Successful Safety
Incentive Programs

WORKPLACE SAFETY

By Bill Sims Jr.

Developing an effective safety incentive program is essential creating a strong safety culture. Whether the goal is to improve a poor safety record or to maintain an already stellar record, incentive programs are an excellent tool.

However, debate continues to rage over these programs, as some claim they fail to create any genuine improvements.

Of course, no incentive program is a substitute for effective safety manage- ment. In recent years, however, incentive programs have been characterized (often unfairly) as the "bad boys of safety," due to a longstanding debate of "attitude versus behavior." Many critics contend that incentive programs cause workers to hide injuries. In isolated cases, this is true. Incentives can be used properly or misused with disastrous results. Just as a scalpel can be used to save a patient's life, it can also be used improperly and cause harm. Incentive programs can be wielded the same way.

Unfortunately, many incentive pro- grams are ill-conceived, often with little thought given to rulemaking. In such situations, the incentive tool is not at fault. The true problem is the poor rule design that creates excessive peer pressure and results in hidden injuries and lawsuits. What are some common root causes of injury hiding?

• use of big-ticket prizes (new vehicle, $1,000 cash per person);
• reliance on group performance as the sole method of awarding a gift (while ignoring individual achievements).

Sucess Stories

Before an incentive program is undertaken, a company must have a solid safety program (e.g., safety committees, accident investigations, training) in place. Some companies mistakenly believe that a safety incentive is a magic bullet which allows them to ignore other needs. Nothing could be further from the truth. An effective safety incentive program does not hide bad safety management. However, such a program can transform sound safety management into spectacular safety management.

Heartland Foods, a Minnesota firm that processes turkeys, needed to improve. However, management wanted to be sure that the safety incentive program would, in no way, cause employees to hide injuries. "We had a large number of people on workers' compensation - employees out on a long-term basis," says Marie Huber, safety, health and training director. "In turkey processing, bacteria rapidly enters the wound of a minor cut - and creates a serious infection. So, if you don't report a small injury, it beco- mes a lost-time injury. We had to be very careful to avoid any "injury hiding", and worked to develop a set of rules that would achieve this. Now our numbers are way down."

In only 18 months, the facility's lost-time injuries dropped from 285 to 14. The incentive program used actually generated 200 reports of unsafe conditions and actions that have since been corrected. The rules structure helped Heartland create positive peer pressure, while pre-venting the temptation to hide injuries.

W.R. Grace, a specialty chemical manufacturer in Atlanta, was striving to sustain a record that was already impressive, says Vic Anapolle, plant manager. "We went 11 years without a lost-time accident - a million-and-a-quarter employee hours. Our recor-dables are typically one or two a year for a population of about 70 people."

Factors Critical to Success

Though successful programs differ widely, their underlying processes are the same. A successful safety incentive program raises safety awareness, reduces injuries (without tempting workers to hide them) and instills proactive behaviors that create a safe working culture.

Successful companies that use these programs must ask questions that lead to clear goals, long-term follow-through and meaningful incentives. These factors are even more crucial than the type of incentives used. Managers new to incentive programs are often sidetracked by program content -what types of incentives to offer. One company may offer a steak dinner to employees who surpass one quarter without lost-time injuries; another may offer cash; yet another may offer store gift certificates. What will work best for your company?

Although this is a compelling question, it is not the first question that should be asked. The key question is, "What behaviors will be rewarded?" Prizes and awards can be adjusted. The processes that ultimately drive successful incentive programs must be considered first.

Although the particulars of successful programs vary, their underlying dynamics are surprisingly consistent. The first question should be, "How do we set goals for our incentive program?"

To say that safety incentives should relate directly to safety goals is a truism. Yet, goals can be conceived in various ways and, thus, must be set carefully since how one words a goal may produce different results.

Raising safety performance is an obvious goal of incentive programs. Given that overall objective, employees can receive incentives based on various criteria: days without recordable accidents; months without lost-time injuries; decreases in workers' compen-sation (WC) claims. Any of these results can be achieved with a successful program, each producing a different impact on a company's bottom line.

Alternately, as part of a trend toward behavioral safety techniques, many firms reward safe behaviors. In such a program, a company rewards "upstream behaviors" that ultimately produce a good safety record. Examples of such behaviors include making safety suggestions, spotting close calls, achieving behavioral safety goals, attending safety meetings and assisting inspections.

