What’s the true cost of a lost-time accident?
Employee A climbs a 6′ ladder, but cannot reach high enough overhead to perform the necessary work. Rather than retrieving a platform ladder, Employee A enlists the help of Employee B. Employee B climbs the ladder. Employee A climbs the ladder and attempts to climb onto Employee B’s shoulders. All come tumbling down. True story.
Employee A suffered serious head injuries and incurred medicals in excess of $60,000. Employee B suffered strains, sprains, and contusions, and incurred medicals of approximately $8,000. Employee A was off work for several months before returning on light duty and transitioning back to full-time status. Employee B was off work approximately 2 weeks.
Direct costs of this accident include the +/- $68,000 medical treatment, the entirety of the employees’ time off, and the immediate lost production due to the incident.
What are the indirect costs of this accident? Time spent responding to and cleaning up after this avoidable incident, investigating the incident, filing and processing the workers compensation claim, time spent hiring and training a temporary employee, potential ongoing lost production due to temporary staffing and learning curves, damage to any affected property or equipment involved in the accident, cost of workers compensation wages/premiums, potential reduced employee morale, time spent completing OSHA paperwork for reportable accidents, potential OSHA fines and penalties, potential costs to defend any litigation brought by the injured employees against the company, including time and money spent responding to discovery, attending depositions, and preparing for trial, regardless of whether the case goes to trial.
Some of these costs are tangible, while others are not. An employer’s reputation, for example, can suffer tremendously when a worker is hurt and the public perceives the employer to be at fault or careless in providing a safe work environment.
While this particular accident shows blatantly poor judgment on the part of the employee and never should have happened, it did. In addition to the tens of thousands of direct-loss dollars associated with this claim, the employer suffered extensive additional losses. These indirect losses can have a serious impact on your business.
Be prepared. Take safety seriously and develop your safety policies and procedures before you need them. An ounce of prevention truly is worth a pound of cure.