Truckers May Be in for Higher Policy Limits

Truckers would be required to purchase insurance with higher limits under a new proposal issued by the Federal Motor Carrier Safety Administration.

The FMCSA has submitted a report to Congress, stating that the current minimum coverage of $750,000 for general freight carriers is not enough to cover the costs of damage from some crashes. The reason that it’s no longer enough, the agency says, is due to increasing medical treatment costs for accident victims. The federal agency has yet to recommend the new minimum coverage it would like to see imposed on truckers throughout the country, but it was on track to make the proposal by July and the new coverage minimums could be published by around November.

We’ve recommended in the past that truckers purchase coverage above the minimum limits, so if you have higher coverage, it’s unlikely you’d have to change it.The current minimum financial responsibility levels for motor carriers of property have been in place since 1985. These levels are: $750,000 for the transportation of property, $5 million for transportation of certain hazardous materials, and $1 million for the transportation of other hazardous materials. These limits do not adequately cover catastrophic crashes mainly because of increased medical costs, the report says. During the last decade, medical costs have risen by an average of 10% a year, much higher than the rate of inflation.

According to the FMCSA, if the current minimum financial responsibility limit for general freight coverage ($750,000) had been adjusted for inflation, it would be $1.7 million today. And if adjusted for inflation in the medical price index, it would be $3.2 million.Interestingly, a study by the agency found that catastrophic motor-carrier crashes resulting in injury, death and/or damages that exceed the current limits are relatively rare – less than 1% of 330,000 crashes analysed. These rare catastrophic crashes can result in severe injuries that cost more than $1 million to treat, according to the report.

The analysis reveals that two categories of injury crash – severe and critical – each yield damages of more than $1 million.

Meanwhile, insurance premiums have declined in real terms since the 1980s. The analysis revealed that truck insurance rates have remained stable over the last three decades. Insurance rates for the same level of coverage (e.g., $750,000 or $1 million) have declined slightly on average in nominal terms, hovering around $5,000 per power unit (truck or bus). The real values – inflation adjusted – of insurance rates have also declined.

The FMCSA regulates all registered commercial motor vehicles that operate interstate or carry hazardous materials – or close to 540,000 motor carriers – and their 5.6 million drivers.Trucking firms’ insurance premiums have remained stable or declined since the 1980s at about $5,000 per bus or truck, according to the report.

The FMCSA backs up its findings by pointing to other studies that also have found that the $750,000 minimum limit may be too low:

• A study by the Pacific Institute for Research and Evaluation found that the upper range of liability awards in large-truck crashes involving death or catastrophic injury is about $10 million (in 2012 dollars) and recommended a limit per crash of at least that amount, indexed for inflation.
• The Trucking Alliance reviewed crash settlement data from 8,692 accidents compiled from its membership. It found that in 42% of the accidents, the monetary exposure from these settlements would have exceeded their insurance coverage, if all companies in the study had maintained the minimum $750,000 insurance requirement.

That said, the American Trucking Association (ATA) conducted its own study and concluded that the $750,000 limit should stay in place. The association analyzed ISO data from two large-truck insurers and found only 6.5% of trucks weighing more than 26,0000 pounds have limits under $1 million, while 83% are at $1 million and the remaining 10.5% are written over $1 million.

The ATA study also found that there is only a 1.4% chance of a claim exceeding $500,000, a 0.73% chance of a claim exceeding $1 million, and a 0.31% chance of a claim going over $2 million.

For now though, you can be fairly certain that sometime this year new minimum limits will be set. We will keep you informed in this newsletter.

Ten Tips for a Safe Summer Road Trip

Summer’s almost upon us and when many Americans take a vacation, they will hit the road.

Road trips are part of the American lifestyle, but when it’s time to travel by car, you should be prepared, especially now that it’s easier to drive further as your kids are distracted in the back watching movies or playing on their iPads. And since you’ll all be spending long stretches in the car, you’ll want to make sure that you’ve taken all of the necessary safety precautions.

The National Highway Traffic and Safety Administration (NHTSA) offers the following tips to make your next family road trip safe and enjoyable, and with minimal risk.

Service your vehicle
Before hitting the road for a long stretch, you need to make sure that your car is in good working order and has had its latest regular service and tune-up. Take your car to the shop and have them check your tires, battery, belts, fluids and air conditioner. Also, if you live in a hot climate, consider motor oil with a higher viscosity.

