Culture vs Safety: What Drives the Cost of Workers’ Compensation?

by | May 3, 2012 | Commercial, Farrell Backlund, Risk Management, Safety, Workers Compensation

Have you ever played the game of “If I was starting a football team today, who would I draft to be my starting quarterback?”  Tom Brady, of course.  That’s a no brainer, but a topic for another blog.

What if we were starting a company today?  Where would you invest your time and money?  Let’s drill it down even further.  If you had a finite number of dollars to spend on workers’ compensation cost containment would you invest in safety training or development of your corporate culture?

How many people say safety training?  Wrong.  Ok, you are not wrong, but the reality is decisions like these aren’t made in a vacuum and safety is a very important topic for any company.  As important as safety is, I would argue that the corporate culture of an organization can have a far greater impact on your workers’ compensation costs than a lack of safety training.

Why is that?  For starters, safety is somewhat intuitive.  If I work on a job site where debris may fall on my head, I put on a hard hat.  If debris may hit me in the eyes I wear goggles.  If I lift heavy objects, I should do it properly.  The problem is employees will often times do things their own way, no matter how many times you train them.

The concept of corporate culture is much less black and white.  It is not a tangible goal and cannot be specifically measured.  Yet, if the culture of my organization is one where I am supportive of my employer, I am more likely to leave my helmet on, wear my goggles, lift properly, work at a pace that is efficient, but does not lead to injury, etc.  More importantly, if I am injured I want to come back to work.  I like working for my supervisor and I feel that my employer cares.

If  an organization has a culture that breeds the “us vs. them” mentality, I am far more likely to drag a claim out further than necessary, exaggerate my injury, or visit my attorney to determine the extent of my injuries.  Each of these will, can and does have a significant impact on my cost of workers’ compensation.  These examples do not even take into consideration the indirect costs of rehiring, operational efficiency, supervisory time, etc.

I was recently training a group of supervisors for an employer with 5,000 employees.  They have a very astute vice president of human resources who happened to attend the training that day.  As I spoke about the importance of doing unto others as you would have done to you, she stood up and boiled the training down to one simple statement, “It all about relationships.”

She is absolutely right.  It is like so many other areas of business we deal with every day.  The right relationships drive profitability.  Safety is important and should be a part of every employer’s plan to contain their workers’ compensation costs.  I believe employee/employer relationships have a more dramatic impact on the direct and indirect costs tied to our workers’ compensation premiums.

It’s all about relationships.


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