2016 Teddy Award Winner

The Family That’s Safe Together

An unwavering commitment to zero lost time is just one way that Harder Mechanical Contractors protects its workers.
By: | November 2, 2016 • 6 min read

From a safety and workers’ comp perspective, the construction industry is one of the most daunting of all industries. The numbers say it best. One in 10 construction workers is injured every year, according to OSHA, and over the course of a 45-year career, a construction worker has a 1 in 200 chance of dying. Sobering odds.

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One company beating those odds is Harder Mechanical Contractors, a 2016 Teddy Award winner.

Portland, Ore.-based Harder Mechanical specializes in process piping fabrication and installation, equipment installation, commercial HVAC piping and plumbing, instrumentation and controls, civil and poured-in-place concrete work and structural steel erection services.

The size of the company’s workforce varies, ranging from around 2,000 to more than 3,000 employees, depending upon the number of projects the company has in the works. Having that kind of revolving-door operation can be a major stumbling block for a safety program. But it has actually made the company double down on its efforts to create a safety culture that can thrive even as workers come and go.

“It’s a never-ending battle,” said Jennifer Massey, the company’s corporate director of safety and health and claims management. “Every day we have to reinforce it.”

Jennifer Massey, corporate director of safety and health and claims management, Harder Mechanical Contractors

Jennifer Massey, corporate director of safety and health and claims management, Harder Mechanical Contractors

It’s a battle they’re winning. The company’s injury frequency plunged from 71 to 18 in the past four years, and its total incurred cost per claim dropped from $21,322 in 2011 to $683 in 2015.

“We have a team that is aligned and focused to prevent injuries at the jobsite,” said company President Dustin Harder. “Our senior leaders are trained to support our crews and a lot of attention is put on the boots on the ground. Our field foremen are the first line of defense to preventing injuries and properly managing the ones that do occur.”

“Every person in the company, from the president to the apprentice, is deeply committed to the goal of achieving zero-injuries,” agreed the company’s general counsel and risk manager, Bill Murphy.

Results like that take diligence. Massey’s team is constantly on top of its leading and lagging indicators, working to spot any sign that the company’s safety efforts may need a course-correct.

When the team became concerned that workers were suffering hand injuries despite wearing gloves, it set out to find out why.

“The problem was, we just weren’t helping them to understand that they needed to wear the right gloves for the job they were doing, or to stop and change [gloves] as the conditions change,” said Massey.

With worker input, the team created a colorful quick-reference 4-by-8-foot glove matrix banner, matching images of glove types to specific jobs and tasks.

“We don’t want to just impose something upon the people out there in the field — they’re the ones turning the wrenches, and know how to do their jobs safely. We need to get their input so they own it,” she said.

The outcome was even better than expected — a rapid 60 percent reduction in hand injuries.

Getting to Zero

Harder Mechanical’s lost-time accident rate is enviable: Zero. The company just reached a remarkable 16 million man hours without a lost-time accident.

“That one is actually our easiest situation to deal with,” said Massey, well aware of how surprising that sounds. The key, she said, is an environment of trust. Workers readily partner with the company to make zero lost-time happen.

Dustin Harder, president, Harder Mechanical Contractors

Dustin Harder, president, Harder Mechanical Contractors

Employee pay scales are negotiated under collective bargaining agreements for each state jurisdiction and craft. If somebody is off work and getting TTD payments, said Massey, “they are severely affected” in terms of salary, health and welfare benefits for their families, and pension credit hours.

That’s a heavy burden to bear. Harder Mechanical makes sure that every employee understands there’s another option.

“We effectively communicate with them that … you can partner with us, and get your doctor involved, and all of us come together and agree that we’re going to keep you working no matter what. … Which would you choose if you were an injured worker?”

In the short-term, Massey’s team provides online training platforms. Recovering workers are brought to a warehouse location, where it’s easiest to accommodate restrictions safely. Treating physicians are highly cooperative because they understand that workers’ recoveries will not be compromised, and are inclined to follow their patients’ wishes.

