Employer Responsibilities Part 3 of 3: Ways to reduce the cost!
REDUCING THE COST OF WORKERS’ COMPENSATION INSURANCE
Workers’ compensation insurance premiums are determined primarily by the employer’s industry. For example, workers’ compensation insurance premiums are more expensive for a construction or manufacturing company than for a professional services firm. However, employers across all industries can take steps to reduce the cost of maintaining workers’ compensation insurance.
The easiest and often most effective way to reduce frequent workers’ compensation claims is to implement a quality safety program. Safety programs can help employers identify safety issues that employees face on a daily basis. Safety programs should also establish safe work practices and educate employees on how to reduce risk. When creating a safety plan, employers should analyze the factors that cause frequent claims.
The TWCL requires employers that have an experience modification factor or rate applied to the premium of 1.20 or more to establish and administer a safety committee under TWCL rules. The safety committee must hold regular safety meetings, conduct workplace inspections and make recommendations for improving the employer’s accident and illness prevention program.
Implementing programs to put injured employees back to work, even in a temporary role, can help reduce workers’ compensation premiums, increase the employer’s overall output and raise the injured employee’s morale. Accommodating light-duty restrictions may also help reduce an employer’s liability for temporary or permanent disability benefits.
Fraud is expensive and can drastically raise premiums. If an employer suspects that an employee has submitted a fraudulent workers’ compensation claim, the matter should be promptly reported to the Division for an investigation.
Contact William Blount & Associates or visit the Division website for more information on Workers’ Compensation laws in Tennessee.