Promoting safety awareness, gen- erating safety suggestions and recog- gnizing employees for safe behavior are top priorities of incentive programs. To achieve these objectives, the emphasis should be on the program's rules and how they motivate people rather than the actual awards. Certainly, the awards are the catalyst, but the key is how the pro-gram builds teamwork and motivation.

Raising safety awareness is a goal that fits most settings. An incentive program can work simply by forcing people to pay attention. For example, Bar-S Foods Co. in Arizona cut its WC costs in half between 1988 and 1993. The company's main objective was to carefully record lost-time accidents and watch the numbers closely during that time.

Heartland Foods employees use "close call" forms to report work-related situations that could lead to recordable accidents and injuries. With an incentive program in place, Huber says, "all of a sudden there is a reason to pay attention, because you're going to get something back for noticing."

Incentives - from Bananas to Boats

Once the "how" questions-the "rules of the game"-have been answered, actual incentives can be determined. Consider what the term "incentive" encompasses. It can mean any thing that people deem valuable.

Micheal LeBoeuf, a management consultant, lists 10 basic categories of employee incentives. Besides money, these are:

• recognition;
• time off;
• stock ownership;
• special assignments;
• career advancement;
• increased autonomy;
• training and education;
• parties and other fun activities;
• prizes.

Before agonizing over the value of awards offered, consider the advice of Bob Nelson, author of 1001 Ways to Reward Employees. He relates an incident that occurred at Hewlett-Packard Co. A team of workers had been plagued by a problem for weeks. An engineer finally solved the problem. Overcome with enthusiasm, he burst into the manager's office and blurted out the solution.

Thrilled by this idea, the manager offered the only reward he could find at that moment-a banana from his lunch. The incident started a trend; the Golden Banana Award is now a coveted employee prize. The award took on a personal meaning among workers because it implied recognition - a job well done.

DISPELLING POPULAR MYTHS ABOUT SAFETY INCENTIVES "We don't need to reward safe performance. We give people a paycheck and they deserve nothing more for working safely." If it is true that no one deserve a bonus in return for doing what is expected of them, then why do nearly all Fortune 500 CEOs receive year-end bonuses based on company performance? Why is it fair to reward these executives for good performance while ignoring the contributions made by thousands of hourly employees? "Rewards do not affect attitudes that underlie unsafe behavior, they merely cause an employee not to report injury". Actually, many incentive programs reward employees for reporting injuries. Employees are recognized for reporting and correcting unsafe acts and conditions before injuries can occur. Other programs reward proactive actions, such as attending safety meetings and passing safety inspections. "By instituting reward programs, management ignores the real cause of the problem. Rewards discourage changing the safety system" W.R. Grace documented some 1,800 ideas suggested by employees; more than 50 percent centered on improving the process to enhance safety. "Safety rewards are unnecessary. People are intrinsically motivated and should be willing to do a job safely for the money they receive." According to Dr. Kenneth Kovach (as re-ported in Nelson's 1001 Ways to Reward Employees), recognition for a job well done is the single-most-important factor in em-loyee job satisfaction. Those same emp- loyees said they were not recognized suf- ficiently by upper management 68 percent of the time. In another survey of employees who quite a job, respondents cited lack of recognition and praise as the top reason for leaving. Clearly, recognizing people for being safe fulfills a vital human need.

Safety incentive programs are one element of an overall program that emphasizes safety at every point, from hiring to training and daily supervision.

Nelson found that incentive programs work best when they tap into the reward that employees favor the most - immediate, on-the-spot recognition of a job well done. In other words, a pat on the back. Nelson quotes Mary Kay Ash, the founder of Mary Kay Cosmetics: "There are two things [that] people want more than sex and money . . . recognition and praise." Remember, a pat on the back costs nothing.

FACTORS TO CONSIDER WHEN CREATING THE INCENTIVE
How Can We Get the Most Bang for Our Incentives Buck?

Managers have often assumed that an extra $25, $50 or $100 added to an employee's paycheck, or a gift certificate, is the strongest incentive. Yet, that bonus added to an employee's check can quickly vanish, eaten up by taxes or mundane expenses. Moreover, employees may become dependent on the extra income and begin to view it as part of their salary, thereby nullifying the reward's true purpose - increased safety awareness. Structuring the incentive program properly can minimize the "tax bite."