“I tell [workers], you have to advocate for yourself and tell your doctor, ‘No, this is what I am doing; this is how the company and I are partnering.’ ”

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In 2014, a steamfitter nearing retirement suffered a crushed leg, and nearly lost his foot. Despite multiple surgeries, he was able to utilize the online training platforms until he could return to modified duty at the warehouse.

The employee couldn’t return to his job in the same capacity, so Massey’s team brought in a vocational specialist to help design a permanent job description for him.

With assistance from the state’s preferred worker program, Harder provided numerous accommodations, including special shoes, rolling stools that allow him to rest his leg, a motorized scooter and a golf cart which he uses to travel between buildings.

“We don’t want to just impose something upon the people out there in the field — they’re the ones turning the wrenches, and know how to do their jobs safely. We need to get their input so they own it.” — Jennifer Massey, corporate director of safety and health and claims management, Harder Mechanical Contractors

Throughout the entire journey, he never had to worry about whether he’d be able to provide for his family. That allowed him to focus on his recovery. Eliminating that anxiety has a major impact on outcomes, Massey said.

“Our employees are not affected adversely, financially, so they’re focusing on getting better because they’re not stressed out about how they’re going to pay their bills, or how they’re going to have medical benefits for their family,” she said.

The Human Connection

One important feature of Harder Mechanical’s safety culture is how the company communicates with employees, reminding them why safety matters in the first place, especially in their lives outside of work.

 Bill Murphy, general counsel and risk manager, Harder Mechanical Contractors

Bill Murphy, general counsel and risk manager, Harder Mechanical Contractors

That comes into play with safety commitment letters — letters that workers are asked to write to their families, making a personal promise to work safely.

It’s a tool so powerful that the company only uses it when circumstances warrant a wake-up call.

“We use it when we feel like we’re definitely trending the wrong way and we have to take prompt corrective action to turn the train around before something happens,”  Massey said.

The same principle is applied in a lighter fashion in the company’s newsletter. That features a retiree profile in each issue that details the joys of a retirement they worked so hard for.

For Massey, getting employees safely to those golden years is personal.

“Coming up through, with my dad in the shipyard, [I knew] a lot of my dad’s colleagues who passed away from asbestosis, or they were totally broken down … their quality of life was not what it should be. … People who work hard, they deserve to enjoy the rest of their lives after working.”

Massey said the commitment to protecting every Harder Mechanical employee runs from the top down.

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“For me safety is a value that we will never sacrifice,” said Harder. “I have worked personally with many of the guys within our company; they are an extension of my family, the Harder family. If one of them were to get hurt it’s like a family member gets hurt.”

“The company’s message and safety programs are focused on every worker being able to go home to their families at night in the same condition as when they left for work in the morning,” said Murphy. “I have always been impressed with the company’s consistent approach in all aspects of its business:  ‘Do the right thing.’ ” &

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Read more about the 2016 Teddy Award winners:

target-150x150Bringing Focus to Broad Challenges: Target brings home a 2016 Teddy Award for serving as an advocate for its workers, pre- and post-injury, across each of its many operations.

 

hrt-150x150The Road to Success: Accountability and collaboration turned Hampton Roads Transit’s legacy workers’ compensation program into a triumph.

 

excela-150x150Improve the Well-Being of Every Life: Excela Health changed the way it treated injuries and took a proactive approach to safety, drastically reducing workers’ comp claims and costs.

 

harder-150x150The Family That’s Safe Together: An unwavering commitment to zero lost time is just one way that Harder Mechanical Contractors protects the lives and livelihoods of its workers.

 

More coverage of the 2016 Teddy Awards:

Recognizing Excellence: The judges of the 2016 Teddy Awards reflect on what they learned, and on the value of awards programs in the workers’ comp space.

Fit for Duty: 2013 Teddy Winner Miami-Dade County Public Schools is managing comorbid risk factors by getting employees excited about healthy living.

Saving Time and Money: Applying Lean Six Sigma to its workers’ comp processes earned Atlantic Health a Teddy Award Honorable Mention.

Caring for the Caregivers: Adventist Health Central Valley Network is achieving stellar results by targeting its toughest challenges.

