2017 NWCDC

People First

For Nordstrom, putting employees first isn’t a tactic, it’s a mission statement.
By: | December 7, 2017 • 2 min read

There is one key golden rule in the Nordstrom employee handbook: “Use good judgment in all situations.”

It sounds a little old-school, but that makes sense coming from a 116-year-old retailer.

From a workers’ comp standpoint, the other key rule is to treat the company’s 72,000-plus employees with the same level of care as customers, said Janine Kral, the company’s vice president of risk management. Kral delivered the keynote address at the 26th annual National Workers’ Compensation and Disability Conference & Expo on Dec. 6 at Mandalay Bay in Las Vegas.

Janine Kral, vice president, risk management, Nordstrom

“It’s as simple as keeping the employee at the front-and-center of everything we do,” said Kral, who leads a 75-person risk management team that includes 29 people dedicated to the company’s self-insured, self-administered workers’ compensation program.

That employee focus has always been a core value for the Nordstrom family and for the risk management team, said Kral. The company’s decision to self-insure three decades ago was actually driven by the dissatisfaction of injured workers.

Clearly Nordstrom was a proponent of employee advocacy long before that term joined the lexicon of industry terminology.

Claims examiners are trained to use a customer service approach to claims and to be active listeners. Nordstrom doesn’t encumber them with excessive rules, instead empowering them to rely on their good judgment

“The more rules you have, the further away you are from the customer,” said Kral.

Active listening also helps claims examiners identify high-exposure claims and determine which cases might benefit from nurse case management. Kral said the company’s claims examiners do an excellent job of looking not only at the initial facts of a claim, but also think ahead to what could impact outcomes down the road.

Nordstrom selects service partners carefully to ensure that everyone shares the same values and level of care for employees.

“If one person is negative, it can all go south,” said Kral.

Being employee-focused doesn’t mean that the company never denies claims, said Kral. But when they do, they have solid footing to explain why. And in some cases, the company has taken steps to help employees outside the scope of workers’ comp even when a claim wasn’t compensable.

“The more rules you have, the further away you are from the customer.” — Janine Kral, vice president, risk management, Nordstrom

In one case, said Kral, a 22-year-old employee was paralyzed from the neck down. The claim was ultimately determined to be non-work-related. But the company took the step of getting a special van to give him more mobility.

“As an industry, we need to get back to [focusing on] the worker in workers’ compensation,” said Kral.

Nordstrom’s longtime focus on a employee-centered program provides ample proof that the approach makes good business sense.

By the numbers:

  • Total cost of risk as a percentage of sales has decreased by 11 percent over the past five years.
  • Actuarial claim projections have also decreased by 15 percent over the past five years.
  • 107 percent closure ration in 2016.
  • Less than 500 indemnity claims in 2016 (out of 75,000 employees)
  • 48 percent decrease in narcotic prescriptions over the past two years. &
Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.


That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.


Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

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