Author: Patty Busse

Why employee happiness is so important

Posted on by Patty Busse

Most U.S. employees are unhappy at work, according to a recent study from BambooHR , which showed a decline in employee satisfaction in over the past three years.

As an employer, should that concern you?

Yes! And here’s why…

An increasing body of research shows that a positive work environment fosters employee friendships, enhances personal well-being and ultimately benefits the organization’s bottom line.

Positive and virtuous workplaces lead to higher performance

To begin, the latest research from the University of Warwick says happiness made employees 12 percent more productive.

“The driving force seems to be that happier workers use the time they have more effectively, increasing the pace at which they can work without sacrificing quality,” said an economist who was part the team that conducted the study.

Beyond the increased productivity, there are other benefits of a happy workforce, including the employee motivation of peers, loyalty to the organization and enhanced creativity on the job.

Meanwhile, the post-pandemic work environment has forced employers to be more imaginative with fostering employee happiness. It’s not simply a matter of letting employees work from home.

Harvard Business Review in the fall of 2023 spoke with Adam Grant — psychologist, best-selling author, and chair of BetterUp’s Center for Purpose and Performance — in a piece about the importance of employee happiness. Creating a flexible work environment can take many forms, he said.

“Make a list of things workers want to be free of and things they want to have the freedom to do. And then you can play each of those out alongside choices about where we work, when we work, and how much we work,” Grant said in the article .

Still, as more employees work from home, employers should look to create an environment where employees feel connected. By encouraging certain behaviors in the workplace – among both front-line employees and leadership teams – employers can help workers feel happier.

A 2023 article from Nectar , an employee recognition software company, outlines some of the basics for employers:

  • Enriching employee friendships
  • Having managers measure progress by productivity, not time in the office
  • Being open to feedback at all levels of the organization
  • Learning about their employees likes and crafting office events based on those preferences

Also of note, data from Great Place to Work says employees are three times more likely to have a sense of well-being if they work in a fun environment.

Close friendships generate employee satisfaction

Friendships in the workplace are a big part of employee happiness.

Here is where the impacts of COVID-19 have had a residual effect. People in general have fewer close friends than they did before the pandemic, according to the American Survey Center .

And a 2022 piece from Gallup says having good friends at work is pivotal for employee engagement and career success. According to the article , employees who have a best friend at work are more likely to:

  • Support a safe workplace with fewer accidents and reliability concerns
  • Engage customers and internal partners
  • Get more done in less time
  • Innovate and share ideas
  • Have fun while at work

Job satisfaction directly correlates to having a best friend at work, according to the Gallup study.

Employee happiness keeps workers safer and aids recovery

So, what does all this have to do with workers’ compensation?

Creating a positive work environment can help your employees stay safer and have a smoother recovery if they do become injured. Some of the reasons for this include:

  • Workplace injuries are more common among new hires, so low employee turnover can help prevent injuries.
  • In a positive environment, employees are comfortable reporting workplace safety issues and taking the time necessary to perform their jobs safely.
  • When employees know their employers care about them, there’s less chance the claim process will become contentious if an injury does occur.
  • Workplace friendships create an added incentive for employees to return to work as soon as medically possible after an injury.

The numerous benefits to creating a positive workplace make a compelling case for building a supportive, affirming work environment.

 

Originally published May 2017

De-escalation tactics can prevent violence in the workplace

Posted on by Patty Busse

Employees in a variety of occupations can find themselves in situations with the potential to be exposed to violence at work. De-escalation tactics can be used to defuse volatile situations so they don’t reach the point of violence.

What is de-escalation?

De-escalation is one technique that can be used when confronted with violent or aggressive behavior.

According to professionals, de-escalation means “transferring your sense of calm and genuine interest in what an individual wants to tell you by using respectful, clear, limit-setting boundaries.” In short, de-escalation is the process of managing someone else’s behavior with your own.

How does the concept of de-escalation intersect with workplace safety?

As workplace violence remains a continuously growing threat, many industries are beginning to utilize the benefits of de-escalation training.

These industries include:

  • Education/academic settings
  • Healthcare
  • Policing/public service
  • Social work

Are there some general de-escalation tactics that apply universally?

