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January 2012

Jan 01
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HOW TO LEGALLY KEEP A VIGILANT EYE ON YOUR EMPLOYEES

By Construction Insurance Bulletin

Employees being supervised in their work activities is an inherent element in most all employer-employee relationships. Effective supervision is a vital component in ensuring employees is completing the right work, the right way, and at the right time to make a business’s operations as efficient and profitable as possible.

Employee supervision is also necessary to discourage employees from saying things that could harm the reputation of a business, result in legal liability for a business, or reveal a business’s trade secrets. Of course, such threats are more present and concerning than ever in today’s world of advanced communication technology. It’s no longer just a question of whether or not an employee will say something inappropriate over the office phone, but rather how they use an array of work-related communication technologies such as cell phones, email accounts, and Internet browsers. As a result, many employers have turned to technology as a new means to monitor the activities of their employees.

Many employers have started to monitor the phone conversations conducted by their employees, which is usually allowed by state and federal laws for the purpose of quality control in regards to conversations between an employee and a client. Keep in mind that some states require businesses to give advanced notice to all parties involved in a call that’s being monitored. Federal law, on the other hand, allows business calls to be monitored without such advanced notice, but does require an employer to quit listening if and when they realize it’s a personal call. If a phone is designated and labeled specifically for business use only, then an employer can generally monitor calls of any nature. Additionally, employers can legally obtain a listing of every phone number dialed from a particular phone/extension and the length of the calls. Even when advanced notification isn’t required legally, employers might find doing so helpful in thwarting inappropriate communications proactively.

According to the Electronic Communications Privacy Act of 1986, employers are allowed to monitor employee e-mails when an employee provides consent, the e-mail is related to the normal course of business, and/or the e-mails are stored within an in-house network computer. The keystrokes made on an employee’s computer can even be monitored to determine how much and what type of text an employee produces.

The courts routinely have upheld an employer’s right to monitor their computer systems. For example, the court ruled against a CIA employee who downloaded pornographic material and violated the CIA’s Internet use policy. Another court ruled that there wasn’t a reasonable expectation of e-mail message privacy in a case where an employee described his management using derogatory and profane language in an e-mail.

Legal experts recommend that employers planning to monitor e-mail and Internet activity create a comprehensive, clear employee Internet and email use policy with the assistance of their legal counsel. Be sure to take the following steps:

  • The policy should clearly state Internet use rules, such as the types of files that can/can’t be downloaded and the types of Internet sites that should/shouldn’t be visited, and the disciplinary actions for offenses.
  • The policy should clearly state that employee communications on the employer’s computer system aren’t private and are subject to being monitored.
  • Use the policy to inform employees how long computer files will be stored and deleted.
  • Require employees to sign a copy of the policy before providing them with access to the system.
  • Post the key points of the policy on each computer’s login screen.

Employers should keep in mind that, despite the above precautions and legal monitoring rights, an invasion of privacy lawsuit by an employee is still a possibility. Many employers purchase employment practices liability insurance to protect their financial well-being and cover the costs of litigation and unfavorable judgments.

Employers need to keep a vigilant eye on their employees, but that doesn’t mean violating an employee’s rights during the process. Avoid a lot of undue risk by using technology to your advantage, having a clear Internet and e-mail use policy, and an employment practices liability policy.

Jan 01
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MINIMIZE DRIVER RISK WITH MVR MONITORING

By Workplace Safety

Risk management is a critical part of every business. Every employer knows that it’s cheaper to prevent risks than deal with the consequences of ignoring them. This means it’s important for all employers to screen applicants and monitor current employees. Some of the most costly mistakes made by employees take place when an employee must drive a company vehicle. Whether the nature of the company’s business is driving or delivering, accidents and their consequences can be costly for employers.

Companies who hire drivers must protect themselves and their driving employees. In order to protect themselves, employers should use motor vehicle reports, which are commonly referred to as MVRs. These reports aren’t difficult to obtain. In most states, interested parties can request this information online for a small fee. Some employers may also perform a background check to obtain a more extensive report. Any company regulated by the DOT is required to perform annual MVR scans on their drivers. Employers should always request the MVR of a new applicant for a job. In most cases, an applicant’s driving history is a good prediction of whether or not they’ll be a safety risk to the company.

