Experience rating, safety performance

Our excellent safety performance over the past seven years has been a key factor in reducing our insurance cost. Our low EMR [Experience Modification Rate], incidents rates, and SHARP Management System have impressed our customers and, in many cases, was a key factor in selecting Parsons to perform their project. 

Employers who use contractors to perform work in and around processes that involve highly hazardous chemicals will need to establish a screening process so that they hire and use contractors who accomplish the desired job tasks without compromising the safety and health of employees at a facility. For contractors, whose safety performance on the job is not known to the hiring employer, the employer will need to obtain information on injury and illness rates and experience and should obtain contractor references. 

Experience rating is mandatory for all employers who buy workers compensation insurance from insurance companies. For those employers, experience rating is one of the historical performance measures that can be used, cautiously, as an indicator of the quality of safety in place. Self-insured companies would not have workers compensation experience modifications. 

The actuarial premises on which the workers compensation experience rating system was developed give credibility to OSHA incident recordable and lost workday case rates as measures, and predictors, of safety performance, with these qualifications The statistical base (the hours worked) on which the records are developed has to be large enough and low probability-severe outcome risks may not be encompassed within the experience base. 

Do the OSHA statistics—the recordable case rate and the lost workday case rate —for an exposure of 1,000,000 hours have a confidence level of, say, 68.27%, as measures of the quality of safety performance An entity of this size would more than likely purchase workers compensation insurance and have an experience modification as an additional measure. 

Any simple measurement of performance in terms of injury frequency rates or incident rates is not seen as a reliable guide to the safety performance of an undertaking. The report finds there is no clear relation between such measurements and the work conditions, the injury potential, or the severity of injuries that have occurred. A need exists for more accurate measurements so that a better assessment can be made of efforts to control foreseeable risks. It is suggested that more meaningful information would be obtained from systematic inspection and auditing of physical safe guards, systems of work, rules and procedures, and training methods, than on data about injury experience alone. (HSE, 1976)... 

The insurance loss experience for an organization is closely related to its safety performance. An understanding of how insurance premiums are calculated and the type of impact accidents can have upon premiums can provide the safety manager with an additional method for measuring safety performance. Along with measures of lost workdays and recordable accidents, insurance industry measures should also be part of the safety performance measurement and improvement process. Examples of quantifiable insurance markers that are indicative of safety performance are loss ratios, experience modification rates, and expense ratios. These insurance industry measures are yet another type of performance measure available to the safety professional. 

Various forms of accident data are collected by organisations and a number of standards indices are used, e.g. rates of accident incidence, frequency, severity and duration. Accident data are based on information compiled from accident reports. As such, they are a reactive form of safety monitoring and should not, of course, be used as the sole means of measuring safety performance. However, they do indicate trends in accident experience and provide feedback which can be incorporated in future accident prevention strategies. The following rates are used ... 

Safety performance Experience Modification Rating (EMR) Recordable injury/illness information (e.g., OSHA 300A summaries) Number of hours worked number of OSHA-recordable injuries/illnesses number of fatalities number of lost workday (LWD) cases Recordable or LWD incidence rates (no. recordable or LWD cases x 200,000/ employee hours worked) List of OSHA notices of violation and fines Safety/health-related judgments, claims, contract terminations, or pending/ outstanding lawsuits... 

NOTE Contractors unable to meet host organization requirements for accident rates or experience modification rates may submit a written safety enhancement program designed to bring project performance in line with host organization requirements which will be implemented for all work done for the host organization. If approved by the host organization health and safety professional, the safety enhancement plan will become part of the contractor s job-specific safety plan and the contractor may be approved. 

A systematic study of the validity of such a procedure was performed in collaboration with ETH-Ziirich [15], The validation of the procedure was based on numerical simulations of dynamic experiments and adiabatic runaway curves. These simulations were carried out using different rate equations nth-order, consecutive, branched, and autocatalytic reactions. Moreover, the results were compared to experimental results obtained with over 180 samples of single technical chemical compounds, reactions masses, and distillation residues [17] (Figure 11.8). Thus, they are representative for industrial applications. The line corresponding to this rule (Equation 11.5) is also represented (full line) in Figure 11.8. All experimental points lie above the line and the safety margin remains reasonable. Thus, the method is conservative, but delivers a reasonable safety margin. 

Perform experiments with volatile materials or radioactive gases in a well-ventilated fume hood rated for that class of work. Good practice for safety purposes is to conduct most work with radioactive materials in a fume hood. 

Table 8.1 describes the steps of the methodology in more detail. The procedure starts with the Problem definition production rate, chemistry, product specifications, safety, health and environmental constraints, physical properties, available technologies. Then, a first evaluation of feasibility is performed by an equilibrium design. This is based on a thermodynamic analysis that includes simultaneous chemical and physical equilibrium (CPE). The investigation can be done directly by computer simulation, or in a more systematic way by building a residue curve map (RCM), as explained in the Appendix A. This step will identify additional thermodynamic experiments necessary to consolidate the design decisions, mainly phase-equilibrium measurements. Limitations set by chemical equilibrium or by thermodynamic boundaries should be analyzed here. 

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