Accidents happen. Even when the right precautions are taken, it only takes a second for a routine day on the job to turn disastrous. While your first concern will always be about the health and wellness of your employees, you still have to think about the effects of an accident on your business. Learning tips to reduce workers compensation risks, claims, and costs is a smart financial decision as a business owner.
There are two ways to reduce costs. First, you’ll want to focus on the direct cost of workers compensation, which is your insurance premium. Next, you’ll want to focus on the indirect cost, which can include everything from hiring to retraining in the absence of an injured employee to loss of productivity.
When it comes to reducing claims, it all comes down to reducing risks. We hate to hear about workers compensation claims. But over the years, we’ve learned quite a bit about common injuries and what the more dangerous industries are. That’s why we put together these tips to reduce workers compensation risks so you can keep your employees safe.
Is Workers Compensation Insurance Really Necessary?
We know what some of you may be thinking and we want to stop you right there. Saving on Workers Compensation Insurance by simply not purchasing a policy is not only naïve but illegal. Workers Compensation Insurance is required in all states. The coverage is an efficient and fair way of dealing with injuries and illness that happens on-the-job.
Workers Compensation Insurance premiums are a necessary cost of doing business, but a cost that can be controlled by reducing claims. The first step to take when attempting to reduce claims is to know your risk. There are certain industries that are more likely to experience injury than others. These include:
- Construction
- Health Care
- Manufacturing
There are plenty of sub-industries that branch off of these as well. Those that experience fewer claims are typically businesses with office settings, but this doesn’t mean your desk-bound employees are safe. Claims related to trips and falls can happen anywhere.
To give you an idea of how common claims are, $7.2 trillion in covered pay and wages was provided by workers compensation in 2015. With injuries happening approximately every 7 seconds, going without Workers Compensation Insurance is putting your employees, your business, and everyone’s future on the line.
It helps to not look at Workers Compensation as an added expense but instead as a wise investment in safety. Not only will it save you from legal headaches, it can actually improve your bottom line. Studies show that for every $1 invested in safety, employers can expect a return of up to $6.
To help you start to cash in on those investment returns, we’ve put together the following tips to reduce workers compensation risks. They’re organized by stages, from the hiring stage to after a claim has been made. Whether you take just one tip or all to heart, we know you can start reducing risks, claims, and costs in your industry.
Before the Employee Is Hired
Tip 1: Put Out an Ad With a Great Job Description
Preventing a claim starts with the hiring ad you put out. Make sure the description of the job is detailed and accurate. If you require experience, put how much and that this is non-negotiable. Being as specific as possible in your hiring ad will prevent unqualified candidates from applying. You’ll be able to worry less about a liability slipping under the door and becoming an employee.
Tip 2: Carefully Vet Every Applicant
Sometimes, you need a position filled sooner than later. Don’t ever let this deter you from properly vetting candidates. Require a cover letter and resume for consideration. Then, narrow down your list of candidates and conduct formal interviews.
If possible, the interviews should include more than one person from management. Then, carefully discuss positives and negatives of candidates before making a choice. If you’re torn between more than one, hold working interviews as well. Ensuring you’ve made the best hiring choice will save you money in the long run.
Tip 3: Consider a Drug Policy
As an employer, you have the right to drug test your employees or potential employees. You’ll need to check with your state’s specific laws as some only permit drug testing after an offer of employment is on the table. But making sure your employees are working while not under the influence of drugs can prevent serious accidents and their associated costs.
Tip 4: Have a Safety Policy in Place
Just as you have a vacation policy and benefits policy, having a written safety policy ensures everyone is informed and knowledgeable of protocol. A copy of the policy should be presented to all new hires and the information should be easily accessible to everyone within the company. Review your safety policy every year and change it as needed (e.g. you’ve purchased new equipment or started working with new materials).
While the Employee Is Training
Tip 5: Work From a Training Manual
Training should be consistent for every new hire. You don’t want to have an accident and find out the injured was never properly trained for the job. Have a training manual that’s split up by days and lists what should be covered each day and in how much depth. Only allow highly skilled and experienced employees to train new hires. At the end of each training day, sit down with the trainer and trainee to discuss how the day went.
