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Why is Employee Safety a Good Business Strategy? – Part I

Posted on June 7th, 2016 Read time: 2 minutes

By Tania Fiero, PHR, Vice President, Human Resources – Part I

The National Safety Council recently published that almost 13,000 American workers are injured every day on the job.  It gets worse.  The Bureau of Labor Statistics published their study this spring regarding workplace injuries resulting in deaths in 2014 and for the first time since 2010, that number rose from years prior to 4,821 people, that’s 13 per day.  If you’d like to learn more about these statistics click here.

In celebration of National Safety Month, I thought it would be timely to write about the reasons why companies should make employee safety a priority (part I), and what you can do to improve your safety program (part II).

Why does a safe work environment make cents?  (You notice my play on words?)

  1. It’s the law! The Occupational Safety and Health Administration (OSHA) is the agency that enforces the OSH Act, requiring employers to provide a safe and healthful workplace. Should your company receive a visit from OSHA, they may choose to issue citations if violations of OSHA standards or regulations were observed.  To research these regulations click here.
  2. Workers Compensation Insurance Costs – All companies are required to carry workers compensation insurance coverage. Workers compensation is a mandatory insurance for companies with employees that covers the cost of medical treatment in the event of a workplace injury or illness, covers employees lost wages in the event they are not able to return to work, and covers the cost of litigation should an injured worker sue the company for negligence.  Workers compensation insurance varies based on the industry of the company, the position of the worker, and the state in which the employee is working.  Another factor which should not be discounted is the company’s safety record and claims experience.  Companies with a culture of safety and low level of injuries will have lower premiums than companies that ignore safety best practices and a high level of injuries.  Workers compensation premiums are charged by $100 of payroll so for example, an employee working for a law firm may cost the law firm $0.62 per $100 of payroll in workers compensation premium, whereas an inventory specialist in a warehouse for a large retail distributer may be much higher at $3.32 per $100 of payroll.
  3. Employee Morale – Not surprisingly, employees that notice unsafe work environments are more likely to seek employment elsewhere. The Society for Human Resources Management estimates that the costs of turnover can range from 90% to 200% of an employee’s annual salary. (SHRM Foundation’s Effective Practice Guidelines Series, Retaining Talent, A Guide to Analyzing and Managing Employee Turnover by David G. Allen, Ph.D. SPHR).

Having a better understanding of the reasons behind why it makes sense to pursue a strong safety program will help you and your organization define your objectives and measure the success of the program.  There are many ways you can pursue this goal, click here to read part II of this article to see what you can do to improve your safety program.   Or contact Innovative Employee Solutions with any questions at 858-715-5100.

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