3 Proven ways to reduce worker’s compensation costs.


The worker compensation program is made to facilitate the employee in case of any accident or harm during working hours. It is believed that employees are the responsibility of the company as long as they are within the company premises and on working hours. These worker compensation claims can be very troublesome for organizations to manage as they consume time, effort and damage the expense part of your company’s balance sheet. Dealing with a worker compensation claim is the job of a worker’s compensation lawyer, but mitigating the chances of accidents that lead to this claim is every organizations responsibility.

1.Safety First

Many accidents that initiate worker compensation claims can be mitigated with the proper safety measures. The Human Resource department of every organization should be strict in maintaining safety in order to avoid such compensation claims. These measures could be as simple as caution signs, proper hygiene and advice on body postures. Many employees tend to work during the break time which leads to stress. However, organizations can prohibit working during break hours to prevent stress related injuries.

Proper helmets and a sign board to inform workers at a construction site about the dangers could help cut down work place accidents. Workplace violence on the other hand can be managed through open door policy and creating a work friendly environment where the manager and employees can communicate like friends.

2. Return to Work Program

Organizations know very well that the more time employee spends off work the higher would be the compensation cost. Fighting for cases that are clear cut in the favor of the employee only results in higher compensation than what it was supposed to be. For Example: when an injured employee return to work from home organization needs to cover the replacement income. This translates into pure expense since the organization paid for the due hours but no work was done against the salary. An efficient return to work program can help organization mitigate the cost of worker compensation.

If a quick return to work is not possible, the organization can opt for relaxing working hours or part time until the medical recovery is done. Organizations that leverage work from computers can ask the employee to work from home as well.

3. Partner with a PEO

A PEO stands for Profession Employer Organization. Choose a worker compensation program with them and a lot of things get easier for instance a PEO would,

  • Create safer working environment
  • Negotiate with the insurance company to cut down worker compensation cost.
  • Manage relationship with the injured employee
  • Implement a strategic return to work program


All of these combined can help cut down worker compensation cost by a good margin. It is observed that every dollar spent on the safety of employees result in $2 saved in worker compensation cost. If organizations consistently manage worker safety, especially in risky field of work such as construction and labor, the impact of this cost would decrease.