Workplace Safety

No matter what your workers’ compensation policy is, the best way to operate your business is to avoid having to use the policy altogether. Unfortunately, safety can be difficult to enforce in your own facilities, let alone offshore. Employees often have very different motivations than middle management and even upper management which can make them more prone to risky maneuvers. Here’s how to ensure quality control and safety even when you’re miles away.

Never Assume

This is the most important piece of advice you can get. Accidents are rarely ever predictable to company owners, which is a major red flag that someone has been assuming rather than verifying protocol is being followed. It doesn’t mean you have to start breathing down management’s necks, but it may mean doing more follow up on where the gaps are when it comes to safety measures. Every company can improve in these matters, it’s just a question of which areas to focus on.

Inspect Machines 

Your machinery is likely one of the biggest hazards, and it may be time to increase your maintenance on the equipment — especially if it’s several years old. It can be helpful to list out the common and uncommon hazards alongside potential mistakes that could lead to injuries before contacting the inspectors to review the current schedule and major priorities. Tweaking it can increase the safety (and financial stability) of everyone in the company.

Refreshers

Employees who concentrate on certain projects may forget their safety training for everything except what they work on. Everyone should know about how the different parts of the machines work together, whether they use them everyday or once a month. Safety gear cannot be optional on an offshore site, no matter what the rules of the country are. Mats, boots, helmets, masks: they’re all important. There should be full body harnesses for those working at dangerous heights. Even ergonomic chairs and stretching exercises can be implemented for people who are in a more office-type setting.

Emergency Training

Debris, oil, water cannot be on the floor or in people’s ways for very long. Employees are typically using their own wits to keep themselves from injury, and a rough patch or unexpected object blocking their path can easily make for a bad fall. Offshore facilities often have much more lax procedures when it comes to toxic materials, or even basic clean-up procedures. Taking shortcuts may not technically be illegal, but it can open you up to liabilities that are much more expensive than taking the time to clean. In addition to safety training around machines, employees should know basic emergency safety (e.g., fire, earthquake, etc.) and first aid for the unexpected.

This real-life case reinforces the need for every business to provide OSHA-required training.

A West Virginia company assigned a new employee – call him Jim – to drive a forklift, even though he had no experience or training in forklift operation “There’s nothing to it,” his supervisor told Jim. “It’s just like driving a car.” However, his first few weeks on the job turned out to be bumpy. Several times on each shift, while driving the forklift, he would knock things over. Although the supervisor warned Jim to be more careful, he continued to bump his way through the workday, leaving a trail of destruction wherever he went.

About three weeks after being hired, Jim’s supervisor instructed him to drive down a narrow aisle between two rows of stacked, loaded pallets. After objecting, Jim reluctantly proceeded down the aisle. His left foot, which was dangling outside the forklift where it shouldn’t have been, became pinned between the forklift and the wall of pallets. Jim suffered multiple fractures of the foot, together with a badly twisted knee; both injuries required surgery. Instead of going back to work, Jim went to court, filing suit against his employer and his supervisor for negligence.

His argument was clear: The company and his supervisor failed to provide safety training that could have prevented the accident. Jim’s attorney told the court that, although OSHA regulations mandated specific training, testing, and certification for forklift operators, the company had not trained, tested, or certified him. This meant that Jim should not have been operating a forklift – and if he hadn’t been doing so, the accident would not have taken place.

The Supreme Court of Appeals of West Virginia agreed, ruling there was sufficient evidence to prove that both the employer and the supervisor were negligent. When they hired the employee; they knew that federal law required proper training or certification of forklift operators. Allowing Jim to drive a forklift without proper training was an act of negligence.

The message: Failure to provide OSHA-required training is a huge mistake. Whenever you hire new employees or assign workers to new jobs with new hazards, make sure that they receive proper training from the get-go. Never allow an employee to operate dangerous equipment or perform any other hazardous job until they have completed the required training and demonstrated competence, as well as understanding the hazards and necessary precautions.

All states have their own rules when it comes to workers’ compensation, but those rules rarely stay the same. New Mexico for example recently ruled that ranch employees are required to have workers’ compensation offered to them, whereas before those workers were part of an exempt group under the law. Ranches and farms require a good deal of manual labor, and where there’s manual labor, there’s injury. Find out more about what you should know about workers’ compensation for ranches and farms.

Agriculture Yesterday and Today 

As evidenced by New Mexico’s example, farms and ranches have long been left out of many legal restrictions for businesses. After all, an industrial factory with 1,000 workers couldn’t be held to the same standards as a family farm with 4 people tending to the livestock. However, policies are shifting toward offering more coverage for employees who need that protection. Even if your particular ranch does not need insurance due to the laws in your state, it may still be a good idea to get it.

