Merchants Pre-Employment Integrity Test™ Case Studies
Workers’ Compensation Benchmarking
As a service to our customers, Merchants examines the difference between screened and unscreened applicants.
Since the Merchants Pre-Employment Integrity Test™ is only given to new hires, a built-in control group of existing, unscreened employees is automatically
available. The differences in claim frequency and severity rates between screened workers and unscreened employees can be
readily calculated. These "within year" studies provide an objective comparison of the difference in compensation losses between
the two groups – even when multiple risk control strategies are implemented concurrently with Integrity Testing.
For example, suppose you decided to implement the Merchants Pre-Employment Integrity Test™, a new return-to-work program, and new safety incentives
all at the same time. How then can the impact of the Merchants Pre-Employment Integrity Test™ be accurately measured when two other new programs are operating
concurrently? Simple. All employees (screened and unscreened) receive the benefit of the return-to-work and safety incentive programs therefore,
the only difference is that the new workers were screened by the Merchants Pre-Employment Integrity Test™.
As almost all other risk control protocols apply to the entire workforce (new hires and existing employees), Integrity Testing provides
a unique opportunity to measure its effects on workers’ compensation losses since it only applies to new hires.
Over the past several years, Merchants has completed over a dozen major workers’ compensation benchmarking studies. The results
of some of those studies are summarized below. The average 63% comp loss reduction shown in the table below represents the combined effects
of lower claim frequency and severity in workers surveyed by Merchants compared to unscreened employees working in the same type of jobs at the
same time.
Workers’ Comp Case Studies Prove the Merchants Pre-Employment Integrity Test™ Enhances Earnings
| Study Period |
Industry |
Frequency Reduction |
Severity Reduction* |
Total Employees in Study |
Total Comp Loss Reduction Among Screened Employees |
| 1996 |
Staffing |
56% |
40% |
32,158 |
74% |
| 1997-2000 |
Manufacturer |
71% |
36% |
8,486 |
82% |
| 1999 |
Staffing |
67% |
-7% |
50,710 |
64% |
| 2000 |
Staffing |
93% |
26% |
6,904 |
95% |
| 2002 |
Food Processor |
45% |
48% |
11,659 |
68% |
| 2002-2003 |
Insurance |
78% |
29% |
6,165 |
84% |
| 2003-2004 |
Hospitality |
49% |
50% |
33,345 |
74% |
| 2002-2004 |
Long-Term Care |
55% |
18% |
9,054 |
63% |
| 2004 |
Home Healthcare |
55% |
18% |
5,035 |
63% |
| 2003-2005 |
Staffing |
48% |
15% |
207,509 |
54% |
| 2005 |
Retail |
70% |
45% |
18,200 |
83% |
| 2005 |
Commercial Laundry |
56% |
14% |
10,596 |
59% |
| 2006 |
Construction |
47% |
38% |
4,864 |
67% |
| 2007 |
Long-Term Care |
59% |
81% |
1,605 |
92% |
| 2007 |
Long-Term Care |
41% |
16% |
9,558 |
50% |
| 2008 |
Hospitality |
54% |
59% |
4,161 |
81% |
| 2009 |
Rental Company |
72% |
38% |
8,650 |
82% |
| Total and Weighted Average |
- |
60% |
33% |
428,659 |
63% |
*The severity reduction is based on all claims, open and closed. When the analysis is based on closed claims, the severity reduction is significantly higher.