Posted On Feb 23, 2017
Accidents will happen – about 23,000 times a day in U.S. workplaces, on average, according to one study.
Workers’ compensation insurance pays for occupational injury and illness claims, and that typically protects businesses from defending against personal injury claims brought by employees. In South Carolina, which has a “no-fault” system, it doesn’t matter who is to blame for the workplace injury for a valid claim to be paid.
Although workers’ comp insurance covers an injured employee’s medical expenses and disability pay, the hidden costs for businesses are significant. The Occupational Safety & Health Administration calculates that lost productivity, higher insurance premiums and other indirect costs can total up to four times the cost of the workers’ comp claim itself.
With costs related to occupational injuries and deaths adding up to $192 billion annually, a plan to manage those risks is essential for every business.
First and foremost, employers must develop a culture of safety. OSHA says workplaces that establish safety and health management systems can reduce their injury and illness costs by 20 to 40 percent.
Changing an organization’s culture is not often easy, so leadership is critical to achieve buy-in from employees throughout the organization. Whether it’s a small business or large corporation, the message that safety is a primary concern must come from the top down.
A risk management plan can minimize workers’ comp costs in three ways: limiting opportunities for risk by controlling who comes through your door, identifying and fixing problems before something happens and managing additional risks once an accident occurs.
The initial point for a business to limit the risk of workplace injury is during the hiring process. Employers should develop comprehensive job descriptions that detail physical requirements and use experienced hiring managers to help select the right employees for the job.
Businesses can get an idea of potential risks through pre-employment screening, with written permission of the applicant in accordance with state and federal law. Useful background information can include checks of criminal records, driving records, references and drug and alcohol testing. Some businesses use psychological evaluations.
However, physical disability screening may only be done after a conditional job offer is made. The Americans with Disabilities Act prohibits questions about a disability during that screening as well as questions about the prior workers’ comp claim history of a job applicant. Consult an attorney for additional guidance on what you can or can’t ask under the law.
Another key way to prevent workers’ comp claims is to identify problems before they lead to injury. Your employees are the eyes and ears for your business. Establish a safety committee that meets regularly. Involve front-line employees from all departments, not just managers, to emphasize that safety is everyone’s responsibility.
A safety program should include a handbook of well-written policies, procedures and an explanation of the workers’ comp process. Include it in new employee orientation, and post it in an area that’s visible and accessible to all employees.
Top management can demonstrate a commitment to safety by being visible to employees and making the rounds in the workplace. Understanding the needs of the job, including reviews of ergonomics and workspace design, can be an important preventative measure.
Rewarding departments for safety successes with a pizza or ice cream party can be a relatively inexpensive motivator. It may seem silly, but a little competition can be an effective way to inspire employees to make safety their priority.
After an accident
Finally, have a plan to deal with an on-the-job injury immediately. Managing risks once an accident occurs is key to minimizing additional costs and preventing future problems.
The number one priority after an accident is always to make sure an employee is OK or to immediately provide medical treatment. But don’t stop there. Incident reporting is the backbone to managing risks – not just when something happens but also for near misses.
Employees may be reluctant to file incident reports. The process can be time-consuming, and employees may fear that they’ll get in trouble. Businesses should allow reports to be submitted anonymously and strive to make the process blame-free to encourage feedback. You can’t fix a problem if you don’t know about it.
After a workplace accident, an employer should focus on helping the employee return to work as soon as he or she is able. Expressing interest in the employee’s recovery and providing continued support can have a positive impact on morale, which ultimately helps your business.
A risk management plan that stresses prevention is key to minimizing workers’ comp claims, and employers can begin by encouraging a culture of safety at every level of their organization. Don’t wait until a costly accident takes an economic and personal toll on your business.