Protecting Your Workers in the Rain

Employees working in the rain face specific hazards, such as poor visibility and wet, slippery surfaces.

When it’s wet and windy, potential hazards at a worksite can be exacerbated. Working in the rain can cause slippery surfaces and limited visibility. It’s also riskier to use heavy equipment in the rain, particularly when moving heavy loads, putting workers on the ground – and even the public – in danger.

However, steps can be taken to mitigate such hazards.

It’s imperative that you as an employer ensure your employees’ safety, especially during this heavy year for rain. When working in the rain, train your employees to:

• Move cautiously – While workers may be tempted to move fast in the rain to avoid getting wet, this can be dangerous, especially on slippery surfaces. If anything, they should work more slowly and deliberately in all of their tasks.

• Use the correct equipment – If workers must use electrical tools or equipment, they need to check that they are specifically rated for outdoors. Also, the tools should have textured, no-slip grips and handles.

• Don proper footwear – Workers should wear footwear with heavy treads that can reduce the chances of slipping.

• Remember rain gear – Proper rain gear includes rain pants and a raincoat. The best clothing is ventilated to help your workers stay comfortable. If it’s cold and rainy, they should also wear wool or synthetic materials that can stay warm even when wet.

• Wear non-slip gloves – Workers should wear gloves that provide a sticky grip even when wet. Gloves should be snug and long enough for a jacket sleeve to prevent water from entering.

• Keep vision clear – Workers who wear glasses (if they must wear goggles for certain jobs) should apply anti-fog spray to them. It’s also advisable to wear a hat to keep rain from their eyes. They shouldn’t use headgear that narrows their field of vision.

• Work in proper lighting – When working at night, workers should make sure lighting is adequate and the lights used are rated for outdoor use.

• Ensure visibility – When it’s raining, visibility decreases and it’s easy for motorists and machine operators to have trouble seeing properly. Workers should wear high-visibility clothing, especially in areas with vehicle traffic and heavy machinery. Don’t wear rain gear or vests that have become dull or are no longer reflective.

Cold stress

When it rains, it’s often cold, too – and wet clothing can exacerbate the cold.

Employees working outdoors for prolonged periods of time when it’s cold must be protected from cold stress. Cold stress can cause frostbite, hypothermia and trench foot.

OSHA advises that cold stress is not limited to freezing temperatures, but can occur in outdoor temperatures in the 50-degree Fahrenheit range when rain and wind are present.

OSHA requires addressing this hazard by using protective clothing, in particular the use of layers with an outer material that protects against wind and rain. Although OSHA generally requires employers to pay for their workers’ protective equipment, employers are not required to pay for ordinary clothing such as raincoats.

Heavy-work dangers

Rain makes operating cranes, derricks and hoists more dangerous as well, particularly when moving large and heavy objects. Heavy rain combined with wind speed can make loads difficult to control.

Also, if a rainstorm is accompanied by lightning, equipment such as a crane can become a lightning rod.

If you feel you cannot adequately protect your workers during a storm, you should not conduct operations in the rain.

DOL Issues New Joint Employer Rules to Ease Burden on Businesses

The Department of Labor has proposed a sweeping new rule that will make it much easier for employers to be compliant with laws governing the use of independent contractors, staffing agencies and temp workers.

Joint employment liability has become increasingly murky in light of the gig economy and more employers using staffing agencies and outside contractors to perform key functions. This has spawned thousands of lawsuits, usually with the employers accused of misclassifying individuals as outside contractors when they should be classified as employees.

The stakes have been high since the employers have to pay workers’ comp, benefits and other expenses for bona fide employees.

Now the DOL has issued a proposed four-prong test for employers to help them determine if someone is actually an employee and hence whether they are liable for wage and hour violations.

A joint employer is someone who shares responsibility for a worker, usually in the case of a company that uses workers from a staffing or temp agency or a contractor on their worksites.

The DOL’s proposal includes a “four-factor balancing test” to help businesses determine if they are a joint employer:

1. They must have the authority to hire or fire the employee in question.

2. The company supervises and controls the employee’s work schedule or conditions of employment.

3. The company determines the employee’s rate and method of payment; and

4. The company maintains the worker’s employment records.

Besides the above, the DOL may also use other factors to determine joint employer status, such as:

• The company exercises significant control over the terms and conditions of the employee’s work; or

• Otherwise acts directly or indirectly in the interest of the employer in relation to the employee.

How it affects employers

This proposed rule would go a long way towards setting the record straight as more employers use independent contractors and staffing agencies.

The change, if finalized, would also be significant, as it would limit a potential joint employer’s exposure for wage and hour liabilities of the primary employer.

The new rules aim to simplify a six-factor test that was introduced by the Obama administration and has been blamed for muddying the waters further for employers. Those rules were rescinded after President Trump took office.

The Obama guidance would have allowed a company like McDonald’s to be held liable for minimum-wage violations committed by a franchisee even if it did not directly supervise workers or hire and fire them.

The DOL said it aims to simplify the test: “Only actions taken with respect to the employee’s terms and conditions of employment, rather than the theoretical ability to do so under a contract, are relevant to joint employer status under the [Fair Labor Standards] Act.”

Don’t Overlook Equipment Breakdown Insurance

Imagine it’s a typical July day. You own a 30,000-square-foot office building that is 85% occupied. And the air conditioning and ventilation systems stop working. The outside temperature is in the 90’s and the humidity is high. It doesn’t take long before the tenants start to complain.

The contractor you summon determines that an electrical arc fried the circuit board that controls the systems.

The board must be replaced, but it will take up to five business days for it to arrive. In the meantime, the building is unfit for people to work in, and the leases oblige you to credit tenants’ rents for periods when the building in uninhabitable for more than a day. In short, you face thousands of dollars in repairs and much more in lost rents.

While your property insurance policy will cover the resulting property damage from fires or explosions, it will not cover the equipment or lost income from the downtime during repairs.

But equipment breakdown insurance will.

Equipment breakdown insurance

This form of insurance is not a substitute for other property coverage. It will not pay for damage caused by fire, lightning, explosions from sources other than pressure vessels, floods, earthquakes, vandalism, and other causes of loss covered elsewhere.

Equipment breakdown policies are designed to fill in the gaps left by other policies, not to replace them. Also, they do not cover mechanical breakdowns that result from normal wear and tear as a device ages.

A number of events can trigger a claim for equipment, such as:

• Mechanical breakdown in equipment that generates, transmits or uses energy, including telephone and computer systems.

• Electrical surges that damage appliances, devices or wiring.

• Boiler explosions, ruptures or bursts.

• Events inside steam boilers and pipes or hot water heaters and similar equipment that damages them.

Business owners often overlook equipment breakdown coverage. Bur, virtually all of them have some need for this insurance.

What equipment breakdown insurance covers:

• The cost of repairing or replacing the equipment.

• Lost business income from a covered event.

• Extra expenses you incur due to a covered event.

• Limited coverage for losses like food spoilage in freezers that break down.