It’s important to provide driving safety training to any employees who will be behind the wheel. Although new and current employees may have impeccable driving records, it’s important to take steps to prevent their records from changing. Regular training will refresh employees’ memories of important driving rules. Be sure to educate employees about all company driving rules and regulations. If there are any changes to a company policy, be sure employees are aware of the changes.

Companies of all sizes should utilize MVRs for screening. Many smaller companies think that MVRs are only necessary for larger companies. However, this isn’t true. Smaller companies often pay more for insurance that may not cover careless driving acts by an employee. Since smaller companies usually have less revenue than larger ones, a costly mistake by an employee could be a larger setback for a small company. Performing one MVR before employment isn’t enough. Since these reports change each time a new conviction or record is added, it’s important to request them periodically. Employees who begin showing patterns of reckless driving may need more training. In severe cases, they may need to be suspended from driving duties.

There are driver monitoring services available in some states. These provide employers with monthly or weekly updates. If drivers have license status changes or new violations, they’ll appear in the report. Companies with a large volume of drivers usually benefit from this service. Smaller companies should consider requesting an MVR every few months. It’s important for any company using MVRs to be aware of the regulations and statutes governing their use. State statutes, FCRA rules and DPPA regulations must all be considered. Employers must always disclose their reasons to employees and applicants for requesting such information. In addition to this, they must obtain written permission from these individuals before collecting regular MVRs.

Employers face several important considerations with MVRs. Companies need to develop a legal and fair structure for implementing driving restrictions. Decisions to restrict, suspend or terminate employees based on MVR information should comply with all applicable regulations. It’s also important to consider outside factors. Insurance is a major influencing factor for driving restrictions. Be sure to understand the company insurance policy and its provisions. Drivers who don’t meet the standards should not be permitted to drive company vehicles. If there are any questions or concerns regarding drivers and the company insurance policy, be sure to speak with an agent promptly.

Jan 01
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CONTROLLING WORKPLACE SAFETY PLAN COSTS

By Workplace Safety

Some people may wonder if management professionals are trying hard enough to find ways to reduce company costs and risks associated with workplace injuries. Research shows that most managers are not taking proper measures in either area. If they could learn to make workplace safety and health as important as quality or production priorities, differences may start to appear. However, some companies place more focus on safety than what is necessary.

Although the idea of safety being first might sound like the best policy, it is not as effective when it is set extremely far above other priorities. Companies’ priorities change quickly in today’s advancing world. Many companies set safety so high above other priorities that employees often feel safety is the only goal they should try to achieve. In such a competitive world, speed should also be a priority. Since there are companies successfully producing at higher volumes while maintaining good speed and safety ratings, it is clearly possible to achieve both. However, this does not mean that either priority should be significantly higher than the other should.

If safety is set far above all other priorities, a considerable amount of money is required to fund an elaborate safety plan. This may be counterproductive to business. Every business owner knows the importance of striving to increase profits. However, not every business owner knows how to strive harder for profits while maintaining safety in the workplace. Instead of adopting the policy that safety should be first, it is better to implement a policy reflecting that while striving for higher productivity, proper safety is required to accomplish tasks. Such an idea implies that employees can work fast and hard toward better profits while staying safe.

This idea does not require employers to pour significant amounts of money into an elaborate safety plan. The key idea employers need to remember is that employees also want to see themselves go home unharmed and in one piece at the end of the day. Since this is the desire of both parties, the only task is implementing a way to weave safety measures into each task while not making them so extensive that they inhibit productivity.

The best way to approach such a task is to analyze each safety procedure, policy and program to evaluate its effectiveness. Many employers are surprised to find the source of their workplace injuries are a result of ineffective planning instead of employee faults. Update outdated plans, take note of weaknesses in policies and figure out what the cost of changes will be. One of the key ideas to remember is to focus more on educating managers. Many employers place their focus on only educating employees. It is important to increase manager education without decreasing employee education. Employees need to see that their managers are setting good examples of maintaining productivity and safety harmoniously. Both parties must understand the rewards of higher safety and productivity numbers and the consequences of lower safety and productivity numbers.

