Summary
There are 3 things that an organization can do to help reduce their WCB costs over time while improving workplace safety:
- Develop a Positive Safety Culture where everyone in the organization takes ownership and responsibility for safety
- Understand what your WCB costs are and why
- Develop and implement a plan for reducing pay-out costs by taking innovative, creative, and purposeful actions that can benefit your organization, your employees, and your industry
Introduction
Worker’s Compensation is one of the best forms of insurance a business can have. With few exceptions, every business should participate in this program, and for many, its mandatory. It protects the business against lawsuits from employees or subcontractors, should they be injured on the job.
Unfortunately, WCB has gotten a bad reputation over the years because of the rising costs of workplace injuries and some abuses of the program. Some employers, and employees, take unnecessary chances at work, while other employees (thankfully, very few) see “Workers Comp” as a ticket to paid time-off from work. We’ve all heard the stories, I’m sure, true or not, about WCB claims increasing just before hunting season!
Many business leaders think that being in compliance with the regulations, the bare minimum of what they must do, is good enough, yet their WCB costs are out of control. In fact, some business leaders may have no idea what their WCB costs are. But keep this in mind… every WCB dollar you don’t have to pay out, is an extra dollar of profit, and WCB costs can be substantial.
Workplace Safety is Good Business
Workplace safety is important for your employees, but it is also good business as well. Taking a different approach to workplace safety can have significant benefits for your organization in addition to reducing injuries and perhaps saving lives. The added benefit for leaders is the reduced chance that you will one day have to make a call to a family that starts off with, “I’m sorry, there’s been an accident…” No one wants to be the person that has to make that call.
The emotional aspects aside, the business case for workplace safety is significant:
- It affects an organization’s bottom-line because it is a very real cost, as shown in the WCB Employer portal “My Account”.
- Prevention is far less expensive and less painful than recovery.
- It affects the morale and the levels of engagement of the employees.
- It can negatively impact the organization’s relationships with their customers.
- It adds to the organizational leader’s own stress because, ultimately, it falls on their shoulders to resolve the issues.
So, what can we do differently so the organization can reduce the risk of accidents while working on decreasing WCB costs?
Develop a Positive Safety Culture
First, as stated above, we have to start thinking differently about safety. Being “in compliance” only keeps the business out of trouble if an accident happens. Safety is always going to be an issue because no workplace, no matter how hard we try, is going to be completely safe. The difference comes in the form of the attitude of the leaders and employees about safety and who is responsible for workplace safety.
And here is an important fact… safety is NOT the responsibility of the Safety Officer or the Joint Health & Safety Committee. EVERYONE is responsible for safety.
The Key Objective
The objective is to develop and support a Positive Culture of Safety where workplace safety is another aspect of everyday business for the organization. Each person is responsible, first, for their own safety, and secondly, for the safety of those around them, similar to what the cabin crew tells us during the safety briefing in an airplane, “First put on your own oxygen mask, and then help the people next to you if they need it.” The reason being, in that case, you can’t help anyone if you are unconscious, but you can help an unconscious person next to you if you are conscious. You can’t influence others about their safety if they know you don’t take your own safety seriously. “Do as I say, not as I do” is not the motto of an organization with a Positive Safety Culture.
Evidence of Success
The reality is that seeing tangible benefits from developing a Positive Safety Culture is difficult because people don’t see the accidents that didn’t happen. No one sees, for instance, the accident that didn’t happen because an employee recognized a trip hazard and fixed it before carrying on with their task at hand. The evidence can be found in the lack of injuries and associated WCB claims. Be aware that success can lead to complacency, so it is important to continually be vigilant and reinforce the message that positive employee actions are making a positive difference for everyone. Recognize and celebrate successes.
Understand Your WCB Costs
Secondly, as a leader of the organization, you should understand what your WCB costs are and why. Some businesses are paying a Surcharge and the leaders either don’t know they are paying MUCH higher premiums than their competitors or they believe there is nothing they can do about it. Well, in Nova Scotia, WCB offers a Surcharge Rebate program, so they believe, as we do, that there is something you can do about being in a Surcharge situation.
But regardless of whether or not an organization is in a surcharge situation, every organization should work to improve safety and reduce their WCB costs with the goal of reducing time lost due to injuries.
The Cost of Non-Safety
WCB in Nova Scotia makes it easy to determine your costs. You can check them any time you want by logging in to your “My Account” portal on the WCB Nova Scotia website. I’m sure all other provincial WCB’s have something similar. What you want to know is your “cost of Non-Safety”. That can be best understood as, how much more are your WCB premiums over the other companies in your industry code, and how much are you paying to replace the workers who are off work, on WCB. If you are on the Surcharge list, you could be paying more that 20% higher rates in just the first year on that list and easily be over 60% more by year three on the list. This is above the rate that others in your industry, possibly your competitors, are paying. The cost of replacing an employee off work and on WCB is not often considered but it is a real cost along with the additional training, supervision, lost productivity etc. These are real dollars out the door.
Develop and Implement a Plan to Reduce those Costs
Third, you need to develop and implement a plan to reduce your WCB costs, by reducing what WCB has to payout on your behalf for workplace injuries. Just so there is no misunderstanding, if your organization is in Surcharge, it is going to take approximately 3 years of effort to significantly reduce your WCB costs, but it is possible and the sooner you get started, the more money you will save. Doing nothing different than you are doing now has a cost.
Establish a system of reporting near misses and recognizing the people that find, fix, and report them. Make safety something to celebrate. It is possible to do this without shaming offenders or “ratting them out”. Communication and effective messaging are key to success. The best way to lower your overall cost is to reduce the number and severity of workplace accidents.
Alternatives to Pay-Outs
Return to work and transitional work programs can reduce the time an employee is away from the job and reduce the amount of money that WCB pays out for missed days. This may be a good opportunity for cross-training. Another point to consider is to make sure the claims made are in fact legitimate work-related claims. Employers should not be paying compensation for an employee that hurt their back at home splitting firewood.
It Affects Everyone
Organizations in an Industry or Rate Group have a vested interest in working together to get their rates down by improving safety industry-wide. If an organization has higher pay-outs than what they are paying in WCB premiums, the difference is being covered by other businesses in that Rate Group. Your organization could be paying higher WCB premiums because your competitor is cutting corners on safety. No one wins in those situations.
None of this is easy, but help is available. WCB has programs available, but if you are looking for independent help, we have our People Approach To Safety (PATS) program as one alternative that is available to you. Call and talk to someone that has the skill and knowledge to help you and your organization become as safe and profitable as possible.
If you would like to talk to SSI Consulting Solutions about safety in your organization and/or your WCB costs, call us at: 1-877-576-3370.