Minimize Risk and Lower Costs with a Strategic Approach to Loss Control
By Hale Johnston Senior Vice President, Regional Manager, EMPLOYERS | March 13, 2011
What is loss control and how is it relevant to running profitable hotel operations? In the context of risk management, loss control essentially describes the measures taken to reduce and eliminate the occurrence of workplace accidents that lead to insurance claims. Taking a strategic approach to loss control not only helps make hotel work environments safer for employees, it can also result in direct cost savings for the business.
On any given day, hotel employees such as housekeepers encounter heavy loads and chemicals, the shuttle drivers face risks on the road, and slips and falls is a loss leader for kitchen staff.
When hotel operators take a strategic approach to workplace safety, workers' compensation costs can decrease, fewer overtime costs accrue, productivity increases, turnover rates decrease and relations between labor and management improve. Studies from the Occupational Safety and Health Administration (OSHA) indicate that for every $1 invested in effective safety programs, $4 to $6 may be saved as illnesses, injuries and fatalities decline. By creating a culture of safety in the workplace, everyone benefits.
When an organization successfully controls its losses, it also helps control its workers' compensation experience modifier, which is a key factor in the calculation used to determine premium pricing. Experience modifiers take a company's loss history for a three-year period, excluding the current policy period into consideration. Therefore, taking a strategic approach to loss control that focuses on improving safety can maximize a company's opportunity to reduce costs. A culture of safety starts with management that keeps everyone accountable. Without leadership's involvement and an overt commitment from the top, a culture of safety cannot be established or sustained.
Management Commitment and Employee Participation
The most effective culture of safety programs starts with an authentic commitment from management that integrates workplace safety as an essential component throughout all facets of the organization. This level of commitment requires management to provide visible leadership in collaboration with employees to develop, implement and continuously improve the company's workplace safety initiatives. Together, this collaborative team needs to establish an annual safety goal with the associated objectives and workplace safety plans to reach the goal. Performance relative to the annual safety goal should be reviewed regularly and the results should be communicated to the organization.