Get a good night’s sleep before you leave
Driving while drowsy can reduce your reaction time and judgment as if you were impaired by alcohol. Drive only when well rested, and if another licensed driver is in the car, it’s a good idea to switch every few hours.

Check the child seats
Make sure that your children’s car seats or booster seats are installed properly. The NHTSA estimates that 80% of car seats are not installed correctly, which puts your kids’ lives at risk should you have an accident.

Call 866-SEAT-CHECK to find a nearby location for a free safety seat inspection.

Emergency preparedness
The NHTSA recommends packing an emergency kit that includes:
• Water
• Warm blankets
• A flashlight
• Jumper cables
• Flares
• Tools to change a tire
• A fully charged cellphone
• A first aid kit

You may also want to consider buying a roadside assistance plan that will cover the costs of a tow and assistance if your vehicle brakes down.

Secure the back seat
Activate safety locks in the back seat doors and windows. Check to make sure that you don’t have any stray items that can injured your kids in the back or, if you have young ‘uns, make sure you don’t have any choking hazards. Also remove any items the kids can pick up and throw or that can go flying should have to suddenly put on the brakes.

Pack heavy items low
Store heavy items low in the seat wells so they won’t become projectiles during a sudden stop. And if you have an SUV with an open cargo area in the back, make sure that you strap or batten down heavy items like suitcases or strollers.

Keep your back straight
To reduce the chances of becoming sore from sitting in the driving position for extended periods of time, try to make a conscious effort to sit up straight and not slouch. Slouching can also make you drowsy, which can endanger your entire family as well as other motorists. Bend your legs so you can exert strong pressure on the brake pedal, and bend your elbows slightly so that you can use all of your strength to turn the wheel if necessary.

Take frequent breaks
Try to avoid driving more than two hours straight without a break. Also drink lots of fluids, which will force you to make bathroom stops and stretch your legs.

No Mr. Magoo driving
Make sure that you are looking far enough down the road to survey what’s ahead and so that you can see any oncoming dangers.

In dense traffic, you need to look at least 10 cars ahead, the NHTSA recommends. In faster-flowing traffic, reduce that length to five.

Don’t touch the phone
If you’re on vacation, no phone calls should be so important that you have to pick them up right away – and certainly not when you are behind the wheel. It’s been proven that even talking using a hands-free device is distracting. Talking on the phone and driving at the same time is like talking on the phone and watching TV. You won’t be as focused on the task at hand and may not see a danger that could imperil you and your family.

Will OSHA Conduct an Inspection after an Employee Complaint?

OSHA will make inspections of a workplace for a variety of reasons, including following a worker injury and always after a worker’s death.

Inspections may also occur randomly or part of a program aimed at a particular industry that OSHA has decided to target.

The other way an inspection may occur – and the main focus of this article – is if an employee contacts the agency to complain about possible safety violations.

These complaints may or may not result in an inspection of your workplace based on certain conditions, including the timing of the complaint. Under OSHA regulations, a worker can only report an alleged violation.

After OSHA receives a complaint it will decide whether it is worthy of an on-site inspection.

The agency has a set of criteria, at least one of which must be met in order for it to conduct an on-site investigation or an investigation that includes sending the employer a questionnaire to determine if it is complying with its safety regulations.

A current employee or employee representative must submit a written, signed complaint:

  • That includes enough details to help OSHA assess whether the employer is violating its safety regulations or if there is an imminent danger of physical harm to employees.
  • That alleges the worker was injured or made ill by a hazard that is still present in the workplace.
  • That claims an imminent danger to workers exists in the workplace.
  • About a company in an industry that is part of an OSHA local or national emphasis program, or a high-hazard industry that is the focus of such a program.
  • Against an employer that has been cited in the past three years by OSHA for egregious, willful or failure-to-abate citations.
  • Against a facility that is scheduled for or already part of an OSHA inspection.


If any of these conditions are not met, OSHA will typically make a complaint inquiry by phone or e-mail.


How a complaint inquiry works

If, for example, one of your employees contacts OSHA to complain that you are not using proper lock out/tag out procedures when cleaning certain machinery, the agency would likely contact your company.

