Can Workers Compensation be an Employee Benefit?

workers comp claim

When you think about employee benefits, most of us think about insurance coverage such as health, disability, vision, dental and life insurance. Each of these are paid partially or fully by the employee. But for some reason we do not think about workers’ compensation as an employee benefit. Even though it serves the same purpose as their health insurance or disability insurance.

Most employees see workers’ compensation as a “right” and they believe their employer has a “duty” to protect them financially in the event of a workplace injury.

To be frank, I cannot dispute their claims because workers’ compensation was designed to be the “sole remedy”. It is up to each state to create the rules but, for the most part, workers’ compensation works the same way everywhere except the monopolistic states. If you are in Ohio, Wyoming, Washington, and North Dakota you are in a monopolistic state and may want to stop reading right now.

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Let us get real, shall we? We know most employees value money in their pockets over anything else. That money can come in many forms: salary, commission, bonus, 401k match, and employee benefits. Health insurance is designed to help employees pay for medical expenses that would otherwise be unaffordable. Disability protects a portion of the employee’s income if they are hurt outside of their job and cannot work. Is the same not true for workers’ compensation? It pays for medical expenses related to work injuries that would be unaffordable to the employee and possibly even the employer. It also protects a portion of the employee’s income if they are injured badly and cannot return to work in 7 days.  Sounds like an employee benefit to me!

What if, as a business, you started thinking this way instead of an workers comp being expense you had to pay? What if you started telling your employees that it was a benefit? What if your employees bought into the idea? I am here to tell you it is possible.

One of the best ways to prove this to your employees is to put your money where your mouth is. I am going to suggest that you do something radical. Share with your employees how much premium you pay for their annual workers’ compensation insurance.

What would happen if your employees knew the cost of workers comp and you set up a safety incentive program and pay them cash bonuses for hitting the goals?

Would it help you control soft costs? Did you know that soft costs are anywhere between 2 and 10x the amount of the worker’s comp claim? That is right! A $10,000 claim will cost you between $20,000 and $100,000 in lost production, additional training, and strain on employees. This does not even include the increased cost of workers’ compensation from rate increases and the experience mod rating.

If you are interested in starting a safety incentive program click here and download our free guide!

If like to discuss your workers comp and safety situation, you can click here to schedule a call with Josh or call us at (478) 449-5928.

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