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3 things every employer needs to know to reduce their Workers’ Compensation costs

18-Jul-2018 16:08 | Lisa Docherty (Administrator)

We’re all aware of the direct costs associated with workers’ compensation insurance, however it’s the indirect costs that also impact your business when an injury arises. Workers’ compensation costs can be controlled and reduced through three key considerations….

1. Many injuries are preventable

The most effective way to reduce workers compensation costs is to reduce or eliminate injuries from occurring in the first place. Although it may sound challenging, this can be achieved with some simple strategies…

  • Stop injuries coming through your door with effective pre-employment medical screening.
  • Undertake injury risk profiling to identify why and where injuries are occurring within your business.
  • Create a positive workplace culture – workers exhibiting warning signs of not coping at work should be supported with proactive health and well-being strategies to help them better manage financial, health and emotional effects.

2. Early intervention is key

Unfortunately, not all injuries are preventable. If an injury has occurred, employers must ensure that the injured worker is supported to either remain at or return to safe and sustainable work.

An effective early intervention framework is crucial to reduce the impact of injuries to your business. Early intervention practices have proven to be more effective in fostering a happy and healthy workplace as it promotes a workplace that is supportive and committed to the health and wellbeing of its workforce. This in turn generally supports improved productivity and employee morale.

Research also supports that with early intervention, workers are more likely to be back at work within 6 months, and 50% more likely to return to work at 12 months.

So what are the key elements to effective Early Intervention…

1. Early Intervention begins before an injury occurs.

2. Prompt reporting of injuries is critical – early reporting of injuries result in less expensive claims.

3. Ensure that you have an effective Return to Work (RTW) program including early access to evidence-based interventions delivered by experts.

4. Flexible workplace solutions including the provision of Suitable Duties.

Why invest in Early intervention…

Under an Early Intervention model, less time off work results in less wage reimbursements, and further indirect savings such as improved productivity. When factoring in the reduced costs for time off work, the overall benefit to cost ratio is approximately seven. This means that for every dollar invested the ROI is approximately $7 – a significant savings to your business!

Managing a workforce, regardless of the size of your business, is a balancing act between costs and employee wellbeing. However, when that balance is achieved, the benefits go well beyond the bottom line.

3. Simple tips for consideration

  • Ensure line managers are provided education and ongoing support.
  • Invest in evidence-based strategies with a proven record in effectively reducing and managing injuries.
  • If RTW resourcing or experience within your business is a concern, consider outsourcing the role of RTW Coordinator.
  • Consider appointing a preferred Rehabilitation Provider whom in time and partnership understands your business, as depending upon your premium scheme, their RTW services are often provided at no additional cost to your business.

“Prudence Rehab have been pivotal to the Spotless workers compensation program in reducing claims costs and durations, providing strategy and direction, with clear and concise communication.”

Want to know more?

For expert advice please contact Prudence Rehabilitation on (02) 9283 5552 or submit your online enquiry to

Prudence Rehabilitation is an iCare approved provider based in Harris Park with one of the most experienced Consultant teams in NSW. We are committed to providing Western Sydney with industry leading injury prevention & RTW services, supporting employers to return their valued employees to the workplace, and remain at the workplace in good health.

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