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PRODUCTS AND IDEAS THAT INSPIRE PERFORMANCE

Premium Incentive Products Magazine - Products and Ideas That Inspire Performance

Safety First

Structured Programs Help Meet Safety Goals

Workplace safety should be every company's priority, with the goal of ensuring the health and well-being of all employees. To help carry out safety goals and initiatives, companies can implement incentives to motivate employees and strengthen the safety messaging.

The Ins and Outs

"First and foremost, a safety incentive program is about improving the engagement levels of safety-sensitive employees," said Brian Galonek, CPIM, president, All Star Incentive Marketing, a company that specializes in recognition and rewards programs.

"The simple fact is that you cannot change human behavior until you have an engaged audience, and while a small part of any workforce is naturally engaged and intrinsically motivated, the majority are not. That majority represents the opportunity size for a well-structured safety incentive program," he said.

"The programs are used to capture the attention of the workforce and to get them more engaged by structuring a program around employee recognition (which most employees crave) and around a rewards platform that captures their attention. Once you have that," he added, "you have an opportunity to get the safety messaging through and to build the safety-related 'muscle memory' that will lead to goals being surpassed and to a positive ROI."

A wide variety of initiatives, rewards, structures and other details are included in incentive programs.

"Safety incentive programs can be created to support specific workplace initiatives, and depending on an employer's program objectives, there are multiple variations to choose from," said Theresa McEndree, vice president of marketing at Blackhawk Network, a global financial technology company in Pleasanton, Calif.

To be successful, however, safety incentive programs should be able to check the following boxes:

  • Promotes well-defined actions.
  • Motivates employees to achieve stretch goals.
  • Has milestones to keep employees engaged and working toward long-term goals.
  • Produces measurable outcomes.
  • Incorporates rewards that employees find motivating.

"It's typically best for employers to familiarize themselves with all of the options that are available to accommodate the diverse lifestyles and preferences of their employees," McEndree said. "One of the easiest ways to do that is for employers to find a reward partner that can help shape their program strategy and help deliver the most effective rewards."

Brant Dolan, CPIM, director of business development, Quality Incentive Company, which designs and delivers incentive, reward and recognition programs, suggested that establishing a "safety culture" from the top down should be the first in line.

"Safety needs to be set as an expectation, with a passion behind it. It's not optional," he said. "It needs a task force dedicated to the cause with various departmental inputs, safety director input and employee input. It needs to strive for consistency and a promise of accountability for sustaining a course. It needs to seek to establish a set of key performance indicators, methods to measure, and reports to create a set of analytics.

"The program should address departments as well as individual roles and responsibilities with clear and precise procedural requirements," Dolan added. "Routine review processes and flexibility to adjust as needed should be a standard. All programs need a communications campaign, in a verbal manner, visual manner and constant reinforcement via an employee web portal or standalone site."

And, the employer, if possible, should extend the messaging and awareness to family members.

First and foremost, a safety incentive program is about improving the engagement levels of safety-sensitive employees.

"Being safe at home and in public can affect attendance in the workplace as well," he said. "If the program is online, as most are these days, it should be easily viewed and navigated. And, because it may be online, this 'tech' approach needs to be complemented with 'touch' tactics along the way. Lastly, it should focus on the process of safe behavior and training, not merely quantitative measures."

Donna Chrobak, vice president, sales and marketing, Summit Recognition Solutions, a company that specializes in recognition, engagement and incentive solutions, noted information from the 2018 Liberty Mutual Workplace Safety Index that stated that "Workplace injuries and accidents that cause employees to miss six or more days of work cost U.S. employers nearly $60 billion in 2015."

"That's more than $1 billion a week! You can see why employers take workplace safety so seriously," she said.

"While safety incentive programs or safety recognition as Summit Recognition Solutions refers to them can be an effective tool to motivate workplace safety," she said, "it is important to understand the Occupational Safety & Health Administration (OSHA) guidelines that regulate how these programs can operate."