It would tell you about the alleged hazard and ask that you assist in determining whether a hazard or violation exists.

During that first point of contact, the agency would ask that:

  • You promptly investigate to see whether the violation does indeed exist and that if it does, you abate the hazard to ensure employee safety and regulatory compliance.
  • After investigating, you document your findings and detail what kind of corrective action you took or are undertaking.
  • You post a copy of the complaint letter from OSHA in a conspicuous area so that all of your employees can see it.


OSHA usually requires that you respond with the results of your internal investigation and provide the report of findings and action taken within five days of being contacted by the agency.

If you don’t respond to the initial contact, do not provide a report within five days or if OSHA deems your response inadequate, it may then decide to inspect your facility.

OSHA will also provide a copy of your response to the complaining employee. If the employee thinks you have not made the corrections or have not been honest with OSHA, they can ask the agency to conduct an on-site inspection.


Right Mix of Benefits Crucial to Hiring, Retaining Millennials

As the millennial generation continues filtering into the workforce amid a tightening job market, nearly one-third of them have turned down a job offer because of poor insurance offerings, a new study has found.

Making sure that you have the right mix of benefits, including voluntary benefits, is important considering that other studies have found that millennials are already hard to keep on the payroll. This has been underscored by studies that found that one in four millennials were considering looking for new work in the next year. In addition, they are more cautious than boomers or Gen Xers in choosing their financial portfolios and more focused on planning for their long-term future. Millennials even value health insurance almost as much as older adults do – despite the fact that they’re much less likely to use it.

Having seen the hardships the recession had on their families and/or their friends’ families, they are more likely to watch their wallets and are more inclined to start saving for retirement at an earlier age. Also, many of them are saddled with levels of student loan debt that are much higher than previous generations. These factors all add up to a generational shift towards more financial security through improved benefits.

Here are some of the most telling findings of the study by Anthem Inc.:

  • 27% of 18- to 34-year-olds said they’d rejected a job because of poor benefits, or a lack of them.
  • 29% of 18- to 34-year-olds had engaged in long-term financial planning over the past year. That’s compared with 19% of 35- to 54-year-olds. Besides 401(k) plans, that means millennial workers are also more apt to take up disability insurance which protects their income if they are unable to work because of injury or illness.
  • Of survey respondents who did not have disability insurance, 53% said they didn’t have it because their employer did not offer it. Another 32% said they didn’t have disability insurance because it was too expensive.

Earlier study had similar findings

Towers Watson’s “Global Benefits Attitudes Survey” found that 59% of millennials were willing to sacrifice higher pay for a guaranteed retirement benefit, while 32% said they were also willing to pay a higher amount for a lower or more predictable health cost.

When asked how they would spend money if their employer provided them with an allowance to spend on a variety of benefits, millennials said they would allocate more than half to health care and retirement plan benefits (27% each).

The takeaway

As an employer in a tight job market, you will need to ensure that you have a good mix of health, retirement and voluntary benefits that can give your employees peace of mind that they can meet their obligations even if they get sick.

Millennials, because of their financial situation, are concerned over how to make ends meet, but they also recognize they have long-term financial risks as well, and many agree with having their employer play an active role in encouraging them to better manage their finances. This puts you, the employer, in a unique position to help them shape their benefits package for the long run, with a plan towards the future. That means offering a solid health insurance benefits package, a 401(k) plan so they can start early saving for retirement, and voluntary benefits like critical-care coverage or disability insurance that can protect their finances in case of a catastrophic event.



Drug Use Skyrockets among American Workers

Drug use is rapidly increasing among American workers, as more states liberalize marijuana laws, cocaine makes a resurgence and more people abuse amphetamines and heroin. A new study by Quest Diagnostics Inc., a workplace drug-testing lab, found that the number of workers testing positive for illicit drugs is higher than at any time in the last 12 years.

That puts employers in a tricky predicament, particularly if employees are using at work, which could reduce productivity and also make them more susceptible to workplace injuries since they may not be as focused as they should be on their work. In 2016, 4.2% of the 8.9 million urine drug tests that Quest conducted for employers turned up positive, compared to 4% in 2015 and 3.5% in 2011. The rate was the highest since 2004, when 4.5% of tests showed evidence of potentially illicit drug use.

