Private-Sector Businesses in California
The state of California has regulations by which compliance is mandatory, workplace safety and health laws affect private-sector employers and are monitored and enforced by the California Division of Occupational Safety and Health Administration. Any failure to comply with these safety laws could result in significant company penalties.
In all industries in California, employees are exposed to certain risks that are specific to their field of work. Recognizing that some occupations impose greater risks than others, some safety hazards are prevalent in all workplaces - whether that be an office, construction site, mine, farm, or forest. Every job site has its hazards, and a workplace accident can happen anywhere, anytime.
Most employers are aware that their employees' safety is of utmost importance. And so, most companies are trying their best to cultivate safe workplace environments in order to reduce the number of workplace injuries that occur. In this article, we will discuss the impacts of an accident in the workplace and prove why it is in an employer’s best interest to adopt appropriate safety measures. First, let’s have a look at some statistics.
Workplace Injury Statistics
The U.S. Bureau of Labor reported nearly 2.9 million workplace injuries that occurred in the private sector in 2017. Of this large figure, the most common causes of injury were overexertion, slipping or tripping, falling from a height, reaction injuries, falling objects accidents, vehicle accidents, machine entanglement, repetitive motion injuries, and on-the-job violence.
In this same year, California reported 466,600 workplace injuries and 376 deaths on the job. 22% of these deaths were caused by slips or trips, with 88% of those slips or trips resulting in the worker falling from a height. