Hand injuries can lead to the establishment of claim reserves because severe cuts and lacerations, such as a severed tendon, can cause temporary or permanent disability. (DSM Dyneema photo)

Maximize Construction Bidding Success by Minimizing Your MOD Rate

Advanced glove materials prevent job site hand injuries that impact a contractor's selection.

The experience modification (MOD) rate plays a critical role in a number of U.S. commercial construction bidding scenarios. Although the MOD rate is primarily used to calculate workers' compensation insurance premiums, it has been widely adopted by federal, state, and local agencies as a method to evaluate the job site safety records and risk potential of contractors and construction companies that are bidding on projects. Many government agencies require documented proof of the MOD rate for bid submissions and use it as a factor in the selection process. Even more important, a high MOD number may disqualify contractors from submitting a bid in the first place.

For example, the Carolinas Associated General Contractors states that construction project owners and managers typically use the MOD rate to measure the effectiveness of a contractor's safety program. They often rely on it as the single qualifier to the effectiveness of any individual contractor’s safety record. In construction bid situations, it is common to require a MOD pre-qualification rate of 1.0 (the national average) or less to bid on a project.1

To effectively manage their MOD rate, construction firms need safety and risk control programs that can reduce the frequency and severity of workers' compensation claims. One strategy is to mandate the use of cut-resistant gloves on construction sites to prevent hand injuries. Because the building and construction industry has lagged behind manufacturing in adopting cut-resistant gloves, this approach offers tremendous potential to safeguard workers and drive down the MOD rate. In fact, a study by the Liberty Mutual Research Institute for Safety found glove use was associated with a 60 percent reduction in the relative risk of hand injury.2 Conversely, the industry's tendency of going without hand protection can make it more difficult for safety managers to implement and enforce glove use, especially those made with traditional materials that can be heavy and bulky and trap heat inside the gloves.

Today, there is a new solution that can encourage the adoption of cut-resistant gloves for construction tasks ranging from glass and sheet metal handling to power tool use. Advanced technology based on ultra-high molecular weight polyethylene (UHMWPE) offers lighter weight, less bulk, and greater comfort and durability than traditional materials used to manufacture protective gloves. This new technology makes gloves more appealing to workers, which will encourage use and help safety managers achieve compliance among employees and subcontractors. By lowering the incidence of serious cuts and abrasions that boost the MOD rate, construction companies can increase their success in bidding on projects and reduce their workers' compensation premiums, as well.

Managing the MOD Rate
The MOD rate, calculated by the National Council on Compensation Insurance or individual state rating bureaus (in California, Delaware, Michigan, Minnesota, New York, Pennsylvania, Texas, and Wisconsin), is determined for each employer by comparing past losses for that company to average losses of other employers in that state in the same business, adjusted for size. Hand injuries are often part of those records. In fact, according to the U.S. Centers for Disease Control and Prevention, hand injuries account for 1,080,000 emergency department visits by workers per year. The U.S. Bureau of Labor Statistics cites that hand injuries resulting from cuts and punctures cost the construction industry $382 million each year.

Because the MOD rate is typically based on the company's previous three years of experience, past injuries can have an extended impact because the associated workers' compensation claims involve not only medical payments, but also lost wages or indemnity and final settlements, which can take years to reach their full value. When presented with a new claim, an insurance company will call upon its experience handling similar claims to establish a reserve—the amount it expects to ultimately pay. Therefore, workers' compensation claim reserves are included in the MOD calculation just as if those monies were already spent.3 Hand injuries can lead to the establishment of claim reserves because severe cuts and lacerations, such as a severed tendon, can cause temporary or permanent disability.

