What is safety actually worth?
The absence of safe working conditions can create significant additional costs.
For example, there are fixed, direct costs related to worker safety. Workers compensation insurance premiums rise with accidents (to cover lost wages, medical expenses, and rehabilitation costs). There are penalties for workplace injuries and legal costs associated with liability. Pertaining to benefits, there is the cost of life insurance policy premiums and catastrophic injury medical coverage. And unsafe behaviors carried off-the-job may mean more frequent trips to the ER from home, raising employer health insurance premiums. It is safe to say that the higher the degree of risk of the workforce, the larger the secondary cost of the laborforce.
Yet what a lot of people miss about the true value of worker safety is that there are substantial secondary costs associated with it. Out of production time or lost productivity is the most commonly cited indirect cost of systemic safety failure. According to the Bureau of Labor Statistics, in 2012 there were over 1 million cases of non-fatal occupational events requiring days away from work, with a median average absence of 9 days. The safety of the high-risk workforce has a substantial cost associated with it; serious worker injuries and fatalities are far more expensive than any online safety training investment.
Tied closely with productivity is worker morale. Safety is naturally an emotional issue, particularly in the wake of an accident. The psychological impact of a tragic accident on the workforce, while incalculable, may prove devastating; fear and grief have paralyzing effects on workers. And there are other, more practical indirect costs related to serious accidents, such as expenses connected with training of replacement employees or supplementary staff uptake, cost to repair damaged equipment, licensing renewal fees, and investigation finance, in the extreme. Indirect costs are estimated to equal 4-6 times that of direct costs.
Safety has a quantifiable value for business, and it is at least a manageable expense; if managed properly, safety can even be considered a business asset or competitive advantage. That’s because most employers in a specific high-risk business category experience the same expenses associated with worker safety; employers who successfully manage safety costs ahead of the competition realize an advantage.
Another way to look at it; focusing only on compliance, or doing only the minimum, leaves a lot of liability in your environment or considerable risk, and risk means potential cost. The safety professional, in partnership with leadership, can minimize liability and risk by investing in the safety culture. Online safety training is a tool for controlling the various costs associated with unsafe working conditions.
Want to see what training will actually cost you; and how much you can save? Check out our Return On Investment (ROI) calculator to learn more.