Employers, for example, must inform employees of their right to report work-related injuries and illnesses free from retaliation by their employer.

"As this rule applies to safety recognition programs, you do not want to discourage employees from reporting workplace injuries by rewarding them, for example, for having no workplace injuries during a specific period of time," Chrobak said. "Safety programs should be carefully designed not to penalize employees for reporting work-related injuries or illnesses. Instead, they should promote the reporting of workplace safety incidents, and reward behaviors that preempt accidents and promote workplace safety."

In the fall of 2018, OSHA clarified its position on safety incentive programs, which the incentive industry deemed as a positive statement.

According to OSHA, "The department believes that many employers who implement safety incentive programs and/or conduct post-incident drug testing do so to promote workplace safety and health. In addition, evidence that the employer consistently enforces legitimate work rules (whether or not an injury or illness is reported) would demonstrate that the employer is serious about creating a culture of safety, not just the appearance of reducing rates. Action taken under a safety incentive program or post-incident drug testing policy would only violate OSHA's rules if the employer took the action to penalize an employee for reporting a work-related injury or illness rather than for the legitimate purpose of promoting workplace safety and health."

Importance of Safety Incentives

Improving workplace safety may be the obvious answer as a reason for having safety incentives.

"More specifically, however, safety recognition programs should be built around driving the specific behaviors that create a safer work environment and help achieve the safety goals of the organization," Chrobak said. "These can vary from company to company, but some of the more common behaviors and goals include":

  • Participation in safety program activities and evaluations, such as safety walkthroughs.
  • Completion of safety and health training.
  • Identifying and reporting potential hazards and close calls/near misses.
  • Adhering to preventive maintenance schedules.
  • Compliance with posted workplace safety rules.

McEndree said that employees have come to expect to be rewarded for a variety of professional achievements or practices, including safety. "Having safety rewards available gives employees one more reason to follow smart safety practices, and promotes proactive behavior, like suggesting safety tips, identifying potential hazards and participating on safety committees," she said.

Improving workplace safety may be the obvious answer as a reason for having
safety incentives.

In addition, "some of our latest research found that 79 percent of employees want rewards programs, and 73 percent think rewards encourage engagement," she said. "Incentive programs can be a meaningful way to motivate and engage employees to take desired safety measures." (The research is from the "Efficacy of Employee Rewards," an online survey that was conducted independently by Murphy Research on behalf of Hawk Incentives between Jan. 29 and Feb. 7, 2018.)

What's more, psychological and monetary reasons exist for having safety incentives. "It shows management cares about individuals and their families. It will serve to reinforce your core values," Dolan said. "It creates and sustains a heightened awareness of 'staying safe.' Employees take note. They understand it's a management expectation."

Also, safety programs can assist in the recruiting process and help sway new talent to join the organization.

"Monetarily, it will keep costs down and hopefully improve efficiencies contributing to the bottom line. As for OSHA standards, it shows 'due diligence,'" he said.

Galonek suggested that a company's safety program truly is a collection of many different initiatives built around training, personal protective equipment (PPE), compliance and other objectives.

"That safety program should not be called 'safety program' any more than you should call your pet, 'dog,'" he said.

A crucial part of the success is putting a brand name on your safety program and communicating the brand.

"People respond positively to the brands they like. They understand the values of those brands, and they align with them in a way that compels behavior," Galonek said. "Putting a brand name on your safety program (your collection of safety initiatives) and finding many different vehicles to promote that brand will lead to much greater success. Nothing works better than a well-built safety recognition/rewards (incentive) program at creating and promoting your safety brand, and, therefore, it is a crucial part of success."

And, according to George Delta, Esq., the Incentive Federation's legal counsel and executive director, who has published the federation's position on safety incentive programs over the years, has said that "Effective safety programs play a critical role in reducing worker injuries, save money, and improve employee morale considerably.