Most businesses rely heavily on machines in their daily operations, from computers to refrigeration equipment and elevators to manufacturing equipment.

For some, the cost of repairs to this equipment and resulting downtime can have a serious impact. Such businesses should seriously consider buying equipment breakdown insurance.
Call us if you would like to discuss this crucial form of coverage.

Workers’ Comp Audit Mistakes: What to Look For

No company owner wants to undergo a workers’ compensation audit, but they are a fact of life if you run a business and have employees.

Unfortunately, many audits don’t go smoothly and sometimes your insurer may make mistakes. Missouri-based Workers’ Compensation Consultants, which helps employers through the workers’ comp audit process, recently listed the 10 most common audit mistakes that insurance companies make.

The list highlights a common problem and how you can detect the mistakes to avoid being stuck with a massive audit bill. Insurance companies allow you to review the audit with your broker. If you notice that you have received an audit bill that is obviously overstated, you should contact us.

Here are the things to look for when reviewing an audit by your insurance company:

Wrong class code – Misapplication of job classifications occurs in many workers’ comp audits. With hundreds of job classes to choose from, mistakes can happen. Talk to us and review your old policies to see if any of your class codes have changed.

X-Mod is changed – After your insurer finishes the audit, it will use the information to calculate your premium. When that happens, it has to include your X-Mod to get the right rate. But sometimes the insurer may use an incorrect X-Mod. Check carefully.

Subcontractors are counted – Sometimes insurers will include subcontractors as employees, which results in a new audit bill to account for the additional “employees.” But if they are genuine subcontractors, they should not be counted. Often, uninsured contractors will be included as employees. Make sure to use insured contractors only.

Disappearing credits – Most policies will have some sort of premium credits or other modifiers. Sometimes during audits, the insurer will remove them when recalculating the premium they think you owe. Watch out for missing credits and other modifiers if you get an audit bill, like:

• Premium discount

• Schedule credits

• Deductible credits

• State-specific credits

Audit worksheets missing – If the auditor fails to provide you with audit worksheets, which are used do compile your payroll and other audit information, you should ask to check their work. They will provide you with the information you need to carry out such a check.

Your rates changed – The rates you are charged at the beginning of your policy period must remain the same for the entire policy period. If your base rates have changed, the insurer may have made a mistake. 

Separation of payroll – Depending on your industry, you may or may not be able to split your employees’ payroll between job classifications (like cabinet installers and sheetrock hangers). This is a pinch point when errors can occur. If the auditor says you are not allowed to split job classifications even though you have in the past, your audit may be in error.

Unexpected large premium due – If you get a significant bill for your insurance company after your audit, the auditor may have made mistakes, particularly if you know that your employment has remained relatively stable and you’ve had no significant claims, if any. If it seems out of whack, call us.

Payroll data doesn’t match – If there is a discrepancy between your payroll data and what you see on the audit, a mistake may have been made. Try to match the payroll on the audit with that generated from your accountant. If the insurer made a mistake, you could end up paying for phantom payroll numbers.

No physical audit – There are three types of audits:

• Mail audit

• Phone audit, and

• Physical audit

The mail and phone audits are prone to errors, since neither you nor your staff likely have any experience in premium auditing. If you have a big bill after a mail or phone audit, mistakes could have been made.

Commercial Auto Rates Face New Headwinds

More accidents attributed to smartphone use while driving, coupled with much higher costs of repairs, have led to double-digit increases in commercial auto insurance rates over the past few years.

Distracted driving is just one of many factors that have converged on commercial auto insurance claims, resulting in sustained premium increases. Now there are new factors that are coming into play that will ensure that rates continue climbing, at least in the near term.

Commercial auto rates are increasing for companies with large fleets as well as for businesses with just a few vehicles and drivers. Here’s what’s at play and what you need to be aware of in the future.

Continuing factors

Distracted driving – This is the biggie. Starting a few years after the advent of smartphones in 2009, the steady decline in vehicle accidents and claims costs started to reverse when vehicular deaths started increasing for the first time in decades. The culprit, say many transportation safety experts, is distracted driving.

Repair costs – The cost of repairing vehicles has skyrocketed as cars have become more technologically advanced. A 2018 research paper by AAA found that vehicles equipped with advanced driver-assistance systems (ADAS) can cost twice as much to repair following a collision, due to expensive sensors and calibration requirements.

AAA cited the cost of repairing a car with windshield damage if it has an ADAS. The system uses cameras that are installed behind the windshield. These cameras need to be recalibrated after a windshield is replaced. This has increased the cost replacing such windshields to about $1,500, compared to $500 for a standard windshield.

Medical costs – Health insurance premiums and medical costs have been rising at a steady clip. Those increases carry over into the costs auto insurance companies incur when drivers and passengers are injured in an accident.

More miles driven – According to AAA, Americans are spending more time on the road. Driving more miles increases motorists’ likelihood of having an accident. 

New and future risks

Weather-related property claims – A recent report in the insurance publication National Underwriter noted that commercial auto insurers say that the increasing frequency of large hurricanes, floods, hailstorms and wildfires are leading to higher auto physical damage claims. The number of property claims has been steadily increasing in the past decade as both the frequency and severity of major weather events grow.

Lack of experienced drivers< – As the economy expands, it’s become more difficult to find experienced drivers. Many experienced commercial drivers are retiring, and there are not enough job candidates with the skills and expertise needed to drive commercial vehicles.
The American Trucking Associations estimates that the industry is understaffed by more than 50,000 drivers, and this could increase more than threefold within eight years if current trends continue.

Security with onboard systems – As more vehicle functions become automated, new risks could surface from system failures that may result in accidents. There are number of technologies that come into play in new vehicles and a highly automated vehicle will rely on array of devices, including radar, light detection and ranging, cameras, graphics-processing units and central processing units.

As Cyber Attacks Rise, Is Your Business Protected?

Cyber attacks on companies’ information systems and data have reached unprecedented proportions, and are growing with each passing year.

The biggest threat to an organization is if there’s been a breach of personally identifiable data or credit card information that it stores. That results in a number of costs, including notification costs, providing those whose data was compromised with credit monitoring, potential fines, legal costs if sued – and even reputational costs. If data is stolen, there are also restoration costs.

The threat is largest for smaller organizations. Because larger companies can afford to hire teams of technicians to thwart attacks, cyber criminals are increasingly targeting small and mid-sized organizations as they may not have the same resources to defend their data. The “2019 Internet Security Threat Report” by Symantec found that:

• 48% of cyber attacks target small business.

• Just 14% of small businesses rate their ability to mitigate cyber risks, vulnerabilities and attacks as highly effective.

• 60% of small companies go out of business within six months of a cyber attack.

Ransomware

According to the Symantec report, in 2018, enterprises accounted for 81% of all ransomware infections. While overall ransomware infections were down, enterprise infections were up by 12% from the 2017 level.

With ransomware, hackers gain access to your IT system, lock it down and demand a ransom to release it. The ransom usually has to be paid in bitcoin or other cryptocurrency so that the criminals can avoid detection.

