Before I get into the background and history of safety incentive and recognition awards, and some of the key factors to consider in determining if and why they may or may not be right for your organisation, I would like to profile for you the Newfoundland Power experience. Newfoundland Power has had a long history with 'safety incentives'. It's also perhaps safe to say that we have had a long history with occupational health & safety too.

By and large, the type of business we're in holds a fair degree of risk for many of the types of tasks which we perform. With electrical energy, you can't see it, smell it, or taste it, but we know that it's there, and the sense of touch is the one sense which our experience has shown makes a big difference in our handling of our product - electricity.

It is also with some degree of pride that we have, in our opinion, achieved some honours with respect to the benefits of a positive safety system, including being ranked as the safest utility in Canada for three consecutive years in the early '80s (based on the Canadian Electricity Association's ranking by lost time injuries) and we've been a winner of a Canadian Business Excellence Award in 1989. We won this award for the Labour/Management Co-operation Category, as reflected in improvements to our corporate safety performance. Now some in the Company may debate how we managed to win these awards, but the fact remains, none-the-less, that they were based on efforts directed towards improving workplace health & safety.

During the mid '70s, when safety performance at Newfoundland Power was less than enviable, decisions were made to move forward with efforts to improve. There were a number of initiatives undertaken, including what we would today call a 'best practice' evaluation of other Canadian utilities, as well as initiatives in the safety incentive area.

The prime 'target', if you will, was the one year lost-time-injury-free mark. Based on whether various sections of the Company reached the one year lost-time-injury-free mark or not, employees became eligible for various prizes, ranging from pocket knives, dinners and banquets, jackets, and including an additional days vacation, depending on how long the lost- time- injury -free period stood. As was the case in the mid to late '70s, Newfoundland Power, like many organisations, adapted various popular practices which were in vogue at the time, including posters and slogans to compliment the 'incentive' system.

Like most organisations, Newfoundland Power felt that employees should be rewarded for working 'safely', and working safely at that time meant no lost time injuries. I make this point, not to criticise the Company for its approach at that time, but because we were doing what we felt was right, based on the information which we had available to us at that time. Hindsight is a wonderful thing; however, if we knew then what we know now, the effort perhaps would have looked much different. To compliment these so-called 'incentives', many companies in North America adopted a 'safety first' approach. Some of the more popular efforts to try and market this 'safety first' approach work was the appeal to the human or emotional side of workers.

The psychology of attempting to influence attitude and behaviour change was often designed to address the 'human error' side of the accident equation. As part of the approach to influence attitude and behaviour, many organisations, including Newfoundland Power, utilised such things as contests or awards as 'incentives' to influence safe employee behaviour. While the intention of offering dinners and gifts to employees was laudable and the objectives honourable, the problems with this type of system soon became apparent.

The biggest problem was the perception that while the Company was rewarding for 'safe' performance, we had no real idea that performance (safe behaviour) was improving in any statistically reliable or measurable way, other than lost time injuries, or the frequency and severity rates which we submitted to the Canadian Electrical Association each year, to see how we 'compared' with the other utilities. Our assumption as a company was that if the 'numbers were down', something was working.

In fact, a number of things were perhaps working, and some positive things at that. We were starting to focus more on training and provide the knowledge and skill necessary to workers and supervisors to enable them to more actively participate and manage safety. We were attempting to change our corporate safety structure from one of direction by a 'head office' safety group only, to one which started to assume more ownership, responsibility and accountability for safety within their respective areas of operation. We were making moves to attempt to develop and structure, by design, a safety culture which made safety a value for all workers and management - not simply a value promoted by the safety staff.

Essentially, we were were attempting to capitalize on the positive aspects of our existing safety culture, whicle at the same time weed out those other aspects which were preventing growth in reaching a higher level of safety maturity. In the process, we started to discover some dysfunction which threatened to contribute towards a negative and dysfunctional safety culture, if indeed it had not already done so. Some of these problems I'll explore within the context of the remainder of this presentation.

Newfoundland Power's decision at the time to implement 'incentive' awards for safety was not inconsistent with the direction of others: it was the 'thing to do' and was considered part or the way safety 'programs' were managed at that time. There has been a great deal of research and discussion on this topic over the past twenty years or so, and while many organisations continue to use prizes and awards for no lost time injuries, there still has not been any definitive correlation shown between successful safety performance and incentive awards, although those organisations who use them infer a connection. In his book, Safety Management...A Human Approach, author Dan Peterson notes, 'organisations use dinners and awards simply because it was traditional for safety programs to use them, but in short, there was never any real foundation for using the element of safety incentives in our safety programs'. 5

Some of the most recent research, however, would suggest that 'incentive awards' are still popular. It's just that the pre-requisite for getting the rewards has been challenged for change.