While specific threats vary among industries, Jason Clausen, a Loss Prevention Specialist at SFM, notes that many de-escalation tactics apply universally.

“These tactics all require a state of calm, and operate around the cornerstone of active listening,” he said.

General de-escalation tactics that apply universally include:

  • Respecting personal space
  • Maintaining safe body positioning
  • Giving clear, concise direction
  • Setting obvious boundaries
  • Conveying empathy
  • Establishing positive tone of voice

De-escalation resources

De-escalation training can be helpful to employees in many fields. To learn more about de-escalation, view these SFM resources:

 

Originally published December 2020

Why watching prescriptions closely is so important

Posted on by Patty Busse

It’s not hard to find a story on prescription drugs in the headlines.

Maybe you’ve seen news reports on topics such as:

  • Prescription drug abuse, which has reached epidemic proportions
  • Arguments of overmedication and the push for non-pharmaceutical or non-narcotic alternatives
  • Lack of affordability, with pricing increases far outpacing inflation

These issues and many more can come into play when prescription drugs are needed to treat work injuries.

That’s why SFM works hard to make sure injured employees’ medications are managed well. As part of that effort, we partner with pharmacy benefits manager, myMatrixx .

myMatrixx negotiates pricing for prescription drugs and monitors whether comparable, lower-cost drugs might be available. But its services go beyond cost savings. SFM and myMatrixx work together to see that injured employees are getting the best prescription drug treatments for their injuries and aren’t being put at risk for addiction or dangerous interactions.

The safety of our injured employees is critical.

As a pharmacy benefits manager, myMatrixx acts as an intermediary between SFM and pharmacies, negotiating and paying for medications needed to treat work injuries and connecting the appropriate claims representative or nurse case manager when the medications require approval.

myMatrixx has pharmacists on staff who work together with SFM’s clinical review nurse, nurse case managers and physician consultants.

How does SFM ensure injured workers are getting safe and effective prescription medications?

myMatrixx provides SFM with reports that give us the opportunity to monitor injured employees’ prescriptions. This allows us to address dangerous combinations of drugs, prescriptions that are higher or lower than recommended doses of medications, and ineffective treatments for injuries.

For example, in one case an employee complained that his prescription drug wasn’t helping him. SFM’s clinical review nurse then discovered he wasn’t taking a high enough dosage for it to work.

If there is any concern about a drug(s), SFM’s nurses or one of our physicians can send a letter to the employee’s doctor. Optimal, safe and appropriate medication management is our goal.

How do SFM and myMatrixx control prescription drug costs?

The cost of prescription drugs in the U.S. increased 15.2 percent from 2022 to 2023, according to an October 2023 report from the U.S. Department of Health and Human Services. In fact, more than 4,200 drug products saw price increases.

However, it should be noted that the Inflation Reduction Act, passed in 2023, has a provision aimed at lowering prescription drug costs.

Still, prescription drug spending increased 8.4 percent to $405.9 billion in 2022, according to the Centers for Medicare and Medicaid Services .

Costs for individual drugs can vary widely, sometimes for no obvious reason. Here are a few examples of surprising variations in prescription drug pricing:

  • When a manufacturer changed its pricing in January 2023, one drug’s cost went up 3,000 percent
  • Some drugs can vary from $15 per dose to more than $140 at pharmacies within a single ZIP code
  • A generic medicine could cost $7 or $393 depending on where it was purchased

The world of prescription drug pricing can be complicated at best and downright baffling at worst.

This is why working with a pharmacy benefits manager is so important.

myMatrixx negotiates with its network of 65,000 pharmacies on drug pricing and monitors prescriptions to identify whether identical or comparable drugs might be available at lower prices.

What is SFM doing to prevent opioid addiction?

One major reason prescription drugs have been getting so much attention recently is the sharp increase in prescription painkiller addiction as well as other medications and/or concerning combinations of medications, both legal and illegal.

SFM’s Clinical Review Nurse, Gail Pravatiner, helps prevent addictions and advocates for weaning patients off the drugs, or at least getting them to a safer dosage.

