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How to Develop a Positive Safety Culture
- 1. How to Developa Positive Safety Culture Nick Hardesty District Manager KPA Safety Culture Behavior Communication Training
- 2. Moderator Becky Ross Marketing Manager KPA (303)228-8753 bross@kpaonline.com
- 3. Presenter Nick Hardesty District Manager KPA (262)649-2903 nhardesty@kpaonline.com
- 4. Questions • If youhave questions during the presentation, please submit them using the “Questions” feature • Questions will be answered at the end of the webinar
- 5. 5 Agenda • Can youdefine “Safety Culture”? • Changes in Workers Compensation • Safety Program in 7 Steps • Safety Incentive Programs
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- 7. Safety Culture Wikipedia Safety cultureis a term used to describe the way in which safety is managed in the workplace, and often reflects "the attitudes, beliefs, perceptions and values that employees share in relation to safety" (Cox and Cox, 1991).
- 8. Safety Culture Safety Cultureis…”the product of the individual and group values, attitudes, competencies and patterns of behavior that determine the commitment to, and the style and proficiency of, an organization's health and safety programs.” Safety Culture: A Review of the Literature (UK)
- 9. Safety Culture • EHSToday-America’s Safest Companies“Our culture is to expect 100% engagement from all associates in our safety programs, which includes not only participation but also leadership.” “Our culture of safety innovation and continual improvement has fostered countless, positive safety changes with profound impact on our safety performance.” “How many companies can say that their CEO has reviewed every single recordable injury AND serious near miss? We can!” “Our 76% improvement in recordable injuries and external recognitions are a result of our strong safety culture, and they demonstrate how ingrained safety is in why and how we do business.” “Safety, or EHS, is who we are…It’s a core value that is integrated into all business processes and functions.”
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- 11. Safety Culture • NCCI-NationalCouncil on Compensation Insurance
- 12. Safety Culture MOD Factor “SplitPoint” Changes $5,000 $10,000 $13,500 $15,000 2012 2015 2014 2013
- 13. • Rates arepre-determined • Common set of class codes • Ensure accuracy with job descriptions• 6 Point Dealer Group • 100 Employees at each location • Annual Payroll of $5 million per dealership 600 Total Employees with $30 million in payroll • 8330 (Tech) $9,000,000 = $90,000 x $5.00 = $450,000 $100 • 8748 (Sales) $9,000,000 = $90,000 x $2.00 = $180,000 $100 • 8810 (Admin) $12,000,000 = $120,000 x $1.00 = $120,000 $100 Total manual premium: $750,000 8380 8748 8810 9410 7380 Safety Culture Class code Employee Type % of Payroll $ Payroll Premium $100 payroll 8380 Technicians/ Detailers/ Drivers 30% $9 mil $5 8748 Sales 30% $9 mil $2 8810 Administrative 40% $12 mil $1 Payroll For Aacme Motors
- 14. Safety Culture 2004 20052006 2008 2005 2006 2007 2009 2006 2007 2008 2010 2007 2008 2009 2011 2008 2009 2010 2012 “E-mod” “X-mod” “Mod Factor” “Experience Rating” “Merit Rating” • Calculated by the National Council on Compensation Insurance (NCCI) or a state agency • 3 consecutive years are used to calculate a rating • Excludes current and prior year • Frequency of claims is weighted higher than severity • Used to compare businesses in the same industry • Industry Average is set to “1” $750,000 Manual Premium Aacme Motors ABC Motors Experience Mod .80 (-20%) 1.2 (+20%) $600,0000 $900,000 A difference of $300,000!
- 15. Ratings are basedon business characteristics the insurance company thinks can make a difference in reducing future losses. • Regular safety committee meetings • Positive incentive programs • Written safety programs • Hazard inspections • Ongoing safety training • Timely reporting • Claims Management Safety Culture Aacme Motors ABC Motors Tier Rating 1.17 (preferred plus) 1.67 (residual) Experience Mod -20% (.80 mod) +20% (1.2 mod) Deductible -3.9% ($500 ded.) 0% Provider Discount -2.5% 0% Association Disc. -4% 0% Cost Containment Cert. -5% 0% Schedule Rating -10% +10% Premium Disc. -8.6% -8.6% $390,795 $1,189,804 $750,000 Manual Premium A Difference of: $799,008!!!
