If you want to manage risk within your firm, you need to familiarize yourself with risk-management language. Here are some basic definitions, provided by the National Alliance for Insurance Education & Research, which you can use to build your knowledge base:
- Exposure: A situation, practice or condition that might lead to a loss; an activity or resource (assets, people).
- Peril: A “cause” of loss; an event that might cause a loss.
- Hazard: A condition within an exposure that might lead to an incident; “a peril about to happen.”
- Incident: An event that disrupts normal activities and might become a loss or claim; “a near miss.” Lifecycle of an incident: Pre-incident, incident, immediate post-incident, post incident, rehabilitation (repair, recovery).
- Accident: An incident resulting in injury or damage to person or property which has, or will become, a loss or claim; “an unplanned event definite as to time and place that causes bodily injury or property damage.”
- Occurrence. An accident with the limitation of time removed.
- Loss: A reduction in value.
- Claim: A demand or obligation for payment as a result of a loss.
- Frequency: The number of times an incident occurs.
- Severity: The monetary impact of a loss.
- Expected losses: Loss projections (“loss pics”) based on probability distributions and statistics; frequently developed using actuarial techniques.
For a complimentary review of the risks your business faces, please feel free to contact us at any time.
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On this Veterans Day, let us remember the service of our veterans, and let us renew our national promise to fulfill our sacred obligations to our veterans and their families who have sacrificed so much so that we can live free.
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Businesses are transferring more and more client information files online for storage on hard drives in remote data centers or server farms that offer convenient Internet access. Buying space in this “cloud” (a $40 billion a year business, according to the IDC research firm) is becoming as common as paying for power, water and Internet service. With corporate spies after trade secrets, hackers out to steal sensitive financial information, and the federal government demanding online communications records, protecting data in the cloud creates a serious security risk for companies of all sizes.
“It’s easy to overlook security because of the virtual nature of the cloud,” warns Thomas Trappler, Director of Software Licensing at UCLA. “Your data is going over the Internet to another computer and not to some magical world where everything’s going to be fine.” Unfortunately, businesses often seem blissfully unaware of this threat: a recent nationwide study by the Ponemon Institute found that half the firms surveyed had not considered security risks when storing data with providers in the cloud.
A major question in these deals is determining who’s responsible for the risk of compromised data. Because companies often lack security expertise, they expect cloud providers to do the job. Some providers certify that they meet government or third-party standards for data confidentiality. However, few of them let clients test their digital security – which leaves their clients feeling that they might be liable.
To minimize this risk, Trappler advises businesses to:
- Evaluate the provider’s reputation.
- Insist on reviewing its encryption and security systems.
- Set guidelines for immediate notification of any breaches.
You can also protect yourself from the risks of storing data in the cloud by investing in Cyber Insurance. To learn more, just get in touch with us.
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In the April 2013 issue of Corporate Counsel an article entitled It’s a Systemic World Out Therediscusses the EEOC’s pursuing large “systemic” cases. For example, in fiscal year 2011 they conducted 580 systemic investigations, filed 84 systemic lawsuits, and settled 35 systemic cases for total $9.6 million. Although your company might not be large enough to be on the EEOC’s radar screen, I can tell you that attorneys are also suing small to midsized companies on a class basis. An employee walks into a lawyer’s office because they didn’t receive their final paycheck, and before you know it they’re filing a class-action lawsuit against your company for missed overtime and meal periods. The article provided a few golden nuggets of advice:
- When responding to an EEOC inquiry, don’t use the phrase “pursuant to our consistently applied policy.” This only invites a broader request for information.
- Do not submit more information than is necessary.
- Conduct your own statistical analysis before submitting data.
- Do preventative analysis looking for adverse impacts in the hiring, promotion, or termination practices.
- Validate pre-employment tests.
- Conduct preventative compensation analysis periodically.
- Cover all internal analysis with attorney-client privilege. This might be impossible in smaller organizations, but you can certainly retain outside counsel to instruct you on how to conduct such analysis and report back to them.
