Recently, the Ohio Bureau of Workers' Compensation notified employers that the rebates they've enjoyed the last several years are a thing of the past. The return on its investments is down, and companies' out-of-pocket costs for workers' compensation claims are increasing.
For this reason and others, you can't afford not to invest in a safety program.
The obvious reason is the costs that are visible on the income statement. The average workers' compensation claim in Ohio in 2001 was $40,000 in medical bills associated with the incident and wages for workers that are off work.
With medical costs on the rise, if your company has a 5 percent profit margin, you need sales of $800,000 to pay for that one claim, and that's just for the direct costs associated with the incident.
Then there are indirect costs. The National Safety Council estimates that indirect costs associated with an incident are three to 10 times the direct costs.
For each workers' comp claim, the potential indirect costs are $120,000 to $400,000. Administrative time spent completing incident records and accident investigations, lost time by co-workers talking about the incident, schedule disruptions, production losses due to the inefficiencies of replacement workers, equipment or product losses due to damage, and the cost of training replacement workers are all examples of indirect costs.
All of this time could be better spent improving quality, increasing production or securing new customers.
Companies with low accident rates are often eligible for participation in a group rating program that can reduce workers' comp premiums. Low incident rates may also help a company avoid an OSHA inspection, saving the time involved in responding to the inspector and potential fines associated with the inspection.
Studies show that effective occupational safety programs not only reduce the costs associated with incidents, but they increase morale and productivity and decrease absenteeism. All of these factors increase profits, resulting in an improved bottom line.
How can you afford not to invest in an effective safety program?
For more information, contact your insurance company, the Division of Safety & Hygiene, OSHA's On-Site Consultation Program or a certified safety professional. Dianne Grote Adams is president of SafeX. Reach her at (614) 890-0800 or firstname.lastname@example.org.
An occupational physician assists with developing and implementing an effective occupational health and safety program in the workplace. With proper preparation and planning, he or she can assist the business team to minimize costs and maximize productivity.
Occupational physicians establish preventive medical screening programs, diagnose occupational illnesses early, return injured or ill employees to work more quickly and reduce response time to chemical releases.
To get an occupational physician on board, begin by contacting independent consulting occupational physicians or hospital occupational health programs listed in the phone book under "Occupational Health Services," then interview physicians to find one compatible with your business philosophy.
Once you find your new team member, educate him or her about your business and invite the physician to meet your operating team and go on a plant tour. Provide a process description and chemical inventory. Discuss your corporate environmental, safety and occupational goals and the specifics of your return-to-work policy and restricted work program.
Armed with a thorough understanding of your business and the facility's risks, the physician can advise you on providing associates the proper medical care and follow-up when an incident occurs. He or she also works with the safety director to identify productive work that injured workers can perform until they're able to return to regular work.
This team effort minimizes lost work time, which significantly reduces the direct and indirect costs of a work-related or personal incident.
With knowledge of the chemical, physical and biological hazards, the physician establishes a program to screen for potential occupational illnesses. As a result of the plant tour, he or she knows the exposures that associates may potentially experience. This early detection may result in reducing exposures or in early medical intervention that prevents costly medical treatment and time away from work.
If a chemical release occurs within the facility, the physician is familiar with the chemical inventory and can anticipate the symptoms of exposures and the treatment to minimize health effects.
The physician's team is prepared to assist you with providing medical treatment while calming the fears of other associates during the stressful time of responding to a chemical release. How to reach: Dianne Grote Adams, president, Emilcott/DGA Inc., (866) 364-5342
DLH Industries Inc. is one of Stark County’s most interesting success stories in the exploding polymers industry.
But as with any business planning continued prosperity in the 21st century, it is facing some large issues. The global marketplace has radically changed the way growing companies do business, and DLH Industries must adapt, but a history of steady growth should help it maintain its good fortune.
“My brother, Doug Houck, started the business in 1975, and I joined in 1976,” says Vernon Houck, executive vice president of DLH Industries.
The company operates six plants, five in the Canton vicinity, including Perry Township and East Canton, and the newest plant in Carrollton. Genex Mold, a division of DLH Industries, manufactures custom molds and tooling with full design support. With 525 employees, DLH’s annual sales are about $25 million.
