When Los Angeles Dodgers Manager Dave Roberts posted his World Series opening-game lineup, it was remarkably missing his three best hitters, all left-handed batters who had hit a total of 85 home runs during the season. Roberts instead went with his all-righty lineup against the Boston Red Sox’s left-handed pitcher and got clobbered, both on the scoreboard and by the media and fans.
So why did the Dodgers manager keep 85 home runs on the bench? Because in the age of analytics, a three-ring binder told him it was the best thing to do, to start the righties against a lefty and pray the splits fall in his favor. But what Roberts failed to do was look beyond the numbers and see that his best options lie in trusting his gut, a track record of accomplishments and maybe a bit of common sense. By choosing not to do this, he failed to put his team in the best position to win.
This is also what many employers are doing when they quickly pass on hiring certain subcontractors simply because that company’s experience mod is not to their liking, even though it may not tell the entire story.
The experience mod serves a purpose, but that purpose is not as a proxy for safety performance. The experience mod was designed to enable an insurance carrier to adjust a company’s premium based on whether they are better or worse than the average company in their industry, not to measure safety.
When companies are searching out subcontractors, they often use the 1.0 experience mod as an immovable stat, and any employer north of that number need not apply. However, that number can be skewed because it reflects a three-year window. So, if a company had one bad incident in the oldest year but a stellar showing in the most recent two years, its experience mod rating could conceivably go above 1.0.
This is not to say the numbers shouldn’t matter, just that employers need to use the right numbers when it comes to evaluating what companies they want to work with. Because the numbers you see are not always telling the whole story. One serious injury can dramatically inflate an employer’s experience mod, but if you inspect other statistics, you may find the employer is well-above average in their safety performance.
Employers seeking to screen subcontractors based on their safety performance would find better results using statistics that are built to measure safety performance. The Days Away Restricted or Transferred, or DART, rate measures the number of days injured employees have either been completely out of work or forced into modified duty as a result of their injury. DART is extremely effective in measuring injuries severe enough to cause work restrictions.
Total Recordable Incident Rate, or TRIR, measures the overall rate of Occupational Safety and Health Administration recordable incidents in a business. This statistic captures a more complete picture because it is measuring individual accidents rather than work restrictions.
Both DART and TRIR are leveled to a per-100 full-time employee rate, so it’s simple to compare rates between potential subcontractors, even when those companies are very different in size. They are also both annual measures, so a bad year four years ago can’t make your current data look poor.
Using the wrong numbers is often worse than using no metrics at all. The wrong numbers can cause you to pass up the opportunity to partner with a great company. There is no question that safety performance is an issue when hiring subcontractors, but if you are using the experience mod as the measure of safety performance, you’re doing a disservice to your business and theirs.
Kevin Ring is the lead analyst for the Institute of WorkComp Professionals, which trains insurance agents to help employers reduce workers’ compensation expenses.
