Column: The Other Side of the Organizational Safety Coin
You have probably heard some variation of the saying “there are two sides to every coin” more times than you can count. But have you ever applied it to organizational safety?
One side of the coin is injury prevention. Keeping workers safe is what gets most safety professionals out of bed in the morning and motivates them throughout the day. Reducing injuries and keeping people out of harm’s way is as satisfying as it is tangible, and injury statistics and lost-time incidents are tracked with regularity in corporate safety programs.
When it comes to what keeps safety professionals up at night, many times it is not just thoughts of what could go wrong, but instead how they will justify the cost of implementing safety measures and processes that are often quite expensive. The other side of the coin literally deals with the coin itself—the financial aspect of safety. And this side can feel cold and calculating.
Nobody wants to think the reason we protect people on the job is because it saves the company money—safety professionals do it because it is the right thing to do. But that does not mean safety efforts do not have very real financial implications. As we will see, money and safety performance are very closely linked, and many safety professionals do themselves a disservice when they talk about one without fully including the other in the conversation.
The link between finances and safety is not hard to see. According to the National Council on Compensation Insurance, the average medical cost of lost-time claims is USD 36,592. Because that number has risen every year since 1995, the cost of the medical treatment of workplace injuries is likely to continue increasing. The result is a rough equation that is as simple as it is self-evident: If you reduce the number of workplace injuries, then you potentially reduce the workers compensation premiums your company has to pay. Conversely, more claims will likely mean a higher total payout.
However, most employers are not simply handed a medical bill. Instead, medical costs, wage benefits, and other injury-related expenses are typically paid by workers compensation insurance. But a higher injury rate can lead to elevated workers compensation premiums, and that can really add up quickly for many businesses.