DLH manufactures and supplies thermoplastic custom-extruded and injection-molded products to many major automobile manufacturers. These tubing products are used in air suspension, emission, cruise control and windshield-washer fluid systems, among others. Approximately 90 percent of its business is based on these specialized items.
This concentration on polymer products for the automobile industry has caused headaches for DLH Industries’ executives and employees. In the 1990s, many automobile manufacturers began relocating operations to other countries, specifically Mexico, in pursuit of cheap labor. The obvious “victims” were the assembly-line workers, but manufacturers, including DLH Industries, were affected.
The company now faces two major challenges: global competition and cost reduction.
“Our key efforts are in cost reduction,” says Houck. “We’re the middle guy in automobile manufacturing and it’s getting more expensive to do business. The cost of raw materials, labor, insurance, workers’ compensation and state-of-the-art equipment is going up, but the automobile manufacturers are bluntly telling us that we have to reduce the prices of our products or they will take their business elsewhere.
“Manufacturers are starting to cater to developing nations. We are now in competition with Mexican, European and Asian manufacturers. You have to be creative in order to survive in the modern marketplace. This is the day-to-day way of doing business now. Adjustments must be made rather quickly.”
Diversification is key. DLH is starting to focus on the development of polymers applicable to the manufacture of lawn and garden products such as lawn mowers, snowblowers and leaf blowers, but this is not the first time it has been forced to re-channel its energies. In the late 1970s, the company manufactured a variety of parts for General Electric television sets. Houck says that by 1981, GE had shifted its television manufacturing overseas, and as a result, DLH began pursuing customers in the auto industry.
The “science” of the polymers industry is not really a huge concern at DLH. (“We’re not a manufacturer of raw materials,” Houck says.) Instead, the applications of polymers and developing new products are important.
Bret Adams is a Canton-based free-lance writer.
More than four decades ago, Carole Horowitz was preparing to get married when her husband-to-be suggested she look forward to the day when their children-to-be were on their own.
"My husband and I have been married 45 years," says Horowitz, owner of Plantscape Inc., which offers interior and exterior landscaping, artificial plants and trees, corporate holiday decorations and more. "When we were engaged, he said, 'You may want to have a business when the children we're going to have are grown. You should be thinking about what you want to do.'
She says that at that time, there weren't many women in business.
"It wasn't a popular thing to do," she says. "I was truly a pioneer, which made it difficult in a lot of ways. I had a lot of battles to fight."
Horowitz, who met her husband, Don, in an art class at Carnegie Mellon, had grown plants in her room in high school and thought a business involving gardening would be fun.
"I wanted it to be a business that I knew a lot about," she says. "Figuring out how it would be a success was something that happened in the world of trial and error. It was a hobby that turned into a huge business."
Today, the company, with 91 full-time employees and 50 seasonal employees, has become a family affair. Carole's husband is the head of marketing, their son, Tom Horowitz, directs sales and service, and their daughter, Cindy Urbach, runs commercial sales. Plantscape's annual revenue is about $5 million, and Horowitz plans to continue her company's growth.
How did you develop and implement your strategic plan for growth?
Your plans have to constantly change. We are a market-driven company, and because of that, we do a much more aggressive job of marketing than any of our competitors. We will try new divisions if a client needs something.
If a division is profitable, we continue it, if not, we don't. The customers had to express a need for something for us to want to develop that division.
How did you manage the fast growth of Plantscape?
By hiring good managers. That's been our development process all along. Education and training are the most important things to help a company grow and stay quality-oriented.
I had advisers that told me if I grew any faster, I would've been in financial trouble. I actually grew at the proper pace that I could keep up with.
How do you communicate with your employees your vision for the company?
No matter what, you communicate in person by having meetings so that you can talk to each other. Also, each paycheck comes with an employee newsletter. Everybody gets to learn about what's going on in the company, including nice personal things like birthdays, graduations and new births.
What do you look for in your employees?
We look for people with personality. People who can smile. People with a sense of humor. Without that, it's going to be tough to do everything else.
You appointed a CEO to run the day-to-day operations of Plantscape so you could focus on the big picture. How does your daily work differ now?
The first time we hired someone it wasn't as successful as it is with the person we have now. We learned some things from that. That person didn't respect our employees enough. The employees felt that person talked down to them.
