Classifying Risk-Janitorial Services

CLASSIFYING RISK–JANITORIAL SERVICES

(April 2022)

 

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INTRODUCTION

Janitorial services provide cleaning services to commercial concerns and private residences. A few concentrate on specific types of cleaning, such as at construction sites or inside shopping centers. Many are privately owned and operated. Most work is done based on contracts between the janitorial service and its customer. Some provide additional services, such as carpet cleaning and floor care, window washing, fire and/or water damage restoration, lawn care and landscaping.

JANITORIAL SERVICES

Class Code 96816: Janitorial Services applies to both commercial and residential cleaning services. Unfortunately, the classification does not provide a list of the exact services that a janitorial service can provide. The Premium Audit Advisor Service (PAAS) states that this classification includes building maintenance and ordinary building repairs that are provided as part of a janitorial service contract. The actual classification notes state that window cleaning, painting, maintenance, or repair that take place at locations where janitorial services are not provided must be separately classified and rated. This suggests that the janitorial services classification can include many types of services but only when primary service being provided is janitorial.

This distinction is very important and has very serious implications as an operation grows and begins to specialize.

A business may start out providing general janitorial services to its customers, including occasional window cleaning. It is very good at window cleaning, and some referred customers request that the cleaner provide only the window cleaning service. Soon the business is providing all services to some of its customers while providing only window washing service to others. This business is no longer only a janitorial services provider. It is a janitorial services and window cleaning services provider, so a new classification must be added to the policy and appropriate premium collected. The janitorial services code is used for the payroll of the full-service janitorial service customers. The payroll for services provided to the window washing only customers must be assigned to Class Code 99975: Window Cleaning. If the payroll cannot be separated, the entire payroll must be assigned to the higher rated classification.

The same rule applies to painting services performed in conjunction with janitorial services provided. Class Code 98305: Painting–Interior–Buildings or Structures applies whenever painting is the only service provided to a customer.

The janitorial services code includes several other activities done in conjunction with standard janitorial operations. However, those done at locations where janitorial operations are not provided must be classified and rated separately. Some examples are:

Note: This is a Not Otherwise Classified (NOC) classification.

It is quite unlikely that a janitorial service would be called on to re-wire a building. However, it is quite likely that it might be asked to change a fuse or reset a breaker, help with light bulbs and lighting fixtures, and perform similar or related minor tasks. Plumbing operations could similarly involve clearing clogs from pipes, clearing drains and other relatively simple operations related to domestic plumbing systems.

SUMMARY

All businesses change over time, and this is especially true with service businesses. A janitorial services company may evolve and only wax floors. On the other hand, a business that only waxes floors may decide to expand, branch out, and become a full janitorial services company. It is important to review the operations of such businesses regularly to be certain that the codes and classifications used accurately reflect current operations.