Incentives: Small Investments Equal Big Rewards

Aug. 1, 2007
The risk of injury, death or expensive insurance claims should be enough to ensure workers and companies practice safe procedures in the workplace. But since it is not, other programs have been developed to make sure employees go home at night the same way they got to work that day.

Employers often turn to recognition or safety incentive programs to encourage and reward safe work behaviors. The idea is to give workers not just praise, but tangible rewards to encourage them to remain safe on the job.

This is idea is supported by Jerry Bach, vice president of Sacramento, Calif.-based Safety Center Inc. He says employees remember getting positive reinforcement more than they remember the negative, like getting into trouble and being disciplined.

“It is better to give incentives than to have to discipline employees,” Bach says. “Positive reinforcement takes you much further than discipline. Do not give just a pat on the back, but give a $20 gift card to a store. It is better than the $120,000 workers’ compensation claim you are likely to receive on behalf of an employee who was not following the safety rules.”

And that is the idea: A small investment in prizes and rewards for employees made by companies is much cheaper than an employee not following safety instructions, becoming injured and hitting the company with a large insurance claim or, worse yet, a lawsuit.

“Incentive programs are fun, do not cost much money to implement and are much better than the alternative,” Bach says. “They are also much better than threatening an employee constantly with negative consequences if he or she is not following the safety rules. Nobody likes to be nagged like that, whether or not they are doing the wrong thing. In fact, it will probably just make the problem worse.”

Program Rules

Stan Smith, a vice president with CA Short Co. in Benicia, Calif., a supplier of safety incentive programs, agrees with Bach. Smith adds there are some rules that should be followed when implementing an incentive program for safety.

“The program that will work best will have simple and well-defined rules,” Smith says. “It will be of an accrued nature, so workers can choose the gift on their own.”

He adds the longer it takes for employees to earn rewards, the more likely they are to lose interest. He suggests that programs offer rewards every 30 days or so.

In addition, Bach suggests changing the focus of the safety recognition or incentive program every so often. “It is good to have a lot of variety with the incentives,” he says.

Program Basics

When setting up a program in which employees accrue points over a period of time for various safety behaviors, Smith and Bach note that accruing points is much like going to the carnival when you were a kid and getting those tickets – are you going to cash in right away for an eraser or hold on and get a big stuffed animal?

“It means more if they can let [points] accrue and use [them] when they want,” Smith says. “There should be no limit on accrual. Some spend their points right away, some save them for a year, a year and a half, even 2 years.” He adds that most people start spending their points after about 6 months.

Prizes can be anything employees respond to, say Bach and Smith. Smith’s company, for example, offers a catalogue of merchandise with items ranging in value from $20 to more than $1,000 that can be purchased by the employer and offered to employees who wish to spend their accrued points.

Both Bach and Smith agree that giving employees cash is a bad idea. “Money is just really a terrible incentive,” Smith says. “Workers have nothing to show for the money. They probably paid a bill and will not remember where the money came from or how they got it. But if they buy merchandise with it, every time they use whatever it is that they got, they will know they worked safely for 1 month, 2 months or whatever amount of time it was.”

Bach mentions items such as T-shirts, barbecues and gift cards as potential safety incentive and recognition items. “Gift cards are not cash and are only good when being redeemed for some type of merchandise,” Bach says.

Program Structure

When putting together a safety incentive and recognition program, Bach suggests basing the program on the actions of individual workers – not on the collective group as a whole – and for good reason.
“One thing you have to be careful of is when the incentives are team-based,” Bach says. “There can be peer pressure from the group for an individual not to report something because then the incentive will be taken away from the entire group, which, obviously, is not a popular thing.”

But what happens if you have employees who may follow safety rules but want no part in the incentive program because they see it as immature or silly?

“Not everyone will participate,” acknowledges Bach. “Some people do not like it or just have an attitude about these things. You just have to hope they practice safety on their own.”

Cost vs. Cost Savings

While safety incentive and recognition programs cost money, they absolutely pay for themselves many times over in cheaper insurance premiums, fewer days lost on the job and minimal insurance claims, say Bach and Smith.

“Companies put the programs in to save money,” Smith says. “That is the reason. But awareness prevents accidents. This is to build awareness. You want your workers thinking safety.”
Bach warns that once you start an incentive or recognition program, you should be cautious about how or why you end it. “If you take it away, you run the risk of [employees] suffering from low morale,” Bach says.

Some employers cut the programs if they feel the results are not what they expected, or if the program costs start to escalate. Think hard before ending a safety incentive or recognition program, warns Bach. If employees support the program, they won’t be happy if it ends, especially if they feel the program’s “failure” was through no fault of their own, he points out.

Employers who recognize safe behaviors send the message that they are “trying to have a positive {work] culture,” says Bach. Such employers want safety to become part of the culture, to become a routine that employees follow, much like any other routine.

“[Reward and incentive programs] get people to do the right thing and lead to a better and safe work environment and culture,” says Bach.

Shel Segal is a freelance writer based in Buena Park, Calif.

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