Advocating for Injured Workers: By helping employees navigate through the workers’ comp system, Cottage Health decreased lost work days by 80 percent.

A Matter of Trust: St. Luke’s workers’ comp program is built upon relationships and a commitment to care for those who care for patients.

Keeping the Results Flowing: R&I recognizes the Metropolitan Water Reclamation District of Greater Chicago for a commonsense approach that’s netting continuous improvement.

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

More from Risk & Insurance

More from Risk & Insurance

Exclusive | Hank Greenberg on China Trade, Starr’s Rapid Growth and 100th, Spitzer, Schneiderman and More

In a robust and frank conversation, the insurance legend provides unique insights into global trade, his past battles and what the future holds for the industry and his company.
By: | October 12, 2018 • 12 min read

In 1960, Maurice “Hank” Greenberg was hired as a vice president of C.V. Starr & Co. At age 35, he had already accomplished a great deal.

He served his country as part of the Allied Forces that stormed the beaches at Normandy and liberated the Nazi death camps. He fought again during the Korean War, earning a Bronze Star. He held a law degree from New York Law School.

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Now he was ready to make his mark on the business world.

Even C.V. Starr himself — who hired Mr. Greenberg and later hand-picked him as the successor to the company he founded in Shanghai in 1919 — could not have imagined what a mark it would be.

Mr. Greenberg began to build AIG as a Starr subsidiary, then in 1969, he took it public. The company would, at its peak, achieve a market cap of some $180 billion and cement its place as the largest insurance and financial services company in history.

This month, Mr. Greenberg travels to China to celebrate the 100th anniversary of C.V. Starr & Co. That visit occurs at a prickly time in U.S.-Sino relations, as the Trump administration levies tariffs on hundreds of billions of dollars in Chinese goods and China retaliates.

In September, Risk & Insurance® sat down with Mr. Greenberg in his Park Avenue office to hear his thoughts on the centennial of C.V. Starr, the dynamics of U.S. trade relationships with China and the future of the U.S. insurance industry as it faces the challenges of technology development and talent recruitment and retention, among many others. What follows is an edited transcript of that discussion.


R&I: One hundred years is quite an impressive milestone for any company. Celebrating the anniversary in China signifies the importance and longevity of that relationship. Can you tell us more about C.V. Starr’s history with China?

Hank Greenberg: We have a long history in China. I first went there in 1975. There was little there, but I had business throughout Asia, and I stopped there all the time. I’d stop there a couple of times a year and build relationships.

When I first started visiting China, there was only one state-owned insurance company there, PICC (the People’s Insurance Company of China); it was tiny at the time. We helped them to grow.

I also received the first foreign life insurance license in China, for AIA (The American International Assurance Co.). To date, there has been no other foreign life insurance company in China. It took me 20 years of hard work to get that license.

We also introduced an agency system in China. They had none. Their life company employees would get a salary whether they sold something or not. With the agency system of course you get paid a commission if you sell something. Once that agency system was installed, it went on to create more than a million jobs.

R&I: So Starr’s success has meant success for the Chinese insurance industry as well.

Hank Greenberg: That’s partly why we’re going to be celebrating that anniversary there next month. That celebration will occur alongside that of IBLAC (International Business Leaders’ Advisory Council), an international business advisory group that was put together when Zhu Rongji was the mayor of Shanghai [Zhu is since retired from public life]. He asked me to start that to attract foreign companies to invest in Shanghai.

“It turns out that it is harder [for China] to change, because they have one leader. My guess is that we’ll work it out sooner or later. Trump and Xi have to meet. That will result in some agreement that will get to them and they will have to finish the rest of the negotiations. I believe that will happen.” — Maurice “Hank” Greenberg, chairman and CEO, C.V. Starr & Co. Inc.

Shanghai and China in general were just coming out of the doldrums then; there was a lack of foreign investment. Zhu asked me to chair IBLAC and to help get it started, which I did. I served as chairman of that group for a couple of terms. I am still a part of that board, and it will be celebrating its 30th anniversary along with our 100th anniversary.

