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2017 Teddy Award Winner

Advocacy Takes Off

For Delta Air Lines, putting employees first is the right thing to do for all company stakeholders.
By: | November 1, 2017 • 5 min read

It’s coming up on 90 years since Delta Air Lines made its first passenger flight.

Delta founder C.E. Woolman, considered a visionary by many, keenly understood how employee satisfaction has a direct bearing on company success.

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“It is the initiative, the personal attitudes and the motivations of our people as they approach their daily work upon which we rely for acceptance, for growth, and for survival,” said Woolman.

No doubt he would be pleased that Delta is a winner of the 2017 Theodore Roosevelt Workers’ Compensation and Disability Management Award — an honor bestowed in large part due to the company’s embrace of his founding philosophy, that Delta employees’ are the number one asset to the organization.

Headquartered in Atlanta, Delta operates a mainline fleet of more than 800 aircraft, offering service to 335 destinations in 62 countries on six continents, serving more than 180 million customers each year.

All of that rests on the shoulders of 85,000-plus employees worldwide who are exposed to a broad spectrum of workplace risks, from moving heavy cargo to serving passengers in the midst of turbulence. Caring for those workers is no small endeavor.

A 2013 shift toward an employee advocacy model for disability and leave management was a game-changer for Delta. Early success convinced the company it was the right way to go.

In 2015, the company moved to an integrated absence management program for all lines, including workers’ compensation, administered by a single TPA (Sedgwick) to further improve the employee experience.

Full Integration

Chris Collins, Delta’s vice president, global human resources services, championed the move to a single-source vendor. His goal: To reduce the frustration and duplicated processes that an employee experiences when navigating through the various programs at Delta after being injured on the job.

“We were looking for a single vendor source — a majority of the disability programs are unbundled,” explained Collins. “We couldn’t do that; it wasn’t working for us because of the way we pay the disability claims.

Chris Collins, VP Global HR Services, Delta Air Lines

“We needed it all with one vendor so that we didn’t have competing systems and competing vendors that don’t communicate well with each other.”

More than 110,000 claims were transitioned into the system, along with a staggering 5 million documents. All things considered, said Collins, the process went smoothly, allowing Delta to streamline the program and reduce duplicated redundant steps in the process.

“We reviewed and changed processes that tended to be redundant and cumbersome for the employee to manage through when a work comp injury was filed. Delta’s disability and leave benefits run concurrent when a work comp injury occurs,” said Susan Emerson, general manager, claims management, disability, leave and workers’ compensation claims.

Delta sees solid results resulting from the integrated programs. Since the move to an integrated model in 2015, Delta’s claims program has maintained an average closing ratio of 114 percent, exceeding expectations.

Of course, the most gratifying achievement is the improved employee experience with the claims process. The 2017 employee satisfaction surveys provide good comments and accolades from employees for the improved process and ease of claim handling.

“Delta Air Lines strongly embraces employee advocacy and this drives everything we do from a claims perspective,” said Lynn Williams, managing director with Sedgwick.

“We were looking for a single vendor source — a majority of the disability programs are unbundled. We needed it all with one vendor so that we didn’t have competing systems and competing vendors that don’t communicate well with each other.” — Chris Collins, vice president, global human resources services, Delta Air Lines

“Whether addressing occupational or non-occupational incidents … we all become advocates for their employees to ensure their recovery and return to a productive life.”

To Emerson, the employee advocacy model is a matter of common sense. The strategy streamlines the claim process, making it more efficient and smooth for employees.

Employee advocacy starts by adding more user-friendly language to explain benefits and the process — and removes cumbersome insurance terminology and technical terms. Being injured or ill is enough of a challenge in itself. Employees don’t need the added burden of understanding insurance and technical terminology, she said.

Susan Emerson, general manager, claims management, disability, leave and workers’ compensation claims, Delta

Additionally, Delta works with its TPA to integrate convenient offerings into the claim process. This includes direct deposit for payments to the employee (for lost wage replacement benefits, as well as reimbursement for other expenses such as mileage or out of pocket medical expenses), access to highly-rated physicians in the medical management network, a complex pharmacy review program, nurse triage, telephonic and field nurse case management services.

Emerson said she’s aware of those who perceive employee advocacy as soft and assume it may not be the best approach for some employers. “We see eyebrows raised a lot,” she said. “But Delta’s success follows that of other large employers who take a similar approach — including Disney, Safeway and industry peer Southwest Airlines. We decided ‘Stop the grinding;’ all it does is cause a lot of frustration in the process, and your employees are less apt to be favorable to your program.”

