers can submit the MCCPAP application up to six months after the expiration date of the policy term in question. If a credit is issued after a policy has expired, the premium will be adjustment will be made following the audit.

Your insurance agent should address your eligibility for the MCCPAP credit as part of each renewal cycle to ensure you do not miss out on this rewarding program – before it is too late.

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