OSHA to Issue Guidance on Acceptable Workplace Safety Incentive Programs

Fed-OSHA has promised that it will soon publish guidance on what type of employee incentive programs discourage workers from reporting workplace injuries and illness.
The announcement comes after the workplace safety agency has clamped down on the use of programs that include incentives that can reduce the chances of workers reporting injuries so that they can receive rewards instead.
OSHA has been warning about the use of such programs since March 2012, but has issued no guidance to help employers. At the same time, it has increasingly been citing employers for using programs it considers problematic.
The problem for employers is that OSHA has not published guidelines to help them craft programs that are palatable to the workplace safety agency, but that looks likely to change.
David Michaels, assistant secretary of Labor, said in June that OSHA will publish a compliance directive that describes which types of incentive programs the agency wants to encourage and which types it has evidence discourage workers from reporting injuries and illnesses.
He promised that the directive would be published before 2017.
In a March 2012 memo, OSHA projected its disdain for worker incentive programs that may discourage workers from reporting injuries, saying they violate federal health and safety and whistleblower laws.
The paper, known as the “Fairfax memo,” gave examples of what the then-deputy assistant secretary for Labor, Richard E. Fairfax, called “discriminatory policies,” as follows:
• Those that have the potential for unlawful discrimination because management or supervisor bonuses are linked to lower reported injury rates.
• Entering employees who have not been injured in the previous year in a drawing to a win a prize, or rewarding a team of employees if nobody on that team is injured during a certain time period.
• Those that disqualify an employee or an entire work group for receiving incentives if one of them is injured.
• Any other programs that may dissuade workers from reporting injuries.

Besides the under-reporting of injuries, OSHA says the fallout from not reporting injuries goes deeper.
Such programs conceal workplace hazards that can instead remain unabated and continue to threaten workers’ health and safety. If workers don’t report injuries, management or the in-house risk manager will not know to investigate the incident and nothing can be learned from it.

Meanwhile, acceptable incentive programs may:
• Reward workers who demonstrate safe work practices, and when they take proactive measures such as reporting close calls.
• Reward workers who take steps to abate hazards, and use their stop-work authority to prevent a workplace injury.

Programs already under scrutiny
OSHA has taken a tougher tack on incentive programs since 2015, when it updated its safety and health program management guidelines.
Lawyers say that employers are being cited more often for having incentive programs that OSHA considers as discouraging reporting. And although all of the cases have been settled before going to trial, barristers say that defending against the citations cost the employers both time and money.
Insurance companies and employers have criticized the agency for its new stance, saying that it made its decision on employee incentive programs despite the fact that they have shown to be effective in reducing workplace injuries and illnesses.
And even though OSHA has not implemented regulations for incentive programs, the warnings have prompted some employers to stop using them, workplace safety experts say.