"Employee injuries and illnesses cost employers in several respects: (a) lost productivity, (b) increased worker's compensation claims (and the corresponding increase in insurance premiums), (c) damaged equipment, (d) poor employee morale and retention, and (e) litigation. In several industries where injuries are common, for example, contracting, handling baggage, trucking, heavy manufacturing and chemical processing, the cost of injuries can be staggering," he said. "Even injuries from repetitive motions can keep employees off the job for significant periods of time, even though these types of injuries do not necessarily involve much exertion. Safety programs are an extremely effective means of reducing all types of workplace injuries. When they are implemented properly, they have a multitude of salutary effects."

He also has said that "Well-designed safety incentive programs would tend to emphasize safe conduct or behavior, and they would reward workers for individual rather than group conduct.

"Moreover, even behavior-based programs can and should lead to the reduction of workplace injuries, which is the ultimate goal of such programs. In contrast to rate-based programs, however, behavior-based safety programs that lead to the reduction of reportable injuries and illnesses are aimed at individuals, encourage safe conduct and practices and should foster open communication about safety issues and should encourage the reporting of injuries and illnesses. Like all other safety tools, safety achievement programs can certainly be misused," Delta said. "When programs are designed and used properly, however, they are extremely important in reducing workplace injuries. Any employer facility that tolerates the non-reporting of injuries is probably beyond the assistance of a safety incentive program. A program (and awards under that program) should never become more important than safety and respect for the well-being of an employee."

Legal Requirements

Regarding worker safety, OSHA's rules outline the agency's main concerns about such programs and cite what is not permissible.

"For example, OSHA published a final rule that, among other things, added a provision prohibiting employers from retaliating against employees for reporting work-related injuries or illnesses," said Steve Slagle, managing director of the Incentive Federation. "In the preamble to the final rule and post-promulgation interpretive documents, OSHA discussed how the final rule could apply to action taken under workplace safety incentive programs and post-incident drug testing policies."

Action that is taken under a safety incentive program or post-incident drug testing policy would only violate OSHA's rule if the employer took the action to penalize an employee for reporting a work-related injury or illness, rather than for the legitimate purpose of promoting workplace safety and health.

"… The type of incentive program that rewards workers for reporting near-misses or hazards and encourages involvement in a safety and health management system is always permissible," Slagle said. "Rate-based incentive programs are also permissible, as long as they are not implemented in a manner that discourages reporting.

"Thus, if an employer takes a negative action against an employee under a rate-based incentive program, such as withholding a prize or bonus because of a reported injury, OSHA would not cite the employer under as long as the employer has implemented adequate precautions to ensure that employees feel free to report an injury or illness," he added.

McEndree added that safety incentive program compliance regulations are ever-changing.

"At the same time, employees are demanding a reward experience with as little friction as possible," she said.

Safety programs can assist in the recruiting process and help sway new talent to join the organization.

"Employers wanting to take advantage of the benefits of safety incentive programs while meeting their employees' expectations for a user-friendly reward experience need to be well-equipped to handle constantly evolving regulations. The reality is many are not. Working with an experienced partner can help employers stay on top of compliance regulation," she said.

Dolan noted that there are tax laws and standards that the IRS has mandated under tax code 274j that need to be referenced before establishing the program's design and goals.

"Individual state legislature needs to be referenced as well. One should also review OSHA's guidelines and expectations especially avoiding any endeavor or practice that may be viewed as 'discriminatory.' A great resource is a review of OSHA's VPP (Voluntary Protection Program)," he said.

"The OSHA guidelines," Chrobak said, "require all employers with more than 10 employees, and whose establishments are not classified as a partially exempt industry, to report work-related injuries and illnesses, and they must post statistics annually. This is one of the primary ways that employers and OSHA measure workplace safety metrics. Therefore, it is critical that any safety recognition program is designed by someone that understands safety guidelines as they apply to these types of programs, and do not deter reporting of workplace injury or illness, nor punish employees when they do report.

