Good Safety Incentives Gone Bad - MC Magazine Spring 2002 - Concrete Publications

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Good Safety Incentives Gone Bad

Safety incentive programs don't always fill the bill as safety prevention programs.

By William Atkinson
William Atkinson is a writer based in Carterville, Ill.

Though safety incentive programs may be well-intentioned, the basic premise - to provide a safe and healthful place in which to work - is often short-circuited. For example, "minor" safety infractions may be swept under the rug so as not to lose an incentive award, and even cash rewards may lose their incentive value over time. How can an employer avoid such pitfalls?

When rewarding employees for working safely, several options are available. However, before a program is selected, it is important to first create a management culture that emphasizes safety and provides rewards or incentives to all employees for being part of the program.

Sergio Arvizu, safety and personnel director for Western Precast Concrete (El Paso, Texas), agrees. "The key to any safety incentive program is good management," he states.

General Incentives
One simple way to begin creating a safety culture is to promote incentives that do not require any particular results, activities or behaviors by employees. Examples:

"At the beginning of each season, each location kicks off with a safety program," explains Dean Howarth, director of safety and loss control for Cretex Inc. (Elk River, Minn.), and a contributor to NPCA's safety manual. "We provide employees with caps and T-shirts."
Drivers, crane operators and welders at Western Precast are allowed to attend safety seminars put on by local distributors and suppliers. Not only are the seminars free to the employees, but they are paid for their time attending.
Each year, a number of Western Precast suppliers donate items (caps, T-shirts, safety equipment, calculators, etc.) to the company, which gives them to safety team members, employees with perfect attendance and other outstanding staff members. "However, no one in the company leaves empty-handed," emphasizes Arvizu. "Employees receive tickets for raffles for other prizes, and everyone walks out with something."

Traditional Safety Incentive Programs
Traditional safety incentive programs, which reward employees for going certain periods of time without lost-time accidents, have been around for decades. Rewards can include cash, merchandise and gift certificates.

However, there has been some recent concern about these programs, especially from the National Advisory Committee on Occupational Safety and Health (NACOSH), a direct advisory body to the U.S. Occupational Safety & Health Administration (OSHA), and a number of safety consultants who promote a strategy called behavior-based safety (BBS).

In BBS programs, employees are trained in the inherent values of working safely, how to work safely themselves, how to observe their co-workers to see if they are working safely, and how to discuss these safety observations with their co-workers. No formal rewards or recognition are offered. Most BBS consultants believe that safety is its own reward. As such, BBS in and of itself is not considered a "safety incentive program." However, a few BBS consultants believe that informal or formal recognition (but not reward) is important when employees work safely.

NACOSH and BBS have three major concerns about incentive programs:

Such programs can encourage employees and supervisors to underreport accidents and injuries.
Some employers may use the programs as substitutes for more comprehensive safety efforts and programs.
Such programs may fail to have lasting effects, that employee interest and participation naturally wane over time.

In 1997, NACOSH commissioned a formal study of safety incentive programs, which led to a preliminary report, "Review of the Literature on Safety Incentives," published in October 1998. The report summarized academic literature and anecdotal evidence of the potential benefits and drawbacks of safety incentive programs. A weakness of the report, though, is that there are no reviews of academic studies on incentive programs after 1987. "We did not purposely exclude such studies," explains Dr. Ruth Ruttenberg of Ruth Ruttenberg & Associates (Bethesda, Md.), who helped prepare the report. "We were simply unable to find many formal studies conducted after this time."

While the research did not uncover any strong, primary-data studies showing underreporting trends across industries, it did find individual instances of underreporting. Ruttenberg emphasizes that she did not begin the research project with any preconceived notions. "I am an economist, and the majority of my work is in the area of occupational health and safety economics," she adds. "Based on my research, I do believe that traditional safety incentive programs, by their very nature, encourage underreporting."

The report generally concludes that traditional safety incentive programs can lead to underreporting of injuries and are occasionally used by employers to substitute for comprehensive safety programs.

Based on these results, NACOSH encouraged OSHA to take a hard look at traditional safety incentive programs, which the agency is now doing. "The fact that some employers use these programs in lieu of formal safety and health programs is of very real concern to us," says Richard Fairfax, director of compliance programs for OSHA. "Of even greater concern is the fact that underreporting can and does occur. There have been cases where injured employees were pressured not only by fellow employees, but by their supervisors, to not report injuries in order to maintain eligibility for safety incentives." Fairfax adds that, while there may be some acceptable programs in place, he is not aware of any that do not have the reporting disincentive.

For these reasons, OSHA is now directing its compliance officers, when visiting work sites, to see if such incentive programs are in place and, if so, to investigate more fully for potential underreporting. "If we find such instances, and if the employers are aware of these, they could be subject to citations for record-keeping violations," Fairfax says.