While there were marked increases in positive tests for most illicit drugs, the surprising excption was prescription opioids like hydrocodone and oxycodone, thanks to stricter enforcement in many jurisdictions around the country. Marijuana is the most commonly used drug among U.S. workers and was identified in 2.5% of all urine tests for the general workforce in 2016, up from 2.4% a year earlier. In oral fluid testing, which detects recent drug use, marijuana positivity increased nearly 75%, from 5.1% in 2013 to 8.9% in 2016. The highest increases for marijuana usage among workers seemed to be in states that have recently legalized the recreational use of marijuana. The number of workers testing positive in Colorado rose 11%, while in Washington there was a 9% increase. The rates of increase were more than double the increase nationwide in 2016.

Changes in test-positives by drug:

  • Amphetamine: Up 8%
  • Marijuana: Up 4.2%
  • Heroin: Zero (after 146% increase in four years prior)
  • Oxycodone: Down 4%
  • Cocaine: Up 12%

Implications for businesses

About 12% of workers who die on the job test positive for drugs or alcohol in their system at the time of the incident. And incidentally, one OSHA study found that the most dangerous occupations, like construction and mining, also have the highest drug use rates among workers.

Employers suffer from hiring substance abusers in many ways. Not only do they run the risk of having deadly or dangerous accidents occur, but substance abusers also cost employers money in other ways, including poor productivity and decision-making.

Substance abusers may:

  • Have poor work performance.
  • Frequently call in sick or arrive late.
  • Frequently change workplaces.
  • Struggle with productivity.
  • Injure themselves or others at work.


The takeaway

If you’re concerned, you can initiate an effective workplace drug program that includes drug testing before hiring and during employment – and the consequences for violating the rules. You should have in place rules for working while under the influence and the ramifications for doing so.

You may also want to consider an employee assistance program for employees who feel they may have a problem, as well as for those who feel they’re developing a problem. A quality assistance program will offer services such as counseling to deal with substance abuse problems. You can also want to consider holding meetings about health and safety and drug use. Provide education about what addiction looks like and why people begin to abuse drugs/alcohol. Education can help employees understand how to support those that are struggling, as well as remove negative stereotypes often associated with addiction. Provide health benefits that offer a more “comprehensive coverage” for addiction. This includes addiction assessment (screening), treatment, aftercare and counseling.


Insurance Investigators Mine Social Media to Ferret out Fraud

Insurers are increasingly using social media to track down workers who are perpetrating workers’ comp and other liability fraud by faking injuries or staying on the dole after they have healed. Investigators are increasingly making use of Facebook, Instagram, LinkedIn and other online social media sites to nab claimants who are fraudulently trying to collect payments. But while social media can be a goldmine of information on claimants, investigators have to act ethically and should do so quickly, experts say.

If an injured worker posts pics of themselves being active on Facebook, it gives investigators quick, actionable evidence for their probes. But that’s only if the images are shared publicly and not just with their friends. Workers claiming disability payments gift investigators evidence when they post photos of themselves being fit and active on Facebook, for example, but only if the images are shared publicly, experts say.

While insurers are doing their part, employers are also getting in on the action. According to a report in the trade publication Business Insurance, one large grocery chain conducts social media research for auto and general liability claims and other employers research the social media profiles of all injured workers who have workers’ comp lost-time claims. Many firms have started using social media investigation software that can quickly help them find an individual’s address, phone number and their relatives or associates by indexing sites such as Facebook, Twitter, Instagram and YouTube.

And while many people share their personal information and posts with friends, some post everything publicly. But, by researching the profiles of a claimant’s family and friends, investigators usually can find pictures and other information that has been publicly shared about the claimant on other people’s pages. While this takes some time, they can usually find recent pictures or videos of anyone using this method, investigators say.

Investigators are also using something called “geofencing.” The practice involves using GPS or radio frequency identification to search for public social media posts that were uploaded within a certain distance of an incident, like a car accident. Sometimes they are able to locate photos of videos taken by bystanders who have publicly shared posts. And since most posts on Facebook, for example, use GPS to show location, this can be extremely useful to investigators. Often, they can even find potential witnesses to an incident.

