Why Your Staffing Agency’s EMR May Be Higher Than It Should Be
By Bob Thompson on August 25, 2026
Staffing agency owners often assume their experience modification rate (EMR) reflects only how safe their workplaces are. In practice, a lot of the number has little to do with safety at all. Data errors, classification mistakes, and how claims get handled can all push an EMR higher than a staffing agency’s true loss history would suggest, and each of those factors shows up in the staffing agency workers’ comp insurance that an agency carries into its next renewal. Staffing firms face more EMR volatility than a typical single-site employer because of high turnover, multi-state placements, and a mix of job classifications that shift from month to month.
What Actually Drives an EMR Number
An EMR compares an agency’s claims history to the expected losses for similar businesses within its class codes. The National Council on Compensation Insurance (NCCI) develops and publishes the formula behind that comparison, and the underwriter applies the resulting factor to the premium at renewal.
The formula weighs claims differently depending on size. A handful of large or slow-to-close claims can push the number up more than a longer list of minor incidents that closed quickly, because the largest losses are split into primary and excess portions before they feed into the calculation. The split point means the first dollars of a claim carry more weight in the formula than the later dollars.
Data errors play a role here, too. An outdated payroll figure or an incorrect class code on file with the rating bureau can distort the calculation even when an agency’s safety record holds steady year over year.
Reasons Staffing Agencies See Inflated EMRs
A few drivers show up often enough in staffing agency workers’ comp insurance programs that they’re worth checking before every renewal.
- Classification errors: A placement coded under the wrong class carries claims data into a rating category where it doesn’t belong, which can throw off the expected loss comparison for that class.
- Slow claims reporting or weak claims management: A claim that remains open longer than necessary continues to generate reserve dollars that count against the agency, even after the employee has recovered.
- Gaps in return-to-work programs: Employees who stay out of work longer generate higher claim costs, and those costs carry directly into the EMR calculation for years afterward. The Department of Labor notes that early, effective help keeps injured workers in the labor force and limits the downstream costs employers absorb when recovery drags on.
What Staffing Agencies Can Do To Correct an Inflated EMR
Owners aren’t stuck with whatever number shows up on the worksheet. A few steps can catch problems before they turn into a renewal surprise:
- Request a detailed loss run review. A broker who reviews claims data line by line can catch outdated figures or miscoded classes before they carry into the next filing.
- Build a proactive return-to-work program. Getting recovering employees back into modified duty sooner keeps claim costs from climbing. Staffing-specific underwriting expertise helps agencies design programs that fit the realities of a temporary workforce rather than a single-site employer.
- Report quickly, and stay in contact with the carrier. Fast reporting and clear communication keep claims moving toward closure rather than remaining open and adding costs.
Take Control of Your EMR
An EMR isn’t a permanent judgment on a staffing agency’s safety culture. It’s a number shaped by data accuracy, classification, and claims handling, and all three can be corrected with the right attention.
Staffing-specific expertise catches these issues before they surface as an unwelcome renewal number rather than after. If it’s been a while since anyone reviewed the rating data behind your agency’s staffing agency workers’ comp insurance, talk with a broker who understands staffing before your next filing.
EMR FAQ
What is a good EMR for a staffing agency?
Per NCCI, an EMR of 1.0 is considered average for any employer, not just staffing agencies. NCCI compares an agency’s losses to the expected losses for its class codes, and anything below 1.0 means a better-than-expected claims history for those codes.
How often is EMR recalculated?
Typically, once a year, using the agency’s claims history from the prior three policy years, excluding the most recent one.
Can a staffing agency dispute its EMR?
Yes. An agency can request a review if it believes a data error, such as an incorrect class code or outdated payroll figure, was fed into the calculation.
About Bob Thompson
Bob Thompson is the CEO of T2 Insurance Solutions LLC, a specialized insurance wholesaler focused on workers’ compensation for the staffing industry. With decades of leadership experience, Bob brings deep industry knowledge and a strategic approach to complex insurance challenges. He co-founded T2 to address critical gaps in the market, delivering expert-driven solutions tailored to staffing firms and the brokers who serve them. Backed by a leadership team with over 100 years of combined experience, Bob is committed to building strong partnerships and advancing innovative strategies that help clients navigate the evolving workers’ compensation landscape.
About Jeff Tuisl
Jeff Tuisl is president and co-founder of T2 Insurance Solutions, a wholesale brokerage firm specializing in workers’ compensation programs for temporary staffing companies and professional employer organizations. With more than 30 years of experience in the property and casualty insurance industry, Tuisl built his career across underwriting and brokerage, including 24 years as a principal at Assurance Agency, a Marsh McLennan Agency, where he grew a national staffing book of more than 500 clients. He holds the CPCU designation and is a graduate of the University of Illinois Urbana-Champaign, based in the Chicago area.
About T2 Insurance Solutions
T2 Wholesale Insurance Brokers is a reliable expert in workers‘ compensation insurance. With a century of combined experience, T2’s founders bring unparalleled insight and understanding to the table. Specializing in catering to the unique demands of workers‘ compensation insurance, T2 prides itself on its ability to craft comprehensive and competitive insurance solutions that address the diverse requirements and challenges faced by all industries.
