Yes, and for roofing contractors paying $15 to $40 per $100 of payroll under NCCI class code 5551, properly splitting class codes is one of the most effective — and most commonly overlooked — premium reduction strategies available. The concept is straightforward: employees who perform non-roofing duties for a meaningful portion of their time can have their payroll allocated to lower-rated class codes, but only if you meet strict documentation requirements.
How Class Code Splitting Works
NCCI allows employers to assign different class codes to the same employee if that employee performs distinctly different types of work. For roofing contractors, common secondary class codes include:
- 8810 — Clerical: Rate approximately $0.20 to $0.50 per $100 of payroll. Applies to office staff, administrative assistants, bookkeepers, and any employee whose duties are exclusively clerical and performed in an office setting.
- 8742 — Sales/Outside sales: Rate approximately $0.50 to $1.50 per $100. Applies to estimators and sales staff who do not perform any manual labor on job sites.
- 5606 — Contractor executive/supervisor: Rate approximately $5 to $12 per $100. Applies to project managers and superintendents who supervise but do not perform manual roofing work. Available in some states but not all.
- 8227 — Construction yard/shop: Rate approximately $4 to $8 per $100. Applies to employees who work exclusively in your yard or shop fabricating materials, maintaining equipment, or organizing inventory.
Documentation Requirements
NCCI and state rating bureaus require contemporaneous time records to support class code splits. This means daily time sheets or digital time tracking that separates roofing hours from non-roofing hours for each employee. Estimates, approximations, and after-the-fact allocations will be rejected at audit. If an auditor asks for documentation and you cannot produce it, all of that employee's payroll reverts to 5551 at the full roofing rate.
The records must show a clear, consistent separation of duties. An employee who spends Monday through Thursday on roofs and Friday in the shop can potentially have Friday's wages coded to 8227, but only with time records that prove it. An employee who periodically helps in the office between jobs cannot be split — the duties must be regular and clearly defined.
The Standard Exception Rule
Certain class codes, including 8810 (clerical) and 8742 (sales), are "standard exceptions" under NCCI rules. These can be separated from any governing class code, including 5551 roofing, without restriction. Other secondary codes are subject to the "general exclusion rule," which allows splitting only if the secondary work is a distinctly separate and identifiable enterprise. Your state's rules may vary — some states restrict splitting more tightly than NCCI standard.
Real Dollar Impact
Consider a roofing company with $1.2 million in total payroll paying $28 per $100 under code 5551. If $150,000 of that payroll belongs to clerical staff and $100,000 to a dedicated estimator who never performs manual labor, splitting those employees saves approximately:
- Clerical: $150,000 moved from $28 to $0.35 = savings of approximately $41,475
- Sales: $100,000 moved from $28 to $1.00 = savings of approximately $27,000
Total annual savings: approximately $68,000. Over a three-year policy cycle, that is more than $200,000 in reduced workers comp costs — with zero change to your safety program or operations.
Common Mistakes
The most frequent error is splitting an owner or foreman into a supervisory code when they occasionally pick up a nail gun or help with installations. Under NCCI rules, any manual roofing labor — even one day per year — disqualifies the entire payroll from a non-roofing code. The second most common mistake is failing to maintain time records and having the split reversed at audit, resulting in a large additional premium bill. Set up your payroll system to track codes from day one, not at audit time.