Profiting from Safety

posted in: People, Plan, Processes 0

There are lots of reason to focus on safety in a business, starting with taking care of employees and reducing their families’ distress. But there is a bottom-line argument for it, too: as injuries go down, profit goes up. Worker’s Comp premiums go down. Product quality goes up. Less time is missed from work. Employee engagement goes up and turnover goes down. According to one survey, safety improvements yield 300%-500% ROI, making them one of the better investments a company can make.

Workplace injuries are often referred to as accidents, but they are often all too predictable. Injuries are caused by a series of incidents leading up to the “accident”; disrupt the chain and you prevent the injury. Finding those disruption points is one application for risk management, but many of the solutions are easy to figure out, like wearing ear and eye protection while using a grinder.

The first step in creating a safer work place is to decide. Safety will only improve with a commitment from the top; otherwise it will soon be overridden by more urgent concerns like productivity. Safety applies to the boss as well as the line; if employees see that the boss doesn’t follow the rules, they won’t either.

Once the commitment is there, learn about safety. Get an on-site safety consultation to identify areas for improvement, with no penalties; it beats explaining the problems to OSHA, and it is free. Develop a written safety plan and a return to work plan. Get any necessary systems in place, from forms to training schedules.

Then implement your plans. Start by training your supervisors and employees; SafetyFestMT  is a free option, offered regularly around Montana. Add safety training to orientation as well as to the ongoing training schedule. Communicate your goals and reasons. As appropriate, have daily toolbox talks, a few minutes each day (or week) to discuss safety issues that have come up or remind employees of how things need to be done; major energy corporations have twice-a-day toolbox talks and weekly meetings, because they recognize how expensive accidents are.

If an injury does occur, a Return to Work plan can reduce damage and cost. Getting an employee promptly back to work (safely) is better for the employee and for the business’s operation. In addition, doing it within four days reduces the charge to your Worker’s Comp experience rating by 70% (in Montana). Obviously there are cases where this won’t work – you can’t drag an employee out of a hospital bed to get them back to work! – but in most cases employees can productively return to light duty far sooner than they do; the average injured Montana worker takes 27 days longer to return to work than the national average. That is over five weeks of extra expense and time someone has to replace them at work.

Monitor critical numbers, including your Workers Comp loss ratio. Negotiate with your Works Comp provider to lower your premiums as your incidents drop. Find a way to measure return on the investments in safety so that you can see them working; they will be more sustainable if there are numbers to back them up.

Montana’s injury and Workers Comp premiums are among the highest in the country, in large measure because we have so few major companies; smaller companies are less likely to have safety plans in place because the costs of poor safety are less obvious. Reducing injury rates will benefit employees and businesses alike, while paying off on the bottom line.



Thanks to Fred Miller, Safety & Health Specialist with the Montana Department of Labor and Industry, for the information.