Phishing and malware

One of the most common ways for criminals to compromise an organization’s data is through phishing, a process through which employees are sent e-mails with links, which if they are clicked, gives the hackers entry into the company’s computer systems. Malware is usually the code that is inserted into the computer system to either slow systems down or to access the information.

What you can do

• Install anti-malware software – This can weed out the latest malware before it does damage.

• Keep your software up to date – Using up-to-date versions of operating systems, applications, firmware and browser plug-ins helps protect against the latest threats by patching security vulnerabilities.

• Use strong passwords – Use a password manager tool to generate unique passwords and securely store your log-ins.

• Lock down your devices – If your staff uses company-owned devices, or you allow them to use their own, require that the devices are locked with a password, fingerprint or other method.

• Think twice before downloading – Remind staff to be cautious about downloading new software or browser plug-ins.

• Click carefully – Teach your staff to look for telltale signs of phishing e-mails that prompt them to click on malicious links.

The ultimate protection

Cyber-liability insurance covers losses that result from data breaches and other cyber events.

While cyber-liability policies vary among insurers, there are some common threads:

Loss or damage to data – Many policies cover the costs to restore or recover lost, stolen or corrupted data, and may also cover the cost of outside experts or consultants you hire to preserve or reconstruct your data.

Loss of income or extra expenses – Many policies cover income you lose and extra expenses you incur to avoid or minimize a shutdown of your business after your computer system fails due a covered peril. The perils covered may be the same as those covered under damage to electronic data.

Cyber-extortion losses – Cyber-extortion coverage applies when a hacker or a cyber thief breaks into your computer system and demands a ransom to unlock it, or to not damage the data. Extortion coverage typically applies to expenses you incur (with the insurer’s consent) to respond to an extortion demand, as well as the money you pay the extortionist.

Notification costs – Policies may cover the cost of notifying parties affected by the data breach by government statutes or regulations. They may also include the cost of hiring an attorney to assess your firm’s obligations under applicable laws and regulations.

Network security liability – This covers lawsuits that individuals or companies file against your organization alleging negligence on your part for failing to adequately protect data belonging to customers, clients, employees or other parties.

As Health Deductibles Rise, Employees More Likely to File Workers’ Comp Claims: Study

Sometimes, injured employees are afraid to file a workers’ comp claim after being injured at work because they fear the specter of retaliation by their employer.

Experts suspect that up to 10% of workplace injuries are never reported because the workers choose to have the injuries covered by their employer-sponsored health plans. Most employers may not be aware of the full extent of their workplace injuries because of this phenomenon.

But, that could change as workers are saddled with higher deductibles and out-of-pocket expenses, according to a new study.

A number of past studies have found that if the costs to workers for having their personal health insurance cover a workplace injury is less than the “cost” to them of filing a workers’ comp claim, they will opt to have their health insurance cover it instead.

Here’s what studies have found over the years:

• A 1996 study found that workers without health insurance have an incentive to claim their medical issues are work-related even if they are not, so that workers’ compensation insurance will pay for care. The study also found that if the injury occurs at work, health insurance may deter workers from filing for workers’ comp if they feel there is a cost to filing a claim.

• A 2007 study found that a genuine workers’ comp claim can be “costly” to file for a worker if:

  • The employer dissuades workers from filing workers’ comp claims because they fear the claims will increase their premiums.

  • The injured worker does not want to deal with the paperwork for a workers’ comp claim.

  • The individual feels there is a stigma associated with filing for workers’ comp.

• A 2003 study of Michigan workers and their physicians found that 70% of injured workers did not file for workers’ comp, and that 36% of the non-reporting injured workers cited having health insurance as a reason they did not.

What could be ahead

The most recent study, by the Workers’ Compensation Research Institute (WCRI), found that injured employees are more likely to file workers’ compensation claims when they have high-deductible group health plans.

The study found that workers with a remaining group health insurance deductible that exceeds $550 are more likely to file workers’ comp claims than if the deductible were less. As more workers find themselves staring at higher health insurance deductibles, they will properly report their workers’ comp claims to their employers.

“In years past, workers may have chosen to have a work injury covered within their group health plan,” John Ruser, WCRI president and CEO, said in a statement. “But the increasing cost of deductibles may cause them to consider having the injury covered ─ where it potentially belongs ─ in the workers’ compensation system, where there are no deductibles or copayments for the medical care they receive.”

This is likely to add about 5% more claims into the system, the WCRI found.

What you can do

There are risks to both your employee and your organization if a worker does not report their workplace injury.

Urge your workers to report any workplace injuries so that you can have them properly treated. If a worker decides to not report the claim and they have their health insurance pay for it, problems can take root and cause major issues for you later:

• Your insurer loses the chance to direct the initial treatment to an occupational health clinic that specializes in treating workers’ compensation injuries and coordinates with the employer’s return-to-work program.

• A delay in seeking treatment may cause a deterioration in the employee’s condition that will impede their recovery time.

• It impedes the insurance company’s ability to investigate a claim, determine compensability and identify claims fraud.

A New Approach to Preventing Workplace Injuries

While overall workplace injuries have been falling in the last decade, the numbers of deadly and catastrophic injuries are actually on the rise.

A new report recommends that employers focus their injury prevention efforts on reviewing accidents that could have resulted in serious injury or death, as well as on near misses, where a potentially serious accident was narrowly avoided.

The “Serious Injury and Fatality Prevention: Perspectives and Practices” report, by the Campbell Institute, recommends that employers focus on their internal processes that could lead to serious injuries and fatalities, rather than on human error itself.

They should focus on identifying and fixing holes in their safety management system, examine their workplace culture, and change or modify work processes so as to eliminate the chances of human error affecting safety.

The report recommends that organizations don’t put the blame on the injured worker, but instead take a look at internal factors that contributed to an accident. To identify events or near events that could have led to serious injury or death, the prevention model in the report recommends focusing on and studying:

• Precursors to accidents

• Near misses

• All recordable injuries

By identifying potential precursors to such events and educating employees about those precursors, companies can focus on eliminating the potential for accidents to occur in the first place.

One key component of this method is to identify which smaller accidents or near misses had the most potential to inflict serious injury or death.

Recommendations

Establish a system for reporting near misses. Consider:

• Addressing issues such as workers being afraid of the consequences of reporting a near miss. Try to instill trust among your workers that they won’t be punished for a near miss, and that reporting them can help prevent future serious injuries.

• Define what constitutes a near miss.

• Include near-miss training during new employee orientations.

• Get buy-in from management and supervisors to foster a culture of reporting near misses.

• Make reporting simple and straightforward.

• Make sure that your investigation includes a precise log of what led up to the near miss, as well as the root cause.

• Take corrective action after conducting the investigation.

When rolling out the plan, hold a safety meeting explaining to employees why the company is focusing on the smaller incidents and near misses, and how a minor incident can turn major. Explain the importance of looking at potential rather than actual outcomes for minor incidents.

