It’s becoming an increasingly more difficult economy for many small business owners. As budgets get tighter, some small businesses are axing workplace safety programs to cut cost, because they aren’t perceived to impact the bottom line. However, this is a huge misconception and, in fact, the Occupational Safety and Health Administration reports that businesses spend approximately 1 billion dollars per week on workers compensation. This number doesn’t even account for all of the direct costs, let alone indirect costs, associated with workplace injuries.
Direct costs include:
- Workers Compensation
- Medical Expenses
- Legal Fees
- Increased Insurance Premiums
Indirect costs include:
- Emotional Damage to the Team
- Cost of Training a New Employee
- OSHA Fines
- Overtime Hours to Cover the Loss of an Employee
- Damaged Equipment
The National Safety Council suggests that on average, a death at the workplace costs a business 1.42 million dollars. That number can climb as high as 3 million dollars depending on indirect costs like public relations damage, possible turnover or damage to team morale.
For many small business owners, it’s difficult to imagine something critical happening to an employee at work. Some small business owners who have experienced a freak accident at their place of business may even suggest that a workplace safety program wouldn’t have prevented the incident from occurring. However, The Occupational Safety and Health Administration reports that businesses who invest in workplace safety programs see a reduction in injuries by 60%. The data would suggest that statistically there is at least a decrease in the odds of an accident happening in the workplace of individuals who invest in one of these programs.
Ultimately, a workplace safety program may not prevent 100% of accidents in the workplace; but the National Safety Council suggests that every $1 invested in injury prevention, returns $2-$6. Even in the event of an accident, most insurance companies will consider whether or not a business had a workplace safety program in place when determining insurance premiums following an accident. In some cases, having a workplace safety program in place can even save companies millions of dollars in litigation. Contact us to learn how we can help your company.