CSM logo - horizontal

Incentive vs Recognition

There is a significant difference in Safety Incentive and Safety Recognition. While both involve the use of some form of reward, the methods used to decide who receives the award is different.

Safety incentive programs:

  • Many companies utilizing safety incentive programs hand out prizes such as cash, tangible award items etc. rewarding reductions in the number of workplace accidents and injuries. (“Lagging indicators”)
  • If the numbers of incidents were increasing, there would be no reward.
  • In some situations, the company may tie these rewards to an individual’s performance or to work teams, departmental or even the overall company performance.

While the concepts behind these types of programs appear to be rewarding employees for positive results, there has been an increase in the number of criticisms by many in the safety profession and even OSHA regarding the actual impact of these programs.

Negative impact of safety incentive programs:

  • These programs can create pressure on employees not to report accidents, injuries, near misses or other incidents to keep the “positive record” intact.
  • The consequence of employees not reporting incidents, even if minor, can negatively impact a proactive safety program, in gathering as much information as possible on accident and injury trends so that steps can be taken to control these risks in the future.
  • If employees are pressured not to report incidents, a company will have less information to base future safety efforts.

In the best safety programs, employees are actively encouraged to report all incidents and to offer their suggestions on how these types of situations can be controlled in the future.

Leading indicator recognition programs:

  • These programs recognize and reward employees for proactive safety-related behaviors and activities.
  • Examples of these types of behaviors include the reporting of safety violations, making suggestions of ways to reduce risks associated with their jobs, personally taking steps to remedy unsafe situations and volunteering for safety committees.
  • When employees see unsafe acts or unsafe conditions while working, they should be encouraged to either work to correct them or offer suggestions for long-term solutions. These efforts should be recognized and promoted.
  • Recognition can take many forms, such as, getting an immediate thank you from their department manager, a personally signed letter or certificate from the company president or CEO, or a special recognition during a company meeting or dinner.
  • The desired outcome is that the employees realize that safety is part of their job and that their contributions are recognized and valued.

No recognition program is an effective substitute for an inadequate safety program. Employees cannot improve performance if they are not trained to perform their jobs or do not have clear direction of expectations. If employees have not been trained to recognize and control the hazards associated with their jobs, and do not feel they are part of the solution, the recognition program becomes a meaningless effort.

Developing a recognition program:

  • Start by enlisting management.
  • If management does not understand the benefits of a program and support it, neither will the employees.
  • The employees must understand the program goals and methods of measuring performance and that they each have a chance at being recognized.
  • They must trust that the program will be administered fairly, and this is done through an active and strong management presence.
  • If not, the workers will not support the program.
  • Develop the recognition program by setting performance goals, which do not have to be limited to safety performance.
  • By combining all areas of performance, safety can be seen as an integral part of the operation.
  • Based on the employee culture within the company, decide what recognition methods would be best received.

Managers and supervisors often do not recognize employee performance on an informal basis because they don’t know what to say and in turn do nothing.

Some simple guidelines for recognizing employee performance include:

  • Thank the employee specifically using their name.
  • State exactly what the employee did to earn the recognition.
  • Describe the feeling incited from this behavior and its impact on the operations.
  • Explain how the behavior has added value to the company.

Basic program components:

  • The recognition must be sincere.
  • The recognition should be documented and public. (It should be noted that some employees have difficulty with public displays and their concerns should not be ignored, however, alternative recognition efforts should be used).
  • The recognition should occur as soon as possible after the fact with a more formal recognition provided at a later date (company dinner, meeting or another public event).
  • The employee’s suggestion leading up to the recognition must be implemented.

Failure to establish proper guidelines and administer the program fairly is usually cited as the primary reason that recognition programs fail. The administration of a safety recognition program is a complicated process that requires a complete understanding of the work being performed, the risks associated with the work, and the relative value of the employee actions and recommendations.

Recognition awards can range from a simple “Thank You” to items or services of significant value. Cash awards and other tangible items that can be identified as having a specific benefit value may impact your Workers Compensation premiums due to their inclusion in the company payroll amounts that are used to set these premiums.

What to recognize:

  • Each company is different regarding culture, management style, operating conditions and financial circumstance.
  • What is common to all companies is that they employ people and ask them to perform certain services to benefit the company.
  • Every company has performance standards, either formal or informal, that employees must work within.
  • An effective performance recognition program establishes acceptable performance and identifies efforts that are viewed as rising above this standard.
    • Example: Dave operates a drill press and consistently reports to work, meets his production goals with minimal errors and has never had a work-related injury. Steve, who works next to Dave on another drill press also meets his production quota, has never been late for work and so far, is accident free, but he also has made numerous suggestions to his supervisor about making improvements in the production process and a more efficient machine safeguard for his drill press. While Dave is a “good employee”, Steve’s efforts exceed the standard in that he makes an effort to further improve the company’s operations and as such should be recognized for this effort.

Areas to be considered for recognition should include:

  • Initiative – an employee steps up and identifies a hazard and offers effective suggestions on how to eliminate or control it.
  • Role model performance – an employee consistently performs their job without significant error, is reliable, and is willing to speak up and offer their contributions to the organization.
  • Thinking freely – an employee looks beyond the historic approach and suggests positive improvements in operational procedures, schedules, etc.

A successful recognition program is one that recognizes the culture, reflects the value that the company assigns to safety effort, and then fairly and adequately recognizes employee performance. Start with a critical evaluation of your current safety program and make necessary improvements. Initiate communication with the employees in regard to their views about the current effectiveness of the safety program and how they view their roles and responsibilities in support of it. Using that, develop performance criteria to be used in determining recognition. Implement the program and adjust as necessary to ensure the continuing success of the program.

Disclaimer:

This article is provided solely as a reference tool to be used for information purposes only. The information in this article shall not be construed or interpreted as providing legal or any other advice. The information material does not amend the provisions of any insurance policy issued by CompSource Mutual. It is not a representation that coverage does or does not exist for any particular claim or loss under any such policy. Coverage depends on the facts and circumstances involved in the claim or loss, all applicable policy provisions, and any applicable law.

Meet Our Safety Team

Related Safety Resources

HVAC: ergonomics

HVAC workers are required to do extensive labor with hands, material handling, bending, pulling, etc., which can create many potential

Read More >