According to the Bureau of Labor Statistics, in 2020, 2.7 million employees were injured on the job. This is about 2.2 cases per 100 FTE workers. Even if your industry is low risk, there is a chance of an employee being injured on the job. Office workers can experience repetitive strain injuries or slips and falls entering or leaving the building.
These statistics represent both a significant loss of productivity and the potential elevation of workers' comp costs. Workers' comp premiums, like other insurance, are determined in part by your claims history. One way to reduce the cost of claims, and thus future premium increases, is by having a quality Return to Work program.
What is a Return to Work Program?
A Return to Work (RtW) program is a set of policies designed to limit an injured employee's time out from work without compromising their recovery. The program is designed to:
- Identify essential functions of the worker's job that they must be able to do before they can return.
- Identify non-essential functions that can be temporarily handed off to somebody else.
- Make reasonable accommodations to allow them to do those essential functions so they can return to work OR
- Identify an alternative position they can work in until they have recovered.
For example, a driver injured in a car accident while performing duties might have non-driving tasks such as lifting boxes or washing the vehicle. If they cannot drive, they might be assigned to office or dispatch duties until they recover. This allows them to come back and help support your business, and receive a salary instead of compensation from the insurance.
What are the Benefits of an RtW Program?
There are four main benefits of implementing a return to work program:
An RtW, as already mentioned, is primarily designed to reduce the cost of workers' compensation claims, and thus premiums, by getting the employee back to work sooner. It also helps avoid relapses when an employee feels pressured to restart normal duties too quickly.
If you have a great company culture, your employees will want to come back to work. Many people don't want to lie around at home any longer than is necessary, but would rather be contributing somehow. A RtW program also demonstrates that you are not the kind of employer who would push an employee to do duties they aren't capable of, which improves everyone's morale and loyalty.
Because a correctly-planned RtW program involves the employee in their own accommodations and plan, it also gives them agency and helps them feel happier about their return.
Without a RtW program, an experienced employee may leave for a different job they can do sooner, taking their institutional knowledge with them. RtW programs help employees recovering from injuries or illness to afford to stay and support them through their recovery.
Any missing employee reduces productivity. The more experienced they are, the worse the hit. If other employees have to cover for them, overall productivity takes a hit. Hiring a temporary replacement will still dent productivity as that person will have to be trained, be slow while they come up to speed, and need more supervision.
While some loss of productivity is inevitable after an accident or workplace illness, a return to work program helps minimize it.
Finally, an employee who knows they can come back slowly, in a different job if needed is much less likely to sue you for damages. They are much less likely to need the money, and more likely to feel engaged. Employee litigation is costly and often ends with the employee not returning regardless of the outcome.
How Else Can Companies Reduce Workers' Comp Costs?
The absolute best way to directly reduce your premiums is to partner with a Professional Employer Organization (PEO). Businesses can sign their employees up for the PEO's workers' comp plan, which allows you to benefit from the PEO’s experience modifier and claims history, as well as from economies of scale. The PEO also allows you to pay monthly premiums rather than a potentially prohibitive upfront deposit.
Partnering with a PEO will also help with many other HR issues, reducing costs and taking tedious administrative tasks away from your HR team.