AGENDA #3a
The Goal:
- Emphasize a safe work place to reduce preventable accidents
- Reduce Workers Compensation and accident costs as a part of
the Town’s budget
The Proposal:
- Develop and implement a safety program designed to reduce
preventable accidents through training, appropriate provision of and use of
protective equipment, defined work procedures, enhanced light duty
opportunities, and established safety expectations of supervisors.
- Effective July 1, 2009, return the Town’s current worker’s
compensation (accident leave) policy to conform to state statutes.
What have we already done?
- Declared safety violations a serious incident to be reported
immediately to the Town Manager for determination of how to address those
violations
- Employed an experienced Safety Officer in the Human Resource
Development Department to supervise a Town-wide safety program for all
employees and empowered that officer to order Town operations to cease if
safety violations are discovered
- Included safety performance of departments as a component of
senior manager performance evaluations
What needs to happen to implement this proposal?
- Continue to monitor and improve our employee safety program to reduce
preventable accidents. Establish standards by which we evaluate our safety
efforts
- Hold employees, supervisors and managers accountable for unsafe
actions
- Recommend that Council amend the Code of Ordinances to delete
Section 14-64, which provides for a “town-paid workers’ compensation salary
supplement.” If enacted, amend all related policies and procedures to reflect
the change
How are current employees affected by this change?
- The waiting period before receipt of workers’ compensation
benefits will be 7 days instead of 3 days. Employees will be able to use accrued
leave during this period to maintain their pay.
- Benefits payments will be 66.7% of regular salary with no state
and federal deductions up to the maximum payment of $816 per week, instead of
100% of regular pay with state and federal deductions as provided under the
current ordinance. The 66.7% is not subject to state or federal taxation
which, in most cases, significantly reduces the gap between the current benefit
and the statutory benefit. Employees will also have the option of using
accumulated leave to make up the difference between the statutory benefit and
their regular pay. In the examples below, the use of leave to make up the
difference is less than one day of leave per biweekly period
Annual Salary
|
Biweekly
Gross
|
State & Fed
Deductions
|
Current
Sal Cont Net
|
Statutory*
Sal Cont Net
|
Difference
from sick leave
|
$23,000
|
$884.62
|
$286.93
|
$652.41
|
$589.75
|
$62.66
|
$35,000
|
$1,346.15
|
$445.39
|
$955.48
|
$897.43
|
$58.05
|
$50,000
|
$1,923.08
|
$643.44
|
$1,334.36
|
$1,282.05
|
$52.31
|
The effect on the Budget:
- Changing the Town’s worker’s compensation benefits to conform to
statutory requirements will save an estimated $30,000 per year in direct costs.
Reduction in lost work days through an enhanced safety program that helps
prevent accidents and return employees to work sooner with a revised return to
work program and improved rehabilitation efforts will provide indirect benefits
that could far exceed the monetary value of the direct savings.
- Reduction of preventable accidents will also reduce the amount we
spend to repair damaged vehicles and equipment, making these finds available
for other uses.
- Workers’ compensation claims account for approximately two-thirds
of the insurance premiums paid each year by the Town (approximately. $1.1
million for FY09). According to a risk management audit conducted by McNeary
Consulting in FY2007, the Town pays between 60 and 100% more for worker’s
compensation coverage than comparable North Carolina towns. We can reduce this
premium with an aggressive safety program and change in workers compensations
benefits as proposed. Funds we do not use for premium payments can be used to
benefit employees.