Transcript Document

Eastern Shore SHRM
Tuesday July 24th, 2012
Cambridge, MD
Ways to Reduce
Workers
Compensation
Costs
OSHA, Safety
and Training
Why the decline in workers’
compensation costs for the last two
decades?
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Employer Safety Efforts
Managed Care/Occupational Health Providers
Aggressive Claimant Fraud Investigation
Workers’ comp “Reforms” - reduced benefits in some states
Aggressive RTW Programs
OSHA outreach and state consultation programs
– Curtailing/Discontinuation of certain programs
– More enforcement on the ground
• Work Comp Premiums/Costs have enjoyed a long “soft” market
Work Comp Report Card By State
State
Grade
State
Grade
MN
A+
WV
D
NV
A
SC
D
AZ
A
CA
D
IA
A
MA
D
VT
B
CT
D
VA
A
DE
D
NC
A
PA
F
MO
A
NJ
F
MD
B
NY
F
VT
B
RI
F
ME
B
PR
F
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Source: OSHA, BLS, Work Loss Data Institute http://www.worklossdata.com/SRC2010grades.htm
Factors That May Reverse the Trend of
the last few decades
• Curtailing of Health Insurance Benefits – Changes in
Health Insurance Benefits
• Influx of New/Inexperienced Workers
• Future Economic Downturn
– Work comp used as form of disability insurance
– EH&S Downsizing
• Medical Inflation outpaces Overall Inflation
• Employer Premium Fraud
Factors That May Reverse the Trend of
the last few decades – Cont.
• Hardening WC Premiums
– Q4 ‘11 first increase in Premiums overall for 20 Qtrs
– Depends on structure of program
– Guaranteed cost will see much fewer decreases than retained risk
programs
– High Hazard/Poor Loss Experience means larger increases
– Combined Ratios higher – investment income down
– Rising Tort verdicts
– Record Catastrophic Losses
Top Ways to Reduce Workers Compensation Costs
Controlling Work Comp Costs
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Alignment of EH&S With Operations
• Align Safety Metrics with Other
Parts of the Business
– Production
– Quality
– Customer Service
• Direct Chargeback of Work Comp
Costs
– Division
– Business Unit
– Department
• Assign Work Comp/Safety
Coordinator/Manager
• Cautious aligning monetary
rewards tied to accident metrics
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–
OSHA fines under general duty & Record keeping
clause
Concerns of under-reporting
• SMART Objectives
Safety is not a cost of doing business…
Accountability For Safety Performance
• Train Supervisors & Managers
and hold accountable for:
– Uniformly enforcing all work
rules
– Promptly reporting all accidents,
injuries and conditions
– Participating in accident
investigations
– Completing accident corrective
actions/follow-up activities
– Providing light duty work
Partner With Medical Providers
• Set up local physician for
employees, preferably with an
occupational health focus.
– Review Panel a couple times a year
– Have the primary physician tour the
facility
– Educate the clinic on RTW program
– Outline job descriptions and
demands for medical provider
– Hold regular disability reviews with
provider
• Use the emergency room only for
emergencies.
Injury Reporting Lag Time
• Employee
– Diligently Communicate
Expectations from Day 1
– Coach and counsel
• Line Supervisors/Managers
– Hold accountable
Employee
MD
PA
Notice to Employer
Within 10 days after injury (30 days for hernia).
Within 30 days after death. Excusable.
If not given within 21 days, no benefits
until notice given, after 120 days
disallowed.
Claim Filing
Within 60 days after disability begins; excusable
up to 2 years. Within 18 months after death.
W/n 3 years after injury, disease or
death.
Employer
MD
PA
Employers Report Of
Accident
Within 10 days of learning of accident/injury
Within 48 hours for death.
7 days, but not later than 10 days. For
claims with I or more days of disability
Penalty
Max. Fine - $50, and loss of defense on statute of
limitations
Max. fine – 10% of comp awarded plus
interest
Reporting Claims ASAP – Saves $$$$
$30,000
$25,000
$20,000
$15,000
What are some
reasons for this?
$10,000
$5,000
$0
0 to 1
2 to 4
5 to 7
8 to 14
Days to Report Injury
15 to 30
31 to 90
Aggressive Return to Work
• Assign light duty to return employees
to work as soon as medically
possible
– Have physician review light duty
assignments
– Educate Supervisors on positive
impact of light duty
• Make light duty offers in writing
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–
Employee should sign accept/decline
Include job duties
Send certified mail
Bona fide light duty offer
MD
PA
Waiting Period
3 Days
7 Days
Retroactive Period
14 Days
2 weeks
State
This is not where you want your employees….
Studies Have Shown
• After 6 months of continuous lost time,
less than 1% of employees ever RTW
• A well managed RTW program can
reduce direct and indirect costs by 30%
• The average cost of a claim when an
employee returns to work within a few
weeks is $1,000, but injuries that
involve lost time beyond 30 days
average costs are $50,000
OSHA
Who is
Responsible?