Exemption for Agricultural Activities

Small farms across the nation typically weren’t expected to keep up to the commercialization culture simply because of the size and production scale of the business. The exemptions vary from state to state, with some basing the exemption on total payroll numbers, or the type of labor on the ranch (e.g, seasonal, family business, etc.) The extra rules were made to protect the farm from exorbitant fees, but also to protect Americans from having to shoulder the raised costs of production. However, this has led to workers being hurt who otherwise would have been covered under normal workers’ compensation laws.

Employees may not only be affected by their exact title (e.g., farmer vs. feed mill salesperson), but by the exact activity that they’re doing at the time of injury. One worker who was injured after handling a steer was told by the employer that they were engaged in an agricultural activity, which would have been exempt in that state. However, after challenging this in court, he was granted compensation because it was determined he was conducting commercial business rather than agricultural at the time. This type of distinction illustrates just how complicated these affairs can be.

The Future Is Covered 

If you remember anything about workers’ compensation in this sector of the economy, the clear takeaway is that there is more pressure for employers to give more consideration to their employees. Constitutional activists are clear that they find these exemptions exploit the workers who put their bodies at risk everyday. While state law may take more time to catch up, it’s likely worth looking into having some type of coverage for ranches regardless.

It’s no longer enough to choose an insurance company simply because they offer what appears to be the best coverage or lowest rates. You also have to know the financial security of the company especially in these challenging economic times when even the largest companies might be teetering on the edge of insolvency.

Additionally, you want to know something about the company’s track record when it comes to paying claims and overall customer satisfaction. Not all insurance companies are the same and you should take a hard look at your prospective insurer before handing over a big premium check.

How can you find this information? Well, it’s easier than you think because there are several major companies that rate insurance companies. Each offers a detailed rating service and most of these services are free. The rating system for each of these rating companies is based on a letter grade system such as “AAA”, through “NR.” However, you should note that there are both subtle and significant differences in the letter grade system. A “C” rating might mean an average score for one rating company but might also suggest the insurance company is experiencing significant financial challenges with a different insurance rating company. Make sure you fully understand the rating system for each of the companies before jumping to an erroneous conclusion.

Some rating companies only rate the top 200 insurers, while others offer more comprehensive data. Here is a brief summary of the major companies which rate insurance companies.

A.M. Best – www.ambest.com

This rating agency is the only one which specializes in banking and insurance companies, reinsurers and covers the total insurance market spectrum including international markets such as the U.K and Canada. Also offers a comprehensive article base and in depth commentary.

Fitch Inc. – www.fitchratings.com

Provides a global rating service on insurance products through combining both local and international expertise on contemporary insurance issues and trends. Also offers a monthly newsletter dealing with specific insurance issues called “Insurance Insights.”

Moody’s Investor Services – www.moodys.com

You have to register to log in with this company before you can access their info. Covers title insurers, life, mortgage and property and casualty. Mainly focused on the financial health and outlook of insurance companies and overall realm of the financial market.

Standard & Poor’s – www.standardpoors.com

Must be a subscriber. Offers international rating services on property and casualty, life, annuities, health, title, mortgage, bond and reinsurance. Rating services include link market solutions and both the derivative product and financial subsidiaries.

The National Council of Compensation Insurance (NCCI) is a group of people who hold the details that will lead to how insurance carriers set their rates. They’re the ones who are collecting and analyzing the information, and of finding the most efficient and accurate ways to parse the numbers and risks. Find out more about what they do, so you’re not taken by surprise when change makes its way to your business.

Core Services 

NCCI is looking to get the word out when it comes to insurance, so they spread the information and provide tools for everyone to learn more about workers’ compensation. They’re constantly going over the trends in every industry to spot which sectors may need more education when it comes to providing safe facilities and duties. They assist in coming up with exact prices and rates that insurance companies and employers will use to prepare their insurance plans. NCCI provides data products to more than 900 different insurance companies across 40 different states.

Who Uses These Services

This group is meant to advise and analyze both the market, the laws, the money, and the compliance levels of different regulations and mandates. The people who use this service the most are insurance companies, but independent bureaus, and self-insured organizations also rely heavily on the numbers and opinions of the organization. Risk managers, legislators, and workers compensation agencies will also utilize different tools available. General employers will check their own experience ratings with NCCI for signs that they need to change their workplace safety measures (a higher score will mean higher insurance rates.)

Who They Are

NCCI has over 900 employees who are working across different systems to get the information ready to make decisions. They’re faced with a nearly endless string of data, so it’s not small feat. They rely on regulators, coalitions, and trade associations as well as insurers to help them ensure that they’re getting everything right. It will be someone from this group that a state or regulatory agency will listen to when it comes to raising or lowering costs, so their influence is widely felt in a variety of industries. While big data is still in its infancy in terms of exactly how to organize it all, they’re constantly working on better ways to get to the heart of the problem.

