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Experience Modification Rate (EMR) in Construction - An Overview


Posted on February 26th, 2024

EMR in Construction.

Safety incidents negatively impact construction companies in many ways. One effect of injuries and fatalities on the jobsite is a higher EMR, or experience modification rate.

What is an EMR in construction?

In construction, an experience modification rate (EMR)—also known as an EMOD or XMOD—is a calculation based on a business’s total number and cost of safety incidents resulting in workers’ compensation claims over a specific period of time.

EMR is primarily used by insurance companies to price the cost of workers’ compensation insurance premiums. However, a high EMR may also affect your ability to win or even bid on certain contracts.

What is a good EMR rating? What is the best?

When it comes to EMR ratings in construction, lower is better. The average EMR is 1.0. If your business scores an EMR of 1, your risk level is considered average for your industry.

The best EMR in construction is any rating lower than 1. An EMR below 1.0 means that your business is generally less risky to insure than your peers, and your workers’ compensation insurance rates may be lower.

If your EMR is above 1, you are considered a high-risk business, and your premiums will be raised.

How is your EMR calculated?

EMR is calculated based on several factors, including: the frequency of safety incidents, the severity of incidents, your business’s payroll, the cost of insurance claims, and the number of reported incidents. Each state may use a slightly different method to calculate your rating.

Generally, your rating will be based on data from the past 3 years, sometimes with a lag of 1 year due to the way claims are reported. 

Why is EMR important in construction?

EMR is important in construction because your rating determines your workers’ compensation insurance rates and directly impacts the bidding process.  

Working to lower your EMR, or to maintain a low rating, has several benefits.

Keep your workers’ compensation insurance premiums as low as possible

Most states dictate that businesses must have workers’ compensation insurance in order to operate. This is especially important in construction, one of the most dangerous industries for workers according to the National Safety Council. The risk of injury and death for contractors is higher than average compared to other professions. 

With a lower EMR, you’ll be charged less for worker’s compensation insurance, saving you a significant amount of money on a necessary recurring payment. 

Win more bids

Many project owners review a construction company’s EMR as a part of the vetting process. Government contracts in particular may not accept bids from companies with high EMRs, due to the higher risk.

Lowering your EMR will give you more opportunities for work and prevent you from losing profitable business. 

Prevent safety incidents on the jobsite

The strategies that will help you maintain a low EMR will also make the jobsite a better place for employees. When there are less injuries in the field, workers feel safer, improving productivity and employee retention.

How to improve your EMR

The only way to improve your EMR in construction is to reduce safety incidents. You need to establish strict guidelines, closely monitor the jobsite for violations, and provide tools and resources that help workers follow proper procedures on a continuous basis.  

To improve your EMR, you can:

  1. Assign safety checklists

  2. Schedule relevant toolbox talks

  3. Make observations easy

  4. Measure compliance

  5. Document safety

  6. Implement safety management software

Assign safety checklists

Checklists standardize safety and quality control procedures by giving workers a step-by-step guide to inspections and other important safety-related tasks. 

Use checklists to make sure employees are properly conducting inspections, correctly wearing the appropriate protective equipment, and keeping safety top of mind throughout the workday.

Schedule relevant toolbox talks

Frequent toolbox talks remind workers of safety rules and processes they may otherwise forget in the middle of a busy workday. Schedule regular toolbox talks and be sure to choose topics that relate to the actual work that’s being performed that day for maximum impact.

For example, if your employees will be working in cold weather, consider scheduling a toolbox talk to remind them of the signs and symptoms of cold stress. Likewise, if they will be using ladders for the next few days, give a toolbox talk on ladder safety before those tasks begin.

Make observations easy

Give workers a fast and easy way to report safety concerns on the jobsite. 

While a supervisor or foreman may be in charge of monitoring the jobsite, it’s impossible for one person to see everything that happens across an entire project—let alone multiple projects.  Empowering each worker to take ownership and report potential issues will help them be more proactive about their own safety and the safety of their coworkers.

The system you use for observations should be simple and allow workers to quickly create and submit  their observations to the right personnel, so that any issues reported can be corrected immediately.

Measure compliance 

Once you implement safety measures like checklists, toolbox talks, and observations, you need to closely track their success. Are workers consistently completing checklists on time? Are there any common safety violations reported through observations? Is the entire crew showing up for toolbox talks?

If you measure compliance and frequently assess the effectiveness of your safety strategies, you can identify pain points and make impactful changes when needed.

Document safety

Documentation is just as important for safety as it is for project progress. Keep track of all that you’re doing to improve and monitor safety. You need a reliable way to store checklists, observations, toolbox talk attendance, and all other documents related to safety so you can easily access and review them.

Documentation is historical proof of what happened on the jobsite, which can be used to monitor improvements over time and help you fairly resolve disputes or litigation in the event an accident does happen. 

Implement safety management software

It’s difficult to manage something as complex as safety on pen and paper. Construction safety management software will help you implement safety strategies efficiently and keep documentation organized.

Improve safety and prevent incidents with Raken

Raken’s construction safety management tools improve jobsite visibility and standardize safety, helping you maintain a lower EMR.

Proactively identify risks and prevent incidents with:

  • Managed checklists - Assign and schedule custom safety checklists that take the guesswork out of any task

  • Observations - Submit positive or negative observations from the field, attach photos and videos captured right in our app, and tag a team member for resolution

  • Toolbox talks - Choose from over 100 topics, schedule talks, and digitally capture attendance

  • Safety insights - Track compliance at a glance with a visual dashboard that automatically collects data from checklists, toolbox talks, and observations

  • Secure documentation - Save all your documentation securely on the cloud, easy to find and share from the field or office 

Our safety solutions are designed for ease of use, so your team will actually want to use them. Try our web and mobile app today.

Reduce safety incidents on your jobsites

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