The overall idea to remember is that it is more expensive to react to situations than it is to prevent them. In addition to this, safety plans should not be too sparse or elaborate. Companies must perform their own analyses to determine what changes must be made. Managers and employees need to be educated to learn about how profits and productivity work and how to tie safety into their tasks. Making positive changes is an excellent way to save money, increase safety ratings and enjoy higher productivity.

Jan 01
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OSHA FIRST AID REQUIREMENTS IN THE WORKPLACE – ARE YOU IN COMPLIANCE?

By Workplace Safety

Just as workers have a responsibility to conduct themselves safely in the workplace, employers have a moral and legal responsibility to mitigate the effects of any reasonably anticipated accidents or injuries. Specifically, employers must comply with OSHA Standard 1910.151, which states that “adequate first aid supplies shall be readily available.”

This makes good fiscal sense for employers – too: A well-resourced injury prevention, first aid and emergency response program can pay off in terms of lower insurance premiums, less disruption to the work flow, and reduced absenteeism.

The Occupational Safety and Health Administration (OSHA) has released federal guidelines for workplace first-aid programs. Specifics depend on your industry. Construction sites should have a more extensive first aid program than general industry workplaces, for example.

First Aid Kits. Consider directing a responsible worker to inventory your first aid kits, and ensure they are complete, supplies have not been used up, and components are not expired. For most workplaces, the minimum standard for a generic workplace first aid kit is outlined in American National Standard (ANSI) Z308.1-1978.

You can include over-the-counter medicines in a first aid kit – such as Tylenol or aspirin. But make sure you do not include anything in the kit that may cause drowsiness. A sleepy worker who has just taken some cold medicine could cause a workplace accident much worse than a cold could ever cause.

If you reasonably expect workers treating other injured employees could come into contact with blood or other pathogens, you should also consider including personal protective equipment, such as latex gloves, masks, gowns and face shields.

Training. Depending on your industry and the specific workplace hazards, it may not be enough to just have a first-aid kit on hand. You may need to invest in training employees in how to provide First Aid, and CPR, and possibly the use of cardiopulmonary defibrillators. In some cases, your license or contract requires you to have trained and certified staff on hand.

Implementation. Occupational health and safety compliance is a full-time job in itself in some companies. If you have a lot of staff or have staff routinely exposed to hazardous conditions on site, you may want to appoint a health and safety manager for your workplace. This individual can be responsible for tracking current first aid and CPR certifications, scheduling training, inventorying first aid kits and supplies, and making recommendations for improvements to management.

This employee should not only be familiar with OSHA regulations on first aid and occupational safety and health, but also with regulations at the state level, as well – which may be more onerous than federal regulation.

For more information, visit the Occupational Safety and Health Administration’s website at www.osha.gov.

Jan 01
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ADVANTAGES OF TELEMEDICINE

By Employment Resources

Telemedicine, which is already being used by many, is expected to become more popular in the future. Every employer should consider the advantages of this option for their employees. Although there are many vendors available, it’s best to choose one of the top three. To use telemedicine, patients call a phone number to speak to a trained representative. The representative completes a health profile for the patient. By doing this, the representative is able to determine what type of medical issue the patient may be facing. If the nature of the call isn’t an emergency, the representative ensures that a physician will call the patient back within a few hours. However, if the patient indicates a situation that is considered an emergency, the representative will urge that individual to seek emergency care or dial 911.

After speaking with the patient, the physician makes a diagnosis. If the physician feels that the patient needs further tests, the patient must schedule an appointment at a medical facility. However, most patients who use telemedicine programs have a cold, mild infection or a virus that can be cured with medication. If the patient needs medication, the physician calls a nearby pharmacy to order the prescription. Most physicians advise patients to schedule a visit with their regular physician after completing the recommended treatment.

