Safety Measuring Methods for Manufacturers
Safety Measurement Methods Keep Workers' Compensation Premiums Low
Measuring the effectiveness of a safety program is a crucial, but sometimes forgotten step. The impact of safety activities has obvious benefits to protecting employees and also has a large impact on the financial health of the company. Successful companies are focusing on safety results and measurements in the same manner they manage and measure other important business practices. Common methods of measurement, primarily focused on employee injuries, are noted below.
Experience Modification Rating (EMR)
The experience mod rating is a number that indicates workers’ compensation loss history. The EMR is calculated annually based on the last three years of loss experience, excluding the current year, and has can have a direct impact on workers’ compensation premium. The primary point of measurement or comparison is an EMR of 1.00. A 1.00 EMR indicates you’re on a level playing field with your industry peers as it relates to your workers’ compensation claims/payroll ratios. If your EMR is below 1.00, you’re outperforming your peers. If it’s over 1.00, then you’re not performing as well as your peers.
Insurance Loss Runs
Loss runs are specific reports from your insurance carrier detailing losses for all lines of coverage. The total number of losses and average cost of loss are common points of measurement /comparison year to year, in addition to your loss ratios (premiums vs. losses).
OSHA 300 Logs
300 logs are spreadsheets that track recordable employee injuries and are required by OSHA for employers with 10 or more employees. Employers must maintain a five-year history of the OSHA 300 log and is therefore a good tool to do a historical look back of injury types and frequency.
Frequence and severity measurements are another common method of evaluation. The calculations include recordable incident rate (RIR) (also referred to as “Frequency Rate”) and DART Rate (also referred to as “Severity Rate.") The Bureau of Labor Statistics is a good reference for obtaining national averages for RIR and DART by NAICS or SIC codes. This provides a good point of comparison for your company to other similar companies in the US.
Ideally, a company will measure safety effectiveness throughout the year and interpret the results in a way that will direct future safety program activities with a goal toward continued improvement until zero losses are achieved. As with any other key performance indicator, management support and follow up is important. For access to a safety measurement calculator, check out our Incident and DART Rate Calculator, free of charge.
- Incident and DART Rate Calculator
- OSHA 300 Recordkeeping Requirements
- OSHA 300 Log Reporting Webinar Replay
- Manufacturing Blog
- Manufacturing Industry Page
- Manufacturing Webinar Replays
- Manufacturing Library Resources
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