Pub. 14 2015-2016 Issue 1

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S I S S U E N O . 2 , 2 0 1 5 24 new jersey auto retailer BY SCOTT HUBBARD EFFECTS OF INJURIES ON INSURANCE COSTS AND REVISED OSHA INJURY REPORTING REQUIREMENTS Similar to other industries that commonly work with power equipment and hand tools, injuries can occur as part of the automotive repair business. Mechanics use equipment that has the potential to fail during operation, which can subsequently cause injury to the operator(s) and other nearby workers. There are also risks involved when working on automotive parts, as mechanics use their hands to remove, repair or replace various components of the automobile. In addition to the risks associated with us- ing tools and equipment on vehicles, there is also a potential for injury during routine tasks, such as retrieving stock or walking across an uneven floor (trip hazard) or where fluids (e.g., oil) have been spilled (sliphazard). There are also hazards associated with the composition of various products (chemical hazards) used during automotive repair services, including degreasers, gasoline, an- tifreeze, paint, and paint thinners. The most recent published data from the United States Department of Labor (USDOL) indicate an- nual incidence rates of nonfatal occupational injuries and illnesses for newcar dealers of 3.8 per 100 full-timeworkers. Having a properly implemented safety program is not only re- quiredby theOccupational SafetyandHealth Administration (OSHA), but is an important aspect in reducing workplace injuries. The are many reasons for trying to prevent personal injuries to workers, other than the obvious principle of taking care of the people working at your dealership. Additional “losses” to your dealership and bottom line can include: decrease inoverall productivity; losing an employee who has been trained in a specialized skill within the company; potential fines by regulatory agencies; and legal implications. A less-obvious loss to the dealership and your bottom-line, and one whichmay not be realized immediately after an accident, can likely involve your insurance rating and associatednegative adjustments to policy premiums and coverage. As such, this article focuses on two issues directly related to this impact at your dealership: 1 How workplace injuries affect workers’ compensation insurance; and, 2 Recent changes in the OSHA injury recordkeeping requirements, which took effect January 1, 2015, and directly affect automobile dealerships. EFFECTS OF WORKPLACE INJURIES ON WORKERS’ COMPENSATION INSURANCE Insurance companies use an experience modification rate (EMR) to adjust workers’ compensation insurance premiums for a business. The EMR is based on a company’s injury rates and indicates whether insurance premiums will be higher or lower than the average for the automotive repair industry (Industry Class 8380). Once the insurer has calculated the base premiums, it then applies the EMR to adjust the final premium cost. To calculate the EMR, the insurer uses a formula that takes into account many factors, a primary one of which is workplace injuries for the three years prior to the previous year (i.e., a policy for 2016 would incorporate the injuries from 2012 – 2014) compared to other companies in the automotive repair industry. This formula takes into account both the number of injury claims as well as their severity. The industry

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