Cost of Workplace Accidents and Injuries
When you take into consideration the fact that most working age Americans spend approximately 40 to 50 per cent of their waking hours at work, it is no wonder that every year millions of people suffer injuries or accidents in their workplaces. Not only is there the obvious cost of lost work, compensation and medical coverage involved, there are numerous hidden costs associated with workplace accidents and injuries.
The obvious associated direct costs of workplace accidents and injuries involve the immediate cost of treatment, additional associated medical costs, hospital and physician bills, occupational therapy, prescription medicine and medical equipment. Most workers' compensation insurance will cover these direct costs. The federal government requires that most businesses that employ five or more employees must carry workers' compensation insurance. This rule may or may not apply to businesses that employ only part-time workers, and will depend upon the state in which the employment occurs.
Indirect costs associated with workplace accidents and injuries include damage to the equipment the worker was using, loss of work time and cost to hire and train a permanent or temporary replacement for the employee. Other indirect hidden costs include the possibility that the employer's insurance premium may raise because of the accident. Indirect costs associated with workplace accidents and injuries can total as much as three or four times the amount of the direct costs and may amount to 30 times the amount spent for direct costs, depending upon the type of accident that occurred.
Estimating the Costs
Because each accident or injury is unique, it is impossible to estimate an exact cost associated with each type of accident or injury. The occupation associated with the accident or injury can help predict how likely an injury or accident is to occur, as some occupations place employees in more danger than others. All jobs expose workers to some risk of accident regardless of what type of employment is involved. Businesses that employ individuals who are most at risk of injury on the job are therefore more likely to suffer some type of lost revenue due to workplace accident or injury.
Workplace Safety Programmes
Companies that focus on safety programmes tend to have a decreased overall rate of accidents, better employee morale and increased productivity. Many companies offer some sort of incentive to employees who have no workplace safety incidents as a part of their workplace safety programmes. One problem with this type of incentive programme is that it may encourage employees to fail to report minor workplace accidents or injuries in an effort to earn an incentive reward.
Other costs associated with workplace accidents and injuries may include the cost of legal services if the employee sues the company, the cost of accident investigation and the implementation of measures to correct the situation that caused the accident or injury to occur. Additional safety training may be required after an accident, which prevents business operation and thwarts profits during the training session.