Workplace Safety

The Occupational Safety and Health Administration (OSHA) has a list of companies that face inspection and enforcement – and your company might well be on it!

Here are five ways to evaluate your chances of getting a visit from OSHA:

1. Check your own injury and accident rates. Use the OSHA Form 300 log and Form 300A Summary to review your accident statistics, injury and illness logs, and incident rates, particularly your Days Away, Restricted, and Transferred (DART) rate, and Days Away from Work Injury and Illness (DAFWII) rate.
2. Look at OSHA trends in citations and violations for your industry. Go to the OSHA Web site athttp://www.osha.gov/pls/imis/citedstandard.html and browse through the regulations that cover your industry for the number of citations under a particular regulation
3. Compare your incidence rate with those of your competitors. You can find the history of your competitors’ inspections on the OSHA site at http://www.osha.gov/oshstats/index.html. The database also contains the list of citations by regulation number.
4. Determine whether you’re making the news. OSHA inspectors respond to media stories about an organization, even if the coverage is positive. If a news agency wants information about you, carefully screen any comments or photographs you provide. Even a positive story can sting you inadvertently when it comes to workplace safety and health.
5. Monitor what’s new with OSHA. Keep an eye on the agency’s Special Emphasis program (http://search.usa.gov/search?affiliate=usdoloshapublicwebsite&query=Special+Needs+Program&x=34&y=8) for targeting certain high-hazard industries.

When you think of safety hazards and employee injuries, you probably focus on what goes on inside the workplace. However, one of the greatest threats to worker safety is in your parking lot. Motor vehicle accidents are the most common cause of workplace deaths, representing about one in four fatal work injuries.

Whether they drive on the job or commute by car, everyone in your company should take a comprehensive defensive driving course. Here are some basic rules for employees to follow:

• Buckle up for safety.
• Follow traffic rules, signs, and signals.
• Don’t speed and keep at least two to four seconds behind the vehicle in front.
• Keep your eyes on the road, your hands on the wheel, and your attention on traffic.
• Check your rearview and side mirrors frequently.
• Adjust your speed and driving to changing weather and traffic conditions.
• Expect the unexpected, and stay especially alert in heavy traffic for sudden stops, work zones, road debris, and vehicles passing or changing lanes.
• Keep cool, yield the right of way, and avoid disputes with other drivers.
• Pull over to make or receive phone calls.
• Keep your vehicle maintained properly and follow the manufacturers’ recommendations for oil changes, tune-ups, and so on.
• Don’t drink or take drugs and drive.

An ounce of prevention …

What constitutes Workers Compensation fraud? The Florida Bureau of Workers Compensation regularly encounters four types of these scams: Premium fraud, working without Workers Compensation coverage, fraudulent certification, and claimant fraud.

Why do employers commit Workers Comp fraud? Easy: To save money by beating the system. What’s more, there’s always the possibility that regulators will fail to sniff out the scheme and the employer will get away with it. That is, of course, if no one ever gets hurt — an expectation that’s completely unrealistic.

If the system catches a fraudulent employer and they’re convicted, they’ll pay restitution to the state and the insurance company. At a minimum, they’ll have to pick up the costs of the investigation. Of course, there’s always the potential for jail time. All in all, not exactly a walk in the park.

People tempted to commit Comp fraud don’t understand that the purpose of Workers Compensation is to save them money. Imagine the expenses incurred if an uncovered employee suffered a serious injury on the job. The bottom line: No policy means zero protection for anyone involved.

We can help you design and maintain a Workers Comp program that will offer you and your employees the protection and savings you deserve. For more information, or a review of your current coverage, contact us today.

Most states exempt certain individuals, or groups from required Workers Comp benefits. Examples include sole proprietors, partners, corporate officers, and independent contractors.

However, attempted abuse of the system to reduce premiums is causing several states to reconsider these types of exemptions.

Auditors and worksite inspectors tell tales of construction firms that designate everyone as a corporate officer. Or, when visiting what appears to be a company with 20 employees, the auditor is assured that it’s only a sole proprietor who’s outsourcing his work to 20 independent contractors. To prove the point, each “contractor” is required to purchase his own Workers Compensation policy, which, of course, is useless because each is exempt from the law as a sole proprietor.

