Safety Incentive Programs

Posted: Jan. 7, 2020 • By Kevin Kohler

Safety Incentive Programs

We get a safety award every so often, I’m not sure why.

Safety incentive programs are a traditional component of health and safety programs.  They can be effective in helping to promote a culture of working safely however, as with any component of our safety systems, over time they can become stale or disconnected from their original intentions.  How many employees who receive a group safety award or incentive can explain how or why it was earned?

Can poorly designed safety award programs harm our safety system?

An Insurance Journal article (May 10, 2012) on incentive programs discusses an explosion at a U.S. refinery that killed 15 people and injured 180:

A safety incentive program at the refinery rewarded workers with bonuses for achieving low rates of injuries and illnesses. A 2007 study after the explosion found that workers feared reprisals for reporting potentially risky conditions at the refinery.

That accident also prompted members of Congress to ask the federal Government Accountability Office (GAO) to look into safety programs. In 2009, (the) GAO issued a report that found that safety incentive programs “can provide disincentives for workers to report injuries and illnesses to their employers.”

Incentive programs that are solely linked to rate based  “lagging indicators” of safety performance, such as lost time incidents or recordable injuries, may encourage under-reporting of incidents.  The pressure that employees feel to underreport may not necessarily be “overt”, such as by having their peers pressure them. Employees may simply not want to disappoint others. Overt pressure can be present, especially when financial incentives, such as cash bonuses, are at stake.

What do others have to say about incentive programs?

Objective data is lacking to determine the merits of incentive programs according to the GAO study.  Based on their survey of industry experts the GAO did caution against “rate based” (lagging indicator) programs.  One obvious finding was that if injuries are minor and the safety rewards are substantial, there is an incentive to underreport.

So should we do away with safety incentive programs?

An emphatic no, however they must be designed to reward the behaviours that we want to encourage, and the award should be based on objectives that are likely to promote and improve health and safety.

OSHA had this to say about incentives and rate based safety award programs in a 2018 Clarification Memorandum:

A statement that employees are encouraged to report and will not face retaliation for reporting may not, by itself, be adequate to ensure that employees actually feel free to report, particularly when the consequence for reporting will be a lost opportunity to receive a substantial reward.

OSHA recommends that rate based or lagging indicator incentive programs be counterbalanced with programs that reinforce reporting, employee rights and non-retaliation policies. 

Safety incentive programs should not be solely focused on rewards for past performance.  These lagging indicators may not promote future health and safety improvements or provide any information about the current state of the health and safety system.

Celebrate past achievements and reward current behaviour

Achieving our benchmark goals of having zero losses over target time periods is worth celebrating and companies should not let important milestones go unrecognized.  These rate based targets should also be supplemented with leading indicator based objectives that reward current safety performance such as:

  • Targets for reporting of near misses and hazards
  • Training provided for new safety initiatives 
  • Safety improvement projects initiated or suggested
  • New or young employees successfully mentored

We can celebrate our safety rate achievements while at the same time rewarding the behaviour and results that will improve our health and safety systems going forward.


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