Temporary
Workers
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Managing the Temp Troops and Your
Staff
 What are your training responsibilities when hiring temps
or for your internal staff employees?
 Are you properly documenting?
What are the responsibilities of both staffing service and
your company – including OSHA, safety compliance, PPE,
log reporting, and other Environmental, Health and Safety
training in order to protect your company.
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Shared Responsibility
 The General Duty Clause – 5(a)(1)
 Day-to-Day Supervision
 “in addition to specifying the output, product or result to be
accomplished by the person’s work, the employer supervised the
details, means, methods and processes by which the work is to be
accomplished.”
 A “shared responsibility” between staffing services and
their clients for all standards.
 Staffing Services do General Training
 Host Employers do Site Specific Training
 Multi-Employer Citation Policy (CPL 2-0.124)
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Creating Employer
Exposing Employer
Controlling Employer
Correcting Employer
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Multi-Employer Citation Policy
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Creating Employer - creates a hazardous condition
Exposing Employer - exposes own employees to a hazard
Correcting Employer - corrects a hazardous condition
Controlling Employer - provides supervision of the site with the
power to have safety & health violations corrected
 Two Step Process
1)
2)
OSHA first looks to see if an employer fits one of the categories
above (Employer may have multiple roles)
Then to determine whether or not the employer reasonably went
about fulfilling their responsibility under the various standards,
regulations and rules.
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Supervision
 Generally, host employers who engage temporary staff to
work in their facility supervise the temporary employees.
 Defining a temporary employee as a “team lead” or
“supervisor” does not transfer the responsibility for
compliance with OSHA from the host employer to the
staffing service.
 Even when actual day-to-day supervision is provided by
the staffing service, the host employer retains
responsibilities for compliance with safety and health
standards as well as retaining a significant amount of
compliance risk.
What is OSHA’s National
Emphasis Program(NEP) on
Recordkeeping All About?
And Why We Need to
Care…
Target Industries & Data
• Inspections increased 6+% in 2010
• Following sites will be Targeted –
– Manufacturing establishments with a DART rate at or above 7.0, or a
DAFWII case rate at or above 5.0 –
– Non-manufacturing establishments (except for Nursing and
Personal Care Facilities) with a DART rate at or above 15.0, or a
DAFWII case rate at or above 14.0
• Top 10 Most Frequently Cited Standards
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
1926.451 – Scaffolding
1926.501 – Fall Protection
1910.1200 – Hazard Communication
1910.134 – Respiratory Protection
1910.147 – Lockout/Tagout
1910.305 – Electrical, Wiring Methods
1910.178 – Powered Industrial Trucks
1926.1053 – Ladders
1910.303 – Electrical, General Requirements
1910.212 – Machine Guarding
Target Industries & Data – Cont.
• Targeted Standards/Industries
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Combustible Dust
Food Flavorings - Diacetyl
Hexavalent Chromium
Microwave Popcorn Processing Plants [292 KB PDF*]
Petroleum Refinery PSM
Primary Metal Industries
PSM-Covered Chemical Facilities
Recordkeeping
Severe Violator Enforcement
Shipbreaking
Will Other Industries Be Impacted?
• YES
• OSHA will inspect OSHA 300 Logs in every
inspection – not just Recordkeeping NEP
inspections.
• OSHA has also recently increased the amounts of
recordkeeping related citations.
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OSHA Recordkeeping
 The employer who does the day-to-day
supervision must record the injury or
illness.
 Only one employer is to record the injury
or illness.
 Host employers may keep a separate log
for their permanent staff and their
temporary staff. Both must be produced
to OSHA or BLS when required.
 Staffing Services are required to provide
information to the host employer so that
the Form 301 can be completed.
 Host employer has the ultimate
responsibility for making good-faith
recordkeeping determinations regarding
an injury or illness to any temporary
employees they supervise.
 Exempt SIC/NAICS codes & <10 Full
time employees
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OSHA Reporting Fatalities/Inpatient
Hospitalizations of 3 or more Inpatients
 The Employer who has control over  See OSHA Interpretation Letter
employees and the temporary
Dated April 30, 1996 –
workers day-to-day work activities
Information on Temporary
would be responsible for reporting
Workers
to OSHA.
Federal OSHA – 800-321-OSHA
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OSHA Required Training
 Host employers retain responsibility for
compliance with safety and health training
standards when staff and temporary
employees are engaged.
 In the absence of a written agreement
between the host employer and the staffing
service that defines responsibilities for
safety and health, host employers are
responsible for all training and staffing
services are responsible for knowing if that
training is adequate. Documentation is key
for both.
 A contract may be used to define which
employer is responsible for which training
items. Some items may not easily be
transferred to the staffing service (for
example/ phase 2 and 3 forklift training).
