Why Preventing Work Place Accidents is a Sound Financial Business Strategy

The cost of a lost time accident varies from countryreplace them?
to country and from state to state. Even so, there- Was there any down time as a result of the
are common areas of loss. Some of them are visibledamage? What did this cost?
and easy to measure, on the other hand some of- Were any products damaged or spoiled as a result
them are invisible and can only be estimated. There isof the accident? What was the cost of rejecting or
one constant that cannot be ignored. It is almostre-working them?
impossible to measure but represents what is theInvisible losses created by a lost time accident
greatest loss of all. It is the loss to the victim of the- Possible deterioration of industrial relations
accident. They tend to suffer the biggest loss andparticularly if the union had recognized the potential
are probably the people who can least afford it,for the accident previously.
financially or emotionally. It makes good business- Low public perception negating promotional and
sense to prevent accident in the work place.advertising dollars. Often, bad publicity surrounds an
Immediate visible losses created by workplaceindustrial accident and implicitly the business seems to
accidentsget the blame.
- When a business repeatedly claims insurance costs- This accident may create resentment among the
for accidents, their premium will inevitably rise addingstaff because they believe the organization does not
to the overheads of the business.care about their health or welfare.
- When the accident occurred, it is likely that other- In turn this will lead to poor morale in the workplace
employees stopped work to look at or comfort himleading to low productivity and low quality. A
her, or just out of curiosity. For how long? What waswithdrawal of all discretionary effort.
the cost?- Lack of loyalty by staff leading to higher staff
- Did someone take the victim for treatment? Whoturnover.
did their job?- Loss of skill and experience contributing to failed
- What was the loss in dollar terms?production targets.
- If first aid was given, what was the cost of the- Poor internal customer service leading to a
dressings etc?breakdown in team work.
- When the person finally returned to work there- A reduction in external customer service leading to
was a time before he/she was able to produce asdissatisfied customers.
effectively as before. What is the cost of this?- After a serious injury, the equipment is normally
- You normally have to produce a report on thetaken out of service until after the investigation.
accident. What time was involved and what did it- Cost of supervision or control measures to prevent
cost?recurrence.
- Other managers including the immediate supervisor- Loss of esteem from Government bodies. This can
were involved in the report. How much time did thiscreate a situation where they withdraw any
cost?co-operation and make it very difficult to achieve
- The injured person's job would have to be fulfilledanything.
by someone. If this new person's job was not done- Long term reduction in victim's productivity during
what did this cost?months after return to work.
- If the new person's job was fulfilled by someone- Increased cost of expensive rehabilitation programs
else, who in turn did their job or did it not get done?The invisible costs can be hard to establish and
What was the cost?individually they might not seem to be a great deal,
- The replacements are unlikely to be as proficient inhowever, together they represent a substantial loss.
the jobs as the original people. What did this cost inIt has been estimated that the minimum loss to a
training and familiarization before they were asbusiness is a least two or three thousand dollars a
profitable as the original people?day profit for every day that the person is away
- Were any tools or equipment damaged in thefrom work.
accident? If so, how much did it cost to repair or