We knew the next time we looked for someone, we had to be much more aware of these valued employees. We had to spend some time with this person to make sure it was understood where we were coming from and that our goals were similar.
I can now take time away from the company, but that allows me to plot and plan for its future.
I also enjoy teaching and passing along my knowledge. It's a fun, very diverse business. There are no matching days. You have to learn to go with the flow.
What's the next step for Plantscape?
Increasing the profitability of the company and increasing the quality standards of both products and services. And hiring better and better employees, all with smiling faces and good personalities.
How to reach: Plantscape Inc., (412) 281-6352 or www.plantscape.com
Every business owner would love to have the “problem” of rapid growth. But it really can be just that a problem.
All vital parts of a business products, services, employees and equipment become even more of a concern.
Bob Shearer, president of Brewster-based Shearer’s Foods Inc., is one business leader lucky enough to have to worry about managing rapid growth. Now in its 25th year, Shearer’s has posted several years in a row of close to 30 percent growth. Its Grandma Shearer’s brand snack products are winning national industry awards and the company last year completed a $13.5 million expansion.
Shearer says the biggest risk factor for food-based businesses is the unpredictability of Mother Nature. Drought was a factor this year, but two years ago, floods virtually destroyed a bumper crop of potatoes in Florida. When severe weather pummels a food company’s raw materials, he says it’s hard to assess how much, if any, of the cost should be passed on to consumers.
“Every day is a challenge and a new opportunity,” Shearer says. “Do we feel like we have our growth under control? Definitely.”
Jim Allan, Shearer’s vice president of purchasing, says that the company’s limited sales area the Midwest, parts of the east coast and Canada helps it stay nimble.
“Because we aren’t a national company, we can make decisions and adjust more quickly,” says Allan. “But you have to step back periodically and look at what you’re doing.”
Shearer’s is fortunate to be part of a somewhat bulletproof industry. The snack and candy industries are widely considered invulnerable to recession. If the overall economy is good, as it has been the past several years, that’s good for business. If the economy is poor, people tend to stay at home, and Shearer says snack food sales actually go up when the economy is sluggish.
Coleman Caldwell, vice president of sales and marketing, is largely responsible for generating opportunities to grow. He says there are just two ways to grow: Grow your existing customer base or add customers.
“If your customers open up new stores, be part of that growth,” says Caldwell. “The other way to grow is to add new customers. What we’ve been fortunate enough to do over the last three or four years at Shearer’s is do both fairly successfully. We can always have a lot more room for improvement.”
Caldwell says growth is fairly fundamental. Part of it is discipline: You have to stay focused on traditional sales and marketing skills.
“There’s no silver bullet out there that says, ‘I’ve got the new widget that everybody’s going to beat a path to my door for and I can sell it for an obscene amount of money,’” he says. “When that happens which happens once or twice in a career or in the history of a company sometimes that’s great. But it’s the everyday consistency.
“It’s the everyday understanding of how you’re going to grow, having a plan, working your plan, executing it and then reviewing it. It can almost be fairly mundane to talk about.”
Of course, a company is not solely responsible for its own chance to grow. Its customers dictate if, when and by how much it will grow. Companies must keep expanding their potential client base, because not all of the prospects will become customers.
“So much of what we do has long lead cycles,” says Caldwell. “There’s people that I might be calling on today that won’t make a decision for six months, and after they make a decision, with all the internals, testing, packaging and this and that, we may not actually bill our first order to them for six months later than that.”
Caldwell says managing growth is a matter of getting enough “turns at bat.”
“If I’ve got an active account list or a new target account list of 15 or 20 people, they’re all going to make decisions at different times,” he says. “Six months from now, five of them may not be considered top prospects anymore, for whatever reason, so I’ll have to go out and replace those with five others.”
And a company can’t directly control its growth by simply willing it to happen. Instinct can and often is a factor.
“If all of your potential customers hit, you could grow significantly quicker than you thought, and at the same time, if none of them hit you’d say, ‘Boy, I really had some grandiose plans that didn’t come to fruition.’ You don’t really decide, ‘Today I’m going to go out and grow X percent,’ but after a few years, you gain confidence and you get a sense of what your gut intuition tells you,” says Caldwell.
