Work Safety Policy - The Safety & Numbers Blog, presented by IAS

Work Safety Policy EMR Strategies to Lower Workers’ Comp Rates

At the beginning of each fiscal year, your insurance agency will provide you with your Experience Modification Rate, or EMR. This value serves as a multiplier to calculate your annual workers’ compensation insurance premium. EMR may lower or raise your premiums based on the history of safety and injury claims that your company exhibited over a three year period. It is also the most direct method of calculating a return on investment on work safety investments.

By improving work safety policies and following preventive practices that lower injury loss rate, business can save thousands of dollars annually on premium reductions.

Work Safety Policy EMR Strategy

The most direct way to lower your EMR is to institute a Work Safety Policy that is supported and promoted throughout the organization. Work safety policies build cultural safety values and institute programs, incentives and controls that improve processes and cross-departmental knowledge of safety.

Here are some ideas from a work safety policies at successful companies.

Develop a Safety Committee to assess and improve communication about safety policy and strategic EMR initiatives
Create a Return to Work Policy to encourage workers to return when able and reduce the length of claims
Initiate Job Classification reviews to communicate job responsibilities to employees and improve expertise
Implement strategies to generate a Safety Culture including Management Involvement, Incentive Plans, and Injury Claim packets with helpful information

Equipment Work Safety Policies for EMR

In support of work safety policy, effective management of equipment can further help reduce injuries and lower EMR. Ensure that equipment is operating properly and develop an Out of Service policy to inform team members how to handle malfunctioning equipment. Conduct work hazard analyses to identify equipment to reduce injury risk. Input from the employees that actually operate the equipment is highly valuable when developing policy. And remember that each work site or piece of equipment is unique and thus may require custom access solutions.

The above article was originally published in the January 2014 IAS Trucker Newsletter. Sign up today to subscribe and receive our monthly Work Safety newsletter.

Workers Comp EMR Risk Management Sample Case

EMR, or Experience Modification Rate, is the most direct method of determining the effect that claim history has on the annual premium a business pays for workers’ compensation insurance. In technical terms, it is defined as follows.

The adjustment of annual premium based on previous loss experience. Usually three years of loss experience are used to determine the experience modifier for a workers’ compensation policy. The three years typically include not the immediate past year, but the three prior. Source: http://en.wikipedia.org/wiki/Experience_modifier

An average Workers Comp EMR rate is 1.0. In essence, an average EMR means that the actual losses during a 3 year period is equal to the expected losses for that period. Since EMR functions as a multiplier, a company with an average EMR rate will pay precisely the calculated premium based on industry, number of employees, and other risk factors. From a work safety perspective, it would appear that these companies are effectively but not optimally preventing work injury hazards that drive EMR risk.

A Sample Workers Comp EMR Calculation

Workers’ comp EMR rates are lower or higher if a business incurs total losses that are lesser or greater than expected losses in the applicable 3 year time period. For example, a company with more losses than expected may have an EMR of 1.1, and thus their premium is 1.1 times the base premium for their business. At the same time, if that business experiences fewer losses over the next 3 year period, their EMR may be 0.9 and they will pay less than the base premium.

Minimum Workers’ Comp EMR and Controllable EMR

EMR values can and often do vary more than 0.1 above or below average. Each business has a minimum EMR that they can strive to reach in order to pay their lowest possible workers comp insurance premium. If Company XYZ has a Minimum EMR of 0.85 and a current EMR of 1.1, they have a Controllable EMR of 0.25 [1.1-0.85]. Here is where the bottom line effect should get the attention of business owners, as seen below.

Effective Safety Reduces EMR Risk and Saves Money

Effective work safety and EMR risk management has many positive effects. Improved morale, hiring and employee retention advantages, lost time reductions, and project timeline improvements to name just a few. While these factors are difficult to monetize, the bottom line effect of improved workers comp EMR and resulting workers’ comp premium savings illustrates how effective safety can be at providing long term profit advantages and improved cash flow. It’s clear that from a financial perspective, managing work safety is a win-win for businesses of all sizes or strategies.

Learn how to Lower Your Workers Comp EMR

The Importance of Fall Protection in Construction: INFOGRAPHIC

The national initiative to improve fall protection measures has been a topic that we have touched on in various posts throughout 2013. The statistics are eye opening: In 2012, Falls killed more than 1 construction worker every 2 days, and the trend continues to grow. Have a look at our newest infographic to consider the need for Construction Fall Protection and get started implementing work safety policies to reduce your risk.