Although telemedicine isn’t able to solve every problem a patient has, those who are fairly healthy can benefit from this program. Emergency room visits can cost thousands of dollars. Even a simple office visit costs more than what most people have in their pockets. In many cases, a visit to the doctor or emergency room isn’t necessary. Patients may simply be worried and need assurance. In some cases, they may only need a medication to solve their problem. For example, a patient who has chronic infections may have to spend a considerable amount of money to visit the doctor each time symptoms appear. However, if telemedicine is used, the patient is able to get the required antibiotics quickly. There is no need to risk contracting another virus to by going to a clinic. Patients may not have to take time away from work to wait for a doctor. The cost of telemedicine is much less than paying upfront for a doctor visit. However, patients who have extremely low copay amounts may pay slightly more for telemedicine. It’s definitely an affordable price to avoid the hassle of going to the doctor for a simple issue. This is also beneficial for people who live in rural areas.

Employers who wish to save money should consider telemedicine as an addition to their health plan. Employees who use telemedicine won’t need to take time away from work as often to see the doctor for simple or routine things. In addition to saving time, this plan also saves money. Healthier employees with more time to devote to work are a financial asset to the company. Employers considering this coverage should speak to an agent about the various options available.

Jan 01
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THE NEW AMENDMENT FOR WOMEN’S PREVENTATIVE CARE

By Employment Resources

The Department of Health and Human Services, commonly called HHS, recently added an update to the Interim Final Regulations for Women’s Preventative Care on August 1, 2011. This preventative program is regulated under the Patient Protection and Affordable Care Act, which is commonly called PPACA. Recent changes were developed by the Institute of Medicine to make the plan more beneficial. The institute’s orders to review which services are necessary for women’s health came from HHS. This new amendment outlines additional guidelines for Preventative Services and the needed alterations of policy provisions in health plans in the near future. The change applies to all plans that are classified as Non-Grandfathered. This includes health policies, insured plans and self-insured group health policies. With this change, health plans must cover Preventative Services. The outline includes a provision for birth control without deductibles or copay amounts.

This change applies to Non-Grandfathered plan year starting on or following August 1, 2012. After this time, they will be required to provide coverage without cost sharing for the following women’s Preventative Services:

  • Annual well-woman visits to a healthcare provider
  • Breastfeeding support, supplies, and counseling
  • Gestational diabetes screenings
  • Counseling for STIs
  • HPV DNA testing for women over 30 years of age
  • FDA-approved contraception methods and counseling for contraceptive users
  • HIV screenings and counseling
  • Domestic violence counseling and risk screening

There are some exemptions to these plans. Group health plans that are sponsored by some religious employers are exempt from the contraceptive coverage requirement. In addition to this, group health insurance coverage that has connections to such plans is also exempt from covering birth control for women. In definition, a religious employer is one that has the inculcation of religious values and its purpose, primarily serves people sharing religious tenets, is a non-profit organization under the IRC and is one who has a majority of employees sharing religious tenets.

Although these changes are nearly a year into the future, it is important to analyze the additional services’ impact on pricing. While these changes will benefit thousands of women across the country, the changes will certainly come with a price. Benefits Account Managers should keep abreast of of any additional changes and amendments affecting the Patient Protection and Affordable Care Act.

Jan 01
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2012 HSA & FSA CHANGES TO KNOW ABOUT

By Employment Resources

Health savings accounts and flexible spending accounts are growing in popularity. Many people aren’t aware of the changes that take place in these plans from year to year. It’s important to discuss account details with an agent each year to be fully aware of the current rules or upcoming changes.

Flexible Spending Accounts
These accounts are sometimes called flexible spending arrangements. They are tax-advantaged accounts that let employees automatically deposit a specific amount of each paycheck into them. After funds accumulate, they can be used to pay for qualified medical expenses. These accounts are different from HSAs and HRAs in the respect that they are usually offered with traditional medical plans. They also differ from HSAs in the respect that the unused funds in the account may not be carried over to the next year. Debit cards or forms are used to access funds from the account if money is needed.

Flexible spending accounts allow account holders to contribute to the FSA for any costs that aren’t covered by insurance. Some examples of such expenses include coinsurance, copay amounts and deductibles. If a health insurance won’t cover a treatment or related health expense, FSA funds can be used to pay for it. The specified limits saw some changes from 2011 to 2012.

