Risk Insider: Terri Rhodes

2017 Forecasts for Absence and Disability

By: | January 25, 2017 • 3 min read
Terri L. Rhodes is CEO of the Disability Management Employer Coalition. Terri was an Absence and Disability Management Consultant for Mercer, and also served as Director of Absence and Disability for Health Net and Corporate IDM Program Manager for Abbott Laboratories.

Paid Family Leave

2016 was the year of paid family leave. While the chance of change at the federal level is unlikely, paid family leave remains the top absence and disability management trend of 2017. Work-life balance is especially important to younger employees, while the labor market continues to tighten. Thus, increasing numbers of large employers are offering paid parental leave as a central recruitment and retention strategy. We’ll see more of this in 2017.

Even more important, localities and states continue to pass paid family leave laws. New York City and San Francisco already have such laws. In 2016, California, New York, New Jersey, and Rhode Island were joined by the District of Columbia (D.C.) with paid leave laws. What is especially noteworthy about D.C.’s law is that it is funded by a tax on employers. The millions of dollars in revenue will be used to set up a separate department to administer the paid parental leave law. If this is imitated in other jurisdictions, it could have major ramifications for the “who pays” dimension of paid leave.

Paid Sick Leave

Over the last several years, paid sick leave laws have ranked high as a continued trend in absence management. Five states, 29 cities, two counties, and Washington, D.C. have some form of a paid sick leave law. We believe there are more to come with legislation pending in more than 25 states. Most paid leave laws offer job-protected absences and/or layer on top of other job-protected leaves, which provide a host of administrative issues. The laws themselves often differ in important ways. Those employers operating in a multi-state environment are left with an array of laws and regulations with which to comply. This will be a key issue in 2017.

Outsourcing ADA

Outsourcing absence management has steadily increased over the last several years, with ADA outsourcing now leading the way in growth. Technology has changed the cost equation. According to the 2016 DMEC Employer Leave Management Survey, even employers with fewer than 250 employees are outsourcing. The most common outsourced programs are state and federal FMLA. From FMLA, it is a natural leap to look for help managing ADA obligations. Medical information for documentation is similar for both laws. We will see this outsourcing trend continue in 2017.

Vendor Engagement

Vendor engagement emerged as a trend in 2016 and will come into its own this year with growing implementation of vendor summits.  Summits allow vendors to better learn the needs of employers and capabilities of other vendors. All concerned can step out of silos and look at absence and disability management in a holistic way. This can result in more efficiency and improved services. Summits help move relationships from “vendor” to “partner,” and we anticipate more employers will take this approach.

Workplace Mental Health

2016 witnessed both vendors and employers more focused on finding solutions to growing awareness of workplace mental health issues. At the 2016 DMEC Annual Conference, we dedicated a full-day preconference workshop to workplace mental health topics and discussion. 2017 will see even greater efforts to develop and implement behavioral health strategies. We also hope to see less stigma in mental illness.

Absence Management Professionals

Finally, we will continue to experience professionalization of absence and disability management in 2017. This has been and will continue to be driven by the growth and complexity of leave laws.  Adding value in these circumstances requires continuous learning.  Conferences, seminars, and professional designations like the new Certified Leave Management Specialist (CLMS) program give those in the field the tools to excel.

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The labor market should continue to tighten in 2017. That means richer benefits, increased employee mobility and higher costs for employers. Now more than ever, it is important for absence and disability management professionals to learn and use innovative skills and programs to help lower those costs. For those who do, 2017 should be a year of greater professional and personal rewards.

More from Risk & Insurance

More from Risk & Insurance

Robotics Risk

Rise of the Cobots

Collaborative robots, known as cobots, are rapidly expanding in the workforce due to their versatility. But they bring with them liability concerns.
By: | May 2, 2017 • 5 min read

When the Stanford Shopping Center in Palo Alto hired mobile collaborative robots to bolster security patrols, the goal was to improve costs and safety.

Once the autonomous robotic guards took up their beats — bedecked with alarms, motion sensors, live video streaming and forensics capabilities — no one imagined what would happen next.

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For some reason,  a cobots’ sensors didn’t pick up the movement of a toddler on the sidewalk who was trying to play with the 5-foot-tall, egg-shaped figure.

The 300-pound robot was programmed to stop for shoppers, but it knocked down the child and then ran over his feet while his parents helplessly watched.

Engaged to help, this cobot instead did harm, yet the use of cobots is growing rapidly.

Cobots are the fastest growing segment of the robotics industry, which is projected to hit $135.4 billion in 2019, according to tech research firm IDC.

