How to Avoid a Workers Compensation “Claims & Costs Nightmare”DATE: July 10th, 2019
In today’s litigious society, workers compensation insurance has become a necessary line of coverage for nearly all employers. In fact, in California, this type of coverage is legally required (Labor Code Section 3700) for all employers with at least one employee. This type of coverage is often a business’s largest insurance expense, and the more it’s used, the higher your premium rates will rise. That’s why it’s so important to minimize workers compensation claims (which, in turn, lowers premiums).
Here are 10 Practical Tips to Help You Minimize Workers Compensation Claims in your business.
1. Build a Culture and Environment of Safety and Trust
Building both safety and trust into your work environment is a key step for injury and illness prevention. It will not only reduce the frequency of injuries, but it also may reduce the length of time that injured employees need to heal. This approach can significantly reduce the number of fraudulent workplace injury claims that are made by employees. All of this leads to a more cohesive workplace culture, improved production, and significantly less money spent on insurance premiums and defending employee lawsuits.
2. Understand Your Claims History
To minimize workers compensation claims, it’s best to start with the baseline of data you already have. Review your company’s claim history from the past several years and look for patterns. Is one department experiencing more injuries than others? One shift of workers over another? By uncovering trends in past claims, you’re identifying high-risk elements that require a closer look.
3. Hunt for Hazards & Implement Solutions
Now that you understand where past injuries and illnesses have happened, it’s time to hunt for hazards. Engage the whole team – supervisors, managers, and employees – and request that they report anything that doesn’t seem compliant with your safety standards. Then, work with the executive team to develop and implement long-term remedies – helping to prevent workplace injuries before the occur.
4. Train Your Team
Far too often, businesses take the step to create an official “Injury and Illness Prevention Plan,” but don’t commit to continually updating the document and training (and re-training) employees. Instead of thinking of these policies as something to be reviewed annually, start incorporating them into the everyday employee code of conduct. In other words, just like employees are expected to clock-in on time, they’re also expected to know and adhere to these safety standards.
5. Take Safety Seriously
If supervisors and senior management don’t take safety seriously, then employees won’t either. Define clear consequences for failing to follow safety and injury/illness prevention policies – and ensure every supervisor is committed to following through. Especially for high-risk industries and positions, we suggest considering a “two strikes and you’re fired” rule. After all, employees who believe they don’t need to follow the rules not only increase the chances of a workplace injury – but their behavior is often contagious and tempts others to follow-suit.
6. Establish Procedures for Injuries and/or Illnesses
Part of working to minimize workers compensation claims and costs involves having a procedure in place for those who are injured or ill to follow. Obviously, in the event of an emergency, getting the person to the closest ER is the top priority (not“procedure”). However, in non-emergency circumstances, employees and supervisors should know the appropriate steps to take – including that it’s company policy for them to get medical treatment promptly.
When establishing these procedures, develop relationships with occupational medicine practitioners who will understand your business operations, accept your workers compensation insurance, and take on any injured employees as new patients. This gives your employees easier access to the appropriate medical specialists and you the ability to better manage the claims process.
7. Handle Claims with Compassion
When it comes to employees and their medical treatment, it’s easy to feel that you should keep your distance. But, when looking to minimize workers compensation claims and costs, being involved can actually make a major difference. Listen to your employee and ask what you can do to support them. Ultimately, an employee who feels heard and appreciated is less likely to seek major damages and more likely to return to work as soon as he/she is able.
8. Identify Small Problems (Before They Grow)
It’s easy to ignore that groggy employee who keeps yawning over his work, that over-stressed supervisor who looks the other way when the team cuts corners to meet production goals, or that office employee who is trying to be helpful by stepping in when the warehouse is short-staffed. However, each of these scenarios translates into an unnecessary risk exposure. Correcting the small problems before they take root will have a major impact on your efforts to minimize workers compensation claims and costs.
9. Investigate Claims (with an Appropriate Amount of Skepticism)
Unfortunately, workers compensation fraud is a common occurrence. For example, an employee gets injured while snowboarding on a Sunday and claims the injury happened first thing Monday morning. By making it standard policy to fully investigate injuries and related claims, employees will be much less likely to attempt a fraudulent claim. Consider employing an objective, third-party workplace investigation service to avoid the appearance of biased results.
10. Create a Return-to-Work Program
As an absolute key element of minimizing workers compensation claims and costs, return-to-work programs provide options for modified or light-duty work that adheres to the treating doctor’s recommendations. “Reasonably accommodating” employees’ ability to return to work in a timely manner (even in a modified capacity) is good for everyone involved – and it may be required by state and federals laws depending on the number of employees you have on payroll. Ultimately, these programs can reduce costs for you and help the injured employee remain engaged with the company.
Access Customized Strategies to Help Minimize Workers Compensation Claims
Trusted in the community since 2007, California Labor Solutions LLC (CLS) is a specialized HR consulting firm – based out of Orange County, California – that offers comprehensive, personalized, and scalable outsourcing services designed to grow with your evolving needs.
As Founder and CEO of CLS, Shawn Larry takes a solutions-driven approach to human resources – working to inspire confidence in the CEOs and managers who depend on his leadership. In addition to 20+ years of experience in the field, Shawn has achieved many credentials and recognitions, including a J.D. from UOP-McGeorge Law School; California Private Investigator License; Certified Mediator; Senior Professional in Human Resources Certification (by HR Certification Institute); and Senior Certified HR Professional (by International Public Management Association).