Module 6: Risk Management 8 % PHR 7 % SPHR

1. Module 6: Risk Management8% PHR 7% SPHR Any student use of these slides is subject to the same License Agreement that governs the student's use of the SHRM Learning System materials.

2. Risk & Risk Management • Risk – possibility of positive opportunities and outcomes as well as negative. • Risk Management – is the identification, evaluation and control of risk that may affect an organization. • Is a complex enterprise-wide concern that has ramifications for all areas discussed in all SRHM Modules

3. Categories of Operational Risk • Personnel risk (fraud and error) • Physical assets (business environments) • Technology (viruses) • Relationships (lawsuits) • External/regulatory (external fraud) HR role: Examine HR policies to prevent or mitigate loss and ensure business continuity.

4. Risk Management Integrated effort of any organization, with executive level support, supports strategic goals and growth of the organization. HR should assess risk and create policies.

5. Risk Management Techniques Tools: Risk management software systems and risk management scorecard

6. Continuity and Recovery Business continuity planning • Identifies potential threats and impacts. • Plans for disruption, interruption, or loss of business functions. Disaster recovery planning • A set of guidelines and procedures to be used by an organization for the recovery of business operations due to disasters such as earthquakes, fires, terrorism, or epidemics.

7. Insurance That Mitigates Risk • Employment practices liability insurance (EPLI) • Protects against claims of discrimination, wrongful termination, and sexual harassment. • Professional liability insurance • Protects directors, officers, employees, and the organization against claims of negligence in the performance of professional services. • Worker’s compensation insurance • Protects workers in case of work-related injury or disease.

8. Risk Management Legislation: OSHA Employee rights Employees must comply with OSHA standards and have a right to: • Demand safety and health on the job. • Request inspections. • Have an authorized representative accompany an inspection. • File a complaint. • Be informed of workplace hazards. • Request action from the employer to correct hazards or violations. • File a discrimination complaint. • Receive training.

9. Keep employees informed. Correct violations. Allow employees to refuse abnormally dangerous work. Provide personal protective equipment. Provide medical surveillance. Provide training. Enforce rules and regulations. Risk Management Legislation: OSHA Employer responsibilities Keep employees safe. • Display OSHA poster. • Provide copies of act and rules/regulations. • Post OSHA citations. • Notify employees of hazards. • Maintain accurate records. • Permit authorized employee representation during an OSHA inspection.

10. Which of the following is an example of an employer’s rights under OSHA? A. To apply to OSHA for a temporary or permanent variance from a standard B. To restrict inspectors and employee representatives from all areas that contain confidential information, processes, or equipment • To refrain from enforcing rules that cause economic hardship for the organization D. To review and rule on employee protests regarding unsafe working conditions Answer: A

11. Emergency Exit Procedures Occupational Noise Exposure Machine Guarding Hazard Communication Control of Hazardous Energy—Lockout/ Tagout Bloodborne Pathogens Confined Space Entry Personal Protective Equipment Process Safety Management OSHA Regulatory Standards

12. Injury and Illness Definitions • Occupational injury: Injury that results from a work-related accident or exposure involving a single incident. • Occupational illness: Medical condition or disorder caused by exposure to environmental factors associated with employment.

13. Recording Criteria For both work-related illnesses and injuries: • Death • Days away from work • Restricted work or transfer to another job • Loss of consciousness • Diagnosis by a licensed health-care professional • Medical treatment beyond first aid

14. OSHA Forms Form 300 – Log of Work-Related Injuries & Illnesses • keep separate logs for each location Form 300A – Summary of Work-Related Injuries & Illnesses • posted at the end of the year for 3 months Form 301 – Injury and Illness Incident Report Filled out within 7 days of learning of an accident Form must be kept for five years

15. An employer learns that a worker has fractured an arm on the job. Within what time frame must the employer complete OSHA Form 300? A. 8 hours B. 24 hours C. 3 calendar days D. 7 calendar days Answer: D

16. OSHA Inspection Priorities

17. OSHA Violations

18. Drug-Free Workplace Act Federal contractors with contracts of $100,000 or more and recipients of grants from federal government must: • Develop a policy that maintains a drug-free workplace. • Specify penalties for policy violations. • Provide a copy of the policy to employees. • Establish a drug-awareness program.

19. Legislation Summary

20. Legislation Summary

21. Safety Program Priorities • Injuries are prevented and hazards are minimized.

22. Safety Hierarchy

23. Safety Responsibilities

24. Safety Committees • Encourage safety awareness. • Motivate employees. • Identify and correct hazards. Ensure that the safety committee does not become an employer-dominated labor organization—a violation of the NLRA.

