The negative potential of performance bonuses
We all want to be rewarded for good, safe work. Acknowledgement, appreciation and increased responsibility are some of the forms this reward might take, and without them the incentive to keep plugging away successfully might be lost. We can also lose incentive, however, when faced with the wrong kind of reward. Worse still, the wrong reward – or a reward based on the wrong indicator - can be downright dangerous.
“Workplaces with safety incentives based on Lost Time Injuries [LTI] tend to engage in LTI prevention rather than injury prevention,” said Occupational Therapist Kate Roylance – “and there’s a big difference.”
“I’m suspicious when I go to a workplace with very few LTIs - how much reporting has been pushed down, how much has gone underground?”
“The worst workplaces I’ve ever seen – the worst injuries I’ve ever seen – have been in workplaces with pretty impressive lost time injury frequency rates. A focus on preventing LTIs can be seriously counter-productive to safety because it distracts attention from what really matters - an injury is an injury and that’s what we need to be preventing.”
She describes as “just awful” one workplace which, as their first step towards safety improvement, introduced a cash bonus scheme for employees based on a reduction in lost time injuries. “The work environment was inherently unsafe, work practices were inherently unsafe, consultation was non-existent, there was no system for managing safety – it had just never been part of the culture of the place. This scheme was the worst thing that could have happened at that time - people wouldn’t report injuries because they didn’t want to miss out on a cash bonus – they didn’t want to be the cause of their mates missing out on a cash bonus - there was huge pressure not to report.”
The modest financial bonus became so important that, to avoid missing it, sprains and strains were ignored: “employees refused to report injuries - under no circumstances did anybody dare report them,” Ms Roylance said. “In situations like this, the opportunity for early intervention is missed – even though research shows, time and time again, that early intervention makes a difference to RTW outcomes.”
Sometimes it’s managers and supervisors who are rewarded for a reduction in LTIs and this can lead to a different set of problems: in her career Ms Roylance has seen the consequence of injured workers “being dragged back to work bandaged and bleeding” in order to avoid a lost-time injury. When the priority is to get people back on site no matter what, “the RTW is often not sustainable and, as a consultant, you get called in when the whole thing goes pear-shaped.”
A popular LTI prevention strategy, according to Ms Roylance, is “sending the walking wounded to a back room to watch safety videos.” They’re still at work so it’s not counted as a lost time injury.
Ms Roylance described with horror an employee with serious hand injuries from a machine incident being brought back to work in significant pain – on the day of injury - and made to shred paper while trying to keep his heavily bandaged arm elevated. “Sure they avoided a lost time injury but does anybody really believe an injury like this doesn’t count?”
In another workplace, an injured worker was moved to the “heaviest line in the place as punishment from his supervisor for daring to report an injury - any kind of incentive scheme based on lost-time injury has the potential to create dreadful RTW practices like this.”
“This is real, these are real stories and there are plenty more,” Ms Roylance said. “Some supervisors and RTW coordinators actually take pride in this sort of behaviour and, sadly, some employers encourage it. I strongly believe in early return to work after injury – but it must be safe and it must be sustainable.”
“If a person is injured in your workplace then, clearly, your safety management systems have failed in some way. Avoiding a lost time injury by some ‘creative’ means doesn’t change that. It changes nothing but the stats.”
“LTI statistics can lull CEOs and Boards of Management into a false sense of security about how safe their workplace really is. I believe senior officers need to know the truth, given their legal duties and potential personal liability. My main objection to LTI measures - and any personal performance bonuses built around them – is that too often they hide the truth about workplace injuries. Is that what we really want?”
When asked if performance bonuses might be organised in such a way as to not be counter-productive, Ms Roylance responded that it is possible, when they are implemented in workplaces with good safety management systems in place, and when not used in isolation.
She also discussed the system in place at her current workplace. “When we achieve a certain number of days without a lost time injury, a sum of money is donated to a local charity - there’s no personal gain so no disincentive to reporting injuries - I think that’s the difference. Employees nominate which charities they’d like to receive the donation but nobody risks losing cash out of their own pocket, a slab of beer or whatever - that makes a difference.”
“Whenever’s there’s a personal bonus involved there’s going to be a major disincentive to reporting and an incentive for people to carry injuries that really need some early intervention.”