Try to be innovative in how you tackle workplace safety. For example, an article in Risk and Insurance magazine looked at a number of large employers that have worked with the criminology departments of nearby colleges to analyze injuries and near misses, in order to help identify what they could have done to prevent them.
The magazine’s report found that employers that used this method saw significant reductions in the number of workplace injuries they experienced.

OSHA Not Letting Up on Inspections, Penalties

Despite expectations, Fed-OSHA under the Trump administration has not backed off on enforcing workplace safety regulations.

In fact, the agency is as aggressive as ever and citations are higher than ever as well, after fines were increased substantially three years ago. Based on the agency’s own statistics, a company that’s inspected has only a 25% chance of not receiving a single citation.

In other words, employers should not let up on their safety regimens to not only avoid being cited but also to avoid workplace injuries, which nobody wants.

Here’s what’s going on with OSHA.

Enforcement emphasis still going strong – There are more than 150 local and regional enforcement emphasis programs as well as nine national programs in effect that were implemented at the end of the Obama administration. OSHA is dutifully enforcing them all.

Budget bucks the trend – Despite the budget-cutting at many federal agencies, OSHA saw a $5 million increase in its fiscal year 2019 budget from the year prior. Most notably, that was the first budget increase since 2014. In addition, state-run OSHA programs also received a small budget enhancement of $2 million.

Fines increasing – There has been no attempt to reverse the maximum fines for workplace safety violations. They were increased substantially in 2016, thanks to new regulations that require that the fines be increased every year after to keep up with inflation.

At the start of 2015, the maximum fines were:
• Serious or other-than-serious posting requirements: $7,000
• Failure to abate beyond initial violation date: $7,000 per day the condition continues
• Willful or repeat violations: $70,000

For 2019, the following fines apply (and they increased about 2.5% across the board):
• Serious or other-than-serious posting requirements: Up to $13,260
• Failure to abate beyond initial violation date: Up to $13,260 per day
• Willful or repeat violations: Minimum of $9,472, up to $132,598

Inspections stable – The number of inspections has stayed the same as years prior.

Focus on repeat violators – A continued focus on repeat violations has continued, with 5.1% of all violations in this category. The percentage has been over 5% since FY2016.

General duty clause – There has been continued expansion of the general duty clause to cite employers for heat stress, ergonomics, workplace violence, and chemical exposures below the permissible exposure limit.

New emphasis

And 2018 also saw a new effort by OSHA to fine-tune its work. It issue a memo in May that formalized the use of drones (with the employer’s consent) to collect evidence. This has been somewhat controversial because it could enhance its ability to find other violations it might not normally find.

According to the Fiscal Year 2019 Congressional Budget Justification for the Occupational Safety and Health Administration, increased enforcement seems to be more likely than a decrease. It also seems, although there have been no officially released statements, that the new electronic injury and illness reporting information will be used by OSHA and state plans to increase enforcement.

The increased budget, according to the Congressional Budget Justification, will support additional compliance safety and health officers to provide a greater enforcement presence and provide enhanced technical assistance to employers who need help in understanding how to achieve compliance with OSHA standards.

Protect Outdoor Workers Against the Elements of Winter

​If you have outdoor workers or staff that will have to venture out into the elements during an especially cold winter, you need to make sure you are taking the correct precautions to keep them safe.

If the conditions are extremely harsh, your workers are at heightened danger of injury, or worse. But even if you have employees who are outside for short periods, they can also suffer injuries if they are not prepared.

The many dangers of winter

Winter can bring with a number of dangers to your outdoor workers:

• Cold or frigid temperatures

• High winds

• Damp air

• Slippery surfaces

• Contact with water

• Frostbite

• Hypothermia

• Risk of strains, slips and falls

• Dehydration

• Decreased performance

OSHA has the following recommendations for protecting your workers:

Check the forecast – A supervisor should check the forecast for the next day before the end of the shift the day prior, to alert workers about any precautions they should take.

Appropriate clothing – Workers should have proper clothing suited for working in cold-weather conditions. Clothing from thermal underwear to gloves and jackets are the first line of defense against cold weather. Consider these tips for your employees:

• Wear three layers of clothing. Start with insulating underwear – which traps perspiration – a middle layer that protects the body from precipitation, and an outer layer that allows ventilation and prevents overheating.

• Cotton is not always a good choice. Wool, silk and some synthetic fabrics are better at keeping skin dry even when it’s raining or the worker is sweating.

• Wear loose clothing. Tight clothing can trap moisture and lower body temperature.

• Protect your extremities. That means head, hands and feet. Wear a warm cap or hat, insulating gloves and two pairs of socks and insulated shoes.

• Carry an extra set of clothing in case something happens and a worker has to change.

Train workers – They should be trained on how to prevent and recognize cold-stress illnesses and injuries, and how to apply first aid treatment. Workers should be trained on the appropriate engineering controls, personal protective equipment and work practices to reduce the risk of cold stress.

Workers should be aware of their body signals – Teach your employees about the symptoms of frostbite, hypothermia and dehydration and report any symptoms they are experiencing to supervisors, who should know how to summon help and protect the worker.

The symptoms of hypothermia are:

Mild symptoms:

• The worker may begin to shiver and stomp their feet in order to generate heat.

Moderate to severe symptoms:

• As the body temperature continues to fall, symptoms will worsen and shivering will stop.

• The worker may lose coordination and fumble with items in the hand, and become confused and disoriented.

• They may be unable to walk or stand.

• Dilated pupils.

• Slowing pulse and breathing.

• Loss of consciousness can occur.

The symptoms of frostbite are:

• Reddened skin develops gray/white patches.

• Numbness in the affected body part.

• The affected part feels firm or hard.

• Blisters may occur in the affected part, in severe cases.

Eat healthy, stay hydrated – Employers should stress the importance of a healthy diet to help workers power through harsh weather. They should be told to regularly drink warm water or warm sweetened fluids throughout the day.

Ask that they always eat breakfast before working outside, to give the body the fuel it needs. Also ask them to avoid excessive drinking the night before work.

Employee Embezzlement on the Rise – Are You Protected?

A typical organization will lose an estimated 5% of its revenues every year due to fraud, according to a study by the Association of Certified Fraud Examiners.

The median loss among organizations both large and small was $140,000 per occurrence, and more than 20% of embezzlement losses were more than $1 million, the association found.

With those staggering numbers in mind, if you have not already done so, you need to take steps to reduce the possibility of employee theft – and also make sure you are adequately covered if they do steal from you.

Small organizations are especially susceptible to losses from employee embezzlement. These problems are often seen in cash-heavy businesses, or those with large inventories, but employee embezzlement is most frequently experienced in organizations lacking owner oversight of financial processes, usually due to placing far too much trust in employees and having no internal controls.

The new study by the fraud examiners association was released as another study, this one by professional security firm Marquet International, found that arrests and indictments for embezzlements had reached a five-year high in 2012.

Embezzlers are most likely to be a company bookkeeper, accountant or treasurer, who is female, in her 40s, and without a criminal record. The reason it’s more often than not a woman is that they are typically in the three aforementioned jobs.