Use with caution

While social media can provide valuable information to prove insurance fraud or abuse, the key is to use this technique ethically. For example, investigators should not dupe someone into accepting them as a “friend” so they can then start rooting through their social media posts. At the same time, investigators should not try the same tactic with the individual’s friends or family members to gain insight.

That said, if you are looking to control workers’ comp and litigation claim costs, you should add social media investigation into your tool kit if you suspect fraud. Experts advise employers to index information on claimants’ social media profiles as soon as possible after a claim is filed – and before they can edit their profile.  Also, be aware that many applicant attorneys are warning their injured worker clients to not post on Facebook during their claims.

Thomas Domer of the Domer Law firm in Wisconsin writes: “Use of a Facebook page poses real dangers for injured workers pursuing workers’ compensation benefits. “Since Facebook is a public site, anything posted can be used by respondent insurance companies in claims denial. Even the most benign postings (birthday parties, family gatherings, etc.) can pose problems. For example, a grandparent lifting a 30 pound grandchild when doctors have imposed a 10 pound lifting limit could damage a claim.”

Social media busts
Here are two examples of social media investigations bearing fruit in regard to uncovering workers’ comp claims fraud.

The wayward nurse

A nurse in Ohio had filed for workers’ compensation after injuring herself on the job as an in-home care provider. But her employer smelled something fishy and did some research on her LinkedIn page, which showed she was performing the same kind of duties at three other employers as those that had caused her injury. So, while she was collecting workers’ comp benefits from one employer, she was still actively employed with others. After pleading guilty, she was ordered to pay back the $12,938 that had been paid to her in indemnity benefits – and was also sentenced to a year in jail.

‘Disabled’ worker back on the job

A worker who was collecting workers’ comp benefits from an injury sustained on the job in Ohio was found to be working as a rescue technician for a company in Arizona, thanks to the pictures he had posted of himself on Facebook doing rapelling work. He pleaded guilty to fraud.

Legislation Would Let Employees Trade O.T. for Vacation Time

A newly proposed bill would change the Fair Labor Standards Act’s overtime mandate to allow workers to trade overtime pay for compensatory time off.

Introduced by Martha Roby, a Republican from Alabama, the Working Families Flexibility Act of 2017 would:

  • Cap the amount of paid time off that workers can accrue each year at 160 hours.
  • Require employers to pay out annually any unused comp time.
  • Give employers 30 days to pay out any unused comp time beyond 80 hours.
  • Require employers to pay out any unused comp time accrued upon termination for any reason.


Under current FLSA rules, employers must pay nonexempt workers overtime at a rate of 1.5 times their wage for every hour worked beyond in a 40-hour week.

The bill, if passed, would allow nonexempt workers to earn compensatory time off at a rate of no less than 1.5 times every hour for which they would have otherwise earned overtime pay.

This bill is a novel approach that gives both employers and employees an option of more time off every year, which in turn can help staff better achieve a work-life balance that the standard arrangement of two weeks’ vacation every year may not provide.

Some workers may prefer more time off over additional funds and would be happy to take a longer vacation instead of more money.

The legislation would allow employees to choose which option they would prefer, and the employer must honor their choice.

By virtue of the fact that the legislation was floated by a Republican and that the Trump administration has expressed an interest in laws that would give employees time off, such as after the birth of a baby, there is a chance the bill can advance in the House.


Getting Buy-in from Managers on Workplace Safety Programs

One of the keys to instituting a good safety program is to get management and supervisor buy-in.

You need their support and belief in the system if you are to convince your employees to embrace your safety regimen. If your managers don’t believe in the safety plans you have put together, it will show through when they try to sell them to your staff.

If you don’t have buy-in from your managers, the chances are slim to none that your employees will embrace the changes you are proposing. Managers play a crucial role in getting employees on board with safety.

If you are serious about preventing injuries and want to keep your workers’ comp X-Mod low, the role of your management team is crucial.

You will often encounter a few different personality types among your managers and they need to be convinced of the importance of workplace safety in different ways.

  • The excuse-makers: They are the ones that blame external factors that are out of their control for safety lapses, and they may pooh-pooh the harm that a high X-Mod has. They may talk the talk on safety, but they don’t walk the walk.
  • Half-hearted bosses: These managers may actually buy into the safety program, but they are unable to show their commitment in ways that make an impression on the rank and file.
  • Committed: These managers are fully committed and enthusiastically embrace your safety plans and discuss them with staff with exuberance.