Despite the fact that traditional safety incentive programs can cause underreporting and may encourage other problems, this doesn't necessarily have to be the case. There are instances where such programs work well.

Nontraditional Safety Incentive Programs
A more recent evolution of safety incentive initiatives has been to provide rewards to employees for their specific safety-related behaviors (leading indicators), rather than the results (trailing indicators) they achieve. Under this concept, employees receive tangible rewards for engaging in specific behaviors that have been shown to help reduce or prevent accidents and injuries (wearing hardhats, wearing seatbelts) or that generally promote safety and health in the workplace (submitting safety suggestions, participating in safety meetings).

Ruttenberg finds this approach much more appealing. "In a health and safety class I was teaching, the students said that, if they were rewarded for reporting dangerous situations, reporting near misses that could have caused serious injuries or making other safety-related suggestions, then there was a real role for incentives in the workplace," she says.

In setting up such a program, however, Ruttenberg emphasizes the importance of making sure employees actually do have control over their behaviors. "For example, if you reward employees for not stepping outside safety lines, but inventory is piled up inside the safety lines, then they may need to step outside in order to get their work done," Ruttenberg says.

The Best of Both
While some employers line up in support of traditional, results-based incentive programs and some support the nontraditional, activity-based incentive programs, others find success with a combination of the two.

One such employer is Amcor Precast (Ogden, Utah). Its combination safety incentive program was developed by Brian Rhees, the company's central group regional safety manager.

Traditional Component. For every 100 hours an employee works without a written warning or a recordable or lost-time accident, that employee receives 10 credits. The employee can save up 100 credits to be used for one day off from work with pay, $100 cash or a $100 gift certificate. For every quarter an employee works without a warning or a recordable or lost-time accident, that employee receives $25 additional cash. For every five years an employee goes without a lost-time accident, he or she receives $250 cash (accrued at $50 per year) or a comparable gift. At 10 years, the employee receives $500 cash or comparable gift. Also, when everyone at a work location goes 100 days without a lost-time accident, they receive a catered lunch and a small gift. If they go a full year without a lost-time accident, they receive a catered lunch and a gift valued at $75.

Nontraditional Component. When an employee submits a safety suggestion that is approved by the safety committee, that employee receives $50 cash. The company has a safety committee at each of its locations, composed of six to seven hourly people and six to seven salaried people. Members can earn quarterly incentives up to $120 for their committee activities. Rewards are offered for the following activities ($20 per quarter per activity per committee member):

Hold monthly committee meetings.
Conduct monthly plant inspections.
Find contributing factors that are controllable during incident investigations.
In meeting minutes, identify the problem before proposing the solution.
Resolve all open items within three months of their posting, except where parts are on order.
Open items must reflect safety-related hazards. (Other issues, such as those related to production, sales and maintenance, must be addressed in other settings.)

Another combination program is in place at Western Precast.

Traditional Component. "We maintain records of lost-time accidents," says Arvizu. "Each time the workforce achieves 50 days without a lost-time accident, everyone receives a catered lunch." At 100 days, employees receive the catered lunch plus a bonus check. (At 150 days they receive the lunch, at 200 days the lunch and check, etc.)

Nontraditional Component. All employees are required to wear safety glasses, hardhats, back belts and steel-toed shoes. Gloves are optional but strongly encouraged. To encourage employees to wear their equipment at all times, they receive all items free of charge from the company. As items wear out or are damaged, employees can ask for free replacements. "In addition, when I am walking around and notice someone with damaged or worn equipment, I invite them up to my office, present them with free replacement equipment, and thank them for continuing to wear their equipment and for doing a good job in general," he states. Employees are charged for personal equipment only if they lose items.

Cretex, which has had some traditional safety incentives in place for a number of years, is reconsidering their value. "One problem is that, after a while, employees begin to expect the rewards as a standard part of their compensation," says Howarth. "As such, the rewards lose their value as incentives."

Cretex is now in the process of moving to a nontraditional program and is currently trying to identify the specific behaviors and activities that it wants to reward. "Incentives have a role when you know what you want to highlight," he explains. The questions management is currently asking are:

What do we want to happen in safety?
What behaviors and activities do we want to encourage employees to engage in that will promote safety?
What are the best ways to reward these?

Perspective
So what's the best approach to safety incentives? Again, while some people swear by the traditional results-based approach, others swear at it. Still others are not convinced of the value of activity-based programs, and even those who are continue to debate whether employees should receive rewards, recognition or nothing.

The best advice is to experiment with the different approaches in your organization. Create one or more pilot programs to see what works best, including combination options. "Above all, make sure that you involve the employees and give them some control over how the program is set up," concludes Ruttenberg.

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