How do they do it?

Marquet International in its study found that the most common ways of embezzling are:

• Bogus loan schemes, which include cases in which fraudulent loans are created or authorized by the perpetrator from which funds are taken for their own benefit.

• Credit card/account fraud cases, which involve the fraudulent or unauthorized creation and/or use of company credit card or credit accounts.

• Forged/unauthorized check cases, which are those in which company checks are forged or issued without authorization for the benefit of the perpetrator.

• Fraudulent reimbursement schemes, which include expense report fraud and other cases in which a bogus submission for reimbursement is made by the perpetrator.

• Inventory/equipment theft schemes, including those cases in which physical corporate assets were stolen and sold or used for the benefit of the employee.

• Payroll shenanigan cases, including all forms of manipulation of the payroll systems in order for the perpetrator to draw additional income.

• Theft/conversion of cash receipt cases, which involve the simple taking of cash or checks meant for company receipts and pocketing or converting them for one’s own benefit.

• Unauthorized electronic funds transfers, including those cases in which wire transfers and other similar transfers of funds are the primary mode of theft.

• Vendor fraud cases, which include those where either a bogus vendor is created by the perpetrator to misappropriate monies or a real vendor colludes with the perpetrator to siphon funds from the company.

Thwarting embezzlers

Liability insurer Camico suggests that educating employees on the detrimental effects of employee fraud on the organization can reduce the likelihood of embezzlement.

Also, if you implement a regular review of bank and credit card statements, you’ll have a better chance of catching a thief. Company owners should look at the cleared transactions to determine the legitimacy of payees, including examining actual cancelled checks.

Also, it’s easy for transactions to be changed in the accounting system after the fact. An ill-intentioned bookkeeper could use this tactic to cover up their tracks. If you feel you do not have the time or expertise to oversee you finance department, you should contract with a qualified CPA to perform these checks and balances.

There are also inexpensive physical barriers that should be used to deter criminal activity. To protect cash, you can buy a $200 drop-slot safe to securely keep the night’s deposit until it is taken to the bank.

Similarly, security cameras deter misbehavior and can be the source of valuable evidence in case an incident occurs.

Securing coverage

Finally, you should consider taking out a crime insurance policy.

Most business insurance policies either exclude or provide only nominal amounts of coverage for loss of money and securities as well as employee-dishonesty exposures.

But a crime insurance policy protects against loss of money, securities or inventory resulting from crime. Common crime insurance claims include employee dishonesty, embezzlement, forgery, robbery, safe burglary, computer fraud, wire-transfer fraud, and counterfeiting.

Call us to discuss whether a crime policy is right for your company.

Massive Breach Exposed 773 million E-mails, Passwords

News of the latest global data breach of some 773 million e-mail address and passwords should prompt individuals and organizations alike to change their passwords – particularly for any accounts that have financial, credit card or other personal information.

The scope of this breach cannot be overstated as the list includes log-in credentials from more than 2,000 websites, according to an article on the website Marketwatch, which cited a report by security researcher Troy Hunt.

Hunt said that the files were collected from a number of breaches and uploaded to a cloud service called MEGA, and the data was promoted on popular hacking forums. MEGA eventually removed the data, so it’s not clear how many hackers gained access to the files.

Considering the size and scope of the data trove, you should immediately change your passwords on sites such as:

• Your online e-mail services (like Gmail, Hotmail, etc.)

• Your banking and other financial services accounts (retirement accounts, credit cards, etc.)

• All of your social media accounts.

• E-commerce sites.

• Subscription sites and other sites that store your credit card information.

Hunt has created a page on his website for anybody to check to see if their e-mail address and passwords were compromised. You can check here for free: www.haveibeenpwned.com.

Hunt said even his own data appeared in the giant trove of stolen e-mails and passwords, despite his intensive security practices as a privacy professional.

If you have employees, you should notify all of them about the breach and urge them to change their passwords. It should be an organization-wide endeavor.

To best protect your privacy, Hunt recommends using strong passwords, a password manager and two-factor authentication. Two-factor authentication requires users to input a code sent to their phone or e-mail for log in, adding an extra layer of security

Top five password tips

1. Adopt long passwords – And don’t use things like $ for the letter “s” or 3 for “E”, and other such changes that hackers are on to.

2. Avoid periodic changes – Instead, change your passwords only when you feel there has been a threat. Most people will recycle old passwords or make small changes to their existing password.

3. Create a password blacklist – Use this as the list of codes to avoid when making a new password.

4. Implement two-factor authentication – Two-factor authentication has already become a de facto standard for managing access to corporate servers. In addition to traditional credentials like username and password, users have to confirm their identity with one-time code sent to their mobile device or using a personalized USB token.

5. Organize regular staff training – Nearly 41% of company data leaks occur because of negligent or untrained workers who open phishing e-mails. It’s important to train employees to detect and avoid phishing and other social media attacks.

OSHA Stays Serious About Temp Worker Safety

While the Trump administration has eased off a number of regulations and enforcement actions during the past two years, Fed-OSHA continues focusing on the safety of temporary workers as much as it did under the Obama presidency.

This puts the onus not only on the agencies that provide the temp workers, but also on the companies that contract with them for the workers.

As evidence of its continued focus on temp workers, OSHA recently released guidance on lockout/tagout training requirements for temporary workers. This was the third guidance document released in 2018 and the 10th in recent years that was specific to temp workers.

One reason OSHA is so keen on continuing to police employers that use temporary workers, as well as the staffing agencies that supply them, is that temp workers are often given some of the worst jobs and possibly fall through the safety training cracks.

OSHA launched the Temporary Worker Initiative in 2013. It generally considers the staffing agency and host employer to be joint employers for the sake of providing workers a safe workplace that meets all of OSHA’s requirements, according to a memorandum by the agency’s office in 2014 to its field officers.

That same memo included the agency’s plans to publish more enforcement and compliance guidance, which it has released steadily since then.

Some of the topics of the temp worker guidance OSHA has released since the 2014 memorandum include:

• Injury and illness record-keeping requirements

• Noise exposure and hearing conservation

• Personal protective equipment

• Whistleblower protection rights

• Safety and health training

• Hazard communication

• Bloodborne pathogens

• Powered industrial truck training

• Respiratory protection

• Lockout/tagout

Joint responsibility

OSHA started the initiative due to concerns that some employers were using temporary workers as a way to avoid meeting obligations to comply with OSHA regulations and worker protection laws, and because temporary workers are more vulnerable to workplace safety and health hazards and retaliation than workers in traditional employment relationships.

With both the temp agency and the host employer responsible for workplace safety, there has to be a level of trust between the two. Temp agencies should come and do some type of assessment to ensure the employer meets OSHA standards, and the host employer has to provide a safe workplace.

Both host employers and staffing agencies have roles in complying with workplace health and safety requirements, and they share responsibility for ensuring worker safety and health.