"If employees do not feel free to report injuries or illnesses, the employer's entire workforce is put at risk, employers cannot correct dangerous conditions, and injured employees may not receive the proper medical attention or other benefits they may be entitled to," she said. "Additionally, programs that encourage non-reporting of injury or illness in the workplace, even if it is unintentional, it would result in the employer's failure to record injuries as required, and could result in an investigation by OSHA."

Galonek added that "OSHA's position on safety incentive programs has evolved over the years, especially recently."

In its most recent "clarification on OSHA's position on workplace safety incentive programs…" the agency makes it clearer than ever that it is not against the use of such programs, but instead, in favor of them as long as they are properly built.

"So, what are the elements of a "properly built" program? They should not be cash-based (disguised compensation), but instead should use tangible awards that are far more memorable," he said. "They should not feature overly large awards (like a pickup truck) offered in a sweepstakes where one winning name is pulled from a hat and they should not tie all workers together (where one person's accident penalizes an entire group), which creates negative peer pressure. They instead should reward individuals for their individual behavior and focus not just on performance, but also on proactive safe behavior; or going 'above and beyond' for safety."

Rewards That Work

Typically, no one-size-fits-all reward exists in safety recognition, or any other type of incentive or recognition program. Thus, it is important to ensure that the employee is recognized publicly.

"Public recognition is often the part of recognition that an employee values the most," Chrobak said. "It is also a great way to promote the program by letting employees see the value of understanding and adhering to safe workplace behaviors.

"The value of the recognition being given, or the total potential value of a recognition that employees can receive can also determine the type of reward that is offered," she said. "For example, if it is a lesser-value one-time award vs. the ability to earn awards throughout the year, this will drive what types of awards are offered."

Some effective tangible awards include:

  • Brand-name merchandise.
  • Gift cards.
  • Corporate logoed apparel or merchandise items.
  • Safety apparel or equipment required in the workplace that employees may have to purchase on their own, such as work boots or safety glasses.

Non-tangible awards are effective motivators, too, including:

  • Public recognition or praise.
  • Free lunch.
  • Prime parking spot.
  • Extra time off from work.

"Rewards depend on the company's culture, demographics and geographics," Dolan said. "They should contain a balance of symbolic awards as well as lifestyle awards, meaning 'tangible things' people desire."

He said the IRS allows for these elements to be a non-tax event within certain guidelines, whereas cash, travel, meals and entertainment do not meet IRS requirements.

"There may also be other things unique to a company's culture to make for an award outside of the typical merchandise range of awards. This is where your task force can get creative," he said. "At minimum, rewards work best when there is choice and the reward options ensure 'something for everyone'."

"The mistake that some companies make is that they ask their workers what they would want for awards and, of course, the vast majority will say they want more money; that is just human nature," Galonek said.

"What they should instead be asking themselves is, 'What type of awards will be the most memorable for employees and will best lead to long-lasting behavior change?'" he said. "The answer to that question is tangible brand-name awards and experiential travel. Program participants need to be able to remember the awards they receive to close the loop and fully connect that safe behavior is rewarding and only tangible awards like a golf club, TV or weekend getaway can create long-lasting memories. Cash is forgotten almost instantly after receipt, where tangible awards can literally be remembered for decades."

Slagle suggested that effective awards include merchandise from a broad range of choices—from a selection incorporated into a catalog provided to the employees, rewards points to be redeemed later, reasonably priced plaques, trophies, etc.

"Given the IRS guidance, it's clear that cash and cash equivalents aren't permitted, nor are extravagant awards and gifts that may have been used in the past," Slagle said. "Also, given the monetary limits described above, it's clear that really expensive merchandise doesn't fit in a qualified plan.

"What type of merchandise or tangible personal property works best likely ties to the employer's work culture, type of business, type of safety issues, etc.," he said. "For example, and not to generalize, if the employer is a construction company employing individuals working outdoors in a physically challenging work environment, merchandise that matches the work habits and personal interests of that particular demographic might work best.

"Considerate employers will seek the opinions of their employees," he added, "and have them help design the programs to ensure the awards are respected and valued."



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