Health and Safety is increasingly a concern for managers across all organisations.
Research has shown a direct connection between OHS and productivity levels, notably by Dr Maurice Oxenburgh and Pepe Marlow, whose paper The Productivity Assessment Tool is well worth a read. Here are seven ways we see these effects.
1. Absenteeism
When an employee is absent from work productivity levels obviously suffer, with effective OHS policies and procedures in place there are fewer incidents and illnesses keeping employees away. Closely related to absenteeism is presenteeism, which is when a worker is injured or sick but still turns up to work, and is slow and inefficient.
The Australian Workers’ Compensation Statistics for 2016-17, published by SafeWork Australia states that the median time lost for work-related incidents in Australia: 5.8 weeks.
2. Costs of lawsuits and fines
There are hefty penalties to pay for non-compliance and neglecting workplace health and safety. Breaching the Work Health and Safety Act 2011 (WHS Act) or the Electrical Safety Act (ES Act) could land your company in serious hot water and hit your pocket hard. According to SafeWork Australia, the Model Work Health and Safety Bill states:
Industrial Manslaughter
Up to $10 Million penalty for a corporate and 20 years in prison for an individual negligently causing the death of a worker.
Category 1 Offence
Up to $3 Million fine for a corporate and $300K for an individual. Reckless conduct that exposes an individual to whom a duty is owed to a risk of death or serious injury or illness that is engaged in without reasonable excuse.
Category 2 Offence
Up to $1.5 Million fine for a corporate and $150K for an individual. Failure to comply with a health and safety duty that exposes an individual to a risk of death or serious injury or illness.
Category 3 Offence
Up to $500K fine for a corporate and $50K for an individual. Failure to comply with a health and safety duty.
3. Cost to a company in medical treatment and compensation payments
The Australian Workers’ Compensation Statistics for 2016-17, published by SafeWork Australia states that the median compensation paid for a serious claim in Australia: $11.5K
Companies would save noticeably if they could reduce the number of incidents that had compensation claims.
4. Cost to a company’s reputation
Companies who deliberately turn a blind eye to the effects their operations have on workers’ health will pay for it in a public roasting by the media. The high-profile lawsuits which follow lead to long-term brand damage, with the potential loss of both existing and new clients and employees.
5. Worker morale
A recent study by economists at the University of Warwick found that happy employees are 12% more productive.
Dr Dominic Cooper’s article, Effective Safety Leadership states: Engaged employees are 5 times less likely to experience an injury.
Companies need to look after their greatest assets, their employees. Job satisfaction is about more than money, with employees who feel valued and cared for investing themselves more into their workplaces, and generally having a better attitude towards their role. Better job satisfaction results in a more motivated employee which results in better bottom line results. Added to the health benefits, the happier an employee is, the less likely they are to leave, reducing employee turnover.
6. Time Saving
Most workplace accidents are preventable if a company has a solid system in place. Incident and Safety software go a long way to help manage OHS, including keeping management informed to make better business decisions and having an accurate audit trail to ensure full compliance. Also, it helps prevent the incident from happening again.
Time and money are saved by not getting lost in disjointed paperwork and spreadsheets, and with mobile technology, health and safety can be managed in real-time and on-site.
7. Return on Investment (ROI)
Don’t hold back on investing in workplace safety, whether it’s software, training, maintenance etc A well-implemented and resourced OHS system will benefit both the employer and employee. Managers should lead their staff to move from merely reaching government standards to aiming for excellence in occupational health and safety.
When offset against improved work productivity levels and possible punitive costs, spending money on workplace safety is a no-brainer. A lack of understanding on how to do a job properly is dangerous, but if a worker is well-trained they make fewer errors and perform better. In all areas, overlooking health and safety will cost you, whether it’s project delays, broken machinery and a high staff turnover. It’s not worth taking a chance.
National Safety Council (US) business case for injury and illness prevention programs states: Each prevented lost-time injury or illness saves an employer $37,000 US ($54,000 AU).
According to SafeWork Australia 2012-13, the total estimated cost to the economy, due to work related injuries and disease is $61.8 billion, representing 4.1% of GDP.
By Jeannie De Vynck