A key concept is that each employer should consider the hazards it is in a position to prevent and correct, and in a position to comply with OSHA standards. For example: staffing agencies might provide general safety and health training, and host employers provide specific training tailored to the particular workplace equipment/hazards.

Successful joint employer relationship traits

• The key is communication between the temp agency and the host to ensure that the necessary protections are provided.

• Staffing agencies have a duty to inquire into the conditions of their workers’ assigned workplaces. They must ensure that they are sending workers to a safe workplace.

• Ignorance of hazards is not an excuse.

• Staffing agencies need not become experts on specific workplace hazards, but they should determine what conditions exist at the host employer, what hazards may be encountered, and how best to ensure protection for the temporary workers.

• The staffing agency has the duty to inquire and verify that the host has fulfilled its responsibilities for a safe workplace.

• And, just as important, host employers must treat temporary workers like any other workers in terms of training and safety and health protections.</li>

For a look at all 10 of the guidance documents OSHA has issued in the last few years, visit the agency’s temp worker page: www.osha.gov/temp_workers/

Storefront Crash Stats Are Alarming – How to Reduce Risk

Vehicles crash into storefronts about 60 times each day across the United States. Such incidents cause about 4,000 major injuries annually, and about 500 fatalities.

These findings were reported by the Storefront Safety Council, which aims to spread awareness about the dangers of such crashes.

Retail outlets were the most common types of stores to be involved in crashes, followed closely by convenience stores, restaurants and miscellaneous types of businesses. Offices and commercial buildings were less commonly hit by vehicles.

Business owners everywhere must be aware of their risks and know how to be prepared for a vehicle crash.

Why so many crashes?

Studies show that “pedal error,” where drivers mistake their gas pedals for their brakes, is the leading cause of damage to buildings from vehicle impact.

Drivers can also confuse ‘Drive’ with ‘Park’ on their automatic transmissions, while drivers of all ages get distracted or suffer medical emergencies and fail to brake in time, or at all, when entering or leaving parking areas.

Even in a best‐case‐scenario incident where no injuries occur, a vehicle collision into a building can cause serious damage. Simply replacing plate glass windows or doors can cost thousands of dollars.

A storefront crash puts commerce on hold – sometimes only for a few hours, sometimes for a few days and in the worst cases, permanently. While no business is immune, high customer/vehicle‐turnover locations such as convenience stores suffer many more accidents than locations with fewer visitors or separate parking facilities.

Prevention

A combination of methods can be implemented to protect your business from damage due to vehicle impact, as follows:

• Direct pedestrians– Keeping pedestrians and moving vehicles separated is vital. Bollards, guardrails and signage direct people to walk in safe, predictable areas.

• Reduce vehicle speeds– Slowing vehicles down means drivers have more time to see and react to pedestrians, other vehicles and signage, and pedestrians have more time to get out of the way. When a crash is unavoidable, the slower a vehicle’s speed, the better the chances of minimizing damage. Speed bumps are a good way to reduce speeds.

• Shield people and property– The types of barriers that can be erected to prevent these accidents include bollard posts, large planters or other architectural items that actually enhance appearance while offering a layer of protection. Bollards can be removable, retractable or fixed, but must be tall enough for drivers to see.

• Point cars into safety zones– Orient parking spaces so they’re pointed away from people and buildings. Arrange parking so vehicles pull in toward a planted berm or other pedestrian‐free zone.

• Don’t rely on car stops or curbs– Standard 6- to 8-inch car stops or curbs are not effective barriers for moving vehicles. Once the wheels roll up over the edge, there’s nothing to impede the vehicle’s momentum.

To learn more about storefront safety, discuss your concerns with us.

Does Business Interruption Insurance Cover Partial Shutdown?

What happens if your business suffers property damage or a supply chain disruption and is forced to stop operations either fully or partially? Will your insurance cover the work stoppage or slowdown?

It is important to understand how your insurance can protect you from the resulting financial loss. In addition to potential recovery for property damage from your property/casualty policy, you may be able to recover lost revenue from your business interruption coverage. If your operations are disrupted – completely or partially – the language of your policy will determine if, and for how long, your insurance company will cover the loss.

In the best scenario, your insurance should cover income loss not only when operations are completely shuttered, but also when your business is partially suspended.

Historically, many business interruption provisions required a “necessary suspension” of operations. The problem is that these older policies and forms did not define “suspension” or state whether a complete shutdown was necessary. Courts have wrestled with this issue, and have often come down on the side of a “complete shutdown.”

The precedent in California is the case of <i>Buxbaum vs. AETNA Life &amp; Cas. Co. </i>, which held that a “necessary suspension” of operations “connotes a temporary, but complete, cessation of activity.”

In this case, the court said that business interruption coverage for a law firm was not triggered because there was no complete cessation of operations when evidence showed that its attorneys continued to bill hours following a water damage incident in its offices.

The key here is that if “suspension” is not defined in a policy, the policyholder will likely not recover lost income due to a partial cessation or slowdown of business.

The catch-22 in this type of interpretation is that the business interruption policy will usually include a clause obligating the policyholder to mitigate losses.

Slowdown coverage in new forms

In light of other states’ court decisions that were similar to the California case, the industry has developed new forms that also cover slowdowns.

One such form is the Insurance Service Office-approved “Business Income (and Extra Expense) Coverage Form.” It was updated to define “suspension” as “[t]he slowdown or cessation of your business activities.”

Fortunately, most insurance companies use forms that affirmatively state the policy “shall cover the loss resulting from complete or partial interruption of business.”

If you are renewing your business interruption policy or purchasing a new policy, ask us if the form the insurer uses includes the above language. If not, we can find an insurer that includes such wording.

That specific language can ensure that you get paid for any lost business income due to a partial shutdown of your operations.

Saving Your Business from the Threat of Occupational Violence

Over the past 15 years, workplace violence has been among the top four causes of death in the work environment, according to federal statistics.

The Occupational Safety and Health Administration says almost 2 million American workers report incidents of workplace violence each year, and “many more” cases go unreported.

Workplace violence is defined by OSHA as any act or threat of physical violence, harassment, intimidation or other threatening disruptive behavior that occurs in the workplace.

To stem this dangerous trend, the federal agency has issued new directives to inspect workplaces that have a “high risk” of violence – primarily health care, social services and late-night retail outlets.

If you operate businesses in any of these high-risk industries, you should be aware that your workplaces now have a greater chance of being inspected by the feds. If your workplace is found to be unsafe because you’ve failed to eliminate or reduce recognized hazards, you can be written up with a citation possibly involving civil and criminal penalties.

To avoid that, be prepared if you get an OSHA inspection and they are looking at violence-prevention measures. Inspectors will want evidence of what you’re doing to help keep violent acts at bay, such as:

• Training employees on preventing workplace violence.

• Developing a workplace violence-prevention program.

• Maintaining working alarm systems and other security devices, such as panic buttons and private channel radios.

• Reporting and logging any threats and violent incidents.