She sends letters to treating physicians of injured employees who’ve been prescribed high doses of opioid painkillers or other drugs of concern, asking them to develop plans to wean the patients off of the drugs. With increased awareness of the dangers of opioids as well as other prescription medications/combinations and the concerns for prescription use disorder or addiction, more and more doctors are complying.

According to CDC, chronic pain is a pervasive health condition affecting as many as one in five adults and nearly one-quarter of them have used a prescription opioid in the past 3 months and this is associated with increased risk for misuse, addiction, morbidity and mortality.

In some cases, injured employees themselves request to be weaned off the drugs due to safety concerns after seeing the letters outlining the risks, Pravatiner said.

Sometimes, simply tapering down the medication over time isn’t a safe option. In cases of long-term, high-dose opioid use, other dangerous drug combinations, or both, SFM has sent injured employees to rehabilitation programs. These programs focus on non-medication pain management treatment/alternatives as they help people stop using their opioid painkillers.

Overall, SFM has been successful in helping many of our injured employees taking opioids or other prescription drugs discontinue use or decrease to a safer dosage.

“We consider it our responsibility to injured employees and society as a whole to do our part to prevent opioid/prescription medication abuse/addiction,” Jung said. “It’s been gratifying to see injured workers get their lives back as a result.”

Originally published November 2021

New CompOnline administrator guide available

Posted on by Patty Busse

SFM has released a new version of CompOnline. The improvements enhance security, provide more permissions to the administrator and streamline our behind-the-scenes processes allowing us to serve you even better.

CompOnline administrators may notice a few changes, including:

  • Administrators can now manage all policy contacts, not just CompOnline users. Any additions or changes to contact profiles will directly update the information we have on file for your organization.
  • For security purposes, administrators can no longer create the first-time password for a CompOnline user and will no longer be able to reset a CompOnline user’s password.

Download the new guide

If you’re a CompOnline administrator, please download our updated CompOnline Administrator Guide for information on the updated features.

Four things you need to do after an employee is injured

Posted on by Patty Busse

Your employee was injured at work. You took care of the employee’s immediate medical needs and reported the incident to your workers’ compensation insurer.

What’s next?

You can help prevent similar injuries, get the employee on the road to recovery and ensure a smooth claim process by doing the following:

1. Investigate the incident

The goal of investigating isn’t to find fault, but to understand exactly what happened so you can make sure the same type of injury doesn’t happen again.

Go to the scene of the accident and talk with witnesses to learn what happened. Take photos. Save any equipment involved. Our post on workplace accident analysis tells you how to prepare to investigate incidents and even provides a checklist that can help you think through what happened and how your organization can prevent similar incidents in the future.

2. Consult with your claims representative

Notify your SFM claims representative right away if the employee will be off work. This ensures that the claims representative will have enough time to get wage-loss benefits paid before your state’s deadline.

When the injured worker is released back to work, call your representative. Make sure you’re aware of the status of the claim and the employee’s treatment schedule, and don’t hesitate to ask questions.

3. Stay in contact with the injured employee

Make a call or a visit as soon as you can. It’s important to answer any questions an injured employee has about the expected recovery and return to work.

It’s not uncommon for injured employees to become isolated or depressed and fear they won’t have a job to return to. Reaching out to them early and often reassures them you care about their well-being and are looking forward to their return to work.

For more details on this topic, read our post about staying in contact with injured employees.

4. Arrange for return-to-work

As soon as a doctor clears the employee to return to work, find a way to bring the employee back, even if medical restrictions prevent returning to his or her pre-injury job. Options include finding a temporary light-duty position, reducing hours or adjusting the employee’s regular job to accommodate restrictions.

Make it clear when, where and to whom the employee is to report.

If the accommodation means the employee will be earning less pay, either because of reduced hours or the position pays less, SFM can make up some of the difference by paying temporary partial disability benefits.

Learn more about return-to-work with the post about why return-to-work matters now more than ever to your bottom line.

Tips for hiring temporary workers or subcontractors

Posted on by Patty Busse

Do temporary employees need safety training? Are subcontractors covered for workers’ compensation?

If your workforce includes temporary employees or independent subcontractors, you may have questions like these.