Challenges of Compliance
Even when protective gloves are required, recommended or provided, many construction workers do not wear them consistently, or at all. More than half of workers perform tasks barehanded—often because they cannot find the comfort, dexterity, and protection they require in a single hand protection product. Among those who do wear gloves, more than half remove them at some point during the day so they can complete certain tasks.4

Some cut-resistant gloves, such as those used in construction tasks that call for a high level of protection, are reinforced with steel or glass fibers. However, these materials add weight and bulk, which can interfere with dexterity in precision tasks and cause hand fatigue. They also can produce discomfort by trapping heat and causing hands to perspire, which in turn can lead to slippage.

Choosing the Right Gloves
Gloves used by construction workers are often made of leather, based on the common misconception that this material offers good cut protection. In reality, leather is the worst material for cut protection, although it prevents abrasion. Even cotton canvas outperforms the heaviest leathers, although cotton itself provides poor cut protection. Other glove materials—including aramid and gloves with fiberglass and steel—can be heavy, bulky, and non-breathable.

Advances in cut-resistant fiber technology help to eliminate the reasons why workers fail to use protective gloves while addressing the performance shortfalls of leather and cotton. These high-performance textiles, based on UHMWPE, reduce weight and bulk and provide flexibility and breathability. When special hardness components are incorporated within the fiber itself, these enhanced textiles can deliver cut resistance up to EN Level 5, the highest under the European standard, EN 388, Protective Gloves Against Mechanical Risks, and ANSI Level 4 under the U.S. standard, ANSI/ISEA 105, American National Standard for Hand Protection.

The best way to guarantee glove use compliance is to choose a glove appropriate for the tasks associated with a particular type of job. Within the construction industry, these tend to be:

  • Carpentry—requires good dexterity for handling tools and other small objects; cut protection and some puncture resistance are also needed.
  • Sheet metal work—the biggest hazards are sharp edges and metal burrs; requires cut protection, sometimes significant, as well as need to grip potentially slick surfaces.
  • Glass work—involves handling sharp edges and slick surfaces; cut protection and grip are important.
  • Electrical work (wire pulling)—pulling wire and reaching into tight places can require some puncture resistance, abrasion resistance, and cut protection to keep safe from sharp edges.
  • Concrete work (rebar)—workers face edges, burrs, and the bands that keep rebar tightly bound together, which can be a sharp edge hazard when bands are cut to release rebar; they also need abrasion resistance to protect from grinding and repeated contact with rough edges.

Clearly, not every task on a construction site requires exactly the same level and type of protection, so selecting the appropriate glove for each task is crucial in defending workers' hands and the safety rating of the company. Choosing a glove with the highest level of cut resistance when a lower level of protection is suitable would be unnecessary and expensive. On the other hand, choosing a glove with insufficient protection could present grave personal and financial risks.

Job site hand injuries not only affect construction workers' health, but also contribute to high experience modification rates that can prevent contractors from bidding on or winning government jobs. Many of these injuries could be avoided if workers would consistently wear appropriate protective gloves on the job. However, employee and subcontractor safety can be affected by the construction industry’s tradition of using poorly performing leather or cotton gloves—or no gloves at all.

Another hurdle is finding gloves that meet workers' comfort and dexterity needs while delivering a high level of cut resistance. To help manage their MOD rates, contractors and construction firms should provide or recommend protective gloves made with next-generation materials. Ultra-high molecular weight polyethylene technologies surpass traditional materials by providing lighter weight, reduced bulk, and improved coolness/breathability, combined with cut resistance up to the highest level of protection. Investment in gloves made with UHMWPE can help contractors pre-qualify for government construction bidding and compete more effectively.

1. https://www.cagc.org/members/files/positions/Experience_Modification_Rate_as_Indicator_in_Construction.pdf
2. G.S. Sorock, D.A. Lobardi, et al. A case-crossover study of transient risk factors for occupational acute hand injury. Occupational & Environmental Medicine. http://oem.bmj.com/content/61/4/305.full
3. http://workcompconsultant.com/experience-modification-rating-workers-compensation-emod-emr.htm
4. http://ansellpro.com/main/pressRoom_whitePapers_details.asp?rId=87

This article originally appeared in the August 2015 issue of Occupational Health & Safety.

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