These arrangements create two major problems. First, if an exempted party suffers an injury, no benefits will be available. At this point, the entire house of cards might collapse in lawsuits and accusations. Second, Workers Comp premiums and loss costs for all insureds become distorted as large numbers of employees whose premiums should be helping to cover claims stay out of the system by exploiting these exemptions. As a result, several states are moving, or have already moved, to close these loopholes by modifying or eliminating the allowable exemptions.

If you’re using any of these types of exemptions to avoid paying Workers Comp premiums on certain employees, now would be a good time to revisit the purpose behind those choices. Let’s sit down together and discuss your requirements, goals, and options.

Adding additional insureds to a Liability policy is a common request in the construction industry. It’s so common, in fact, that the Insurance Services Office (ISO), the organization which develops many of the standard insurance coverage forms in the marketplace, has created an endorsement for Liability policies that adds additional insureds on a blanket basis.

Before these endorsements, contractors had to add a new endorsement to their Liability policy for each additional insured. When a contractor had to add multitudes of additional insureds, the avalanche of paperwork became a burdensome task, particularly for smaller firms.

The blanket approach replaced the multitude of endorsements with a single attachment by changing the endorsement wording. A typical additional insured endorsement employs this (or similar) wording: “Who Is an Insured (Section II) is amended to include as an insured the person or organization shown in the Schedule.” In the ISO blanket endorsement (CG 20 33 10 01), the wording reads: “Section II — Who Is an Insured is amended to include as an insured any person or organization for whom you are performing operations when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy.”

A word of caution about using the blanket approach: Although the endorsement greatly simplifies the process of adding additional insureds by removing the requirement to name each one, it makes this inclusion contingent on a written contract or agreement stating that the additional insured must be added to the contractor’s policy. So, when using the blanket endorsement, be sure to keep copies of the contract, which provides the necessary written agreement to avoid any conflicts over insured status at the time of a claim.

If you have other questions about additional insureds, or any other endorsements to make certain your Liability coverage continues to meet your needs, please feel free to get in touch with us.

A review of many lawsuits and claims against firms in the construction industry reveals that one of the key causes of disputes, and thus litigation, can be summarized as “unmet expectations.”

Whether it’s a clear case of the contractor failing to deliver what was promised (such as work that doesn’t meet project specs), or an evolving standard on the part of clients (workmanship issues), an unhappy client/contractor relationship creates a fertile breeding ground for allegations of liability. Although we review your Liability coverage program and needs regularly, good risk management also requires other measures to help minimize or prevent such actions.

For example, when negotiating agreements, it’s crucial to define project parameters clearly. Never begin work until the agreements are completed fully. According to one industry study, companies experienced far more claims when they provided services before a completed agreement.

It also helps to be selective in choosing clients. A potential client’s history of past litigation, complaints against you or other contractors, and their reputation for fairness and financial stability all indicate what you can expect in future dealings. If there are one or more red flags, proceed with caution.

Beyond the specifics of any agreement, it’s also critical to manage the client’s expectations. Although it might be tempting to brag about how great the final product will be and list numerous examples of superior work during the negotiation (and pricing) process, the fact is that the higher the client’s expectations, the greater their dissatisfaction when you don’t meet those expectations. Be clear about what you can accomplish within a given budget and the effects of making changes once the job is underway. The more the client is prepared to accept what happens during a project, the less likely that they’ll immediately go to the mattresses once a problem arises.

It’s always better to negotiate expectations with your clients now, than to have their attorneys negotiating settlements later.

Subrogation occurs when an insurance company pays a claim and then uses the insured’s right to sue the other party for causing the loss as a way to recover their funds. This seems reasonable, so why do business contracts commonly include a “waiver of subrogation” clause?

Business contracts often require that one party or the other be primarily responsible for providing insurance. The purpose of including a waiver clause is to have the party carrying the insurance waive any rights of recovery against the other party for claims covered by the insurance. The intent is to reduce risks significantly by preventing the insurance company from circumventing the contract’s intent of making one party financially responsible for the losses through the purchase of insurance.

However, it’s also possible that overly broad language in the contract might leave the insured agreeing to take on far more responsibility than is reasonable. In such a case, agreeing to a blanket-waiver of subrogation might not be in the best interests of you and your insurance company. The party that transfers all of its responsibilities onto the insurance of others distorts the basic principle of liability, which is that the guilty party should pay.