You’ll need a different approach with each personality type to get them to embrace the concept. Once they do, they can effectively convey the urgency and importance of workplace safety to the rank and file.

Constructor Magazine recently had these recommendations for getting management buy-in:

Select the right leaders – Choose managers who are firm, yet fair with a passion for the safety of the workforce. They should have a track record of success so that they can be an inspiration to their teams. Also, they should not be afraid to get their hands dirty to make a point or demonstrate how something is done.

Talk about risk management holistically – Every facet of your operation needs to be addressed if you want a comprehensive global risk management culture to exist.

Executives can influence this by extending discussions of risk management beyond the worksite to help managers see the bigger picture of why safety matters.

Assessing the risk associated with every task, purchase order, estimate or piece of equipment used will reinforce the notion that risk management is a company-wide function and not only in the sphere that the manager is responsible for.

Make periodic site visits – Top leadership should make a point to get on the floor and visit various departments to watch the workflow and reinforce the importance of safety to the workers. They should make these visits with the manager who has been put in charge of safety for that department.

At the same time, they should not arrive and start nitpicking and being enforcers of safety policy. Instead, their role should be to start conversations with the workers about safety challenges and asking for advice and ideas to make the operation safer.

They can use these visits to also celebrate successes and challenge the team to do better and always look for issues that could lead to injuries.

Employee Texting Blows Holes in Your Company Communications Policy

If you are not aware, your employees are most likely communicating with each other and clients using texting or instant messaging.

While the immediacy of texting and instant messaging is great for business as it allows faster communications, better collaboration and more responsiveness, the downside is that your organization likely can’t track and retrieve those communications.

It becomes even harder if the communications are via instant messaging apps like Whatsapp! and Facebook’s Messenger.

As an employer, it’s important that you understand the issue and that you have clear rules for communications among employees in order to protect your company’s interests.

You’ll need a policy in place when something goes wrong and you need to track the thread of communications to see what was said or promised by whom, and when. These details can be crucial to resolving problems with clients, or if you are ever sued and your communications are subpoenaed for discovery.

Plaintiff-side lawyers in employment cases are already started demanding the production of text messages and e-mails during discovery. And if litigation ensues on an issue, you may have a duty to preserve text messages.



There are a few issues that you need to consider, especially in light of the fact that many companies are allowing staff to use their own devices for company communications, including giving them access to the business’s e-mail system on their phone.

If your employees are exchanging texts and instant messages on company phones, the history of communications would be preserved and you would be able to access the content by asking for the phone.

But, if your employees are sending and receiving work texts and instant messages on their personal devices, the issue gets murkier, particularly if you don’t have a bring-your-own-device (BYOD) policy. Accessing messages about company business on an employee’s smartphone may raise privacy issues.

The problem especially arises in the case of wrongdoing by an employee. If they are using their phones for communications that could provide insight into their behavior, they can erase those messages before you ask to see them.

In other words, you cannot rifle through their phone without first obtaining it, meaning you can’t look at it without them knowing as you could if you looked at their e-mail on your company server.

There are also privacy issues that arise if you are trying to access an employee’s personal phone to view texts and messages.

The big issue is: how do you capture those communications? After all, it will not be done over your network, unlike your company’s e-mail system that preserves all communications which are available to you. The messages reside on the phone instead.


What you should do

Obviously texting and instant messaging are a potential minefield for employers who want to be able to access all company communications among employees and between your staff and clients, vendors or partner organizations.

To ensure you have a handle on it, you should set rules outlining what method of communication employees may use for business purposes.

If you don’t want texting or instant messaging of any kind for company business, that needs to be spelled out – including ramifications for breaking the rule.

If you decide to allow texting and instant messaging, your policy should be clear on what kind of communications are okay.

You will need to amend your policy related to employee communications and record retention to make sure texts and instant messages are included.

If you have a BYOD policy, at a minimum it should include allowing you to take custody of the employee’s phone for legitimate purposes like a dispute with a client, or discovery for litigation.

As you can see, it’s important that you initiate a policy on employee communications that takes into account texting and messaging.

If you haven’t done so, you should do it now as this faster method of communication is becoming the new normal, particular as Generation Y continues filtering into the workforce.