- 16. Safety Culture 1. SeniorManagement Leadership 2. Safety Coordinator 3. Employee Involvement – Recognition – Communication 4. Timely Notification of Claims 5. Return to Work Practices (Medical Treatment) 6. Written Programs & Processes – New Hire Orientation – Safe Work Practices – Safety and Health Policy 7. Recordkeeping & Analysis
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- 21. Safety Culture Injury Report Injury • Employeereaches maximum improvement and returns to work in original position • Employee has not reached maximum improvement and returns to work in transitional work assignment • Employee reaches maximum medical improvement but has received disability rating and is assigned to modified job or different position Send for Medical Treatment
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- 24. Safety Culture Incentive Programs •Open lines of communication • Give ability to make suggestions • Allow for group discussions • Praise – Positive GossipThank the employee by nameState what the employee did to earn praiseExplain how you felt about the behaviorState how the behavior added value to the companyThank the person again by name
- 25. 1.Targeted behaviors • Positiveand tangible 2.Program Rules • Must be clear to all employees 3.The Reward • Appropriate for the effort • Meaningful and memorable Safety Culture Before an incentive program is considered Basic needs must be met The targeted behaviors of an incentive program should be positive and tangible • Focus on “what to do” • Give measurable actions
- 26. Safety Culture SafetyBingo Best Safety Suggestion Good Housekeeping Accident Free Days Safety Bucks
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- 28. Got a Question?Ask our Expert!
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Editor's Notes
- #7 There is no single definition of “a safety culture”. The term first arose after the investigation of the Chernobyl nuclear disaster in 1986 which led to safety culture being defined as “an organizational atmosphere where safety and health is understood to be, and is accepted as, the number one priority”.
- #8 COX, S. & COX, T. (1991) The structure of employee attitudes to safety - a European example Work and Stress, 5, 93 - 106
- #10 EHS Today is a magazine dedicated to the management of risk in the workplace and environment. Every year they award companies that provide a safe working environment for thousands of employees and serve as a point of reference for companies hoping to achieve world-class safety status.
- #12 The National Council on Compensation Insurance (NCCI) develops your experience MOD annually andinsurance carriers use it as a tool to compare your claims experience to that of your industry. The NCCI annually produces a MOD Worksheet that outlines the calculation and the data that was used to develop your MOD factor. As you can see by the map the NCCI is not designated as the licensed rating and statistical organization for every state in the US. Currently 37 states rely on the NCCI. Others utilize an independent state bureau or have a monopolistic structure.
- #13 In layman’s terms, your MOD is simply the amount of your actual work comp losses divided by yourexpected losses based on your industry. For the past twenty years, the first $5,000 of a claim has beenconsidered the “primary” portion and any amount above $5,000 has been considered the “excess”portion of the claim. This magic $5,000 line is known as the “split point” of claim. In the formula theNCCI uses to calculate your MOD factor, there is a big difference between the “primary” and “excess”parts of a claim. The formula counts the entire $5,000 “primary” portion of a claim against your MODbut only counts a small portion (typically 5% - 15%) of the “excess” portion of the claim against yourMOD. Using a $10,000 lost time claim for a company whose MOD formula only uses 10% of the “excess”portion of the claim, just $5,500 of the $10,000 claim would count against your MOD calculation i.e. thefirst $5,000 “primary” portion is fully counted but only 10% of the rest of the claim ($5,000 x 10% =$500) is used in the MOD calculation.The major change that the NCCI is proposing is they will be raising the “split point” of claims from$5,000 to $15,000 over the course of three years. Starting 1/1/2013 the “split point” will be increasedfrom $5,000 to $10,000, and then will be increased to $13,500 in the second year and finally to $15,000(plus two years of inflation adjustment) in the third year. Looking back at the above example, starting in2013, that $10,000 lost time claim will have the full $10,000 “primary” portion of the claim fully countagainst your MOD factor calculation.employers “with bad experience are going to see a higher apportionment of debits” added to their pricing, while those with a good loss history will see more creditsSo it really underscores the need for employers to invest in loss control, invest in safety, invest in their people and have a very strong return-to-work program
- #27 There are many positive incentive games out there, unfortunately many of these games focus on the wrong objectives. Take the traditional rules of safety bingo; a number is drawn daily, and a prize is given for the employee that gets “Bingo”. The prize is increased with each subsequent game, so there is more incentive to not have an accident. The game is cancelled and the prize returned to the lowest level whenever an accident occurs. I hope you’re seeing the pitfall here, if you do a web search on “safety bingo” you’ll find hundreds of pages describing the multitude of problems that can take place as a result of this game. Unfortunately the game forces a lot of peer pressure among the employees to not report accidents and hide injuries. Some game rules talk about punishing employees for trying to hide injuries to prevent this sort of thing from happening. None of this sounds very “positive” to me and gives mixed message to the employees. Why not change the rules a little and take the emphasis off of failure and accident reporting? For instance, why not only draw a number if one or more of the positive behaviors from the last slide occurs? So if a safety suggestion is made, or a hazard gets fixed a number is drawn, otherwise, no number for the day. A little change in the rules, changes the focus of the game.
- #29 Well that’s all folks. Now time for some Q & A. Eliana, do we have any questions I can answer?