OSHA inspections can be spurred by a complaint, fatality or violent incident at the workplace. But they can also be a routine scheduled inspection unrelated to any complaint or incident. Inspectors will want to see if you have workplace violence-prevention policies in place.

Weighing ‘known risk factors’

OSHA’s new directive says the agency weighs “known risk factors” in deciding whether to conduct an inspection related to workplace violence. They include whether the jobsite employees:

• Work with the public, or “volatile, unstable people.”

• Work alone or in isolated areas.

• Handle money and valuables.

• Provide services and care.

• Are in areas where alcohol is served.

• Work late at night in high-crime areas.

OSHA will take an initial assessment of businesses in high-risk industries to determine whether an inspection appears to be needed. For instance, if late-night retail outlets such as gas stations, convenience stores and liquor stores seem to have poor interior and parking-lot lighting – something that can attract violence – OSHA may cite the store.

But not all incidents of workplace violence may trigger an OSHA inspection.

For example, if a patient in a psychiatric ward assaults a nurse in a hospital, it will prompt an inspection. The reasoning is that the patient is a known risk factor for a violent outburst, and the employer should take abatement steps such as having two or more employees around unstable clients.

But, in a case in which a disgruntled lover stabs a bookstore employee at work, OSHA may not conduct an inspection if there are no known risk factors, such as if:

• The bookstore was not in a high-crime area,

• The incident occurred at 2p.m., and

• There were five employees present at the time.

OSHA notes that there are “no known prevention measures” for random violent acts in a low-risk setting, like an office, the aforementioned bookstore, a print shop, and more.

The agency website www.osha.gov/SLTC/workplaceviolence/ has recommendations for violence-prevention programs and the latest enforcement procedures for investigating workplace incidents.

Safety Risks Soar as Job Market Tightens

One by-product of a strong economy is more employment, but the increased activity usually results in more workplace injuries.

That’s because there are more inexperienced people on worksites and when a company is busy and there is more activity, the chances of an incident occurring also increase. This is especially the case in manual labor environments from production facilities, warehousing and logistics to construction and other trades.

The September USG + U.S. Chamber of Commerce Commercial Construction Index found that 80% of contractors said that the skilled labor shortage is affecting jobsite safety and it’s the number one factor increasing safety risk on the jobsite.

As business activity grows and the job market tightens, many companies are forced to hire more inexperienced workers who are not skilled at understanding all safety hazards.

Experienced personnel have the know-how to identify workplace hazards and understand the safety protocols for all aspects of their work. While training can help new hires, nothing beats experience.

Additionally, with many businesses working hard to fulfill orders, workplaces are busier, which can cause some workers to cut corners or take risks. Amidst all that hustle and bustle and people moving quickly, the speed and activity can also contribute to accidents in the workplace.

Also, aggressive scheduling may cause employers to use workers with less experience or training, and can push employees to work longer hours, which can lead to shortcuts and compromised processes. If employees are working overtime, they may also be tired and fatigued, which can contribute to poor judgment and workplace incidents.

One other issue that’s affecting workplace safety and is related to the tight job market is that employers are often having to settle for workers they may not normally hire in other times. As you know, the scourge of opioid addiction has been rampant and unfortunately if someone who has an addiction is hired, they may be a serious liability for the employer.

Not only that, but more states are legalizing recreational marijuana and nearly 40 states have medical marijuana laws on the books. In many cases, people can easily get their hands on a medical marijuana card without an affliction that would require a prescription.

Here’s what’s concerning construction employers on the worker addiction front, according to the USG + U.S. Chamber of Commerce Commercial Construction Index:

• 39% were concerned about the safety impacts of opioids.

• 27% were concerned about the safety impacts of alcohol.

• 22% were concerned about the safety impacts of cannabis.

The report showed that while nearly two-thirds of contractors have strategies in place to reduce the safety risks presented by alcohol (62%) and marijuana (61%), only half have strategies to address their top substance of concern: opioids, which is a growing issue.

What you can do

In this environment of labor shortages and high competition for workers, employers should focus on:

• Creating a culture of safety.

• Improving the safety climate in the worksite.

• Improving the firm’s safety culture.

• Providing more leadership training for supervisors.

• Tracking near misses and injuries, and identifying the factors that led to the near miss or accident.

• Ensuring accountability at all levels.

• Demonstrating management’s commitment to safety.

• Empowering and involving employees in the safety process.

Tackling substance abuse safety risks

The top strategies employers are using to reduce safety risks caused by substance abuse are:

• Testing

• Prescreening before hiring

• Education

• Communication oversight by supervisors

• Zero tolerance policies

• Counseling

• Access to rehab.

The Health of Your Drivers May Be Hurting Your Business

Most goods in the U.S. are delivered by truck. Trucking companies, businesses that deliver their own product and their customers rely on well-functioning vehicles and drivers for the success of their operations. 

Too often, though, driving a truck is not conducive to good health. That can spell trouble for the drivers and for the profitability of their employers.

There are a number of factors about the truck-driving occupation that contribute to poor physical health, including:

• Drivers are hired to sit all day behind the wheel, with limited opportunities for exercise.

• They eat at truck stops and other restaurants where they can get meals quickly, contributing to poor diets.

• Their work schedules are not consistent, interfering with sleep patterns.

• The job is stressful. They have to contend with the annoyances and hazards of the road all day long, including traffic delays, dangerous drivers, and poor weather. On top of that, they are under pressure to reach their destinations on time. This gives them incentives to skip on sleep and ingest stimulants to help them stay awake.

Not surprisingly, studies have found that:

• The obesity rate for truck drivers is double that of the general population.

• Their smoking rate is almost triple that of the general population.

• 88% of truck drivers report having hypertension, smoking or obesity, and 9% reported having all three, quadruple the general population’s rate.

• Truck drivers’ life expectancy is 16 years less than the national average.

• Unhealthy drivers do not perform their jobs as well as healthy ones do.

• Among private sector employees, truck drivers have the highest number of illnesses and injuries that cause them to miss work.  

A 2017 study found that drivers with three or more serious health conditions like the ones mentioned above are two to four times more likely to have an accident than are those with only one.

One common affliction for many drivers is sleep apnea. Drivers who have untreated sleep apnea are five times more likely to have a preventable accident than are those who treat it.

What you can do

What can you as an employer do to maintain a healthy driving force? Plenty.

• During the pre-employment screening process, evaluate candidates’ fitness levels through physical examinations and a review of their driving histories.

• Review employer safety policies and driver wellness and fitness requirements during new employee orientation.

• Implement injury prevention programs.

• Offer free or discounted memberships at gyms with locations around the country.

• Encourage drivers to take quick exercise breaks during trips.

• Encourage healthy eating both at home and on the road.

• Monitor drivers’ performance through data provided by telematics devices installed in trucks, review of accident reports, and in-person observation of drivers.

The takeaway

If a truck driver suffers a heart attack or dozes off while hauling a load weighing tens of thousands of pounds, the results can be catastrophic. In addition to the lives lost or forever changed, the cost to the employer could be millions of dollars in jury awards.

