Transcript Creating and Managing a Best-In-Class Fleet Safety Policy 11-17-10

Creating and Managing a Best-In-Class
Fleet Safety Policy
Pete Mitchell
Senior Manager, Account Development
The CEI Group, Inc.
November 17, 2010
© 2010. The CEI Group, Inc.
What Is a Fleet Safety Policy?
It’s a document
Must be tied to an action program
Primary purpose of both:
To reduce/prevent fleet accidents
83 percent of fleets have one,
17 percent don’t*
*(Fleet Management Newsletter, July 10, 2010)
© 2010. The CEI Group, Inc.
The Fleet Safety Challenge
Fleet accident frequency: 6X the general driving public’s
NHTSA*: 620,000 fleet vehicle accidents per year
Fleet accident rates: 10 to 40+ percent per year
Why? Fleet drivers log more miles (20-25,000 per year vs. 12-15,000)
Motor vehicle accidents:
leading cause of workplace fatalities
2002-2007: 1,371 workers per year (U.S. Bureau of Labor Statistics)
NAFA: 50 percent of all fleet accidents are preventable
*National Highway Traffic Safety Administration
© 2010. The CEI Group, Inc.
Accidents Are Expensive
NETS* (2003): They cost business $60 billion per year
Physical damage
Medical expenses
Worker’s compensation claims
Lost productivity and revenue
Insurance premium increases
Administrative overhead
Liability: third-party claims
*Network of Employers for Traffic Safety
© 2010. The CEI Group, Inc.
NETS Employer Accident Cost Worksheet
Indirect costs
Supervisor’s time (rescheduling, making special arrangements)
Fleet manager’s time to coordinate vehicle repair, replacement
Reassignment of personnel to cover for missing employees
Overtime pay (to cover work of missing employees)
Employee replacement
Re-entry and retraining of injured employees
Adminstrative costs (documentation of injuries,
treatment, absences, crash investigation)
Inspection costs
Failure to meet customer requirements resulting
in loss of business
Bad publicity, loss of future business
© 2010. The CEI Group, Inc.
Accidents Are Expensive
Average total cost of accidents (NETS, 2001/ NHTSA, 2002)
All:
Fatal:
$ 16,500/ $11,229
$ 504,408
Breakout of average accident cost
Physical damage
Lost productivity:
Medical costs:
Administration
Legal:
Other (e.g., premiums, taxes)
© 2010. The CEI Group, Inc.
(NHTSA)
$ 3,720
$ 3,646
$ 1,988
$ 925
$ 678
$ 272
Fleet’s Biggest Hits: Negligent Entrustment
Definition:
Trusting a dangerous driver on company business
DUIs
Suspended licenses
History of frequent violations and accidents
Court punitive awards in the millions*
2007: Florida trucking company, $11 million settlement
2002: Tennessee transport company,$6.8 million jury award
1994: New Mexico company, $2.6 million, even though
driver found NOT at fault!
* Source: Risk Management Magazine, June 10, 2010
© 2010. The CEI Group, Inc.
Having Fleet Accidents Is Like
Losing Sales or Tax Revenue
Operating
Profit Margin
20%
10%
5%
2%
Sales Needed to
Replace Profits
Average Accident*
$ 56,495
$ 112,990
$ 225,980
$ 564,950
Fatal Accident
$ 2,500,000
$ 5,000,000
$10,000,000
$25,000,000
*At average total cost of $11,229
© 2010. The CEI Group, Inc.
Hallmarks of a Best-In-Class
Fleet Safety Policy
It communicates to drivers
Clearly written
Use active voice
Uncomplicated sentences,
short paragraphs
Avoid “legalese”
Attractively presented
Avoid small type face
Professional layout and design
Easily understood
Easily and readily available
© 2010. The CEI Group, Inc.
Hallmarks of a Best-In-Class
Fleet Safety Policy
It’s comprehensive
Addresses all major safety issues and causes
of motor vehicle collisions
It’s communicated to all drivers
(regular fleet, grey fleet, authorized secondary drivers)
© 2010. The CEI Group, Inc.