Even these workers need safety training and workers’ compensation coverage. Here are a few things you should know about hiring subcontractors and temporary employees, and their workers’ compensation coverage and safety.

Hiring temporary workers

When you hire a temporary employee, you need to be sure that the outside temp agency will be liable for payment of workers’ compensation benefits in the event of a work injury.

Beware of scanty contracts, either deliberately or unwittingly silent on important legal considerations including workers’ compensation coverage. Consider having contracts from temp agencies reviewed by an employment attorney before you sign them.

Keeping temporary workers safe

Give temporary employees the same safety training you give regular employees. Don’t skimp on safety training just because someone will only be working with you for a short time.

“The most common causes of injuries we see among temporary employees include workers not being properly trained for the jobs they’re performing, or the physical abilities of the individual do not match the task,” said Lee Wendel, SFM Director of Loss Prevention.

Here are a few suggested questions employers should ask their temp agencies to keep workers safe:

  • Will the agency provide personal protective equipment for the temporary employees?
  • What safety training will be provided by the agency?
  • Does the temporary employee require any additional help to perform the job?
  • Is worker safety a company priority?
  • Will you visit the worksite and conduct a safety assessment?

For more resources on temporary worker safety, visit OSHA’s Protecting Temporary Workers page .

Hiring subcontractors: Are they covered for workers’ compensation?

Hiring subcontractors that are uninsured can pose a significant liability to your organization.

Anyone working independently for your organization needs to be covered for work injuries. An independent contractor working alone may or may not carry workers’ compensation insurance.

If contractors say they have coverage, you’ll need to get certificates of insurance at the time they are engaged. Your SFM premium auditor will look for these certificates at the time of your premium audit. If a subcontractor does not provide a certificate of insurance for work comp, we will typically include their
payroll in the calculation of your premium.

Some entity types with no employees may not be required to carry workers’ compensation insurance. If this is the case then you’ll need to get insurance certificates for general liability with adequate minimum limits of coverage.

Are subcontractors truly ‘independent’?

You’ll need to verify that the individual meets the state’s legal criteria to be considered an independent contractor. The specific requirements vary by state, and an employment attorney is your best resource to make sure your contractors meet them.

In addition to verifying coverage and determining “independent” status, SFM attorneys recommend having a subcontractor agreement drawn up by an employment attorney for all subcontractors to sign before they go to work for you.

For more information on Minnesota’s guidelines, see SFM’s General contractor’s liability Legal Advisory and Hiring subcontractors CompTalk.

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.

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Strategies to combat work-related stress

Posted on by Patty Busse

Have you noticed your employees’ work stress levels rising recently? Are they eating at their desks to meet deadlines? Calling in sick? Snapping at co-workers?

Here’s how to recognize the signs of stress and tips on what you as an employer can do to prevent it from hurting your employees.

Research shows the harmful impacts of stress

Numerous studies have found that stress at work is a major cause for concern and leads to physical symptoms. In one survey conducted by the Harvard T.H. Chan School of Public Health, National Public Radio and the Robert Wood Johnson Foundation, 43 percent of workers said their job is bad for their stress – yikes!

In a 2021 APA Work and Well-being survey , more than 70 percent of workers say they typically feel tense or stressed out during their workday.

And the consequences: survey respondents reported that stress has an impact on their physical and mental health, results in overeating or skipping a meal, and nearly half say stress has caused them to lie awake at night in the past month. One in five respondents say they intend to seek employment outside of their company in the next year.

The most serious issue in the workplace for the development of illness that we in Total Worker Health need to solve is stress.

~ Dr. John Howard, NIOSH director

Persistent work-related stress can lead to lost productivity, health costs, burnout  and turnover.

NIOSH Director Dr. John Howard knows stress is bad for business and bad for workers. In a video for the Healthier Workforce Center of the Midwest , he says, “The most serious issue in the workplace for the development of illness that we in Total Worker Health need to solve is stress.”

