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(PM-869) Cost-Benefit Analysis of Construction Safety Incentive Programs

Primary Author: Dr Carla Lopez del Puerto CCC Colorado State University
Co-author(s): Mr Jon Elliott Colorado State University

Audience Focus: Intermediate
Application Type: Experience-Based
Venue: 2012 AACE International Annual Meeting, San Antonio, TX, USA

Abstract: Safety incentives are reward techniques designed to reinforce safe behavior with the general objective to reduce lost time due to accidents and improve safety-related records. Construction companies spend millions of dollars each year on safety incentives hoping to improve their safety records and experience modification rates (EMR). However, a great deal of uncertainty exists regarding the effectiveness of safety incentives and their ability to produce these desired results. Much of the confusion and differing opinions about incentives can likely be attributed to conflicting definitions and the interchangeable use of terms. This paper highlights the differences between outcome-based incentive programs, incentives typically based on predetermined parameters, such as no work days lost due to injuries, and behavior-based incentives programs, incentives based on preventing injuries by reducing the frequency of unsafe behavior. The paper analyses the cost-benefit of construction safety incentive programs and provides recommendations for construction managers and cost engineers to assess their current and future incentive programs to ensure that construction companies are spending their resources effectively.