Any number of articles, webinars, and conference presentations for the last few months have been trying to predict THE BIG ISSUE for workers' comp in 2018. The Journal's fearless prediction is: who's an employee? Put it down to the gig economy or put it down to the never ending quest to pare costs in a world of price transparent transactions, but companies of all stripes seem to be trying to redefine employees as contractors and eliminate the cost of workers' comp.
The struggles of Uber to maintain that its gig-based drivers are not employees have been widely documented, not only in the trade press but in the major media. Every week seems to bring a new story along the same lines. Some involve small, local operations but some involve large, major industry confrontations. A good example of the latter is the new suit filed by the City of Los Angeles against a number of large transportation companies operating in the LA Harbor jurisdiction. This story appeared in various forms not only in The Wall Street Journal (yes, that other Journal), but also in a number of Southern California newspapers and USA Today. In other words, worker classification is no longer just a parochial, "inside baseball" concern for us risk management wonks.
For example, most of us in the business know that the volume of workers' comp has been trailing off in terms of both claims and premium dollars for some time. Joe Paduda provided an excellent brief overview recently in Managed Care Matters. But a review of the flood of classification suits and regulatory actions being brought asks the question - how much of this shrinkage is real and how much is jobs being reclassified right off the comp books by the likes of Task Rabbit, Upwork, Toptal, LocalSolo, Guru, and Gigster?
We can expect many of these legal brawls to hit the courts in 2018 and move from arguments and posturing to decisions which may impact workers' comp in ways that go beyond what's a "gig" and what's a "job". Stay tuned. We'll do a round up in January of 2019. Side bets, anyone?
2018 is getting off to a running start as the year of cyber risk, the year when the vague threats which have been clustering around IT operations, the cloud, customer interfaces, data security, et al blossom into the major concern of risk managers in every industry. Here is the Journal's roundup of some of the more intriguing recent cyber risk headlines. We expect to be adding to this collection as the year moves on.
Top of the List: a recent survey of CEOs by Dow Jones puts cyber security at the top of the worry list of CEOs across America. A recent survey by XpertHR, an online provider of compliance guidance, tells us about 64% of 1,031 human-resources professionals believe data security and the threat of a cyberbreach will become a very challenging or extremely challenging issue in 2018. If cyber risks worry you, well, at least you're not alone.
A use for Bitcoin: a survey by Citrix, reported in the MIT Technology Review, tells us that a third of the IT units queried are stockpiling bitcoins to pay off data hijackers in the event of a ransomware event. Hackers holding data for ransom are now common enough that some folks are prefunding the expected cost. What does this say about the state of cyber security?
How long has this been going on?: according to The Daily Telegraph, chips from Intel as well as AMD and other manufacturers have had serious security flaws for some ten years now, making them eminently hackable. These are the chips found in major business applications and in some cloud operations. No, we are not talking about Xbox controllers. The patches may well slow key applications down by some 30% once installed. Check here for the most recent information about our new friends, Spectre and Meltdown. Who pays for the disruptions, the reworking necessary to recover acceptable operating speeds, any hacks still waiting to be uncovered? This revelation suggests a whole new type and magnitude of cyber exposure not seen before.
A new hire at Stanley: Stanley Black & Decker, which makes power and hand tools, recruited Mark Maybury as its first chief technology officer in November. He is a cybersecurity specialist with a doctoral degree in artificial intelligence. Dr. Maybury's duties include overseeing cybersecurity. Could this be the beginning of a new trend to link the CIO and risk management? Do you have a cybersecurity specialist? Gonna get one?
Book Report: Great at Work
Morten Hansen's new book, Great at Work: How Top Performers Do Less, Work Better, and Achieve More, is due in a bookstore (or a Kindle) near you on January 30. Did you catch that subtitle? This book is not about risk management, per se; it's about how to manage your own work and your department's work to best advantage. In a world where more risk management tasks seem to be chasing fewer risk management resources, this could be a very important read.
Dr. Hansen's book wraps up his five year study of American workers - all types, levels, and industries. Dr. Hansen is a professor of Management at the University of California, author of two other important books on management and a highly regarded author and speaker. In his new book he deploys his expertise to investigate how people actually perform in the workplace - not how we think they should. His study shakes off a great deal of business folklore and explores why a busy person is often not a successful person.
Performance follows the person who knows how to say "no" when he or she has to. Hansen provides many examples of how top performers successfully dodge distracting, low value tasks without antagonizing bosses and colleagues. Your most important meetings* may occur while avoiding the ones you don't need to be in. Does this ring true: "If you're not careful," Hansen tells us, "you can expand your scope until you lose the elements that made you successful in the first place"? If you resemble that remark, this book's for you.
* "A committee is a place to which men resort/ To avoid the dreariness of labor and the loneliness of thought." Attributed to Shakespeare, among others.
California Dreamin' - Ain't What It Used To Be
The San Francisco Chronicle published a great, short format survival guide for fires, earthquakes, floods, and more earlier this month following their most recent 7.1 slippage along the Hayward Fault. This illustrated guide shows you how to prepare for the inevitable. It includes everything from home fire drills and a three day earthquake survival kit to what to do in the event of a toxic chemical emergency. While some of the illustrations are specific to the San Francisco Bay Area, the good advice is universal. Disaster has struck! What do you do? You get some good ideas featuring an 11-year-old boy and his puppy for illustration.
This is the kind of information that every risk management professional in any state or metro area should have at his or her fingertips and readily share with anyone who is interested. Could you adapt this format to your company, people and places? We live in a dangerous world. Knowing what to do makes it that much less dangerous.