“Robots are embedding themselves more and more into our lives every day,” said Morgan Kyte, a senior vice president at Marsh.

“Collaborative robots have taken the robotics industry by storm over the past several years,” said Bob Doyle, director of communications at the Robotic Industries Association (RIA).

When traditional robots joined the U.S. workforce in the 1960s, they were often assigned one specific task and put to work safely away from humans in a fenced area.

Today, they are rapidly being deployed in the automotive, plastics, electronics assembly, machine tooling and health care industries due to their ability to function in tandem with human co-workers.

More than 24,000 robots valued at $1.3 billion were ordered from North American companies last year, according to the RIA.

Cobots Rapidly Gain Popularity

Cobots are cheaper, more versatile and lighter, and often have a faster return on investment compared to traditional robots. Some cobots even employ artificial intelligence (AI) so they can adapt to their environment, learn new tasks and improve on their skills.

Bob Doyle, director of communications, Robotic Industry Association

Their software is simple to program, so companies don’t need a computer programmer, called a robotic integrator, to come on site to tweak duties. Most employees can learn how to program them.

While the introduction of cobots into the workplace can bring great productivity gains, it also introduces risk mitigation challenges.

“Where does the problem lie when accidents happen and which insurance covers it?” asked attorney Garry Mathiason, co-chair of the robotics, AI and automation industry group at the law firm Littler Mendelson PC in San Francisco.

“Cobots are still machines and things can go awry in many ways,” Marsh’s Kyte said.

“The robot can fail. A subcomponent can fail. It can draw the wrong conclusions.”

If something goes amiss, exposure may fall to many different parties:  the manufacturer of the cobot, the software developer and/or the purchaser of the cobot, to name a few.

Is it a product defect? Was it an issue in the base code or in the design? Was something done in the cobot’s training? Was it user error?

“Cobots are still machines and things can go awry in many ways.” — Morgan Kyte, senior vice president, Marsh

Is it a workers’ compensation case or a liability issue?

“If you get injured in the workplace, there’s no debate as to liability,” Mathiason said.

But if the employee attributes the injury to a poorly designed or programmed machine and sues the manufacturer of the equipment, that’s not limited by workers’ comp, he added.

Garry Mathiason, co-chair, robotics, AI and automation industry group, Littler Mendelson PC

In the case of a worker killed by a cobot in Grand Rapids, Mich., in 2015, the worker’s spouse filed suit against five of the companies responsible for manufacturing the machine.

“It’s going to be unique each time,” Kyte said.

“The issue that keeps me awake at night is that people are so impressed with what a cobot can do, and so they ask it to do a task that it wasn’t meant to perform,” Mathiason said.

Privacy is another consideration.

If the cobot records what is happening around it, takes pictures of its environment and the people in it, an employee or customer might claim a privacy violation.

A public sign disclosing the cobot’s ability to record video or take pictures may be a simple solution. And yet, it is often overlooked, Mathiason said.

Growing Pains in the Industry

There are going to be growing pains as the industry blossoms in advance of any legal and regulatory systems, Mathiason said.

He suggests companies take several mitigation steps before introducing cobots to the workplace.

First, conduct a safety audit that specifically covers robotics. Make sure to properly investigate the use of the technology and consider all options. Run a pilot program to test it out.

Most importantly, he said, assign someone in the organization to get up to speed on the technology and then continuously follow it for updates and new uses.

The Robotics Industry Association has been working with the government to set up safety standards. One employee can join a cobot member association to receive the latest information on regulations.

“I think there’s a lot of confusion about this technology and people see so many things that could go wrong,” Mathiason said.

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“But if you handle it properly with the safety audit, the robotics audit, and pay attention to what the standards are, it’s going to be the opposite; there will be fewer problems.

“And you might even see in your experience rating that you are going to [get] a better price to the policy,” he added.

Without forethought, coverage may slip through the cracks. General liability, E&O, business interruption, personal injury, cyber and privacy claims can all be involved.

AIG’s Lexington Insurance introduced an insurance product in 2015 to address the gray areas cobots and robots create. The coverage brings together general and products liability, robotics errors and omissions, and risk management services, all three of which are tailored for the robotics industry. Minimum premium is $25,000.

Insurers are using lessons learned from the creation of cyber liability policies and are applying it to robotics coverage, Kyte said.

“The robotics industry has been very safe for the last 30 years,” RIA’s Doyle said. “It really does have a good track record and we want that to continue.” &

Juliann Walsh is a staff writer at Risk & Insurance. She can be reached at [email protected]