The key to controlling workers’ comp costs is to take a more proactive approach that shifts the focus onto safety, which is an approach known as “loss control.” Loss control is the practice of making a workplace safer by implementing and consistently managing proper safety and injury prevention programs. Historically, these types of programs have not been viewed by employers as a cost reduction strategy, but rather as a requirement needed in order to maintain regulatory compliance with state and federal agencies such as the Occupational Safety and Health Administration (OSHA). However, research from the National Safety Council suggests that when an organization invests in safety, they often greatly increase their return. According to their 2014 “Injury Facts” report, each dollar invested into injury prevention sees returns of between two and six dollars. 

“When a workplace is safe, less workplace injuries occur.”


A successful loss control program includes the following four elements:

  1. Assessment

An assessment of hazards and safety opportunities needs to be conducted by either a loss control professional or members of an internal safety committee. According to the recommendation from OSHA, an internal safety committee should consist of two managers plus two responsible and reliable employees. The object of the assessment is to look for any hazards that could pose a threat to workplace safety as well as note any common injuries in past workers’ comp claims. Risks will vary depending upon the workplace environment. For example, a restaurant will have significantly different risks when compared to an accounting firm, but knowing what an organization’s individual risks are helps create a foundation for the next step.

  1. Creating an Action Plan

Using the information collected during the assessment, the professional or committee will then identify each independent risk and provide a solution to reduce or eliminate each risk. This creates a customized loss control action plan. 

  1. Implementation and Training

Some training will be necessary to educate all employees on properly observing the loss control action plan’s guidelines. A safety orientation should be held after the action plan has been created as well as for any new hires in the future. Routine documented safety meetings and annual training refreshers are also helpful in ensuring the action plan is consistently followed by all employees.

  1. Documentation and Record Keeping

Accurate and detailed records should be kept, not only to maintain compliance with OSHA and other regulatory agencies, but also to create accountability and enable the organization to learn from past experiences and prevent repeated incidents in the future.

Taking a strategic approach to workers’ comp cost control does more make a workplace safer for employees. An effective loss control program has the ability to not only reduce workers’ comp costs, but also can improve the overall productivity of employees, decrease turnover, reduce overtime costs and impact an organization’s bottom line in a very positive way.

About Emplicity:
Since 1995, Emplicity has provided a smarter, more secure, and integrated platform of employer services to its 300 business clients and their 8,500 employees. As a Professional Employer Organization, or PEO, the California-based HR outsourcing firm simplifies the compliance, administration, and support businesses need in the areas of employee benefits, payroll, and human resources technology.

For more information about us, visit or call us at (877) 476-2339. We’d love to make your employee management more simple—and secure.

NOTICE: Emplicity provides HR advice and recommendations. Information provided by Emplicity is not intended as a substitute for employment law counsel. At no time will Emplicity have the authority or right to make decisions on behalf of its clients.

Share This