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Check out our weekly blog posts and see the latest news and discussions happening in the HR world of business.

How Do Safety Programs Save Businesses Money?

A while back, we published a blog post citing data suggesting that investing in a workplace safety program can actually save businesses significant money (not to mention stress!) In fact, the survey, which was conducted by the Occupational Safety and Health Administration (OSHA), found that for every one dollar investment in such a program, companies can expect to see a return of up to six dollars, which feels particularly relevant when OSHA notes that most occupational injuries are paid for directly out of company profits. 

Read on below to learn how exactly such programs contribute to cost savings and how they can otherwise boost your business.

Lower workers’ compensation costs: 
When you have evidence that you have an official workplace health and safety program in place, your insurer takes notice and rewards you for your efforts. In general, premiums for this type of insurance vary by state and are based on a calculation that takes into consideration the inherent risk of the job, as well as your company’s claims history to create an experience modification rate (EMR). In general, an EMR of 1.0 conveys an average risk, anything under 1.0 a lower risk, and anything over 1.0 a higher risk and thus higher premiums. While you can’t change the industry you work in, by establishing a comprehensive workplace safety program you will likely reduce the number of claims you have to make and thus lower your EMR, with OSHA themselves noting that the best defense to higher premiums lies in the prevention of accidents, illness and injury. 

Reduced medical expenditures: 
If folks aren’t getting hurt on the job, they aren’t making as many claims both under workers comp and on their general medical insurance because they can’t “prove” that that niggling back pain was caused directly by work (even though they know it can’t possibly be helping!). By implementing a workplace health and safety program, you will likely decrease the number of accidents and injuries that happen on the job, but you might also make changes to the physical environment or the manner in which folks complete their work to make it more healthy for employees. For example, you may provide standing desks for your typically sitting staff that get them up and alleviate back pain or you may design a new portion of your factory line to decrease the repetitive motions made by employees, thus reducing various overuse injuries. 

Lower spending on return to work programs: 
When an accident or injury occurs on site, there are obviously a lot of upfront expenses with addressing the injury, but there are also significant costs associated with getting said worker back on the job. Return to work programs can be hugely labor and admin intensive for all parties. During the whole process, you must stay in close contact with the injured employee and then must get a note from a physician stating when they can return to work and under what circumstances. While some employees are able to hit the ground running, others may require alternate or light duties, which are generally overseen by a manager and a HR professional to ensure that they meet the appropriate standards and that they allow the worker to do their job without potentially risking their recovery. In either case, employees need to be monitored closely upon their return to ensure that they don’t become re-injured and that they feel safe, which again requires oversight from other staff. A second considerable cost associated with return to work programs stems from having to hire temporary staff to fill the void left by the injured worker, or paying their peers overtime for taking on their portion of the project, which can further add to costs and even impact productivity. By having a safety program in place, you should potentially limit the number of accidents that occur within your company, but you’ll also have done the heavy lifting upfront in terms of considering what return to work programs may look like for your staff. 

Lower spending on job accommodations: 
With any workers compensation claim, the aim is to always get your worker back to performing their regular duties. In some cases, however, injuries are so severe or are simply so slow to heal that you will need to make accommodations for the employee to be able to safely resume their old duties. While we’ve noted in a previous blog posting that workplace accommodations don’t always have to be expensive and are generally quite cost-effective, it can require a lump sum investment that may prove to be a significant financial hardship after you’ve already paid out so much for the accident itself. Obviously, the safety program should reduce the risk of these accidents occurring, but in truly analyzing your workspace before an incident ever happens, you may find that you have to make fewer or less costly accommodations following a workers compensation claim. 

Fringe benefits: 
Beyond the opportunities for cost savings outlined above, there are several secondary benefits that businesses with health and safety programs can enjoy. For example, OSHA notes that businesses with such programming can enjoy increased productivity due to lower employee absenteeism and reliance on temp workers to fill the gaps and reduced employee turnover due to employees feeling unsafe in their jobs or needing to leave the company because they can no longer perform their duties. These, in turn, lead to lower employee stress and improved morale, since everyone feels safer at work and appreciated that the company truly has their best interests at heart. We would also be remiss to note that being accident-free on account of a comprehensive workplace safety program can really allow HR to focus on the most important issues within your company, namely growing and developing your business.

With all these perks, you’d think that every company would be clamoring to implement a program of their own! However, the reality is that while there are both federal and state occupational safety and health rules and regulations, there isn’t a whole lot of uniformity in what these programs cover and how they should be implemented (which proves especially tricky for companies that operate in multiple states!). Many companies know that they should have a workplace safety program in place but have no idea how to get one off the ground. Enter Abel HR! We have our very own safety officer in house and are well-versed in federal, state, and even industry safety regulations. Further, we’ve had a lot of practice evaluating workplace environments to identify existing and potential hazards, designing workplace safety programs to address any underlying issues, and training you and your employees on how to stay compliant and manage a claim should the need ever arise. 

If you would like more information about our offerings, give us a call today at 609.860.0400

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