Workplace injuries and the bottom line: indirect incident costs are staggering

This week the Intelex Blog introduces its newest contributor, Robert Smith. Head of Injury Management Solutions, Robert has tons of experience in Human Resource and Disability management, including a long stint with WSIB. Robert will blog on a biweekly basis on issues related to compensation, claims management, case management, and much more. This week Robert tackles the real costs of workplace injuries.

I have been directly involved in workers’ compensation issues for well over 20 years and, like many of you, I have heard the stories of the costs of a workplace injury and how important it is to implement health and safety programs and to manage claims. Yet time after time I have conversations with employers who still do not grasp the big picture. 

So what is the big picture? Most companies are aware of how their workers’ compensation premiums are calculated and that poor performance results in surcharges. Most are aware there are claim cost limits to seemingly protect them financially. But – and this is a big but – there are aspects that many do not calculate into their strategies. These are the “indirect” costs of the claim and can add from three to ten times to the direct claim costs. 

To put this into perspective let’s look at the claim cost for an Ontario NEER employer:

In 2013 the Claim Cost Limit is $416,000.00. If you take just the minimum indirect cost factor of three, the actual cost is $1,248,000.00. Considering the worst case scenario at ten times the actual cost is a staggering $4,160,000.00

These indirect costs include:

  • Damage to equipment, machinery, materials, facility, etc. 
  • Production downtime. 
  • Lower employee morale. 
  • Loss of products or services. 
  • Delays in shipment or filling orders. 
  • Additional overtime. 
  • Managers’ lost time resulting from the accident. Also includes inspections, investigations, meetings, and administration. 
  • Employees assisting with the accident. Includes administering first aid, and witness interviews. 
  • Hiring and training replacement workers. 
  • Wages of replacement workers. 
  • Other non-productive time incurred by the injured employee. Includes all medical related appointments. 
  • Potential MOL, OSHA penalties. 
  • Legal fees.
Although this list is quite long it still doesn’t encompass every indirect cost. Understand that for each injury that occurs in your workplace, the increase in your workers’ compensation premiums is dwarfed by all of the indirect costs associated with that injury. Now is the time to take the necessary steps to limit, or better yet, eliminate all injuries to ensure your company’s maximum productivity and profitability.
Questions or comments? Post below or contact Robert.

US Labor Department’s OSHA exposes safety and health hazards at construction sites through no-notice incident prevention campaign

This release has been reposted from www.dol.gov.

PHILADELPHIA – The U.S. Department of Labor’s Occupational Safety and Health Administration has concluded its 2012 “Construction Incident Prevention Initiative,” during which it issued 243 citations and assessed a total of $658,862 in proposed fines to companies on construction sites throughout the agency’s Philadelphia Region.

The four-month campaign included 545 no-notice inspections focused on falls, trenches and silica exposure. Fifty-nine percent of the inspections revealed violations, some of the most common of which are failing to use fall protection when working on roofs, ensure that scaffolds are constructed safely and protect trenches from collapse.

“This alarmingly high number of violations underscores the need for employers in the construction industry to make a stronger commitment to workplace safety and health,” said MaryAnn Garrahan, OSHA’s regional administrator in Philadelphia. “Employers are responsible for ensuring safe and healthful workplaces, and will be held legally accountable when they fail to do so.”

OSHA’s Philadelphia Region, which encompasses Delaware, the District of Columbia, Pennsylvania and West Virginia, had a total of 43 construction-related fatalities in fiscal years 2011 and 2012, with 18 attributed to falls.

In April, Secretary of Labor Hilda L. Solis announced a national campaign to provide employers and workers with lifesaving information and educational materials about working safely from ladders, scaffolds and roofs in an effort to prevent deadly falls in the construction industry. In 2010, more than 10,000 construction workers across the United States were injured as a result of falling while working from heights, and more than 250 workers were killed. OSHA’s fall prevention campaign was developed in partnership with the National Institute of Occupational Safety and Health and NIOSH’s National Occupational Research Agenda program. More information on fall protection standards is available in English and Spanish at http://www.osha.gov/stopfalls.

To ask questions, obtain compliance assistance, file a complaint, or report workplace hospitalizations, fatalities or situations posing imminent dangers to workers, the public should call OSHA’s toll-free hotline at 800-321-OSHA (6742).

Under the Occupational Safety and Health Act of 1970, employers are responsible for providing safe and healthful workplaces for their employees. OSHA’s role is to ensure these conditions for America’s working men and women by setting and enforcing standards, and providing training, education and assistance. For more information, visit http://www.osha.gov.

This release has been reposted from www.dol.gov where other press releases and news materials are available. The information above is available in large print, Braille, audio tape or disc from the COAST office upon request by calling 202-693-7828 or TTY 202-693-7755.

Alarming news on global coal consumption, a mysterious update on OSHA’s I2P2 program, EPA’s soot regulations and more on EHS This Week

What? More whistleblower news? You guessed it. Kind of a trend recently on EHS This Week, the only weekly podcast to round up the top stories in EHS news around the world. 

This week we’ve got a ton of great (and not so great) news. We discuss the emerging OSHA whistleblower committee, strange news on OSHA’s upcoming (or is it?) injury and illness prevention program, and new EPA regulations on soot. 

Take a listen and don’t forget to send your comments and suggestions to paul@ehsthisweek.com.

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More whistleblower news, signs of EPA and Texas climate progress, deaths in fertilizer blasts and more on EHS This Week

This week Kristy and I discuss another whistleblower case, EPA’s work with Texas on a clean air plan, blasts at a Mississippi fertilizer plant, Mexico’s climate legislation and more.

Got an idea for an EHS story? Care to come on our program? Just write us at paul@ehsthisweek.com and we’ll make it happen.

Enjoy the show!

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