For workers’ compensation cases with a disability and leave component, the workers’ comp examiner is the single point of contact for employees and helps them navigate the disability and leave processes. This reduces phone calls and correspondence and improves payment accuracy.

Additionally, Delta created a concierge desk for its disability and leave of absence benefits. Employees can call to request assistance, ask questions or ask for direction at any time.

The integrated program focuses on assisting employees select top-tier providers or specialists immediately, ensuring that each claim is heading in the right direction from the start.

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“Sedgwick has a robust network — they really pay attention to the top-tier providers and their outcomes,” said Emerson. “They do what they’re supposed to do to help employees get well and return to work. To me, that’s the best approach.”

Emerson said that while Delta’s integrated program wouldn’t be the right fit for every company, it was the right move to make for the benefit of both employees and Delta.

“You make the investment to help the process flow more smoothly for all parties involved.” &

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More coverage of the 2017 Teddy Award Winners and Honorable Mentions:

Advocacy Takes Off: At Delta Air Lines, putting employees first is the right thing to do, for employees and employer alike.

 

Proactive Approach to Employee SafetyThe Valley Health System shifted its philosophy on workers’ compensation, putting employee and patient safety at the forefront.

 

Getting It Right: Better coordination of workers’ compensation risk management spelled success for the Massachusetts Port Authority.

 

Carrots: Not SticksAt Rochester Regional Health, the workers’ comp and safety team champion employee engagement and positive reinforcement.

 

Fit for Duty: Recognizing parallels between athletes and public safety officials, the city of Denver made tailored fitness training part of its safety plan.

 

Triage, Transparency and TeamworkWhen the City of Surprise, Ariz. got proactive about reining in its claims, it also took steps to get employees engaged in making things better for everyone.

A Lesson in Leadership: Shared responsibility, data analysis and a commitment to employees are the hallmarks of Benco Dental’s workers’ comp program.

 

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Risk Report: Manufacturing

More Robots Enter Into Manufacturing Industry

With more jobs utilizing technology advancements, manufacturing turns to cobots to help ease talent gaps.
By: | May 1, 2018 • 6 min read

The U.S. manufacturing industry is at a crossroads.

Faced with a shortfall of as many as two million workers between now and 2025, the sector needs to either reinvent itself by making it a more attractive career choice for college and high school graduates or face extinction. It also needs to shed its image as a dull, unfashionable place to work, where employees are stuck in dead-end repetitive jobs.

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Added to that are the multiple risks caused by the increasing use of automation, sensors and collaborative robots (cobots) in the manufacturing process, including product defects and worker injuries. That’s not to mention the increased exposure to cyber attacks as manufacturers and their facilities become more globally interconnected through the use of smart technology.

If the industry wishes to continue to move forward at its current rapid pace, then manufacturers need to work with schools, governments and the community to provide educational outreach and apprenticeship programs. They must change the perception of the industry and attract new talent. They also need to understand and to mitigate the risks presented by the increased use of technology in the manufacturing process.

“Loss of knowledge due to movement of experienced workers, negative perception of the manufacturing industry and shortages of STEM (science, technology, engineering and math) and skilled production workers are driving the talent gap,” said Ben Dollar, principal, Deloitte Consulting.

“The risks associated with this are broad and span the entire value chain — [including]  limitations to innovation, product development, meeting production goals, developing suppliers, meeting customer demand and quality.”

The Talent Gap

Manufacturing companies are rapidly expanding. With too few skilled workers coming in to fill newly created positions, the talent gap is widening. That has been exacerbated by the gradual drain of knowledge and expertise as baby boomers retire and a decline in technical education programs in public high schools.

Ben Dollar, principal, Deloitte Consulting

“Most of the millennials want to work for an Amazon, Google or Yahoo, because they seem like fun places to work and there’s a real sense of community involvement,” said Dan Holden, manager of corporate risk and insurance, Daimler Trucks North America. “In contrast, the manufacturing industry represents the ‘old school’ where your father and grandfather used to work.

“But nothing could be further from the truth: We offer almost limitless opportunities in engineering and IT, working in fields such as electric cars and autonomous driving.”

