Determinants of Firm Workplace Health and Safety and Claims Management Practices

Abstract

The authors examine workplace health and safety practices and workers' compensation claim management at some 450 Quebec firms in 1995. An analysis controlling for factors such as firm size and risk of injury finds that experiencerated employers—those whose workers' compensation insurance premiums were tied to their own injury rates—were more likely than non-experience-rated employers to implement measures to prevent workplace injury and disease. They also were more likely to engage in aggressive claims management, that is, practices for reducing compensation costs by means other than disease and injury prevention, such as hastening the injured worker's rehabilitation and challenging claims. These dual efforts appear to have resulted in a reduction in injury claims. There is also evidence of a systematic relationship between wages and compensation cost reduction strategy, with high-wage firms more likely than low-wage firms to emphasize improvement of health and safety over claims management.