Workers compensation can feel like just a line item to business owners who already feel like they can’t control their budgets, but it’s much more than that. There’s a lot of decisions made behind the scenes that determine what you pay and when you pay it. Understanding the climate of NCCI  can make it less of a mystery.

Choosing the right respirator relevant to the nature of the employment is critical to a worker’s safety. Exposure to different hazards means that not just any respirator will suffice.

Two main classes of respirators are available:

Air-Purifying Respirators (APR)

These respirators are designed to filter air borne contaminants such as fumes or noxious dust. Other forms of APR models use a canister or cartridge containing a material that absorbs the contaminants.

APRs are tight fitting to the face and have different designs. These designs include particulate respirators, powered air-purifying respirator (PAPR), gas masks and chemical cartridge respirators. They come in four different designs, including:

Full face piece – Fully covers the face from underneath the chin to an area above the eyes. This feature provides added protection to the eyes, especially from chemical irritants.

Half-face mask – Gives protection from beneath the chin to and including the nostrils.

Quarter-mask – Protects the mouth and nose.

Mouth bit respirator – Normally used for escaping a hazardous situation only. Contains a bit which is inserted into the mouth and nose clip to seal the nostrils closed.

Supplied-air respirator (SAR)

These respirators provide breathable air via an air line or a compressed work tank. SARs come in two different types. The first has a loose fitting respiratory inlet, such as a helmet or a hood which envelopes both the neck and head, that is supplied purified air through airlines. This type may have face pieces which fit loosely.

The other form of SAR has either a half or full face piece and has very snug respiratory inlets.

Choosing the Most Suitable Respirator

Selecting the most suitable respirator must be performed by an expert, such as a safety professional. The expert will consider the appropriate apparatus only after they have identified and evaluated the potential respiratory hazard and considered the relative limitations of the respiratory apparatus for the situation.

Key Questions to Ask

Here are some factors an employer should consider when determining whether a respirator may be required:

Establish the existence of a hazard by considering warnings about the material, like its chemical components or the nature of the particulates that might be released through the work performed.

Determine whether there is limited oxygen present.

Is the hazard airborne such as a particulate, fume, or vapor?

Ask whether the respirator will be used for an emergency or in combating fires.

Evaluate whether the work is strenuous and will be performed in hazardous atmospheric circumstances.

Is there any agent present which might be possibly fatal, carcinogenic, skin absorbable or acts as an irritant?

Will the work be conducted in a confined space or will the worker be exposed to abnormal temperatures?

The key is that respirators should be used to suit the work. The proper choice of respirator is vital to the health and safety of workers in many types of employment.

Mad Men may have made alcohol in the workplace look normal, but most people tend to see a drink only at the end of the day. Each business comes with its own dangers, and winery owners need to take into account the specifics. For those who purchase workers’ compensation for their winery, there are a number of circumstances to consider. Find out more about how to balance safety with your budget.

Glamor and Hazards

Few things seem more glamorous than a winery, with sophisticated, well-dressed people sipping out of glasses and declaring what hints they taste, so it’s easy to ignore the dangers within. For those working in the tasting rooms, the floor has to be dry so they don’t slip, they need to use their spit buckets if they taste with the customers, and they need to cut people off when they’ve had enough. But the real hazards may be what surrounds them.

Wine Cellars and Barrels 

Barrels might be stored very high up, which in certain states (e.g., California) can be extremely dangerous. Earthquakes and forklift operator error may cause far more than liquids to be lost. So far, there is no regulation to change how high they’re stacked either. Winery owners may not fully account for the risk they’re taking when it comes to safety. When barrels collapse or fall, they pose deadly consequences. Until there’s a mandate to change their configurations, it may be worth rethinking barrel stacking for worker safety. A winery’s reputation is tied in with how well they treat their employees, so just one incident could mean a major debacle both in terms of direct costs (e.g., fines and raised insurance rates) and indirect costs (e.g., a loss of customer loyalty.)

Accidents Happen

No matter how safe your workplace is, it’s never going to be immune from having an accident occur. Without the right coverage, you may be opening yourself up to a lawsuit from the employee or family who claims an extreme amount for either real or imagined damages. With the right safeguards in place though, like liability insurance and complete workers’ compensation policies, you reduce your chances of being crushed by financial penalties. Choosing a carrier who will contain the fall-out is going to be as important as implementing safety laws in the workplace.

Your Costs

Costs are determined by your risk assessment and how much you pay your employees. You will get a classification based on how you operate, with each classification having its own base rate when it comes to workers’ compensation. Enforcing safety laws is one of the best ways to bring your rates down, as is hiring the right employees and taking the right precautions.