“I don’t want to say we’ve had control over our destiny, but we’ve had a little bit of a feel for how we could grow. We set the bar pretty high.”
Caldwell sets lofty goals for his sales team, what he calls “stretch targets.”
“Let’s strive as hard as we can for it, but if we come up just a little bit short, we’ll still have had a phenomenal year vs. setting it at a comfort level,” he says. “I believe that you are what you strive to be or what you think about, and if you think you’re only going to grow so much and you’re satisfied with that, you’re selling yourself short.”
New industry trends also affect the growth of a business, but keep an eye out for excessive hype. In the snack food business, “healthier” baked or Olestra-based products were supposed to be revolutionary. It didn’t happen. (Caldwell thinks that most people are eating their favorite snacks in moderation instead.)
It is also impossible for a company to grow while providing every product imaginable. Small businesses must focus on their strengths and let the industry leaders take most of the responsibility for developing products that appeal to minor portions of the market.
“We see these ‘healthier’ snacks as something that’s here to stay, but at this point in time, there’s nothing that indicates it’s going to be a significant part of the overall snack food industry,” Caldwell says. “While 7 or 8 percent of the market is valuable, we can’t be all things to all people.”
Providing consumers with quality products is also key in any growth strategy. People are no longer willing to settle only for value, Caldwell says. The food industry is a perfect example. Generic products were the next big thing several years ago. They offered value, but little in terms of quality. Now, grocery stores are promoting high quality products with their own names on them. In fact, 30 percent of Shearer’s Foods’ business is making private label snacks for stores.
“Every chain is going to have a different rationale for it, but generally they want to have some identity,” Caldwell says. “They want to be something different to the consumer than just a place to go buy national-brand items. All of a sudden, the store is the brand. Branded products command premium prices.
“The private-label business is growing. The quality of private-label items is much, much higher than 15 years ago when generics meant low quality, low price. Now, private label means equal to or better than national brands. They’ve gone down the avenue where it was just price, and the road didn’t go too far.”
Hiring qualified, reliable people is also fundamental to growth. Shearer’s has many employees who have served from the beginning, but in the past two years, it doubled its work force due to expansion. The company now employs about 280 people.
“Everybody starts a business that way, hoping for success,” says Shearer. “A lot of luck is involved. You hope for success, and you’re happy when that happens.
“Our desire for going into business was to make a good product.”
How to reach: Shearer’s Foods Inc., (330) 478-2179
Bret Adams is a Canton-based writer.
Both office and manufacturing environments contribute to these costs, but implementing an ergonomics program can reduce the risk of worker injuries.
The initial step in developing an ergonomics program is to quantify the need for and extent of the program. Begin by reviewing the OSHA 300 log and workers' compensation claims for musculoskeletal injuries such as carpal tunnel syndrome, tendonitis, low back pain, shoulder strains and similar injuries.
Determine the percentage of incidents related to ergonomic factors and total the annual associated workers' compensation costs. These numbers help indicate the need for an ergonomics program and the opportunity to reduce workers' compensation costs.
After reviewing records, identify job tasks that have the following risk factors: awkward work positions such as extended reaching or overhead work; forceful exertions including lifting, pushing and pulling; and repetitive motions, contact stresses or use of vibrating equipment.
Obvious risk factors can be detected during a walkthrough, then do a job analysis of tasks that appear to have significant risk factors. There are checklists available to assist with scoring job features against risk factors. Prioritize jobs based on severity of exposure to risk and develop an action plan to minimize or eliminate them.
If the work environment presents a high risk for ergonomic problems or workers' compensation costs are considerable, an extensive program may be necessary. If the risk appears to be low to moderate, it may be appropriate to begin with a basic ergonomic program that initially includes only an employee education program and an employee suggestion program.
Employees should be educated on ergonomic risk factors, the physical symptoms that may be associated with poor ergonomics, the options available to minimize the risk factors and the elements of the employee suggestion program. Encourage employees to participate in identifying solutions and to report signs of physical discomfort early in an effort to identify ergonomics risks and prevent long-term injuries.