Whenever you’re presented with a contract that requires you to purchase insurance for the interests of another and includes a waiver of subrogation, be certain to review the provisions with your attorney — and with us.

The American melting pot is fast becoming a smorgasbord of distinctive cultures. During the past 10 years, more than half (51%) of new entrants into the U.S. workforce have been minorities. The next 10 years will see a dramatic increase in minority workers, many of whom might lack English proficiency and familiarity with basic workplace safety precautions. To help you meet the safety needs of an increasingly diverse workforce — especially where language barriers are an issue — we’d recommend these guidelines:

• Speak slowly, explain fully, and repeat important points several times.
• Choose simple words and avoid technical jargon (whenever possible).
• Use a translator with groups of employees who have only minimal English skills.
• Team up non-English-speaking employees with English-speaking employees.
• Provide handouts in the language(s) that trainees speak and read.
• Make sure that workers are able to understand written materials. Don’t assume that they can read forms, signs, written directions, etc.
• Stress the importance of following safety regulations and policies.
• Show employees how to use safety protections and explain why they’re important.
• Demonstrate while you speak and use pictures, diagrams, props, etc., to supplement your words.
• Follow up on the job to make sure that employees properly apply what they’ve learned in training.

Every state battles fraud and abuse of its Workers Compensation system. Even though you use Worker Comp to protect your employees and keep your premises safe, you might well end up paying higher premiums because other firms, employees, and medical providers have no compunction about cheating the system through fraud and abuse.

Workers Comp fraud involves such criminal acts as workers falsifying claims, employers misclassifying high-risk workers with less dangerous jobs to lower their premiums, and physicians exaggerating injuries and their treatment and overbilling insurance companies for expensive services never rendered. Fraud has led a number of states to pass legislation simplifying the prosecution of offenders. On the judicial front, some states provide insurance companies with immunity from lawsuits if they report Workers Comp violators. On the downside, insurers need to tread cautiously because a firm wrongfully accused of fraud has legal recourse after a false report or misleading statement.

Unlike fraud, Workers Comp abuse isn’t a felony, although it also increases premiums for everybody. Usually, this misuse of benefits involves a worker who uses unnecessary medical services, remains away from work after their injury has healed, or reports an off-hours injury as happening on the job.

According to a recent Insurance Research Council survey, more than one in four workers (28%) believe that padding Comp claims is justified to recover the policy premium, which they aren’t even responsible for paying! Insurance companies have trouble detecting this common abuse, especially when they’re up against a stress or soft-tissue injury, because there are few if any physical symptoms. This attitude among workers might be an extension of the belief that claims-padding on policyholders’ Personal insurance coverages (Auto or Homeowners) is simply a way of getting their money’s worth from their premium.

As a business owner or manager, you can help curb Workers Comp fraud and abuse and keep your premiums under control by:

• Screening out potential abuses when you recruit employees and assign jobs.
• Developing close, mutually respectful relationships with your workers to minimize any grudges against management that might encourage abuse.
• Keeping close tabs on potential abuses of the system.

We’d be happy to work with you in reaching these goals. Just give us a call.

Any business owner knows that sound risk management provides a foundation on which to base all other operation strategies — and a great way to reduce accidents and injuries and lower its Comp premiums.

Because this is such an important topic, here are the seven essential benefits of a risk management program, as detailed by The National Alliance for Insurance Education & Research:

1. Reduced cost of accidents
2. Providing adequate protection
3. Economy of operations
4. Integration of safety plans
5. Reduced risk of criminal liability
6. Ability to plan and budget more effectively
7. A clearer focus on the big picture

If you hire someone to oversee risk management within your company, the Alliance recommends that they: Develop and communicate risk-management policies; prepare recommendations and reports; conduct risk-identification surveys; analyze and measure exposures; review leases and contracts; coordinate compliance with regulations; implement risk-control programs; investigate accidents; manage claims and litigation; arrange risk financing (including insurance); establish retention programs; determine and allocate cost of risk; and monitor results.

This is only one perspective on risk management. We’d like to review your company’s risk management program, as well as your Workers Comp coverage, at your earliest convenience.