Worcester Business Journal

30 Worcester Business Journal | January 8, 2018 | wbjournal.com F or anyone owning a construc- tion company, workers' comp insurance is an inevitable neces- sity. But by learning how the system works, construction executives will be able to better manage and plan for unforeseen events. 1. Ensure accurate job classifications Code misclassifications can cause workers' comp premiums to skyrocket, so it is critical to be sure the correct codes are being used. As many as 70 percent of companies overpay on their workers' compensation insurance pre- miums, and the root cause is most often job code misclassifications. 2. Provide proper care for injuries Job injuries should be dealt with immediately. Develop a process to ensure injured employees receive the proper care. Processes are important, and they will vary depending on the type or injury. But it is equally impor- tant all employees know to immediately notify their employer or direct supervi- sor when an injury has occurred. This is a point at which it is critical to obtain the information for documentation while still remembering this is an injured employee who is in need of compassion. With continuing medical inflation, it is especially important to ensure the employee receives the most appropriate 10 T H I NG S I know about... Causing & preventing business litigation By AiVi Ngyen AiVi Nguyen is a partner at Worcester law firm Bowditch & Dewey. Reach her at anguyen@ bowditch.com. K N O W H O W Five ways construction firms can reduce workers' comp premiums R inging in 2018 means more than just resolving to go to the gym every morning or organizing your sock drawer. This time of year naturally lends itself to laying out the path for your company over the next 12 months. It's a perfect time to con- template the past year and go in new directions or build on solid founda- tions. However, the time of year you focus on goal setting isn't as important as the fact you do it. Set it in stone. "Increasing sales revenue" is not a goal, says Chuck Cohn at Forbes.com; it isn't remotely specific enough to accommodate a detailed strategy. A better goal would be "to increase Product X's revenue by 10 percent over the next six months." Cohn advises company leaders to then figure out what needs to happen. "Setting concrete goals, documenting them and reviewing them periodically can increase your chances of success by up to 95 percent," he writes. Set S.M.A.R.T. objectives. Once the aforementioned concrete goals are in place, they need to be broken down into short-term objectives. Peter Vanden Bos at Inc.com describes use of the S.M.A.R.T. acronym: specific, measurable, action-oriented, realistic and time-specific. "Put a figure or value, such as a dollar amount or per- centage, to the objective," to ensure the task is measurable, he writes, for example. For the goal's steps to be action-oriented, a company needs to lay out what tasks will be done by who, and when. Celebrate along the way. "Set mile- stones and stop to celebrate each small success along the way. This will help you build momentum," writes Alyssa Gregory at TheBalance.com – momentum which is needed to incen- tivize you and your team as you close in on your goals. 10 1: S e t t i n g g o a l s W W 10) Relying on a handshake. I cannot stress enough: Every single contractual term must be in writing. This includes provisions for all possible issues like responsibilities, termination, one of you drops dead, the building burns down. 9) Signing something without understanding it fully. Oftentimes, people are so excited about a deal they will sign documents without fully digesting the terms, agreeing to clauses much too burdensome. 8) Misrepresentation. Business lawsuits almost always include a claim for misrepresentation. To be liable, a party had to have made a material misstatement of fact. In other words, someone lied. 7) Lack of a business plan. Many lawsuits happen because a party simply did not cross all of its t's and dot all of its i's. Having a thorough business plan forces parties to think things through. 6) Ideological differences. Partners often are not on the same page about where they see the business in five, 10, 20 years. Have the discussion early. 5) Greed. This is the primary reason business relationships go south. Combat the temptation by making sure mechanisms oversee the money and punish a partner caught with their hand in the cookie jar. 4) Uneven contributions. Delegate important duties to each partner and hold each other accountable. 3) Failure to communicate. Warring business partners always accuse one another of making decisions without consulting the other. Establish a decision- making process to ensure each stakeholder is kept apprised. 2) Shoddy bookkeeping. Acting in good faith and with integrity is meaningless if you cannot prove it. Detailed recordkeeping prevents allegations of wrongdoing. 1) A lawyer was not involved. Every single litigation I have ever seen could have been prevented if there was competent legal oversight involved from the beginning. Call your lawyer. The attorneys' fees you think you are saving by cutting out the lawyer are a fraction of what it will cost you to get through a lawsuit. W BY ROSS AMATO Special to the Worcester Business Journal care for their particular injury. If emer- gency treatment is not necessary, a walk-in occupational health or urgent care clinic are a lower-cost alternative to the emergency room. Assessing an injury upfront can help streamline an employee's recovery, get them back to work faster, and cut down on claim related expenses. 3. Review information on injuries Speak to an insurance agent to make sure what has been paid on employee injuries is in line with what the insur- ance company is reporting to the rat- ing bureaus. While this disconnect can simply be a matter of human error, it is often a result of miscommunication. Communicating regularly with the insurance agent will ensure the most Ross Amato is a property & casualty consultant with Knight-Dik Insurance Agency, Inc. in Worcester. He can be reached at ramato@knightdik.com and by phone at 508-756-6353. current facts of the case are being addressed and mitigate any potential errors. 4. Analyze your experience modification factors Most insurance buyers assume their experience modification factors are correct, but this is likely not the case. If claims remain open and injury costs escalate, reserves rise and adversely affect the employer's experience modi- fication factor, thus increasing costs. 5. Build a strong back-to-work program Companies with comprehensive back-to-work programs can minimize or eliminate lost-time claims by bring- ing an injured worker back to work as soon as it is practical. It shows the employees they are valued and can still be productive in another capacity on the job. Fostering this feeling can help increase retention, thus reducing costs both on insurance and recruitment. As part of this program, identify activities injured workers can do within the organization to bring them back as they heal, and help the employees iden- tify additional skills they possess to ful- fill needs of the organization. A consultation with a trusted insur- ance advisor will help business owners assess their workers' comp insurance set-up. These simple steps will save time, money and have a real impact on gaining the support of the company's employees. BY SUSAN SHALHOUB Special to the Worcester Business Journal

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