Contribution Limits
It was decided that 2012 would be the last year for no limits on FSA contributions. While there may not be limits in place, plans must specify a maximum percentage of compensation to be contributed to the FSA or a maximum dollar amount. The changes from 2010 to 2011 included over-the-counter medicines being eliminated from coverage if they weren’t prescribed by a doctor. The year 2013 will likely see one of the biggest changes: FSA contribution limits of $2,500 annually with yearly inflation increases.

Health Savings Accounts
HSAs are medical savings accounts that also have tax advantages. Taxpayers who are enrolled in HSA-qualified health plans with high deductibles are able to obtain them. At the time of deposit, the funds contributed to these accounts are not subject to federal income tax. Any unused funds that remain in the account at the end of the year are carried over to the next year and added to further contribution amounts. Since contribution also change with these plans each year, it’s important to be aware of the changes. The changes from 2011 to 2012 include an increase in out-of-pocket HDHP maximums and HSA contribution limits. However, there are no changes with the HDHP required minimum deductibles.

HSA Contribution Limits
Family: $6,250
Individual: $3,100
Catch-Up Contributions: $1,000

The individual amount of $3,100 reflects an increase of $50 from 2011’s limit. The $6,250 limit for families is an increase of $100 from 2011. Catch-up contribution limits, which are for people over the age of 55, remain the same between 2011 and 2012.

HDHP Minimum Required Deductibles
Self: $1,200
Family: $2,400
HDHP Out-Of-Pocket Maximum – Family: $12,100
HDHP Out-Of-Pocket Maximum – Self: $6,050

The HDHP limit increased by $100 between 2011 and 2012 for singles and by $200 for families. Another change between 2011 and 2012 is eligibility of over-the-counter medicines. Insulin is the only OTC medicine approved for reimbursement in 2012 under a health FSA, HSA or HRA without a prescription. In addition to this, it was decided that the penalty of 10% for ineligible expenses paid for using HSA funds would increase to 20% in 2012.

Jan 01
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SICK OF PAYING THE PRICE FOR WORKPLACE BACK INJURIES? TAKE ACTION!

By Risk Management Bulletin

Eight out of 10 people experience back problems at some time during their lives – and back injuries affect millions of American workers every year, costing businesses billions.

Overexertion is a leading cause of lost-time injuries, putting a significant number of workers in most industrial workplaces and construction sites at risk. When a load being lifted, shifted, carried, pushed, or pulled exceeds the body’s limits, the result can be torn or stretched muscles, tendons, and ligaments.

Overtaxing muscles frequently or for extended periods can cause them to become fatigued and prone to injury. Activities that increase muscle fatigue while performing a task include: exertion, repetition, and awkward body posture.

The back – especially the lower back – is the area of the body most often damaged by overexertion. Once workers injure their backs, they’re more likely to suffer re-injury, which leads to more pain and suffering for the worker and more lost work time for the business (it’s estimated that on average workers lose as many as seven workdays per year because of back injuries).

Preventing back injuries is far easier than repairing them. Stressing these five fundamentals can help your employees protect themselves and reduce back injuries:

1. Good Posture
Whether a job involves a lot of sitting or hours of standing, maintaining a good neutral posture (the natural “S” shape of the spine) throughout the workday puts less strain on the back and decreases the risk of injury. This means sitting straight, with back resting against the back of the chair, placing feet flat on the floor or on a footrest, and adjusting the chair so that the knees are slightly higher than hips.

To avoid back strain while standing, employees should stand with their feet shoulder width apart and weight balanced and arms, shoulders, and hips aligned. Some people find that putting one foot on a footrest and then alternating feet helps them maintain good posture while standing.

2. Safe Lifting
Improper lifting is probably the most common cause of workplace back injuries. Teach your worker safe body mechanics for lifting. Have them face the load with feet shoulder width apart, keep their heels down and toes pointed slightly out, squat by bending at the hips, use leg and stomach muscles to power the lift, and maintain the back’s natural curves while lifting by keeping the head up.