To dispel this myth, Holden said Daimler’s Educational Outreach Program assists qualified organizations that support public high school educational programs in STEM, CTE (career technical education) and skilled trades’ career development.

It also runs weeklong technology schools in its manufacturing facilities to encourage students to consider manufacturing as a vocation, he said.

“It’s all essentially a way of introducing ourselves to the younger generation and to present them with an alternative and rewarding career choice,” he said. “It also gives us the opportunity to get across the message that just because we make heavy duty equipment doesn’t mean we can’t be a fun and educational place to work.”

Rise of the Cobot

Automation undoubtedly helps manufacturers increase output and improve efficiency by streamlining production lines. But it’s fraught with its own set of risks, including technical failure, a compromised manufacturing process or worse — shutting down entire assembly lines.

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More technologically advanced machines also require more skilled workers to operate and maintain them. Their absence can in turn hinder the development of new manufacturing products and processes.

Christina Villena, vice president of risk solutions, The Hanover Insurance Group, said the main risk of using cobots is bodily injury to their human coworkers. These cobots are robots that share a physical workspace and interact with humans. To overcome the problem of potential injury, Villena said, cobots are placed in safety cages or use force-limited technology to prevent hazardous contact.

“With advancements in technology, such as the Cloud, there are going to be a host of cyber and other risks associated with them.” — David Carlson, U.S. manufacturing and automobile practice leader, Marsh

“Technology must be in place to prevent cobots from exerting excessive force against a human or exposing them to hazardous tools or chemicals,” she said. “Traditional robots operate within a safety cage to prevent dangerous contact. Failure or absence of these guards has led to injuries and even fatalities.”

The increasing use of interconnected devices and the Cloud to control and collect data from industrial control systems can also leave manufacturers exposed to hacking, said David Carlson, Marsh’s U.S. manufacturing and automobile practice leader. Given the relatively new nature of cyber as a risk, however, he said coverage is still a gray area that must be assessed further.

“With advancements in technology, such as the Cloud, there are going to be a host of cyber and other risks associated with them,” he said. “Therefore, companies need to think beyond the traditional risks, such as workers’ compensation and product liability.”

Another threat, said Bill Spiers, vice president, risk control consulting practice leader, Lockton Companies, is any malfunction of the software used to operate cobots. Then there is the machine not being able to cope with the increased workload when production is ramped up, he said.

“If your software goes wrong, it can stop the machine working or indeed the whole manufacturing process,” he said. “[Or] you might have a worker who is paid by how much they can produce in an hour who decides to turn up the dial, causing the machine to go into overdrive and malfunction.”

Potential Solutions

Spiers said risk managers need to produce a heatmap of their potential exposures in the workplace attached to the use of cobots in the manufacturing process, including safety and business interruption. This can also extend to cyber liability, he said.

“You need to understand the risk, if it’s controllable and, indeed, if it’s insurable,” he said. “By carrying out a full risk assessment, you can determine all of the relevant issues and prioritize them accordingly.”

By using collective learning to understand these issues, Joseph Mayo, president, JW Mayo Consulting, said companies can improve their safety and manufacturing processes.

“Companies need to work collaboratively as an industry to understand this new technology and the problems associated with it.” — Joseph Mayo, president, JW Mayo Consulting

“Companies need to work collaboratively as an industry to understand this new technology and the problems associated with it,” Mayo said. “They can also use detective controls to anticipate these issues and react accordingly by ensuring they have the appropriate controls and coverage in place to deal with them.”

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Manufacturing risks today extend beyond traditional coverage, like workers’ compensation, property, equipment breakdown, automobile, general liability and business interruption, to new risks, such as cyber liability.

It’s key to use a specialized broker and carrier with extensive knowledge and experience of the industry’s unique risks.

Stacie Graham, senior vice president and general manager, Liberty Mutual’s national insurance central division, said there are five key steps companies need to take to protect themselves and their employees against these risks. They include teaching them how to use the equipment properly, maintaining the same high quality of product and having a back-up location, as well as having the right contractual insurance policy language in place and plugging any potential coverage gaps.

“Risk managers need to work closely with their broker and carrier to make sure that they have the right contractual controls in place,” she said. “Secondly, they need to carry out on-site visits to make sure that they have the right safety practices and to identify the potential claims that they need to mitigate against.” &

Alex Wright is a U.K.-based business journalist, who previously was deputy business editor at The Royal Gazette in Bermuda. You can reach him at [email protected]