The employee suggestion program should include a formalized response procedure including timeframes for responding and a committee for reviewing outcomes. Once a suggestion is made or a symptom is reported, conduct a hazard assessment of the job task. This is similar to other safety assessments that are routinely completed, but focuses primarily on the ergonomic risk factors. Once the risk factors are identified, the means of reducing them should be prioritized.
According to the National Institute for Occupational Safety and Health, effective and successful ergonomic "fits" assure high productivity, avoid illness and injury risks and increase satisfaction among the work force. Although there is no OSHA standard, ergonomics should be a part of a proactive health and safety program
For more information, contact your safety consultant or insurance provider, or visit www.osha.gov/SLTC/ergonomics/index.html and www.ohiobwc.com/employer/programs/safety/ergnomiclinks.asp. How to reach: Dianne Grote Adams is president of Safex Inc. Reach her at (614) 890-0800 or email@example.com.
The average cost of an Ohio workers' compensation claim in 2001 was nearly $40,000, with almost 60 percent relating directly to medical expenses. As organizations try to manage costs, an occupational health screening program becomes critical for monitoring, providing feedback and establishing improvements in safety and health programs.
An effective prevention program requires an understanding of workplace exposures, anticipation of potential harm and evaluation of individual incidents and illness patterns. Experience is used to modify programs or implement new ones, and occupational health screening provides the tools to evaluate incidents.
Occupational health associates establish a frequency of medical evaluations to include baseline, periodic, following an emergency and/or prior to termination. they establish medical screening parameters to assist with identifying symptoms that may be early indications of chemical or physical exposures in the workplace.
The frequency of evaluations and medical tests provides data to examine for patterns and individual susceptibility. A relationship between low-level exposure and early health effects may be found using medical information and employee exposure data.
With proper diagnosis and communication, workplace changes may reduce or eliminate occupational illnesses.
Another component is the implementation of regulatory requirements established by OSHA for industries that use specific chemicals. Each standard is different, but many require baseline, emergency, periodic and termination medical surveillance programs along with employee education, industrial hygiene monitoring and control measures. Programs should be established in conjunction with the occupational health professional and the facility industrial hygienist.
Once the basics are in place, the medical surveillance program can be expanded to monitor personal health issues and provide counseling for healthier lifestyles in an effort to reduce absenteeism and increase productivity. For assistance evaluating your medical screening program, talk to an industrial hygiene and safety consultant or an occupational medicine clinic. Dianne Grote Adams is president of Emilcott/DGA Inc. Reach her at (614) 890-0800 or firstname.lastname@example.org.
Employees covered by the Family and Medical Leave Act dont have to be receiving medical treatment for severe morning sickness to have the condition covered under FMLA guidelines, according to a recent court decision.
The FMLA mandates that employees who need to take a leave from work because of a serious health condition, such as the birth or adoption of a child or to care for a child, spouse or parent who has a serious health condition, are entitled to 12 weeks of unpaid leave and reinstatement to their pre-leave, or an equivalent, position.
The FMLA regulations treat pregnancy-related conditions differently from other serious health conditions in a number of respects. For example, unlike employees suffering from other serious health conditions, employees who miss work because of severe morning sickness qualify for FMLA leave even though the employee doesnt receive treatment from a health care provider during the absenceas long as the absence doesnt last more than three days.
The U.S. District Court in Washington, D.C., recently recognized the validity of these regulations. In that case, an employee of Xerox Corp. who was pregnant and alleged that she was absent from work because of severe morning sickness, sued under the FMLA arguing that her employer terminated her for taking FMLA-qualifying leave.
In support of its motion to attempt to have the case dismissed, Xerox argued that the employee failed to offer any evidence that her morning sickness prevented her from performing her job. The court held that, absent an employers request for a medical certification, an employee suffering from severe morning sickness is not obligated to seek out medical treatment for her condition to be covered by the FMLA.
The Whistleblower Law prohibits retaliation against employees of a public body who make good-faith reports to their employers or appropriate authorities about instances of waste or wrongdoing. The term public body is defined expansively in the Whistleblower statute to include any entity which is funded in any amount by or through Commonwealth or political subdivision authority.
In the past, other courts had been giving a more narrow interpretation to the term, applying it only to recipients of government funds appropriated to aid a public body in pursuit of public goals. The court in the Riggio case, however, took a plain-language approach and interpreted the statute more broadly.