 The staffing services would have to have a
reasonable basis for assessing the host
employer training is adequate.
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OSHA Powered Industrial Trucks
 Staffing Services can provide the
“phase 1” classroom training and
the documentation of this training.
 Host employers, or their agent, may
provide the “phase 2” hands-on
training and the “phase 3” operator
evaluation. Both must be
documented properly.
 Host employers may require
temporary employees to have prior
experience. If this experience was
within the last 90 days, then the
“phase 1” training may be
considered complete. Phase 2 and
3 must still be delivered and
documented.
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OSHA Hazard Communication
 Staffing Services have a
general responsibility to train
employees who may be
exposed to potentially
hazardous substances in
their “right to know”, how to
read an MSDS, how to read
NFPA symbols and available
PPE.
 Host employers have sitespecific training responsibility
for specific chemicals,
protections, storage, use and
where to find the MSDS.
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OSHA Lockout/Tagout
 Staffing Services may be
responsible for training
employees who will be
considered “affected” by
lockout/tagout procedures.
 Host employers, or their
agent, are responsible for
training temporary
employees to be “authorized”
to implement lockout/tagout
safeguards, and site training
as an “affected” employee.
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OSHA Bloodborne Pathogens
 Staffing Services are responsible
for:
 General training in universal
precautions
 For ensuring that its employees
have appropriate vaccinations.
 For ensuring proper procedure and
follow-up after an exposure
incident
 Ensuring records are maintained
 Host employers are required to:
 Have a compliant Exposure Control
Plan (ECP)
 Provide site-specific training and
PPE to temporary employees.
 Primarily responsible to control
potential exposure conditions
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Other
 Do Host Employers need to
include temporary workers in
incentive programs?
 It would not be an OSHA
violation, but OSHA does
have issues with incentive
programs that
promote/encourage under
reporting of injuries
 When medical surveillance or
monitoring is indicated, who is
responsible for monitoring and
maintaining records?
 The Host employer must offer
and perform required medical
surveillance and testing
 (Audiograms, PFT’s, Lead Exposure,
Radiation Dosage, etc.)
 IH Monitoring
 The Staffing service must ensure
medical records are maintained
in accordance with the law
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 Staffing Services take the
following risks:
 workers’ compensation risk
 lost staff time needed to
investigate an accident
 OSHA compliance risk
 Other risks as defined by
the contract with a client.
Staffing Service
 Host Employers take the
following risks:
 OSHA compliance risk
 lost productivity risk by the
injured and other employees
 lost supervisor time needed to
investigate an accident,
 cost of overtime, re-hiring and retraining a new worker,
 damage to equipment and tools,
etc.
 Could be protected by Exclusive
Remedy – Kelly v. Geriatric and
Medical Services, Inc., 287 NJ
Super 567, 671 A.2d 631 (NJ
Super. Ct. App. Div. 1996)
Host
Employer
To Reduce Risks Host Employers Should:
 Ensure the staffing service providing temporary workers has appropriate and adequate insurance coverage


worker’s compensation($500K), employers liability($500K), comprehensive general liability($2M), auto liability (if driving
involved)($1M), and excess coverage($2M)
Additional insured endorsements, waiver of subrogation, alternate employer endorsement
 Ensure contracts with temporary agency clearly describe safety responsibilities for both parties
 Ensure all temporary employees receive the same safety-related training as the regular employees for a
specific job – treat temps the same as all other employees in regards to safety training.
 Have a reasonable basis for assessing that the temporary agency safety training is adequate.
 Keep open lines of communication with the staffing service regarding injury reporting, general/site specific
safety training, accident investigations, corrective actions, PPE and safe work practice enforcement, etc.
 Invite staffing service to be represented on your safety committee(if applicable).
 Review new hire orientation safety training periodically and make changes as necessary.
 Invite staffing service staff and/or safety/risk professional in to assist with targeted claims reductions initiatives
 Let the staffing service know anytime the job duties change
 Make sure pre-qualification criteria for selecting temporary agency are ‘Apples’ to ‘Apples’


Temporary agency does not pay small claims direct to artificially lower their Experience Modification Rates (EMR)
Temporary agency does not subrogate losses against their client
 Don’t end a temporary employees assignment for filing a work comp claim, filing an OSHA complaint,
assisting another employee with an OSHA complaint, participating in an OSHA interview
 Don’t forget about Co-employment ,FMLA, ADA, EEOC exposures
Tuesday, 21 July 2015
Questions
34
Other Resources
• Work Comp Comparison By State
– http://www.worklossdata.com/PR_SRC2010.htm
• National Safety Counsel (NSC)
• American Society of Safety Engineers (ASSE)
• Behavior Based Safety Resources
– Professor Dominic Cooper: www.Behavioural-Safety.com
– Scott Geller: www.safetyperformance.com
– Terry McSween: www.qualitysafetyedge.com
• Department of Labor/OSHA – www.osha.gov