Benefits of Having a Return-to-Work Program

If an employee is injured, the insurance company must pay for medical treatment as well as a portion of the employee's normal salary. When a company offers a light duty or return to work program, it gives injured workers lighter/easier work while continuing to pay the worker's partial or full salary.

This reduces the cost of claims for insurance companies, and research has shown that workers on light duty or return to work programs recover faster and return to work sooner, lowering the overall cost of the claim. There are other ways the return to work programs benefit employers. These are discussed further below.

The program can save you money

The most appealing advantage for employers is that a return-to-work program will save them money. Lowering workers' compensation costs can eliminate the need for a new hire. This is incredibly important, more so than most people realize. Remember, replacing an injured employee takes time and money. It can take months to collect resumes, conduct interviews/hire, train, and bring a new employee up to speed. By the time your new hire is fully productive, a previously injured and well-established employee may have fully recovered and returned to work.

Another frequently overlooked  benefit of return to work programs is that if the injured employee works part-time until they are fully recovered, they will receive fewer disability benefits while still contributing to the success of your organization. This is a significant contributor to lower workers' compensation costs.

It can reduce staff turnover

As mentioned above, you reduce the risk of staff turnover by not having to hire new employees and invest time and resources in training them. The cost of turnover is heavily influenced by the industry and position. However, some experts believe that the cost of replacing a position is related to how specialized the job is. Hiring and training a new employee for a midrange to an executive level position is estimated to cost between nine months and two years of that position's salary.

The cost can be even higher if you lose an experienced worker who has valuable customer service skills or technical knowledge that can't be easily replaced. This can result in lost revenue from customer complaints or delayed projects due to lack of expertise--all potentially costing your company more money than retaining your current staff would have done.

An RTW Program can increase morale

Employees want to know that you have their back in exchange for their time and effort. Accidents and illnesses are unavoidable events. Throwing trusted employees under the bus when disaster strikes, on the other hand, is not a good business practice for several reasons.

To begin with, employees will not give you their all if they do not believe you will be there for them in their time of need. By implementing a return to work program and educating employees on how it works and what to expect, you let them know you care about them and their situation. This small validation and sign of care may not seem like much, but it goes a long way toward building mutual trust, improving staff morale, and ultimately increasing productivity.

Also, by showing that your organization cares about its workers' well-being beyond what is legally required by health insurance policies or government regulations, employers create an environment where workers feel valued and appreciated for the hard work they put in every day. Employees who feel valued tend to stay longer with their companies.

RTW & the  Experience Modification Rate 

The experience modification is based on indemnity. By keeping your costs down through the return to work program, the experience modification is impacted as well.

Ex-Mod is a discount (or increase) that is applied to your premium based on how you compare with other companies in the industry. It is calculated by taking into account the frequency and severity of claims for each policy year. It can be a positive or negative number, depending on how your company compares with others in its class.

If you have had higher than average claims costs, your premiums are likely to increase; conversely, if you have had lower than average claims costs, premiums will decrease. This may seem like bad news, but it actually gives you an opportunity to reduce costs by reducing injuries at work and keeping workers healthy.

How Does the Program Benefit the Employee?

A return to work program removes all uncertainty and stress from the injured worker's life. If there is no established return to work protocol in place, an injured or ill employee may wonder, "How will I pay the bills?" “Should I start looking for work?” “Should I try to return to work before I'm fully recovered?” “Is my boss already interviewing potential new employees?” 

Constant worry about job security and income isn't a good way to recover. A properly implemented return to work program will allow employees to rest easy, knowing that there will still be a place for them when they recover, allowing them to focus on recovering and returning to normalcy.

These programs restore a sense of normalcy to the injured or ill worker. It maintains the employee's self-worth by assisting them in focusing on their return rather than their current situation. Depending on the circumstances, the employee may be able to return to work before full recovery, albeit in a reduced capacity — working part-time, performing less stressful duties, and so on. This helps them realize what they can and cannot do more effectively, making them feel useful and facilitating a smoother transition back into the workforce.

Want some help?

As you can see, having a return to work program can be beneficial for everyone and may save your company money in the long run. If you're interested in other ways to reduce costs, consider an instant online quote through Kickstand Insurance.

Our team can complete a plan for you, focused on what you need to maintain stability for your business and the team. We look forward to hearing from you!