Although the defendant hospital was covered by the Whistleblower Law as a public body, it prevailed against the plaintiff employees claim because she failed to establish that she complained about a wrongdoing in violation of a statute, regulation or code of conduct or ethics.
While the Superior Court made it clear that an entity is covered by the Whistleblower Law if it receives any funding directly from the state, the Riggio decision leaves open the issue of whether the receipt by health care organizations or other businesses of monies in the form of grants, reimbursements or even tax breaks constitutes funding by or through the Commonwealth.
In any event, business owners should consult their attorneys before terminating employees who have complained about waste or wrongdoing within the company.
William E. Adams is an attorney with Eckert Seamans Cherin & Mellott, LLC, a national law firm based in Pittsburgh.
A TRTW program will contribute to the bottom line with maintained productivity, improvement of your incident rates and increased employee morale, with injured workers able to be productive while recovering from an injury.
Employees' chances of successfully returning to their original positions increase if they return quickly from an injury. Studies show that the longer the employee is off work, the more difficult it becomes to return. A quick return also boosts the self-esteem of the injured employee.
Retaining experienced employees helps minimize the costs associated with decreased productivity, hiring and training replacements, and overtime. It also decreases the disruption of having temporary workers or workers in unfamiliar job rotations. National statistics show these types of indirect costs are often four times more than the direct costs of the injury.
A solid return-to-work program uses real job duties combined with the employee's restrictions. The program should be viewed as transitional, with a definite end point. Avoid creating light duty jobs that injured employees may see as long term or permanent.
It may be appropriate to work with transitional work developers to implement a TRTW program. The need for outside help varies depending on your work environment and the types of injuries your employees is experiencing. The Ohio Bureau of Workers' Compensation's Transitional Work Grant program helps ease the cost of implementing a program and works with an approved list of transitional work developers.
The goal of a TRTW program is to get the employee back to full duty quickly and safely. Employees see a successful program as a benefit, and getting them back to work quickly reduces their stress as they continue to receive a full paycheck and transition back into a normal routine. Dianne Grote Adams is president of Emilcott/DGA. Reach her at (614) 890-0800, ext. 208, or email@example.com.
This broad complaint seems harmless and the tendency may be to put looking into it on the endless to-do list or to dismiss her as a whiner. But how the supervisor responds may affect management/labor relations, and not investigating may mean an employee suffers ill health as a result of being exposed to a chemical.
Employees are increasingly knowledgeable and concerned about what they are exposed to in the workplace. Employee health problems may be triggered by other workplace events -- concerns about downsizing, poor relationships with co-workers or supervisors, overtime, relocation, dissatisfaction with the job -- but they may be an early indication that ventilation is inadequate.
When employees express concern about exposures or indicate they're suffering from ill health, the supervisor should follow up promptly. An investigation should determine the frequency and duration of symptoms, recent changes in the work area, including new processes or chemicals, whether the onset of symptoms correlates with a change from heating to air conditioning, and when and how frequently the symptoms subside. The employee who complained and others in the area should be interviewed, with care taken not to lead them to conclusions.
Responding promptly and keeping employees informed of the progress of the investigation reassures them that management is interested in their well-being and provides an opportunity to resolve potential problems quickly. Employees often have a solution if the supervisor listens; those who become dissatisfied and don't feel management is taking their health concerns seriously may complain to the union or to OSHA.
If the interviews are inconclusive and complaints continue, the supervisor may consider outside assistance. The Ohio Bureau of Workers' Compensation --Division of Safety and Hygiene, Ohio Bureau of Employment Services -- Onsite Consultation Program or industrial hygiene consulting firms can evaluate air quality in the work area to determine if there are unacceptable concentrations of chemicals or if indoor air quality parameters indicate a potential ventilation problem.
This information is valuable in addressing employee concerns and may be useful in future workers' compensation claims.
A prompt response, keeping employees informed and reporting results maintain a positive working relationship and usually prevent outside agencies from becoming involved. Even if the investigation doesn't yield a measurable problem, the reassurance that the work place has been tested and it is not unsafe is often all the employee is looking for. Dianne Grote Adams is president of Emilcott/DGA Inc. She can be reached at 890-0800 or www.emilcott-dga.com.