Examining Safety at Top Contractors

The Engineering News Record recently published a list of the Top 400 Contractors. At companies with $10-$30 billion in revenue, the number and size of contracts justifies a dedication to worker safety that small to mid sized businesses can emulate to help shorten the learning curve. Safety is deeply integrated into each of the Top 3 contractors’ day to day business policies and organizational culture. Contracting firms that strive to achieve success may observe this theme as motivation to implement safety at the highest level to increase revenue and support growth.

Bechtel

At Bechtel, the safety goal is Zero Accidents. Safety is integrated into each project via technical field procedures and extensive training. Each employee has ‘stop-work authority’ if they feel a job responsibility is potentially unsafe. To incenitivize safety and communicate its importance to employees, Bechtel provides multiple awards for exceptional safety performance and innovation.

Fluor

Fluor’s commitment to safety includes a “ZERO incidents” policy. Fluor has received recognition as one of America’s top safety companies by demonstrating excellence in “support from management and employee involvement, innovative solutions to safety challenges and effective training programs.” One such program is the Field Audit system, a proactive approach to identify and mitigate work hazards.

Kiewit

Kiewit has instituted and follows a ‘Nobody Gets Hurt’ policy. Kiewit is focused on preventing even the most minor injuries through employee engagement throughout the organization coupled with a supporting management commitment. “Safety training, observation programs and job hazard analyses” help to support this vision.

Innovative Access Solutions

Innovative Access Solutions provides safety equipment to each of the Top 3 contractors listed above. In addition to the Trucker series of trailer access products, IAS provides custom access solutions for remote locations, unique jobsite requirements and more, in support of construction work safety policies. To request information about safety equipment from Innovative Access Solutions, click here.

Work Hazard Analysis

Identifying Workplace Hazards is an integral component of an effective work safety program. As a required element of OSHA VPP Program participation, following an organized hazard assessment process can be the backbone of a company’s safety policy. Identifying hazards provides the ability to mitigate risk and evaluate safety effectiveness.

The work hazard assessment process consists of five main components:

Identify Hazardous Condition
Hazards that can lead to injury or illness range from physical injury risk to chemicals, temperature, radiation, noise, and electrical. Employees need to be involved in hazard analysis from the beginning to assist with acceptance and recognition of benefit.
Determine Root Cause
Potential root causes can include lack of knowledge, lack of physical ability, improper training, or unidentified hazards. Managers should reassess hazards when new equipment is installed or new work processes developed.
Eliminate Hazards
Mitigate risks via controls based on level of injury risk, frequency of exposure, and potential harm. Evaluate the level of overall risk to prioritize controls and implement. Identify PPE (Personal Protective Equipment) such as gloves, safety glasses, etc.
Control Measures
Risk management efforts can include engineering controls to manage exposure, layout, and access; administrative controls to to manage employees, tasks, and training; and work practices for safety, hygiene, and work area cleanliness.
Evaluation of Effectiveness
Hazard assessment programs should be evealuated on injury prevention effectiveness. Evaluation tactics include routine inspections; documentation for injury reports and near misses; requesting, researching and responding to employee feedback.

Source: Marine Corp Community Services

Initiating a Work Hazard Analysis

When commencing hazard assessment, plan to document responsible team members, tasks, and step sequence for processes with injury risk. A Hazard Assessment checklist similar to this sample provided by the California Department of Industrial Relations may be helpful. Next, determine and document preventative measures, equipment, and Personal Protective Equipment, and train employees accordingly. Finally, consider residual risk – any risk that remains after controls have been implemented – for future evaluation and improvement.

Thank a Worker this Labor Day

Workers have long been the backbone of American society. While worker safety was often overlooked during the Industrial Revolution, over the past 100 years, advancements in work conditions and OSHA regulations have maintained the importance of the American worker while recognizing and supporting the importance of their health and safety to families and loved ones. In the 21st century, these two initiatives go hand in hand moreso than ever before. Today businesses are actually increasing productivity by focusing on trending safety practices.

From the Department of Labor website:

Labor Day, the first Monday in September, is a creation of the labor movement and is dedicated to the social and economic achievements of American workers. It constitutes a yearly national tribute to the contributions workers have made to the strength, prosperity, and well-being of our country.

With this in mind, Safety & Numbers invites you to take the opportunity to not only honor the national Labor Day holiday, but also take it one step further by recognizing the importance of workers to your company’s productivity and safety culture.

Here are a few ideas to help you accomplish that mission.

Thank a Worker e-cards
Company Celebration at a Local Establishment
YouEarnedIt Employee Rewards Management Software

There are certainly many more ways to recognize the importance of your workers on Labor Day. We invite you to share your ideas in the comment section, and have a safe, relaxing Labor Day Weekend!