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We have a good relationship with China, and we’re candid as you can tell from the op-ed I published in the Wall Street Journal. I’m told that my op-ed was received quite well in China, by both Chinese companies and foreign companies doing business there.

On August 29, Mr. Greenberg published an opinion piece in the WSJ reminding Chinese leaders of the productive history of U.S.-Sino relations and suggesting that Chinese leaders take pragmatic steps to ease trade tensions with the U.S.

R&I: What’s your outlook on current trade relations between the U.S. and China?

Hank Greenberg: As to the current environment, when you are in negotiations, every leader negotiates differently.

President Trump is negotiating based on his well-known approach. What’s different now is that President Xi (Jinping, General Secretary of the Communist Party of China) made himself the emperor. All the past presidents in China before the revolution had two terms. He’s there for life, which makes things much more difficult.

R&I: Sure does. You’ve got a one- or two-term president talking to somebody who can wait it out. It’s definitely unique.

Hank Greenberg: So, clearly a lot of change is going on in China. Some of it is good. But as I said in the op-ed, China needs to be treated like the second largest economy in the world, which it is. And it will be the number one economy in the world in not too many years. That means that you can’t use the same terms of trade that you did 25 or 30 years ago.

They want to have access to our market and other markets. Fine, but you have to have reciprocity, and they have not been very good at that.

R&I: What stands in the way of that happening?

Hank Greenberg: I think there are several substantial challenges. One, their structure makes it very difficult. They have a senior official, a regulator, who runs a division within the government for insurance. He keeps that job as long as he does what leadership wants him to do. He may not be sure what they want him to do.

For example, the president made a speech many months ago saying they are going to open up banking, insurance and a couple of additional sectors to foreign investment; nothing happened.

The reason was that the head of that division got changed. A new administrator came in who was not sure what the president wanted so he did nothing. Time went on and the international community said, “Wait a minute, you promised that you were going to do that and you didn’t do that.”

So the structure is such that it is very difficult. China can’t react as fast as it should. That will change, but it is going to take time.

R&I: That’s interesting, because during the financial crisis in 2008 there was talk that China, given their more centralized authority, could react more quickly, not less quickly.

Hank Greenberg: It turns out that it is harder to change, because they have one leader. My guess is that we’ll work it out sooner or later. Trump and Xi have to meet. That will result in some agreement that will get to them and they will have to finish the rest of the negotiations. I believe that will happen.

R&I: Obviously, you have a very unique perspective and experience in China. For American companies coming to China, what are some of the current challenges?

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Hank Greenberg: Well, they very much want to do business in China. That’s due to the sheer size of the country, at 1.4 billion people. It’s a very big market and not just for insurance companies. It’s a whole range of companies that would like to have access to China as easily as Chinese companies have access to the United States. As I said previously, that has to be resolved.

It’s not going to be easy, because China has a history of not being treated well by other countries. The U.S. has been pretty good in that way. We haven’t taken advantage of China.

R&I: Your op-ed was very enlightening on that topic.

Hank Greenberg: President Xi wants to rebuild the “middle kingdom,” to what China was, a great country. Part of that was his takeover of the South China Sea rock islands during the Obama Administration; we did nothing. It’s a little late now to try and do something. They promised they would never militarize those islands. Then they did. That’s a real problem in Southern Asia. The other countries in that region are not happy about that.

R&I: One thing that has differentiated your company is that it is not a public company, and it is not a mutual company. We think you’re the only large insurance company with that structure at that scale. What advantages does that give you?

Hank Greenberg: Two things. First of all, we’re more than an insurance company. We have the traditional investment unit with the insurance company. Then we have a separate investment unit that we started, which is very successful. So we have a source of income that is diverse. We don’t have to underwrite business that is going to lose a lot of money. Not knowingly anyway.

R&I: And that’s because you are a private company?

Hank Greenberg: Yes. We attract a different type of person in a private company.

R&I: Do you think that enables you to react more quickly?