One of the more recent publications is E. Scott Geller's, The Psychology of Safety. Geller puts forward a number of arguments about the human condition and human behaviour, and the basic purpose of his book, as he acknowledges, is to 'explore the human dynamics of occupational health and safety, and show how they can be managed to significantly improve safety performance'.

In espousing a set of some 50 'principles' for what Geller terms a 'Total Safety Culture', he notes in principle # 9 that safety incentive programs should focus on the 'process' rather than the 'outcomes'. In other words, you should reward for what people do, rather that the consequences of what they may or may not have done. When we examine Geller's approach within the context of such issues as the theory of multiple causation, specifically as it relates to the causes of workplace accidents, the approach seems to makes sense. 6

Fundamentally, this is where Newfoundland Power and people like Geller, and those who accept his philosophy, disagree. In the first place, we have not ascribed to the 'behaviourist' theory of accident prevention, based on the structured or formalized approach to tracking specific at risk or safe behaviours. We approach safety more from a cognitive approach, and start out with the fundamental belief that people want to do a good job - an important and challenging job - and be recognized for their efforts, both individually and collectively. But we don't belive in the buttons, balloons, bells, banners and banquest approach which perhaps might belong more to Disney Land or Las Vagas, rather than the workplace. We also believe strongly that we should be giving rewards for results, especially those things which employees and management have direct control over, not simply variations on lost time injury records or statistics, which are subject to too many variables for them to be adequately subject to an award program. This is not to say that what Geller and others refer to as 'process' is not important; however, we believe that it's important to measure process, but to make sure that unless our objectives or 'targets' are met, the process was not effective.

As a company which has also committed to a process known internally as Corporate Effectiveness (variation on Total Quality Management). It is our corporate philosophy that

'in order to continue to meet our obligations to customers, shareholders and employees, Newfoundland Power is committed to a customer focus, systematic approach to continuous improvement in all aspects of its business. This involves a focus on quality and the achievement of measurable, action oriented goals in pursuit of our corporate mission and objectives'

As part of our internal effectiveness efforts, we have specifically identified a strong link between reaching our corporate objectives and safety. We feel that 'the effectiveness process shall compliment and support efforts aimed at improving workplace safety and health', and our present safety system is structured in such a way as to recognize this approach. So, while Geller may feel as he does, for his reasons, we have our own approach and focus, and feel strongly about its role in our organization.

Says Geller:

'One of the most frequent common-sense mistakes in safety management is in the use of outcome-based incentive programs. Giving rewards for avoiding an injury seems reasonable and logical. But it readily leads to covering up minor injuries and a distorted picture of safety performance. The activator -behaviour-consequence contingency demonstrates that safety incentives need to focus on process activities, or safety related behaviours.

I recently consulted with a chemical plant well known for exemplary safety performance. The annual number of OSHA recordables among approximately 550 employees had varied from 3 to 10 over several years. At the start of 1995, management initiated an outcome-based incentive program to reach a 'step improvement' in safety. Specifically, 20% of a year-end bonus, amounting to $800.00 per employee, hinged on having six or fewer OSHA recordables at the end of the year. By mid-August 1995, the plant had experienced seven OSHA recordables. Everyone lost that $800.00. Needless to say, morale for safety plummeted to an all time low. To boost spirits, employees were promised a significant surprise reward 'that will warm your hearts' if they could go the rest of the year without a single OSHA recordable.

When I visited this plant no OSHA recordable had been reported for 117 days. The plant was on its way to achieving the goal. These outcome-based incentive programs were clearly well intentioned. But I hope you're suspicious about the result. My discussion with employees at this facility verified that minor injuries were being covered up. In fact, one line worker remarked, 'It's only common sense, isn't it, that when you put so much pressure on a person to not have an injury, they'll be motivated to conceal it if they can'.

Symptoms of problems with the safety incentive system at Newfoundland Power started to appear not too long after the implementation, and we didn't need a Ph. D. in psychology to realise it. With some critical evaluation, logic, and some investigative probing, we were starting to discover that Newfoundland Power was exhibiting most of the classic symptoms of dysfunction associated with a safety incentive program based on lost time injury free criteria. Some of the problems noted included a tendency not to report, especially minor injuries; negative peer pressure associated with not wanting to break the record (this pressure became more intense as the one year mark was nearing, or multiple year marks were accumulating); the 'clinic scenario', whereby when an injury occurred which looked as if it might turn out to be a lost time injury, a prime motivator, so it was suggested by some, was 'saving the record' and not worker safety, or initiating accident investigations to determine how and why the accident happened.

In plotting injury control charts in recent years, we have discovered that we were not necessarily having less injuries - we were simply shifting some lost time injuries to medical aid injuries, as attempts to get workers back on light duty were working, having a net effect of 'saving the record'. Some felt this contributed towards to the development of cynicism towards certain safety activities, due to a perception that safety wasn't the issue as much as not spoiling the record.

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HTML by Ralph Stuart	Last revised: April 6, 1997
URL: http://siri.org/library/incprog/nfhist1.html