- Listen to your employees. As I have always recommended, you should survey your employees, including use of the Employee Compliance Survey that can be found in HR That Works.
- Invigorate that underutilized internal complaint system. Again, go one step further and ask if there’s a problem –don’t wait for them to tell you there is one.
- Stay current with legal trends. This is one reason why HR That Works membership is so valuable.
- Walk the talk. Are you sensitive to the potential for your practices to cause adverse impacts? Frankly in my experience I can tell you that some business owners could care less about whether a practice causes an adverse impact. All they care about is getting the best employees they can, damn the EEOC. Of course, few companies appreciate a risk until they’re hit with it.
Finally, the article points out how large corporations can gather the data requested by the EEOC easily because they have such large HRIS systems. However, most companies with less than 500 employees don’t have this data readily available, and t collecting it can be an over-burdensome process. This is one reason to make sure that you hire an attorney any time you receive a communication from the EEOC or another regulatory agency.
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The financial well-being of your employees affects their health, their productivity and your bottom line!
A recent nationwide survey by Purchasing Power, Inc. found that:
- A high percentage of employees suffer significant financial stress. More than one in four workers surveyed (28%) find it hard to meet monthly household expenses and nearly half (44%) have less than $2,000 in emergency savings.
- They bring these concerns to the job. More than four in ten (44%) worry about personal finances during work hours.
- This stress leaves them less engaged at work and reduces productivity. Nearly three in ten employees (29%) deal with personal finances during work hours and almost half of these (46%) average two to three hours a week on money issues.
Purchasing Power Chief Revenue Officer Elizabeth Halkos offers some recommendations to help your workers maintain their engagement and productivity at the office:
- Help them reduce debt by offering education, either in groups (through webinars or with a live speaker) or individually so that workers can learn about topics such as budgeting, intelligent use of credit and savings programs. A referral to a qualified credit counseling agency can provide a useful follow-up.
- Give them access to responsible budgeting tools. Offering non-traditional voluntary benefits, such as employee purchase programs ( which allow workers to acquire high-ticket items and educational services on a “forced saving” basis through payroll deduction) can help reduce their financial stress significantly.
- Encourage employees to participate in retirement programs such as a 401(k) plan. However, before workers do this, advise them to deal with debt and budgeting issues and tuck away a nest egg.
Our Benefits experts stand ready to help you ensure financial peace of mind for your workers. Just give us a call.
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With slips, trips and, falls remaining one of the top causes of workers compensation claims, safety experts stress the need for preventive measures and ergonomic workplace design.
Such accidents need particular attention in nonindustrial environments where employers often install terrazzo or marble floors that can be dangerous to walk on.
According to the U.S. Bureau of Labor Statistics, same- level slips, trips and falls (in which workers slip and fall on the surface where they’re standing) accounted for 134,580 lost workdays and 111 deaths in 2011. The number of same-level falls increased 42.3% from 1998 to 2010, the highest growth of any accident type during this period. These mishaps are costly, in 2010, Liberty Mutual a a leading workers comp insurance company, paid $8.61 billion in same-level fall comp claims.
Implementing safety measures such as, cleaning spilled liquids promptly and placing floor mats on smooth flooring will help prevent workplace injury. Reviewing injury records to find trends will help determine additional safety measures to implement in the workplace. Many businesses are replacing surfaces that contribute to these mishaps which is a highly cost effective investment that can curb expensive litigation and workers comp liabilities.
Although these precautions have prevented thousands of slip-and-fall accidents, the risk will remain a problem until employers work with design professionals to create ergonomically friendly safe buildings. The National Institute of Occupational Safety and Health (NIOSH) is sponsoring a “Prevention Through Design” initiative to address ways that architects and engineers can get involved in designing safer workplaces (for example, by training college engineering and architecture students about safety and ergonomic considerations).
Our workers comp specialists would be happy to check your business for slip and fall hazards and recommend steps to help keep your staff and visitors from slipping.
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