Making driver wellness a priority is the right thing to do, but it also makes business sense for employers.

Limiting Your Liability During the Company Holiday Party

With the fallout from the #MeToo movement forcing employers to change their internal conduct policies, they are also reassessing the office holiday party.

While gatherings can be a good time for your staff to mingle casually with their colleagues and clients, they can also prove to be a liability for businesses – particularly if you serve alcohol.

Not all companies are canceling holiday parties, though. Some are being a little more careful and limiting or eliminating alcohol served at holiday celebrations.

If you are throwing a holiday party, you should take steps to limit risks and make sure you are protected with proper insurance coverage.

Your biggest concern should be intoxicated workers leaving the party and driving. Almost all states have liquor liability laws that allow an injured third party to sue not only the person who injured them or damaged their property, but also the individual or organization that overserved them alcohol.

While these laws were originally written to cover bars and other establishments that serve alcohol, they have been extended to cover “social hosts,” which include:

• Employers that hold events where they serve alcohol.

  1. Individuals or groups that hold events (including weddings and summer barbeques).

Limiting your liability

Experts recommend that you take steps to limit your liability:

• Lay down the ground rules – You should hold a meeting and create documentation for your employees to sign that spells out their duty to act responsibly and treat all other staff with respect. This should also include advising them to drink in moderation and not drink and drive.

• Lead by example – Management should model the behavior they expect from everyone at the party: polite conversation and drink in moderation, if at all.

• Hold the party offsite – This is a smart move because if there are issues that occur, it’s best they don’t happen at your place of business.

• Consider not serving alcohol – This is the safest bet to ensure you are not vicariously liable for any intoxicated employees.

• Use different approaches if you serve alcohol – If you do plan to serve alcohol, consider requiring your staff to pay for drinks. This also has the effect of people drinking less if it’s on their dime. Another option is to issue drink vouchers to limit the amount of drinks each person can have.

• Hire a professional bartender  – Most bartenders are trained to detect signs of intoxication and are better able to cut someone off in a professional and polite manner.

• Offer alternative beverages  – You should also offer non-alcoholic beverages, and always serve food so people don’t drink on empty stomachs.

• Stop serving towards the end of the party  – Stop serving alcohol at least one hour before the end of the party, and instead bring out the coffee, tea and soda.

• Arrange transportation  – If you are serving alcohol, you should make special transportation arrangements before the party. Encourage your employees to take advantage of the transportation for their and the public’s safety if they have had drinks.

Insurance considerations

If you have liability concerns, you should call us to discuss your current commercial general liability coverage to make sure that it doesn’t have any exclusions or conditions for these kinds of risks.

If you have gaps, you may want to consider special event coverage that would cover liquor liability and other liability exposures specific to the event.

We can help you check your policy to see if liquor liability is covered by your CGL policy.

If there is any harassment at the party that could put you in the crosshairs for a harassment lawsuit, you could also be sued. This kind of action would not be covered by your CGL policy, but it would be covered under an employment practices liability insurance policy.

An EPLI policy will extend coverage to your business for any discrimination, sexual harassment, emotional distress, and other workplace-related charges. The policy should include third party coverage, which covers claims made by non-employees, usually clients or customers, who allege that an employee engaged in wrongful conduct such as sexual harassment or discrimination.

Marijuana Laws Require New Workplace Policies

As states continue to liberalize marijuana use, employers are left in a bind in terms of enforcing no-drug policies, respecting their employees’ right to privacy and keeping a safe workplace.

While a majority of states have medical marijuana laws on their books, only a handful of states require employers to accommodate (to a degree) staff who use medical marijuana. And many states, including California, have established case law stating that employers do not have to accommodate someone who has a medical marijuana prescription.

Complicating matters for employers, more states are legalizing recreational marijuana.

Since employers have to balance their legal obligations to their employees, they also have to be able to ensure they have a safe workplace that is free of drugs. Here’s a guide to the main issues facing employers:

ADA compliance

The Americans with Disabilities Act prohibits employers from discriminating against employees on the basis of a disability, and the law requires employers to provide a reasonable accommodation to them if needed. The word “reasonable” is there to ensure that the accommodation does not impose any undue hardship on the employer.

Often, medical marijuana is prescribed to people with disabilities who are considered protected individuals under the ADA. In many cases, the use of marijuana can be vital in allowing a disabled worker to do their job and also perform major life activities.

While the ADA bars discrimination against individuals with disabilities for employment purposes, courts in many states have ruled that medical marijuana use is not a reasonable accommodation.

But, in 2008, the California Supreme Court ruled that employers have a right to drug-test and fire patients who test positive for marijuana, regardless of their medical use.

It based its decision on the fact that because the state’s Fair Employment and Housing Act does not require employers to accommodate illegal use, an employer can lawfully terminate an employee who uses medical marijuana.

More recently, in 2012, the Ninth Circuit similarly held that the ADA does not offer job protection for medical marijuana users because marijuana is an illegal substance under federal law.

That said, as medical marijuana becomes more accepted, companies may want to consider revising their policies to include accommodations for use.

One way to do this is to create policies that bar marijuana use in the workplace, particularly smoking or vaping, but be more forgiving with use outside of work hours. If you also drug-test, you’ll need to make exceptions as employees can show positive for drug use at work even though they may have used marijuana the day before at home.

Your policies should take into account that you have a legitimate interest in ensuring that any medications the employee takes are used in a responsible manner and will not affect job performance. Your company policy could state that a prescription for medical marijuana does not entitle an employee:

• To be impaired at work.

• To compromise his or her safety, or the safety of others.

• To smoke in the workplace.

• To unexcused absences or late arrivals.

Recreational-use states

If you have a business in one of the handful of states that has legalized recreational use of marijuana, you should consider revising your company’s drug policies.

While you cannot legally bar employees from using cannabis outside the workplace, you can regulate them using it on the job or showing up intoxicated at work.

One good solution is to model your recreational marijuana policy after your current policies on alcohol.

To cover your operation, you should probably prohibit employees from smoking marijuana at the office or to come to the workplace under the influence of any psychoactive substance. The policy should outline the specific consequences for breaking the rule.

Some employers may consider prohibiting marijuana use in a recreational-use state and continue drug-testing of workers. But this approach could run into legal challenges and would be difficult to enforce if the employees are not using on the job.

The exception should be for workers that operate heavy machinery, or work in construction, transportation or other dangerous occupations. In these jobs, working under the influence of marijuana should be strictly prohibited, just as on-the-job alcohol use is. Companies can also alter drug-screening guidelines to exclude cannabis during routine drug tests.

Since the effects of marijuana can last many hours, you will also specifically need to spell out the rules for lunch breaks. Employees should be able to return from their breaks and be ready to start work again without being under the influence.

The takeaway

Overall, while it seems daunting, these issues will get ironed out over time. For now, you should try to set policies that will ensure that you can keep a safe workplace, while respecting employee privacy.

Over time, the policies that will be recommended for employers are likely to be similar to those for alcohol use and intoxication in the workplace.