Hank Greenberg: Absolutely. When we left AIG there were three of us. Myself, Howie Smith and Ed Matthews. Howie used to run the internal financials and Ed Matthews was the investment guy coming out of Morgan Stanley when I was putting AIG together. We started with three people and now we have 3,500 and growing.

“I think technology can play a role in reducing operating expenses. In the last 70 years, you have seen the expense ratio of the industry rise, and I’m not sure the industry can afford a 35 percent expense ratio. But while technology can help, some additional fundamental changes will also be required.” — Maurice “Hank” Greenberg, chairman and CEO, C.V. Starr & Co. Inc.

R&I:  You being forced to leave AIG in 2005 really was an injustice, by the way. AIG wouldn’t have been in the position it was in 2008 if you had still been there.

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Hank Greenberg: Absolutely not. We had all the right things in place. We met with the financial services division once a day every day to make sure they stuck to what they were supposed to do. Even Hank Paulson, the Secretary of Treasury, sat on the stand during my trial and said that if I’d been at the company, it would not have imploded the way it did.

R&I: And that fateful decision the AIG board made really affected the course of the country.

Hank Greenberg: So many people lost all of their net worth. The new management was taking on billions of dollars’ worth of risk with no collateral. They had decimated the internal risk management controls. And the government takeover of the company when the financial crisis blew up was grossly unfair.

From the time it went public, AIG’s value had increased from $300 million to $180 billion. Thanks to Eliot Spitzer, it’s now worth a fraction of that. His was a gross misuse of the Martin Act. It gives the Attorney General the power to investigate without probable cause and bring fraud charges without having to prove intent. Only in New York does the law grant the AG that much power.

R&I: It’s especially frustrating when you consider the quality of his own character, and the scandal he was involved in.

In early 2008, Spitzer was caught on a federal wiretap arranging a meeting with a prostitute at a Washington Hotel and resigned shortly thereafter.

Hank Greenberg: Yes. And it’s been successive. Look at Eric Schneiderman. He resigned earlier this year when it came out that he had abused several women. And this was after he came out so strongly against other men accused of the same thing. To me it demonstrates hypocrisy and abuse of power.

Schneiderman followed in Spitzer’s footsteps in leveraging the Martin Act against numerous corporations to generate multi-billion dollar settlements.

R&I: Starr, however, continues to thrive. You said you’re at 3,500 people and still growing. As you continue to expand, how do you deal with the challenge of attracting talent?

Hank Greenberg: We did something last week.

On September 16th, St. John’s University announced the largest gift in its 148-year history. The Starr Foundation donated $15 million to the school, establishing the Maurice R. Greenberg Leadership Initiative at St. John’s School of Risk Management, Insurance and Actuarial Science.

Hank Greenberg: We have recruited from St. John’s for many, many years. These are young people who want to be in the insurance industry. They don’t get into it by accident. They study to become proficient in this and we have recruited some very qualified individuals from that school. But we also recruit from many other universities. On the investment side, outside of the insurance industry, we also recruit from Wall Street.

R&I: We’re very interested in how you and other leaders in this industry view technology and how they’re going to use it.

Hank Greenberg: I think technology can play a role in reducing operating expenses. In the last 70 years, you have seen the expense ratio of the industry rise, and I’m not sure the industry can afford a 35 percent expense ratio. But while technology can help, some additional fundamental changes will also be required.

R&I: So as the pre-eminent leader of the insurance industry, what do you see in terms of where insurance is now an where it’s going?

Hank Greenberg: The country and the world will always need insurance. That doesn’t mean that what we have today is what we’re going to have 25 years from now.

How quickly the change comes and how far it will go will depend on individual companies and individual countries. Some will be more brave than others. But change will take place, there is no doubt about it.

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More will go on in space, there is no question about that. We’re involved in it right now as an insurance company, and it will get broader.

One of the things you have to worry about is it’s now a nuclear world. It’s a more dangerous world. And again, we have to find some way to deal with that.

So, change is inevitable. You need people who can deal with change.

R&I:  Is there anything else, Mr. Greenberg, you want to comment on?

Hank Greenberg: I think I’ve covered it. &

The R&I Editorial Team can be reached at [email protected]