Hallmarks of a Best-In-Class
Fleet Safety Policy
It’s actually communicated/marketed
Distributed to all drivers
Drivers sign off
Revisions distributed
Regular communications with drivers
© 2010. The CEI Group, Inc.
Hallmarks of a Best-In-Class
Fleet Safety Policy
It’s driven from the top
Senior management commitment
Tied to company/organization strategy
Senior management communications
© 2010. The CEI Group, Inc.
Hallmarks of a Best-In-Class
Fleet Safety Policy
It’s enforced
Uniformly
Without exception
On a timely basis
© 2010. The CEI Group, Inc.
Components of a Best-In-Class Safety Policy
Statement of Purpose/Mission Statement
Definitions
Terms
Roles
Responsibilities
Authority
Identifies standards of acceptable driving behavior
Establishes accident reporting procedures
Training requirements
Penalties for policy violations
Good driver reward program
© 2010. The CEI Group, Inc.
The Mission Statement
Ideally, from the CEO
The purposes, goals of the policy
The importance of safe driving to all
© 2010. The CEI Group, Inc.
Sample Safety Policy Statement
To our employees:
Vehicle accidents can cause serious injury and undue hardship on you
and your families, and have a negative impact on our company, both
as a community of co-workers and as a business. It is the policy of
(name of company) to achieve the greatest practical freedom from
accidents and to ensure that every employee is provided safe and
healthful working conditions. We have begun a fleet safety program
to reduce and prevent accidents. We will, as always, comply with all
applicable regulations and expect all drivers to drive safely and obey
traffic laws. Safety is a priority. Your cooperation and help are needed
to make our program a success.
Signed,
President
© 2010. The CEI Group, Inc.
Roles, Privileges, Responsibilities and Authority
Approved drivers
Who they are: regular fleet, “grey” fleet, secondary drivers
Drivers license requirements
Vehicle and use
Nature of vehicle (equipment, assigned or driver-acquired)
Permitted uses: (i.e., business, personal)
Reimbursing fleet for tickets, camera violations, etc
Fleet and safety management
Supervisor/management responsibilities
© 2010. The CEI Group, Inc.
Standards of Driving Behavior
Obeying all traffic laws
Key safety issues:
Seat belts
Impaired driving
Aggressive driving & Speeding
Distracted driving
Cell phones
Texting
© 2010. The CEI Group, Inc.
Accident Procedures
At the accident scene
Calling emergency personnel
Data gathering
Answering police questions
Reporting to fleet
Required time frame
Who and how to notify
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Enforcement
Enforcement thresholds
Events
Points
How events/points are
cleared from the record
Nature of penalties
Required remedial training
Loss of driving privileges
Termination
© 2010. The CEI Group, Inc.
Securing Driver Compliance:
Enforcement and Recordkeeping
Communicate changes in driver status/score as they occur
Enforce the policy
Uniformly
As soon as possible
Without exception
Uniform enforcement is vital to defense against fleet liability
Document every intervention with drivers
Retain all records
Your audit trail for legal defense
© 2010. The CEI Group, Inc.
Good Driver Reward Program
The importance of recognition
Types of rewards (not necessarily costly)
Examples: point or monetary awards, vehicle upgrades
© 2010. The CEI Group, Inc.
Creating Your Safety Policy
Fleet management has primary responsibility
Involve all relevant departments to secure buy-in
Risk management
Human Resources
Sales & Service (managers and drivers)
Legal
Procurement
© 2010. The CEI Group, Inc.
Creating Your Safety Policy
Use examples to get you started
Make it uniform across all divisions and locations
Level the playing field by jurisdiction
© 2010. The CEI Group, Inc.
Managing Your Policy Document:
Annual Reviews
State laws and Federal regulations change
New technologies
New trends in your fleet can emerge
These may require new policies, like:
MVR reporting requirements
Policies on secondary drivers
Use of electronic devices
New reimbursement procedures for accidents and fines
New policy provisions should be communicated immediately
© 2010. The CEI Group, Inc.