Safety performance workers compensation

Harshbarger, D., Rose, T. (1991). New possibilities in safety performance and the control of workers compensation costs. Journal of Occupational Rehabilitation, 1, 133-143. 

Later, while researching for Chapter 24, Measurement of Safety Performance, I observed that companies with superior OSHA rates also had lower workers compensation costs than did other companies. I then wanted to determine whether the quality of investigation of hazards-related incidents would also be superior. (For this second study, it must also be said that the methodology used would not stand the test of good science.)... 

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. 

But, using workers compensation costs per hour won t get much attention in a company in which the culture has required and achieved exceptionally good safety performance. For a company that has operations the public would consider high hazard, the annual workers compensation cost per employee has recently ranged a bit plus or minus of 100. That computes at 0.05 per hour. A 20% reduction nets the employer 0.01 per hour, or 20 per employee per year. Not very impressive. 

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. 

Trailing indicators are the traditional metrics that measure past safety efforts (Dupont Corporation 2000). When using trailing indicators, data is collected after the fact (after a number of accidents or illnesses, after two years of workers compensation, etc.). Trailing indicators provide an organization with feedback in terms of how good performance has been over a period of time. Examples of trailing indicators include accident records, loss reports, injury and illness statistics, injury costs, and workers compensation costs. 

Common measures for a safety program s performance are insurance expenses and losses. A cost that is often tracked by safety professionals is the organization s worker compensation premiums. Workers compensation premiums can be calculated in a number of different ways. However, regardless of the method for determining premiums, they provide an excellent indicator for safety performance in the workplace. 

With these activity-based performance measures, there is also a variety of safety metrics that can be used to assess program performance. As identified by OSHA in studies ofVPP organizations, OSHA injury incidence rates, lost work day rates, and workers compensation losses are a few safety metrics that have been correlated to the performance of the VPP criteria activities. These measures can easily be expanded to include unsafe behaviors, accident trends, and near misses. 

Each workers compensation claim is either directly or indirectly a drain on the profit margin of the company. This is the primary business reason to track workers compensation claims. Many employers who have a less than stellar experience modification rate (EMR) may have difficulty in procuring work, or bidding on work, when perspective buyers assess their safety and health performance. 

A final observation concerns the importance of the nurse in bringing the problem into focus. None of these workers would have dared claim compensation, and so none of the injuries was defined as a lost-time injury. Consequently the problem did not show up in the lost-time injury records which are conventionally used to measure safety performance. These workers did, however, feel able to approach the nurse on the job for painkillers and other palliative treatment. It was only as a result of these treatments that the extent and nature of the problem became evident. It was the medical treatment data which made it clear that something had to be done, and it was the nurse who blew the whistle. In the absence of a site nurse Robbie would presumably have been able to injure and sack several more workers with impunity. 

Organizations nsnally keep a variety of records which docnment operating and capital costs. These records assist the organization in determining the efficiencies and effectiveness of their bnsiness sections. They also assist with determining budget planning A portion of these records may involve costs associated with occupational health and safety. The costs of various elements of loss control-for example, security, workers compensation or fire - can be broken down for each centre or department to assess performance. 

Other reports may inclnde absenteeism, department compensation costs, etc. These reports will permit performance ratios to be developed to monitor efficiency - for example, the ratios of workers compensation costs to the total wages bill. Uninsured cost calculations for accidents allow the effect of accidents on profitability to be demonstrated. This can assist in seeking allocations for health and safety initiatives. 

Frequency of reviews should be determined based on several factors— for example, the results from previous reviews, previous self-assessments, safety performance as measured by OSHA Incidence Rate (OIR), Lost Workday Incidence Rate (IWDIR), Workers Compensation Claims... 

Superior Safety Performance A Reflection of an Organization s Culture Many large organizations have achieved and maintained superior safety results as evidenced by their best-in-class Occupational Safety and Health Administration (OSHA) incident rates and by exceptionally low worker compensation costs. This chapter provides a composite review of the safety... 

From a legal perspective, safety and health professionals should be aware that there is a significant difference among and between the legal statuses of these individuals working at the job site. Independent contractors, as the name implies, work independently within a contractual relationship and contract, usually written, to perform specific work activities. Contractors are independent and usually paid by the job or activity. Contractors are responsible for their own workers compensation, insurance, wages, taxes, and other federal, state, and local requirements. Safety and health compliance at the worksite can be a provision within the written contact document. Safety and health professionals usually cannot discipline for failure to... 

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