3. Micro breaks.
Encourage workers to take frequent micro breaks of 10 to 20 seconds to arch their backs and stretch tired, tense muscles. Whether the person is exerting, sitting, or standing for long periods, micro breaks increase blood flow and decrease the risk of back injury.

4. Healthy weight.
Excess weight, especially on the belly, puts lots of extra stress on back muscles. Just by losing a few pounds, overweight workers can reduce their risk of back injuries substantially.

5. Exercise.
Encourage employees to exercise and keep fit. Exercise improves overall wellness, and is particularly important for reducing back injuries. Strong, well-toned back and stomach muscles allow the back to work hard without injury.

Jan 01
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SAFETY INCENTIVES: SAVVY STRATEGY OR POOR PLAN?

By Risk Management Bulletin

Ball caps, jackets, logoed merchandise, pizza, points, gift cards, and discounts – the list of incentives for workplace safety goes on. Whatever the reward, the idea is that employers give workers something in exchange for desired behavior or action. However, some critics point out that employees might hide injuries in order to get the reward.

For example, Aubrey Daniels International senior vice president for safety, Janet Agnew sees no role for incentives as businesses usually use them. “The problem with any kind of incentive that has a monetary value (beyond maybe a pizza) is that it can motivate some people to do things, including lying and cheating, that they wouldn’t otherwise do to get the incentive,” says Agnew. She’s also concerned that workers can behave unsafely, and if they don’t get caught, still earn a reward. The thinking goes that as long as there’s no accident, the employee deserves the incentive.

What’s more, adds Agnew, while employees like getting “stuff,” they don’t believe incentives influence their daily safety behavior. She defines an incentive as a reward that’s tied to something that might happen in the future if one doesn’t engage in a particular behavior.

Agnew prefers the concept of reinforcement to incentives. Although, the most typical form of reinforcement is a positive comment, it also makes sense to reinforce an action by making it easier for employees to do. “Often in safety,” says Agnew, “we make it difficult to do the right thing, like requiring people to sit down and file complicated paperwork to report a hazard.” Implementing a hassle-free system, such as a hot line for oral reporting, reinforces the desired action by making it easier.

Companies can engineer reinforcement into the work process, or encourage it by the way they plan work. “If you’ve have money to spend on safety, I would analyze your organizational and management systems and ask what you can do to make it easier and more reinforcing to do the right things,” Agnew suggests.

Jan 01
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SOCIAL MEDIA RISK MANAGEMENT LAGS

By Risk Management Bulletin

Although business use of social media marketing will rise significantly this year, most small and midsize businesses aren’t prepared for the significant risks and exposures involved.

More than half (53%) of senior financial executives surveyed last September by Grant Thornton L.L.P. and Financial Executives Research Foundation Inc.(FERF) said they expect social media to become more prevalent in corporate marketing strategies during the next 12 months; and nearly seven in 10 (68%) described social media as a critical or important component of their marketing.

At the same time, the survey found that risk management and compliance efforts lag far behind implementation of social media as a corporate tool. More than three quarters (76%) of executives surveyed admitted their company doesn’t have a formal policy on employee use of social media; while 61% haven’t developed an incident management plan to address fraud, privacy breaches, and other potentially devastating liability exposures.

According to the survey authors, “Aside from publishing-related risks such as defamation, libel, and copyright infringement, and anti-competitive behaviors such as false advertising and disparagement of a competitor’s product, companies using social media as a marketing tool can find themselves exposed to fraud, theft of sensitive data, and other cyber security risks.”

Yet, 22% of executives surveyed don’t believe corporate use of social media carries risky – and only 27% said their company reviews its social media content regularly. Among companies surveyed, only (21%) said train employees to recognize and report fraudulent activity. Companies that have a formal fraud/privacy breach management plan, split oversight of those responsibilities among general counsel (24%), corporate security (19%), human resources (14%) and IT departments (14%).

“Social media cuts across many areas of a company (such as HR, marketing, communications and legal, among others),” said FERF Senior Research Associate Thomas Thompson Jr. “This means that any social media policy should use a multidisciplinary approach.”

Our risk management professionals would be glad to help you review your company’s exposure to risk management liability – just give us a call.

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