25. Influences on Accidents and Incidents

26. Classifying Incidents • Failing to use protective equipment • Improper dress or use of equipment • Performing unauthorized procedures • Defective equipment • Noise, heat, dust, or vibration • Poor ventilation • Improper lighting • Unsafe floor surfaces Unsafe acts Unsafe conditions

27. Accident Prevention • Design work sites and flow to manage risk. • Assign safety specialists and line managers to committees. • Analyze why accidents happen and have outside experts inspect working conditions. • Provide updated job and safety training; test and document results. • Provide safety rewards and recognition.

28. Ergonomics Programs • Ergonomics team • Work-site analysis • Job redesign • Surveys/monitoring/feedback • Training • On-site exercise programs • Budget Include: • Musculoskeletal disorders • Computer vision syndrome • Lower back strains • Sick building syndrome Reduce:

29. Return-to-work programs require that injured employees A. return to less-strenuous jobs on a permanent basis. B. refrain from taking FMLA leave until they can return to work. • stay on disability until they can perform all the duties of their current jobs. D. perform jobs that accommodate their current limitations. Answer: D

30. Current illnesses Hepatitis B virus Hepatitis C virus HIV/AIDS Tuberculosis Future pandemics Disease that is new to the population Human infection that causes serious illness Agent that spreads easily Health Hazards Infectious diseases

31. Physical Heat, noise, vibration, air conditioning, radiation, ventilation, smoking, sanitary conditions, drinking water, workplace design Chemical Dust, fumes, gases, toxic materials and chemicals, carcinogens, smoke Biological Bacteria, fungi, insects Health Hazards Environmental factors

32. Employee Assistance Programs EAP options: • In-house • Outside contractors • Consortium • Affiliate Provide counseling for: • Alcohol and drug abuse • Emotional • Family and marital • Legal • Career • Workplace violence • Financial

33. Wellness and fitness Employee Wellness Programs Nutrition and weight control Stress reduction Smoking cessation

34. A written policy on substance abuse benefits the organization because A. it’s a deterrent to absenteeism and tardiness. B. supervisors are more willing to confront employees with impaired performance. • it fulfills compliance with state and local laws and ordinances. D. top management does not have to deal with issues related to drug abuse. Answer: B

35. Drug Testing Categories

36. Drug Intervention Strategies

37. Security Measures • Security guards • Preventive audits • Identification and external control systems — Fingerprints, magnetic cards • Structural barriers — Gates, fences • Security hardware — Alarms, sensors

38. Fraud Control Practices • Inventory counts • Fraud hotlines • Sound auditing procedures • Video surveillance • Dollar-limit authority

39. Risk Analysis Vulnerability = Degree of probability that loss will occur + Severity of impact Probability • Virtually certain • Highly probable • Moderately probable • Improbable Severity • Fatal • Very serious • Moderately serious • Negligible

40. Emergency Response Plan Guidelines • Involve senior management. • Create a team. • Set priorities. • Identify resources. • Communicate the plan. • Keep the plan up-to-date. • Test the plan.

41. Reduce stress by giving employees a vehicle to express concerns. Reduce inappropriate responses by checking employee references and monitoring behavior. Reduce opportunity by maintaining a zero tolerance policy for weapons and violence. Causes of Workplace Violence Violence = Stress + Inappropriate responses + Opportunity

42. Identify and involve stakeholders. Conduct needs assessment. Workplace Violence Prevention/ Intervention Program Elements Monitor and evaluate program and response. Develop prevention and intervention program. Implement program. Invoke incident management plan.

43. A company is located in a multi-tenant building in a suburban area, off an interstate highway lined with shopping malls and fast-food restaurants. There is ample parking in an unsecured lot. There is a desk at the building’s one unlocked public entrance to screen visitors, but the door is locked at night and there is no security guard at the desk. The company operates a sales office, a service center, and a 24-hour call center in this facility. There is no record of employee conflicts and few complaints against supervisors. What is the company’s greatest vulnerability at this facility? A.Workplace stress B. Likelihood of weapons possession in the workplace C. Parking lot at night D. Unsecured alternative entrances at night Answer: C Evening and night shifts will be using the unsecured parking lot at night in an area that is likely to have significant traffic at all hours. This is a vulnerability for employees on those shifts who could be robbed or assaulted on their way into or from work. A range of actions could be taken to address this risk, from improving lighting to contracting with security services during shift turnover hours.

44. Government Responses to Terrorism • USA PATRIOT Act • Department of Homeland Security • National Response Framework

45. Recognize insider/outsider threats. Protection of Proprietary Information • Identify proprietary information. • Use confidentiality and nondisclosure agreements. • Secure trade secrets. • Confine intellectual knowledge on “need-to-know” basis. • Provide training to employees about the organization’s plan.

46. Technology Security Risks • Unauthorized access to data • Virus downloads • Social engineering Organizational policies for accessing and using technology in the workplace help to mitigate security risks.