Insurance companies use an Experience Modification Rate (EMR) formula to calculate your workers comp premium, based on the cost of past claims and the probability of future accidents. The higher your EMR, the higher your premium– and the converse.

Here’s how the formula works:

1. To set a base premium, the company divides your payroll in each job classification by 100, and then by a “class rate” set by the National Council on Compensation Insurance that reflects the risk in this classification. For example, because structural ironworkers have a much greater risk of injury than receptionists, their class rate is significantly higher.

1. The company compares your claims history during the past policy period to those of similar firms in your industry. The formula factors in the ratio between expected losses in your industry and those you actually incurred, together the frequency and severity of losses. The formula “penalizes” businesses that suffer a single large loss less severely than firms that have many smaller (statistically more likely) losses.

1. The result is the EMR, which the company multiplies against the manual premium rate to set your workers comp premium for the next policy period.

If your business has an EMR of 1.0, your premium would remain unchanged. A rating of 1.2 would mean that might pay as much 20% more than a competitor with an EMR of 1.0 – a difference that you would have to swallow by cutting costs and/or raising prices. Conversely, if your EMR came to .8, you would enjoy a competitive advantage over competitors with higher ratings.

The good news: a comprehensive safety program can lower your EMR by reducing workplace hazards and injuries. We’d be happy to help you design and implement a plan tailored to your needs.

Policy changes in workers’ compensation can be fast and sudden or slow and painful. Every time the goalposts are moved, people have to learn to adapt. With the president’s agenda making headlines everywhere, it’s worth taking the time out to learn more about where this issue might head this year.

Minimum Standards and Health Care 

The Department of Labor called for minimum standards set for each state in terms of workers’ compensation before the inaugeration, yet Trump seems like he won’t be an advocate for this measure. When it comes to the Affordable Care Act (A.K.A. Obamacare), there’s a lot of work ahead to develop a sustainable and worthwhile solution to handling workplace injuries no matter what happens.

Interestingly enough, it may be mental health that’s at the top of the docket for 2017. It’s one of the top reasons employees take short-term disability assistance, and this has prompted more companies to place value on and promote programs that support work-life balance and self-care. Some states don’t allow for mental health as a reason to take disability, however that may change in the future as well.

The Enforcers 

ADA, FMLA and OSHA have all seen more enforcement over the past few years, as rules solidify and expectations are set. Last year saw a rise of ADA suits, including issues related to service animals, allergies and the amount of noise in a workplace. The concept of how much time new parents should be able to take off from work will continue to be widely debated this year too. These types of issues tend to snowball until everyone is forced to confront them. Those who own their own business may want to start addressing these issues now before they’re forced to change them later.

Future Outlook

Prices continue to go up when it comes to medical care. This fact, along with changing rules about what does and does not constitute a claim, makes experts think that this year will only see an increase in rates. California, New York, Illinois and Florida all have workers’ comp on their minds when it comes to legislation. Most are considering pricing reforms as old laws are evaluated under a microscope. There may also be changes when it comes to how marijuana is handled (in light of its growing legality) and how opioids are used (in light of its growing addiction base.) Some experts think this is driving us towards an advocacy-based model, where attorneys are used less and employees typically get back to work faster.

One thing is for certain: the more transparency on both sides of the equation, the more likely it will inspire positive and production interactions and resolutions.

Technology associated with construction has dramatically changed operations. Carefully check the class codes and their descriptions to assure proper premiums.

Years ago, 5606 – contractor supervisors – served to describe on site personnel who actively performed construction activities while managing the site. The rate was equivalent to site carpenters. That code has evolved into the computer carrying, service providing construction managers and executives who document the construction process. The rate is closer to outside sales representatives now.

Even excavation and site work is being dramatically changed by GPS technology. Now computers design a cut and fill pattern with efficiency. Labor is more involved in checking the geotechnical and environmental properties of the soils rather than the actual movement of them.

As production technology improves, new sub-codes develop to reflect the decrease in risk. Painting, carpentry, electrician and other trades now use a selection of eight or ten separate codes to describe exact activities. More components are built in shops and brought to the site. This process can change the class code of the installers and the builders.

The trend is towards more computer driven operations. Less labor, more specialists. As this trend continues, class codes will be added, deleted and the descriptions changed. There are currently over seven hundred class codes. Some are antiquated with new meanings – like a ship chandler is now a hardware store.

It pays to become familiar with the classifications. If your business has been active for many years, the “governing code” may be incorrect. The governing code is the catch-all for your business which best describes the overall operation, more obvious in manufacturing. Corrugated box manufacturing has been reorganized into several class codes. Technology has separated the manufacture of cardboard and corrugated cardboard into laminating processes, cutting and folding processes, and fully integrated operations.

Read your relevant class codes and think about which one reflects your operations. Or ask your agent to do it for