A May 12, 2012, report by the Government Accounting Office “Better OSHA Guidance Needed on Safety Incentive Programs” raises some concerns about incentive programs and the way that many companies are using them. OSHA recommends behavior-based incentives and can prohibit rate-based incentives when they are part of an OSHA cooperative program, but otherwise has no regulatory authority over how incentive programs are designed and implemented. On the other hand, there is a lot we know about incentive programs that demonstrates why companies should avoid rate-based metrics regardless of the regulatory requirements.
The problem with injury-rate metrics is that they are based on outcomes and then they award tangible incentives. Both of these have been shown time and time again to be counterproductive for safety — and yet they are among the most commonly used by companies in a variety of industries. My suspicion is that there is a simple explanation — outcomes are the easiest to measure and tangible incentives are the easiest to give out. Let’s review both of these principles to make sure we all know the best practices for safety incentive programs. These are not the only two factors that need to be considered when designing a program, but according to the GAO report, they are a frequent source of mistakes.