Insured Solutions
Insured Solutions

THE #1 MOST COSTLY EMPLOYER MISTAKE PART TWO

Work Comp began as 90% nobility and 10% redistribution.

It has evolved into 10% nobility and 90% redistribution.

WHAT HAS GONE WRONG?

Answer #1: Nothing if you are on the receiving end of the most cleverly disguised and generous redistribution system ever created.

Answer #2: Everything if you are funding it with no say-so as to how it is interpreted, determined, or awarded.

Last month we outlined the amazingly generous benefits provided within the Work Comp system and while states may vary in the details we should make no mistake about it, all of them are sufficiently generous to attract a certain type of individual. As a result of this baited-trap we are left with one major question - who as an uninsured, low wage, unskilled, less ambitious, the glass is always half empty person would NOT avail themselves of the unmatched benefits offered by work comp IF they could get on a payroll, any payroll and even if for but a single hour of a single day?

The above is especially true if the individual has valid medical problems but no way to get them fixed? Or, if they do not have a significant current medical problem they have a desire for a: new used car, a house, have creditors on their back day every day, want a fun “paid” vacation, or they want something beyond their financial reach based on their limited skill and ambition level. For most in the latter category and after failing to win the lottery - they see few options for that sudden rush of cash – thus their only salvation becomes – Work Comp? The trigger may be knowing someone already successful at winning this form of no risk-high return “lottery”, or they have seen the dozens of attorney ads on TV day after day telling them they are entitled to get hundreds of thousands of dollars if they would just pick up the phone and call the legal offices of such and such and, YES we can solve your strapped-for-cash problems, and best of all it won’t cost you a penny unless you win a pile of dough.

In reality the above scenarios create one opportunistic question for those within this group - why not me? After all - It is my turn to have something? It is my turn to finally rid myself of my problems? It is my turn to enjoy life and I believe that only money can make me happy so whatever is preventing me from having the money I need can’t be my fault, it is just not fair. To accept this type rationale one must first discount the dratted morality obstacle, something that today has been replaced by the victimization concept.

As an employer, to not see what is going on is to stick ones head in the sand. To complain and be frustrated over this immorally based irrationality is a waste of time since the system does not care - remember by its very definition - it is not broken and works just fine. Ultimately the consequences of ignoring this human created problem will plunder your back pocket every year around renewal time unless YOU go on offense.

Never forget…as an employer you are the cash-cow for all of this yet you have no say-so in the decision making process or ostensibly the outcome – but you can engage and by so doing avoid much of the financial pain heading your way from benign neglect, from over confidence or simply from not knowing that you don’t know.

THE TRIGGERING MECHANISM

Your nightmare begins with the simple employee utterance or even inference of …. I felt a pain. The origin of the pain is irrelevant as long as plausibility for it exists based on their job description. There are books written about the underlying causes of this politically rooted frustration so we need not go there. For the purpose of this writing however we need only point out that it behooves every employer to...stand guard at the door of their payroll.

What you will do to minimize your vulnerability due to poor hiring decisions is ultimately up to you. In today’s world of governmental intrusion and intensive regulation you must at the very least avoid “majoring in minors” when it comes to effective screening of your new hires. A common response - Yes…but I know what I am doing and can read these people like the back of my hand. Besides, if it costs me to screen I will take my chances and beat the odds; and if wrong I will just terminate the problem. This strategy worked fine decades ago, but not in the work comp legal world of today, and if you doubt this…just look around at the grave yard of businesses, which have failed to see the writing on the wall as their Experience Modifier continued to escalate year after year making annual renewals more and more costly as they became less and less competitive. Moreover, the trap of getting into the ExpMod briar-patch is a slow process, which by design makes getting out of it all the more difficult.

The rule on work comp is - Success is born by basing your action driven decisions - on WORTH not on COST; and the worth of having an Exp Mod below 1.00 can be the difference in surviving or being tossed onto the graveyard with other businesses who also passively ignored the flashing red lights and sirens issued by a system that is committed to the redistribution of your hard earned dollars, which they see as being for a just and noble cause. Remember…the system has the power to do what it wants to do whether you agree or not.

SOLUTION: To protect what you have built and stay competitive find below 10 basic topics that you MUST address when screening applicants to survive the deadly arrows heading your way from a system bent on getting into your back pocket

THE EMPLOYER CHALLENGE

You must balance your need to know with system imposed barriers designed to prevent you from knowing since the system wants you to carry the financial water for those deemed to be less “fortunate”.

  • 1. Set up “pre-application” screening that allows you to be positioned properly on both sides.
  • 2. Set up “key interview questions and answers” that flush out deceptive intentions.
  • 3. Set up “permitted occupational disease” hiring exemptions based on Essential Functions.
  • 4. Set up “Post Offer Medical Questionnaire” screening based on Essential Functions.
  • 5. Set up “physical exam – stress test (only)” provisions based on Essential Functions.
  • 6. Set up “Drug and Alcohol Program” consent forms & testing parameters and - DO the testing.
  • 7. Set up “Refusal of Doctors Care” protection including mandated drug testing guidelines.
  • 8. Set up “Behavior expectations” to flush out those not on the same page with your workplace culture.
  • 9. Set up “Company Standards” to be learned, not just read. Make learning these a requirement of employment. The rule for the world we live in today is - You will not get what you do not demand.
  • 10. Focus more intently on applicant behavior flags. Knowledge and skills can be taught, character cannot.

Every step outlined above will give you yet another level of screening-based protection. Don’t let your business or home stand without doors, windows, locks, fencing, alarms, and yes….even a moat with alligators when it comes to screening applicants. You only need ONE to get through to do their damage to your future bottom line.

Grant us the serenity to accept the things we cannot change

The courage to change the things we can and

The wisdom to know the difference

WHEN IT COMES TO WORK COMP THINK OF - INSURED SOLUTIONS - OUR NAME SAYS IT ALL.