Top five causes of work stress

Different aspects of work — some within employers’ control — cause this stress. The top five work stress factors in 2021, according to the APA, were:

1. Low salaries (56%)

2. Long hours (54%)

3. Lack of opportunity for grown or advancement (52%)

4. Too heavy of a work load (50%)

5. Lack of paid time off or sick leave (50%)

Do managers expect 24/7 communications? Research has found that employees feel “anticipatory stress” when they feel as if they need to respond to work email outside of work hours. Even if they haven’t received any work emails during their off hours, the anticipation that they’ll need to be ready to respond quickly brings work stress into the rest of their lives.

Strategies for employers to address work stress

Employers can take steps to prevent stress from interfering with employees’ productivity, health and well-being.

First of all, identify which work factors are causing the most stress for your employees. An anonymous employee survey can uncover stressors. Then, consider the overall work environment.

The Harvard Gazette’s report on the Workplace and Health study recommends that employers take a holistic approach:

“Experts say many of these health problems can be corrected if companies adopt a much more significant role creating a ‘culture of health’ in the workplace where workers feel empowered to pursue living a healthier life.”

Build stress-relieving activities such as mindfulness into your workplace wellness program, if you have one.

To keep work stress from carrying over into the rest of employees’ lives, management can set clear expectations – and set the example – of not responding to after-hours emails. Encourage employees to take breaks and use their vacation time.

For more on the causes, warning signs and ways to combat work-related stress, view the guide on stress in the workplace from Helpguide . They include advice for employers to alleviate some of the common causes of stress their employees face:

  • Clarify expectations
  • Consult your employees
  • Offer rewards and incentives

And, here are seven steps to help manage stress at work from the APA. Recommend these strategies for your employees, or follow them yourself if you feel stressed during the workday.

People think that stress is a natural by-product of work. You can’t have one without the other. But that doesn’t have to be the case. With these tips, you can prevent the negative health impacts of work stress.

Expert tips to make your safety committee thrive

Posted on by Patty Busse

Your safety committee can be a powerful tool for injury prevention.

A group of dedicated employees from throughout your company focused on making your workplace safer can make a real difference.

Whether you have a safety committee already or are thinking of starting one, you can use these best practices and activity ideas as a guide.

How an empowered safety committee prevents injuries

For one SFM policyholder, a proactive safety committee member helped prevent what could have been a serious injury.

This committee had created safety check­lists in partnership with workers in different areas of the business. They walked through the checklists before each committee meeting.

On one walk-through, a safety committee member discovered a frayed cord on a welder. The employee immediately reported the defect and had the machine taken offline until it could be fixed. He didn’t wait until the meeting to report the issue, since a frayed cord could cause electrocution. The committee member was proactive and empowered to address safety concerns on the spot.

Safety committees are most effective when they can identify issues and have the power and resources to solve them. When a safety committee is working as it should, employees and managers work together to address safety concerns before they cause injuries.

Benefits of a safety committee

You may be required by state law to have a safety committee, but even if you’re not, it’s worth considering.

In Minnesota and Iowa, companies with more than 25 employees are required to have a safety committee that meets regu­larly. Some companies with fewer than 25 employees may also need a committee, depending on their safety record and industry. States under federal OSHA do not have a safety committee requirement. (If you’re not sure whether you need a safety committee, check with your regional OSHA office.)

Even if you’re not required to have a safety committee, it can help you:

  • Give employees an avenue to bring up safety concerns
  • Identify and correct hazards before they cause an injury
  • Involve management and employees in making safety part of your company culture
  • Educate employees about risks
  • Boost morale when employees feel heard and see their concerns addressed
  • Reduce the risk of OSHA citations or other state penalties

And of course, if the committee’s work can prevent even one worker injury, it’s time well spent.

Nine safety committee best practices

Even if your state doesn’t require it, having a committee with the goal of preventing injuries and accidents is worth the time and resources. To make your team the most effective it can be, follow these best practices:

1. Define the role and responsibilities of your committee

Develop a written mission statement. Clearly define the duties and responsibilities of the members. Identify and prioritize goals, and establish action plans to achieve each goal.

2. Conduct regularly scheduled meetings

Use the time to discuss accident prevention methods, safety promotion, hazards noted on inspections and other pertinent topics. Review incidents that resulted in injury as well as the “near misses” that didn’t.

