Safe driving helps your bottom line

According to an OSHA study, motor vehicle crashes cost employers an astounding $60 billion annually in medical care, legal expenses, property damage and lost productivity. This drives up the cost of benefits such as worker’s compensation, Social Security, and private health and disability insurance, not to mention the cost of auto insurance.

The average crash without injury costs an employer $16,000. When a worker has an on-the-job crash resulting in an injury, the average cost to their employer is $74,000. Costs can exceed $500,000 when a fatality is involved.
The real tragedy is that these crashes are largely preventable and you need to have an auto safety program in place.

1. Management Commitment. No matter if you have five or 500 employees, you must stress the importance of safe driving. Show your employees you are committed to safe driving practices. Management should provide leadership, set policies and create a safety culture. Actively demanding and encouraging employee participation and involvement will help the effort to succeed.

2. Written Procedures. Create a clear, comprehensive and enforceable set of traffic safety policies and communicate them to all employees. These are the cornerstones of an effective driver safety program. Have each employee read and sign off, stating they will follow each policy. Then, post the policies throughout the workplace, distribute copies periodically and discuss the policies at company meetings. Offer incentives for sticking to the rules and point out the consequences of disregarding them.

3. Driver Agreements. Establish a contract with all employees who drive for work purposes. By signing, the driver acknowledges understanding of the organization’s traffic safety policies, procedures and expectations regarding driver performance, vehicle maintenance and reporting of moving violations. This should include an agreement that the employee will pay the insurance deductible for at-fault accidents.

4. Record Checks. Have all driving employees sign an agreement that allows you to obtain and review their motor vehicle record, as this is the law in most states. Then check the driving record of all employees who drive your vehicles. You must screen out drivers who have poor driving records, since they are most likely to cause problems in the future. The MVR should be reviewed every six months to ensure that the driver maintains a good driving record. Clearly define the number of violations a driver can have before losing the privilege of driving any of your vehicles.

5. Crash Reporting. Establish and enforce a crash reporting and investigation process. All crashes, regardless of severity, should be reported to the employee’s supervisor as soon a feasible after the incident. Company traffic safety policies should clearly guide drivers through their responsibilities in the situation. All crashes should be reviewed to determine their cause and whether or not the incidents were preventable. Understanding the root causes of crashes and why they are happening, regardless of fault, forms the basis for eliminating them in the future.

6. Maintenance & Inspection. Properly maintaining and routinely inspecting company vehicles is an important part of preventing crashes and related losses. A mechanic should do a thorough inspection of each vehicle at least annually with documented results placed in the vehicle’s file.

7. Disciplinary Action. Develop a course of action after a moving violation and/or preventable crash. It should provide for progressive discipline if the driver begins to develop a pattern of repeated traffic violations and/or preventable crashes. The system should describe what actions will be taken if a driver accumulates a certain number of violations or preventable crashes in any pre-defined period, much the same way your insurance company does. Two moving violations in a 36-month period should require them to be placed on a “watch” basis where their MVR is checked every three to six months to see if they receive any other infractions. Once they receive three moving violations within 36 months place them on a non-driving status, which may lead to termination.
 
8. Rewards/incentives. Develop and implement a driver reward/incentive program to make safe driving an integral part of your business culture. Consider adding reward and incentive programs, which involve recognition, monetary rewards or non-driving special privileges.

9. Driver Communication. Provide continuous driver safety training and communication. Even experienced drivers benefit from periodic training.

10. Daily Reminders. Install signs at parking lot exits reminding employees to buckle their seat belts and drive safely. Let your concern for their safety be their final thought as they leave your lot.

The author is loss control manager at Capital Risk Underwriters. E-mail him at vmorris@gie.net.