The retail segment is filled with many types of businesses that have employees taking on various roles and responsibilities, as well as hazards that they face over the course of their workday. Nonetheless, a closer examination of the sector offers up a few similarities, in terms of the workers’ compensation-related risks that these businesses encounter.
One trend is that the retail sector attracts a lot of first-time entrepreneurs – more than say, manufacturing operations.
Retail Workers' Compensation
“The retail business as a segment tends to have some characteristics that affect it more than other segments. One of those, for example, is the fact that it tends to be an easier entry point than a number of industry segments, so we get more people who are opening a business for the first time,” said Matthew Zender, senior vice president, and workers’ compensation product manager at AmTrust Financial Services. “What that means is you have [people] who may be new to being a business owner and are a little more unfamiliar with some of the things that they need to know about how to treat workplace safety.”
Because the sector is predisposed to first-time business owners, many of them use personal credit versus a line of credit to fund their operation. When a business owner is extending their personal credit, that can affect how they’re going to invest in safety.
“That’s different than many larger enterprises, where they’re going to be working with a commercial banker and a line of credit, and they don’t feel quite as exposed,” said Zender. “If you’re thinking about [whether] I should spend $1,000 and get some mats behind the cash register so that [employees’] backs don’t feel as tired by the end of their shifts, that’s reasonable, but if you’re using your personal credit, it might be harder to pull the trigger on that expenditure than if you’re more established.”
On average, retail businesses also tend to be smaller and have much higher staff turnover rates. As a result, explained Zender, business owners might have four or five people cycle in and out of one position over a calendar year, and will need to document how work is supposed to be completed – and do so safely – so that new people can transition smoothly and without safety-related issues into the role.
A younger workforce likewise is at play in the retail segment, which can affect workers’ comp exposures in both positive and negative ways.
“You may find that a younger worker’s ability to recover from a potentially intermediate-sized claim for an older person might be quite minor to a teenager or a 22-year-old, but you’re also going to find that those younger workers are going to get injured more often than average because they haven’t been around the ropes [long enough] to learn how to work as safely,” said Zender.
Some of the most common examples of workers’ comp claims in the retail segment involve injuries from lifting heavy stock items, as well as cut claims stemming from opening boxes with a sharp blade. To address these and other risks before they even occur, AmTrust has a host of loss control resources that it offers businesses in the retail space.
“We have a ton of resources that are free to be used and shared. If [business owners] want to set up a monthly training session, they can literally turn ours on, and they’re actually quick hitters – they don’t have to sit there for two hours,” said Zender. “We want to be able to arm these business owners with tools that are easy to use because we know that in this segment, these business owners are wearing so many hats that they often have very little time to dedicate to making sure that they’re working safely.”
With around five to eight employees working at an average retail business that AmTrust sees, business owners are doing a lot of the work themselves, and if one employee does get injured and is out of work, that can mean a significant reduction in the business’s workforce, which makes return-to-work times especially important.
“We really like this segment – we like to write it, we like to try to support them in every way possible, and the other thing that we really try to do is in the event of a claim, we like to do everything that we can to get that injured worker safely back to work as quickly as possible,” said Zender. “If you’ve got only five employees, that one person being out could be 20% of your workforce, so you’re faced with some tough choices.”
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