5 Ways to Cut Your Workers’ Compensation Costs
Worker’s compensation premiums are based on many factors, including your industry, location and claims experience. You have no control over your industry, little control over your location (you’re not likely to relocate solely because of workers’ compensation premiums), but substantial control over claims experience.
Make safety a priority. This means focusing time, attention and money on creating policies and procedures to reduce accidents and injuries on the job. Use a common sense approach to correcting safety problems. For example, restaurants statistically have a high rate of slip-and-fall injuries; requiring workers to wear sneakers or other rubber soled shoes can reduce these incidents.
There may be many no-cost or low cost actions you can take to cut claims and reduce premiums. For example, if your workers are experiencing repetitive stress injuries, something as simple as rotating assignments can avoid problems. If your workers may be subject to back injuries from heavy lifting, suggest lifting methods that will help them avoid back problems.
Make sure workers know your policies and procedures. Use employee safety manuals, training seminars and posters to educate your workforce.
Work closely with your insurance agent. Insurance will be paid out to injured workers only if you have insured them correctly. This means clearly telling the agent what workers do in order that they can be properly classified. If they are misclassified, your insurance may be canceled and it can be difficult to obtain new coverage.
Watch for employee fraud in making claims. It pays to track down suspicious claims and help insurance companies fight them so premiums won’t be increased.
Ask for help. Contact a safety expert to review your workplace and make recommendations on how to improve safety. The cost of the expert may be less than the fines you could be charged for safety violations and can help to reduce your workers’ compensation premiums.
Use resources available through the Occupational Safety and Health Administration (OSHA). You are entitled to a free consultation to identify safety and health hazards in your workplace. For general information on OSHA assistance to small businesses, go to www.osha.gov/Publications/osha3163.pdf.
Get workers back on the job. Accidents may happen, but the sooner you encourage injured workers to return to work, the smaller your claims and lower your premiums will be. Doing this may require you to work with outside HR consultants to manage employee cases if this is not part of your insurance coverage.
Allow returning workers to assume a lighter work load or use reduced hours to get them back on the job.
Relocate. This is a drastic step, but moving to an area that offers a number of benefits, including low workers’ compensation premiums, can save you big dollars. Investigate carefully all the ramifications of a move before investing any money toward this end.
