Case History #1 Steel Manufacturing

Client History

This client is an old and traditional steel mill and forge. High quality railroad wheels and precision rings are produced in these two plants. The labor relations were poor between the unionized workforce and management.

The company emerged from bankruptcy protection with the historical projection of $1.1 million in workers compensation losses per year.


Clearly, the projected workers compensation losses were unsatisfactory from a human and financial perspective. There was significant evidence of exaggeration and misapplication of benefits (workers’ compensation was used in lieu of health or unemployment benefits). The supervisors and managers truly believed that injuries were inevitable and tolerable. As a result, there were frequent and very serious injuries.


The solution consisted of installation of a successful proactive loss prevention program. Supervisors were instructed in accident investigations, modified duty, and profit consequences. The long-standing safety committee was gradually refocused from complaint evaluation to injury prevention.


The frequency of injuries was cut by over 50% in the first year. The total cost of losses was cut by over 66% in the same period.

As a result of fundamental and effective management and real safety performance changes, the insurance premium was reduced by nearly $1 million in the first year of the program.