Tip 6: Aim for a Culture of Safety at Your Workplace
Signs that say “Safety is #1” are common on construction sites. Make it more than a sign at your workplace — instill it as an attitude for management and staff. This encourages everyone to filter actions, deadlines, and requirements through the goal of preventing accidents and ensuring safety.
Don’t make safety something you talk about only at quarterly meetings. It should always be in your mind, especially if you work in an industry that’s more prone to accidents. If you encourage new employees to put safety first from the beginning, they’re less likely to act irresponsibly.
Tip 7: Don’t Be Afraid to Extend Training or Reassess
If you’re anything less than 100% confident in a new hire, you do have options. Maybe they just need a little more training. If so, give it to them. But if you feel the issue is more of an error, offer them a new position. Finally, if there is no other position, you need to do what’s in the best interest of your company and release them from their employment. It’s best to cut your losses now, hire someone who is better qualified, and hopefully prevent yourself from a future workers compensation claim.
Tip 8: Remain Adequately Staffed
During training, a new hire should have the complete attention and dedication of their trainer. If you’re short-staffed, the new hire could be pulled in too many directions or asked to complete work they’re not ready to do yet. If it means sacrificing productivity for a day or two, make sure your trainee is being properly guided. It will be worth it in the end. When you let the trainer do their job, the trainee will be able to better do their job when the time comes.
When the Employee Is on the Job
Tip 9: Provide Frequent Breaks
Frequent breaks refresh the mind and body. Repetitive motion injuries are a common cause of workers comp claims, both from clerical and factory workers. And mental fatigue leads directly to unsafe practices and injuries. This is true in workplaces as different as casinos and assembly lines.
Tip 10: Make Your Worksite Ergonomically Friendly
People sit at chairs and desks in front of a computer screen for hours a day to get their tasks done. This can lead to visions problems, neck strain, carpal tunnel, and back pain. The right office furnishings, in addition to breaks throughout the day, can prevent these problems. Spending a little extra to get better equipment and supplies can save you more in the end.
Tip 11: Educate Workers
Train them on the proper way to hold and use equipment so it doesn’t cause harm to themselves or to others in the area. Teach them about safety procedures. Show them how and when to use safety protection gear. Education is never over, especially when it involves safety. Hold safety meetings when you get new equipment or change protocol.
Tip 12: Avoid Overtime
There may be times of the year or instances that demand more productivity from your team. Some may welcome overtime and the benefits that come along with it. But before you start handing out those extra shifts, keep this in mind. Studies show that employees are 61% more likely to be injured when working extra hours.
After the Employee Is Involved in an Accident
Tip 13: Document Each Accident Thoroughly
Get a statement from the employee who was injured. It needs to include information about the exact nature of the accident and the injury. It is important to get the worker to write down, in his own words, what happened in a detailed way. This statement must be signed and dated by the employee.
New York State, as do many other states, has a specific form that is required to be completed in the event of a workers compensation claim. There are very strict reporting guidelines that must be followed when reporting workers compensation claims. Make sure you are in touch with your insurance agent so that you don’t miss any of your obligations.
Be sure to report all workers compensation claims as soon as possible. This reduces the chances of litigation.
Tip 14: Communicate Respectfully With Injured Workers
Call the employee once a week to ask how they are doing. Let them know you are thinking of them, want them back, and are concerned about their health. Ask how they are progressing and if they are experiencing problems.
Treating an injured worker with respect will increase the number who return to work and reduce the number who file a lawsuit.
Tip 15: Talk to the Worker About Their Options for Employment
Ask them on the weekly calls how soon their doctor says that they will be ready to return. Be sure they are keeping up with their physical therapy routine if one is recommended.
Your employee is probably worried about keeping their job. Make sure they understands that even if they can’t do the same work they did before, you will transition them to a post that they are capable of performing.
Work hard to promote a culture of safety at your workplace. Train personnel on ways to stay safe and avoid injury. Invest in the right equipment for all workers. If someone gets injured, treat them with respect and streamline their return to work. By following these preventative and responsible action tips to reduce workers compensation risks, you’re providing your employees with a safer work environment that will benefit everyone involved.