3. Review accident investigation forms

Digging deep into the circumstances of accidents will help you prevent them in the future. SFM offers a downloadable accident analysis form . Have all of the supervisors use the same form to make it easier for the safety committee to review them.

4. Look for claim trends

Analyze patterns in your workers’ compensation claims. Consider three data points to start: body part, cause of injury and result of injury. Look for patterns by comparing with other data, like occupation and business location.

If you start by using a report of claim activity from your workers’ compensation insurer, you might want to consider expanding and tailoring your report to include internal information, such as department, shift and supervisor — whatever you think might help narrow the hunt on when, where and why certain injuries occur.

5. Conduct inspections

It’s worthwhile to develop a safety review and inspection process – like the walk-through checklist in the example above – to identify operational hazards and observe employee work methods. Periodic inspections allow you to gauge the effectiveness of your efforts.

During a safety review you should look for: workplace environmental hazards, workstation set-up, work activity, modified work tasks and employees’ awareness of conditions.

6. Eliminate hazards. Correct employees’ unsafe behaviors.

To be effective, your inspections need follow-through. Unsafe conditions must be eliminated. Unsafe behaviors need to be corrected. Document your inspections, including appropriate follow-up procedures. Determine whether past recommendations have been addressed and implemented.

7. Promote safety

Keeping safety in front of the employees will remind them of the importance and will increase their awareness of hazards. Several types of safety promotions can work in any type of organization. See below for a list of fun safety activities your committee can organize.

8. Take action

Following up and taking action are key. If someone is injured or nearly injured, take corrective action to prevent similar accidents from occurring again. Follow up to ensure these corrections are made quickly. This might require increased safety training, additional equipment or safer work methods.

9. Recommend safety training

The purpose of training is to influence employees’ behaviors. Safety orientation should be provided to all workers, especially new employees. It ensures that they are familiar with the hazards of the workplace and know how to complete their job duties safely.

It’s a good idea to provide training regularly for workers of all experience levels and to have a training calendar to support those efforts.

Safety committee

Safety committee responsibilities

Once your safety committee is established, you’ll want to define its scope and responsibilities.

It’s important for all safety committees to define a purpose beyond just complying with OSHA requirements. Identifying objectives gives the group a sense of purpose and provides a roadmap for accomplishing something significant.

To get committee members to engage, start by creating a roles and responsibility sheet. Let committee members choose which tasks they want to take on and write them down. This could include items like planning a safety talk or taking meeting notes.

You may decide to make your committee responsible for some or all of the following:

  • Reviewing your safety policies and practices
  • Doing regular safety walk-throughs of your facility and noting any concerns
  • Encouraging employees to report safety hazards to your group
  • Looking at past incidents and “near misses” for patterns and areas to focus on
  • Looking ahead to potential issues that could happen in the near-term

The committee provides a venue for front-line employees and managers to work together. It engages people at all levels of the organization and helps to build a cul­ture of safety.

Fun safety committee activity ideas

Are you looking for ideas to inspire your employees or to re-invigorate your safety committee?

Successful safety committees stay interesting, fresh and visible. They get outside of their comfort zones and get creative.

Popular activities that work for almost any type of business include safety contests, posters, special safety/health events, guest speakers and training programs, employee suggestion programs and safety recognition awards.

Get the committee out of the conference room and out into your facility with these ideas for hands-on activities:

  1. Schedule a series of Supervisor Initiated Trainings (SITs) on relevant topics
  2. Record a video about a safety issue
  3. Hang up safety posters from SFM around the facility
  4. Create an award for employees who are “caught” practicing safety
  5. Bring in an ergonomics specialist to evaluate workstation set-up
  6. If your organization holds a benefits fair, have a booth for your safety committee
  7. Involve committee members in choos­ing personal protective equipment
  8. Hold committee meetings outside during nice weather, or take a field trip for a team-building event

Other ideas include:

