The Business Case for Safety

MoneytrendWhen money gets tight, workplace safety is often one of the first things stricken from strapped budgets. Unfortunately, employers who cut back on safety training, personal protective equipment and safety performance rewards may see a drop in the level of service their employees provide.

A recent article in EHS Today gave an overview of a new study published by the National Safety Council (NSC). The study examined utility company work groups that were responsible for customer-related functions. Work units that had more employee injuries also had customers who were less satisfied with the service they received.

“In an organization with a positive safety climate, where safety does not take a back seat to productivity, employees are likely to believe they have permission to do things right,” the study noted. “Doing things right is a permeating value in a work unit that is likely to reach into several domains of work behavior, some of which influence the quality of work.”

The NSC study bolsters the business case for safety. If you’re still not convinced, consider the other benefits of preventing workplace accidents.

Protection for your most valuable asset. Your employees’ well-being is the most important reason to commit to safety. An investment in safety is an investment in your most valuable asset: your employees.

Reduced workers’ comp costs. Workers’ comp premiums are based largely on your experience modifier, which is based largely on your accident history. By preventing accidents, you can help reduce your premiums.

Increased productivity. Replacing an employee can cost 50 to 150 percent of his or her salary. By preventing accidents and keeping experienced employees on the job, you can increase your productivity and reduce the costs of hiring extra help.
Improved morale. This one is closely related to the NSC study findings. When employees feel you care about their well-being, they are more likely to invest in the company and its mission.

Company image. No company wants to be known for on-the-job injuries. Some of your peers may not want to do business with you if you have a high injury rate. Still others may be prohibited from doing business with you due to company policies or government regulations.

600 percent return. The Occupational Safety and Health Administration estimates that employers who commit to workplace safety may reap up to a 600 percent return on their investments.

Indirect costs account for the majority of costs associated with workplace accidents. Essentially, indirect costs are costs that your workers’ comp policy does not cover. We’ll dive into direct and indirect costs a little deeper in a future blog post. In the meantime, review this short presentation developed by the Occupational Safety and Health Administration, Abbott and Georgetown University.

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