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September 2012

Sep 01
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COMPANY SAVES BY INVESTING IN EMPLOYEES

By Workplace Safety

Safety was a major reason for the development of an Employee Assistance Program (EAP) at Chamberlain, a paving contractor in Laurel, MD that specializes in parking lot maintenance. During a three-year period, the company’s increases in Workers Compensation and Commercial General Liability exceeded 100%. By implementing a Safety Awareness Program, the company saw an immediate and significant decrease in the frequency of Workers Comp claims and vehicular accidents.

Because Chamberlain’s heavy equipment and trucks travel daily on interstate highways around metropolitan Washington D.C., the owners implemented an alcohol and drug policy. A local consulting firm helped develop this policy by working with the company’s human resource advisory group. The process included meetings with workers to explain the rationale for the new policy and provide an opportunity for employee input.

During these meetings, it became clear that designing an alcohol and drug policy would not magically solve all the negative effects associated with these behaviors. Employees needed a mechanism to deal with personal problems so that they could find help, take a leave of absence to deal with their problems, and then return to the company and improve their productivity.

The consultant recommended that Chamberlain use a qualified provider to implement and manage an Employee Assistance Program (EAP). This firm leads quarterly training sessions for all employees and counseling on family, financial, and other problems, in addition to those related to alcohol and drugs. Each year, a significant percentage of the Chamberlain’s work force seeks help from the EAP counselor, which shows the confidence of employees in this program.

The company supplements its EAP with a drug testing program managed by a separate organization that does drug testing before employment, after accidents, when there’s probable cause, and on a random monthly basis.

Since implementing the EAP and the drug testing program, the company has enjoyed a significant decrease in job-related injuries and accidents, absenteeism, and tardiness — while reducing its Workers Comp premiums by some $50,000 a year. Chamberlain is also benefiting from an improved quality of workmanship, greater customer satisfaction, and higher employee morale. What’s not to like?

Sep 01
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PROFESSIONAL EDUCATION HELPS YOUR WORKERS HELP THEMSELVES – AND YOUR BUSINESS!

By Employment Resources

When you’re facing budget cutbacks, do educational benefits stand out as a prime target? If it’s hard to measure the value of a single employee’s value to the business, how much more difficult is it to determine the impact of improving this employee’s educational level?

However, many workers — especially those who businesses consider highly valuable — consistently rank educational and professional development opportunities as one of the most important programs an employer can offer. Networking with peers, exposure to new techniques and ideas, and improving motivation are among the benefits that employees cite. Employers benefit from improved retention and higher productivity.

In today’s technology-driven world, businesses need workers with knowledge and skills honed by continuing professional education (especially in science, technology, engineering, and math) to stay ahead of the competition, both here and abroad.

Uncle Sam is helping the cause through Section 127 of the Internal Revenue Code, which allows an employee to deduct up to $5,250 a year in contributions from their employer for college or graduate education. According to one nationwide survey, more than a million Americans are taking advantage of this tax-free employee benefit.

It makes sense for you to help your valued employees join them.

Sep 01
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THE ABCs OF QUALIFIED PENSION PLANS

By Employment Resources

Attracting and keeping good staff is essential to the longevity of your business. Understandably, the availability of retirement benefits ranks high on the list of employee concerns. Creating a pension plan that’s guaranteed by the federal government adds credibility to your retirement offerings and helps protects your employees.

Under “defined benefit plans,” the employer pays the retired employee a fixed amount for a given period. The amount varies, depending on the employee’s length of service, income earned, and age. Because employers fund these plans by contributing to investment funds controlled by money managers, it’s essential to choose highly qualified and reputable fund managers.

Under the increasingly common “defined-contribution plans,” employees contribute to their own retirement accounts, assuming part of the investment risk. In some cases — ideal for employees — employers also contribute to the plan by matching the employee’s contribution up to a certain percentage. The most common type of defined-contribution plan is a 401(k). Even though employees take an active investment role in defined-contribution plans, your company’s advisors and the money managers you use are still fiduciaries with significant liability risk.

Both types of plan are “qualified” pension plans backed by the federal Pension Benefit Guaranty Corporation (PBGC).

For more information about qualified pension plans and how to insure them and their fiduciaries, call our service team today.

Sep 01
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GROUP DENTAL INSURANCE, ANYONE?

By Employment Resources

Although Group Health Plans often don’t offer Dental coverage, employees might consider this a valuable coverage and an incentive when comparing job options.

Group Dental plans, as with Group Health insurance, provide services to individuals while offering the premium savings and insurability advantages of group coverage. Group dental plans are usually preventative in nature, focusing on minor procedures and routine visits. However, plans might offer more expensive procedures (such as oral surgery) at a reduced cost to members of the group.

