According to a recent study by the National Institute of Health (NIH), hotel workers have higher rates of occupational injury and illness compared with workers in other service industries, particularly in the area of musculoskeletal disorders. So is it any wonder why so many hotel employers are throwing up their arms in surrender every time they see their workers’ compensation premiums soar out of control? Many employers treat those premiums with a “there’s nothing I can do about it” mentality when there actually is something that can be done.
The starting point is always your experience mod, or the numbers that dictate what you will pay in premiums, based on your industry. Fifty percent of all experience modifiers are incorrect, and 80 percent of all experience modifiers are mismanaged. You need to understand the importance of managing and reducing your experience modifier—it’s not just a number. Taking a passive or nonchalant attitude can cost you plenty. And this can happen in a number of ways: misclassifications, incorrect payroll audits, recovery at work programs that are weak or in some cases non-existent, and an overall lack of an established safety culture.
It’s recommended that the hospitality entity provide pre-placement screenings for hotel positions that require physical exertion. Examples of these positions could be housekeepers, laundry room attendants, and maintenance staff.
We recently read an account of a 48-year-old female who had two complete knee replacements and got hired as a housekeeper. Within the first three months, she injured her bad knee, and the cost of her workers’ comp claim will be in the tens of thousands of dollars. If this employee had received a pre-placement screening prior to her hiring, the doctor may have recommended her for a different position.
Preventing injuries and mitigating the cost of the claims that do occur can dramatically reduce an employers’ cost of workers’ compensation insurance. Here are eight components of an effective program that can reduce these costs:
1. Monitoring Systems
Knowing if your workers’ compensation program is working or not requires effective monitoring of the results. Review accident investigation reports, claim trends, and the status of open claims.
2. Medical Provider Relationships
Working with a local medical provider is important in controlling the medical cost of claims and getting injured workers back to work quickly. Someone who knows the employer’s operations and recovery at work program can eliminate time loss costs on many claims.
3. Supervisory Accountability
These front line supervisors are in the best position to ensure a safe work place and have the closest relationship with the employees.
4. Transitional Duty
Having an effective recovery at work program can reduce an employer’s workers’ compensation costs. The longer an employee is off work due to an injury, the harder it is to get them back to work and the higher the claim costs.
5. Pre-Placement Screening
Appropriate pre-placement screening, such as pre-placement physicals, may be necessary to ensure the employee can safely perform their duties and not risk harm to themselves or co-workers.
6. Accident Investigation
When an accident does occur, it is important to investigate and document the incident thoroughly to ensure the legitimacy of the claim, determine the causal factors, and to learn how the injury may have been avoided. Sharing information within the organization on how the injury occurred and how it could have been prevented is critical to avoiding similar injuries in the future thus reducing costs.
7. Safety as a Value
Hotel employers who are committed to preventing injuries find unique ways to integrate safety into their value system and culture.
8. Proactive Hiring Practices
Employers with high workers’ compensation costs are often frustrated with a handful of employees who have more than their share of claims or who seem to be “working the system” and increasing the cost of the claims. Implementing proactive hiring practices that focus on safety conscious employees can reduce this frustration and the additional costs associated with these claims.
The bottom line is that you should make every effort to have an implemented plan in place to arrive at your minimum experience modifier within three to five years. When that happens, you will be paying the lowest legal cost you can.
About the Authors
Matt Mallory is vice president and principal with the Mallory Agency in LaGrange, Ga. He has been trained and certified by the Institute of WorkComp Professionals as a certified and master workers’ compensation adviser; 706-302-6070; mattm@malloryagency.com.
Wayne Sanders is vice president of Hospitality Safety and Security Services Inc. in Peachtree City, Ga. He specializes in helping hotel companies manage their cost of risk associated with workers’ compensation and guest liability; 770-284-3027; wayne@swsanders.com.