  • Write safety tips for your company newsletter or intranet
  • Create a schedule of supervisor-presented toolbox talks that include opportunities for feedback from employees (such as SFM’s Supervisor Initiated Trainings (SITs) series).
  • Facilitate a find it/fix it incentive program to encourage employees to report safety hazards and see that they are corrected.
  • Plan an informational campaign — with email messages, posters, maybe even a contest — around a key safety topic like winter slips and falls.
  • Create a display and promotional board about a safety topic, such as using traction footwear to prevent slips and falls.
  • Implement a “virtual safety store” (a page on your intranet with links to recommended vendors) where employees can learn about recommended home safety products such as carbon monoxide detectors and fire extinguishers.
  • Issue awards or plaques to recognize employees who point out safety hazards, for example, a plaque on a machine that states, “This machine made safer by Sarah Smith.”
  • Have fun at meetings by incorporating quizzes, team-building exercises, compelling videos, etc.
  • Encourage safety committee members to bring a guest to each meeting, who can be an employee at any level of the company. This helps increase safety awareness and sustainability of the committee.

When your safety committee is engaged and empowered, it can serve as a vital piece of your loss prevention program. With enthusiastic members and creative activities, the committee can spread a culture of safety to every employee.

Additional resources on safety committees:

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.

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Warning: Using third-party bill pay services can delay payment

Posted on by Patty Busse

When you use a third-party service to pay your workers’ compensation premium, your payment can be delayed. If this causes a late payment, it can start the policy cancellation process.

To avoid delays, we recommend paying bills to SFM directly through the SFM website. When you pay on our website with your bank account, any installment fees are waived, and you can set up AutoPay so future bills are paid automatically on the due date.

SFM is not affiliated with any third-party bill paying services.

 

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What are employer liability limits?

Posted on by Patty Busse

When you purchase a workers’ compensation insurance policy, a coverage called employer liability insurance is also included.

Sometimes called Part 2 or Coverage B, this insurance is rarely used in most states, and makes up a very small part of the workers’ compensation insurance premium.

Because of this, you might just pass over this coverage if not for the need to choose employer liability limits.

The basic employer liability limit is usually $100,000/$500,000/$100,000. That’s $100,000 per accident, $500,000 per policy, and $100,000 per employee.

Since an employer liability claim is unlikely, other considerations usually factor into decisions to increase the limits above the basic $100,000/$500,000/$100,000 level.

What employer liability insurance covers

There are only a few rare cases where employer liability insurance coverage might be used by a policyholder.

Some states permit spouses and dependents of injured employees to sue an employer. Employer liability insurance would provide coverage in those cases.

A more common (but still rare) example of when employer liability limits might be used is when an injured employee sues a negligent third party, and that third party sues the employer for contributory negligence.

For example, say a factory worker was injured while using machinery that his employer purchased from another company, and the employee claims the manufacturer was to blame for the injury. The employee might try to sue the manufacturer for damages. The manufacturer might then sue the employer saying the machine had not been properly maintained or the employee wasn’t properly trained to use the equipment. This is called a third party over action. At that point, the employer liability insurance would cover the employer’s possible settlement and damages costs up to the stated policy limits. The employer liability insurance would also cover defense costs until the policy limits have been met by settlement or damages payments. Defense costs are paid outside the policy limits.

Just as with the workers’ compensation insurance portion of the policy, a claim can only be eligible for coverage under the employer liability portion if it stems from an injury determined to be work-related, as defined by state statute.

Choosing employer liability limits

The basic employer liability limit is usually $100,000/$500,000/$100,000.

Oftentimes policyholders who choose to increase their limits do so because of contractual requirements or requests from their umbrella carrier.

For example, a general contractor might require all subcontractors to set their employer liability limits at a particular level. Or, a policyholder’s general liability or umbrella carrier might have similar requirements and ask for increased limits.

For those reasons, it is common to see employer liability limits increased to $500,000/$500,000/$500,000 or $1 million/$1 million/$1 million.

Because the coverage is rarely used, increasing coverage limits is typically inexpensive.

For example, the cost to raise the limits to $500,000/$500,000/$500,000 is 0.8 percent of premium in most states. The cost to increase the limits to $1 million/$1 million/$1 million is 1.1 percent of premium in most states.

Employer liability limits can be confusing, and every policyholder is different, so consult with your agent if you have questions about your specific situation.

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.

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