These plans usually include a calendar-year deductible and calendar-year maximum. The plan might provide such additional services as orthodontics, periodontics, or endodontics, with separate deductibles, limits, or policy provisions.

To learn more about a Group Dental plans that’s right for your company, just contact our service team.

Sep 01
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PROTECT ‘CONTINGENT WORKERS’ — AND YOUR BUSINESS

By Risk Management Bulletin

If you’re using “contingent workers” — on a part-time, temporary, or contract basis — be aware that these employees face a greater risk of occupational injuries and illness. According to the National Institute for Occupational Safety & Health (NIOSH) reasons for this higher vulnerability include the tendency to outsource more hazardous jobs, lack of experience and familiarity with operations in a dangerous workplace, inadequate protective equipment, and limited access to such preventive measures as medical screening programs. The chances are that temporary workers have a wide variety of experience levels (due to high turnover) or have had the benefit of formal safety programs.

Also, bear in mind that even though the safety of contract workers is the legal responsibility of the contractor, the OSHA General Duty Clause could be interpreted to make you responsible for protecting everyone in your workplace. To help meet this obligation, and bolster workplace safety compliance we’d recommend that you take these steps:

  1. Include safety requirements in the contract, even if only to state that the contractor must comply with OSHA requirements. If the contractor doesn’t follow safety rules, you can force compliance or stop work for breach of contract.
  2. Set the safety compliance ground rules up front, during orientation or before they start work.
  3. Share accountability. Although an accident caused by a contract worker might not be your legal responsibility, it’s still your problem. Don’t leave safety compliance problems for the contractor to solve alone.
  4. Offer assistance. Explain all hazardous conditions or processes during the initial project orientation and stress any rules and restrictions, such as hot-work permit requirements, lockout/tagout, and confined spaces situations and needs.
  5. Document communications with contractors. Give the contractor(s) a document or form to sign when resolving specific safety problems or for conducting inspections.
  6. Read the OSHA Multi-Employer Citation Policy. OSHA published an enforcement and compliance directive (CPL 02-00-124, December 10, 1999) laying out its citation policy for multi-employer worksites, which includes contractors.

Finally, don’t forget that most contingent workers will only be in your workplace for a relatively short time. This only adds to the urgency of getting them up to speed on your company’s safety policies and practices as quickly as possible.

Sep 01
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WHAT IS ALTERNATIVE RISK FINANCING?

By Risk Management Bulletin

Most medium-sized and smaller companies protect themselves against their property and liability exposures by purchasing Commercial insurance, while large corporations and government agencies prefer to use some type of alternative risk financing. However, businesses of any size can employ this tool to enjoy such benefits as improved cash flow and a lower total cost of risk.

Insurers have developed a number of colorful terms for alternative risk financing techniques. These methods include:

  • Excess insurance
  • Reinsurance
  • Guaranteed cost
  • Retrospective rating
  • Large deductible
  • Self-insurance
  • Captive insurance

Using alternative risk financing requires management discipline and a willingness to commit resources. Size isn’t that important. The main criterion is losses. As a rule of thumb, alternative risk financing makes sense for a business whose claims have these characteristics: (1) Reasonable predictability; (2) moderate volatility; (3) minimal exposure to a catastrophic event; and (4) high frequency and low severity. For example, a large hotel or bank would probably experience a number of small Workers Compensation claims, but few large claims.

Casualty insurance products (such as Workers Comp, General Liability, and Auto Liability) are the best candidates for alternative risk financing. Because Comp and Liability claims tend to be paid over one to five years or more, insurance companies that write these policies generate substantial investment income on their premium reserves until losses are paid fully. By using alternative risk financing, your company can invest your funds elsewhere, rather than paying premiums.

Our specialists would be happy to review your business and see if alternative risk financing make sense for you.

Sep 01
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ONLINE SAFETY

By Risk Management Bulletin

Be afraid — be very afraid — because hackers are breaking into Web sites around the world at a frightening pace! These cyber-pirates can copy, edit, or delete files; or trash your site by stealing programs and disrupting networks. Once they’re into your site, hackers can also use phony identities to buy goods and services or vandalize the site by changing its look, text, and overall message.

The easiest way to prevent a hacker from entering your site is to install a firewall on the Web server that keeps out unauthorized access by monitoring the flow of information between your server and the Internet. Although a well-designed firewall should stop all Internet attacks, most sites don’t have properly configured firewalls. One survey of more than 2,000 sites concluded that these companies were doing the equivalent of “putting an airbag in the backseat of a car when it comes to security precautions.”

Before you implement a firewall system, consult with a security expert. The person in your company who created your site might know whom to call; otherwise, ask your Web consultant or Web-hosting company. The expert will want to know if your site was created in a secure fashion: Did your Web developer use secure protocols and software when building the site? Is the ISP that’s hosting your site secure?

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