Statistical Analysis for Comparisons

Companies and federal officials frequently utilize the following statistical pieces of information, which are designed to allow the company to compare its safety and health performance with others: the incident rate, illness rate, lost workday case rate or severity rate, and restricted workday case rate. These rates, answer the following questions: "How often or frequently are accidents occurring?" "How bad are the injuries/ illnesses that are occurring?" The number of times that occupational injuries/illnesses happen is the determinant for the incident rate, while the number of days away from work (lost-time workdays) or restricted workdays is the prime indicator of the severity rate. Both of these rates provide unique information regarding your safety and health effort.

Workers' Compensation

Each employer is expected to provide protection for his/her workers who become ill or are injured by something within the workplace. The premiums that the employer pays are to provide medical treatment and supplemental income when a worker is unable to return to work immediately. This supplemental income is usually two-thirds of the worker's wages and is not taxed. Once a worker files a claim for workers' compensation, the employee is not usually allowed to sue his/her employer.

Thus, workers' compensation premiums paid by the employer act like a protection or insurance policy against liability when a worker suffers injury or illness due to a hazard within the workplace.

The employer's premium is based upon the type of industry as well as the injury and illness history of the employer's workplace. The more injuries and illnesses employers experience, the higher the premium paid by the employer. Also, the more days away from work experienced by the workers, the more the premium increases.

Thus, as a cost factor, the reduction of occupational injuries and illnesses is important to cost containment. Any responsible employer understands the relationship between the bottom-line profit and the number of accidents.

Employers must set up a tracking system, which monitors each workers' compensation claim filed by their workers. They also need to work diligently to return workers back to the workforce as soon as medically feasible. As part of the healing process, the employer needs to make sure that the workers are receiving their medication and going for medical treatment. The longer a worker is away from the workplace, the more unlikely that he/she will return to the workforce. It has been documented that workers who are off work for 6 months have a 50% chance of returning to work. For those off a year, the probability is 25%, and after 2 years or longer, the probability of returning to work is 0%.

Each workers' compensation claim is either directly or indirectly a drain upon the profit margin of the company. This is the primary business reason to track workers' compensation claims. Many employers who have a less-than-stellar experience modification rate (EMR) may have difficulty in procuring work, or bidding on work, when perspective buyers assess their safety and health performance.

The prevention of occupational injuries and illnesses will definitely reduce the cost of workers' compensation premiums. It does not matter whether the company pays into the state workers' compensation system or is self-insured. What motivates most employers to reduce workplace injuries and illnesses is usually dollars. Some studies show that other benefits result from a decrease in the number of injuries and illnesses. For example, employers can expect to increase attendance, morale, and productivity. These are just a few of the side effects of reduced workers' compensation cost.

Summary

Statistical information lends credibility to the OSH effort of a company. These numbers provide substance to recommendations, suggestions, progress, accomplishments, and direction for a company's OSH initiative.

Further Readings

Reese, C.D. Accident/Incident Prevention Techniques (Second Edition). Boca Raton, FL: CRC Press, 2012. Reese, C.D. Occupational Health and Safety Management (Third Edition). Boca Raton, FL: CRC Press, 2016.

Reese, C.D. and J.V. Eidson. Handbook of OSHA Construction Safety & Health (Second Edition). Boca Raton, FL: CRC/Lewis Publishers, 2006.

United States Department of Labor, Occupational Safety and Health Administration, Office of Training and Education. OSHA Voluntary Compliance Outreach Program: Instructors Reference Manual. Des Plaines, IL: US Department of Labor, 1993.

 
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