Customize Incentives

Many successful programs rely on low-cost gifts with a high perceived value.Gifts that reinforce corporate identity can spark high interest as well.

Organizations should be wary of "canned" incentive programs. What works for one company might not work for another. Each culture is unique; such a program would need to be adapted to achieve a proper fit. Since cultures differ greatly, successful incentives will also differ. Key demographics such as age, rate of turnover, geographic location, and racial and ethnic diversity must be considered when selecting incentives. Nelson suggests distributing a "reinforcer survey to find out the type of rewards that employees actually want. Incentive programs thrive on employee input."

Remember the advice of W.R. Grace's Anapolle: No employee is going to get rich through the company's incentive program. Instead, the goals are to promote safety awareness, generate safety suggestions and recognize employees for safe behavior on a regular basis.

Fair Distribution of Incentives

For an incentive program to work well incentives must be distributed fairly. Avoid contests that reward only a few people or which reinforce the view that safety is a matter of chance or luck.

Present Incentives in a Timely Manner

Incentives are made meaningful when they are proportioned to specific behaviors or results. "An employee who completes a two-year project should be rewarded in a more-substantial way than one who simply does a favor for you," says Nelson. Rewards-whether a material item or verbal acknowledgment-should be given soon after the goal has been met. This boosts the incentive's impact.

Joan Klubnick, author of Rewarding and Recognizing Employees, notes that managers and supervisors often fail to give recognition for one simple reason: they do not know what to say. She offers these basic guidelines.

• Thank the employee by name.
• State specifically what the employee did to earn recognition.
• Explain how you felt about the employee's behavior.
• State how the behavior added value to the company.
• Thank the person again by name.

INCENTIVE PROGRAMS & UNION CULTURE

Some unions have stepped up efforts against incentive programs in recent years, citing the objection of injury-hiding. Yet, many unions continue to support these programs. To succeed, the union must be a partner in program design. Early union buy-in is key to selling the program, as are rules designed to eliminate injury hiding.

At UAW's urging, OSHA has examined incentive programs to assess the issue of injury hiding. After pouring over myriad programs. Marthe Kent, director of OSHA's Office of Regulatory Analysis, reported, "I see no dominant trend … the information is overwhelmingly anecdotal. Companies that have good safety incentive programs already have a strong safety and health program in place. A good safety and health pro-gram has employee involvement, hazard analysis and injury reporting" (as quoted in the Sept. 1998 issue of ISHN Magazine).

SUSTAINING INCENTIVE PROGRAMS

Willingness to experiment and learn by trial-and-error are indispensable in creating a successful incentive program. One way to reduce the learning curve is to find out what other companies are doing and consult recent literature.

Anapolle cites advantages to designing a cohesive program, then giving it time. "We took a lot of separate programs that were giving out premiums and various small cash awards. Then, we added up what we were doing and said, "Let's roll these all into one program and see how that works for the next few years."

Consistency and follow-through are key, according to Huber. "You can't start an incentive program, then walk away and expect it to run itself. You have to [conduct] safety meetings and give away incentives every month. Programs work when you implement employee suggestions and correct safety problems as they [occur]."

Both agree that the program should be changed periodically to keep it fresh. Even a minor change, such as a new gift item, may be enough to sustain employees' interest. Huber and Anapolle, as well as others who have succeeded with incentives, rep-ort that incentive programs are simply "icing on the cake"-one element of an overall program that emphasizes safety at every point-from hiring to training and daily supervision. --

REFERENCES

Klubnic, J.P. Rewarding and Recognizing Employees: Ideas for Individuals, Teams and Managers. Chicago: Irwin, 1995.
LeBoeuf, M. The Greatest Management Prin-ciple in the World, New York: Putnam's, 1985.
Nelson, B. 1001 Ways to Reward Employees. New York: Workman, 1994.

Bill Sims, Jr. is President of The Bill Sims Co. Inc., Chapin, SC. During his career, he has worked for Norfolk Southern Railway, Walt Disney World and Coca-Cola, helping them implement employee motivation and recognition programs in safety and quality improvement.