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Difficulties Calculating LTIFR and Other Safety Indicators

The difficulties often encountered when calculating LTIFR and other safety indicators are not with the calculation itself but with the data that is included in the calculation. What are hours worked? What is a lost time injury (LTI) or a medical treatment injury? How are employee numbers worked out? Figuring these things out is essential to having consistent results and getting the most value out of these indicators.

What is an LTI?

In most developed countries there are regulations and standard applying to this and most have a similar definition for an LTI – it is a work related injury that results in one or more complete shifts off work. Some also add that the day on which the injury occurs is excluded but if you think about it that it an unnecessary qualification since the day on which the injury occurred cannot be a considered the loss of a full shift since the person must have been at work for the injury to be work related and therefore didn’t lose a full shift.

Determining whether an injury is work related can sometimes be challenging. For example, an employee that you know to be actively involved in playing football on weekends comes to work on Monday and shortly after starting trips over and twists their knee. Did that happen at work or when they were playing football on the weekend? The honesty of your employees, the conditions in which they were working and the rigour of your investigation process will influence whether you can demonstrate that it was or wasn’t a work related injury. Generally, if the workers compensation people accept the claim then it would be considered work related.

However, estimates from workers compensation insurers indicate that the percentage of fraudulent claims is very small – somewhere between 1% and 5% of all claims – unfortunately they can be some of the more expensive claims but that’s another story.

What is a MTI?

What classifies as medical treatment can be quite contentious as it is not as clearly defined as are LTIs. Questions arise such as:

  • Is treatment by a qualified medical provider such an occupational nurse considered medical treatment or does this only apply when a doctor is involved?
  • If the doctor only conducts an examination and provides no treatment is this still an MTI?
  • If an injured employee elects to see their own doctor rather than the on site first aider should this be classified as an MTI or a first aid injury?

There are no clear answers to these questions and they must be determined internally but they must be determined. Obviously such a situation makes external MTI comparisons questionable but clear internal definitions allow for consistent classification of incidents making internal comparisons reasonably valid.

What are “Hours Worked”?

As the hours worked are the denominator when calculating LTIFR and other health and safety indicators you want them to be as large as possible. At the same time you want them to be reasonably accurate so that the calculated indicators reflect the injury situation in your company as accurately as possible.

The first thing to differentiate is the difference between hours worked and hours paid.

Hours paid often includes penalties for employees who worked overtime. So if a group of employees gets a 50% loading on their salary for overtime work the number of hours paid will be inflated by 50%. This may not be a problem if the number of overtime hours is small but where there is a lot of overtime worked it will result in false rates being calculated. The other problem is where overtime is worked sporadically it will contribute to the peaks and troughs that naturally occur with LTIFR calculations over time and make comparisons between periods invalid.

Fortunately most payroll software can differentiate between hours paid and hours worked so it is necessary that you make this distinction clear when asking you payroll section to provide the data.

Another matter that needs consideration is the amount of leave taken. In Australia, for example, employees are entitled to 10 public holidays and 4 weeks annual leave per year. This equates to almost 10% of the standard hours worked over a year and this doesn’t include sick leave or training leave or maternity leave or any of the other types of leave taken. Again, your payroll section should be able to extract these hours from the figure they give you.

How big a problem this is depends on the working arrangements in your company. Increasingly we are seeing more employees being paid salaries rather than wages. The difference being that salaried employees get paid the same amount no matter how many hours they work and many of them work overtime that is not captured on payroll databases. If you believe that this maybe distorting the figures you receive you may consider using paid hours since the inflated overtime hours offset the unrecorded overtime worked by salaried employees.

It is important to define these things as tightly as is reasonable so you at least know what you’re reporting and what the shortfalls are. If you don’t understand what the figures mean you can’t expect those reading your reports to understand either.

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