Companies often want to know how they compare with others in their industry. These comparisons may involve financial ratios, market share, quality indicators and, in the world of safety, injury/illness incidence rates.

The injury/illness incidence rate is used  for many purposes. OSHA uses it to determine which companies should be put on the list for targeted inspections. Companies use this data to compare contractors as part of the bid process. Individual companies use the rates to compare progress from year to year and to benchmark within their industry.

The process of determining an incidence rate is straightforward and the Bureau of Labor Statistics (BLS) has a great tool to perform this calculation. Here’s the link  Besides calculating this rate, the tool allows companies to compare their rate to others within their industry.

Sounds like a number that would be important to track.  So is it a useful piece of information?  Here are three facts about the incidence rate that call into question its usefulness

The calculation upon which the rate is based is a company with 100 employees.  This fact leads to small companies, even with a single injury/illness, to have a rate that compares unfavorably with the industry average.  When the rates are used to determine who should be targeted for inspections or to  determine if a company’s safety record meets the requirements during a bid process, it is easy to see that smaller companies are at a disadvantage.

Due to two major changes in the classification of industries in the past 10 years, it is difficult to compare industry-specific rates from previous years.  It is also important to keep in mind that the industry rates are estimates based on sampling and survey principles.  With that in mind, the smaller the industry size, the less reliable are the rates.

The rate is a lagging indicator of safety efforts.  While it is okay to look at past events with an eye toward preventing injuries/illnesses, it can be misleading to use the rate as the sole indicator of the impact of your safety program efforts.  OSHA cautions against using injury/illness rates as part of an incentive program.  The agency’s primary reasoning is that it can lead to underreporting of injuries/illnesses.  That may or may happen, but it is more important for companies to focus efforts on the activities that lead to safer workplace.  The basics of ongoing training, facility inspections and program audits are what will lead to zero injuries/illnesses.

Because it is used as a benchmark by OSHA and others, the incidence rate cannot be ignored.  It also important to understand that it can be misused and lead to misleading conclusions about a company’s safety program.

Please keep this in mind.  Championships are not won without doing the work (or the basics) that will lead you to that goal.  Is everybody at your company doing the work that will make for a safe workplace?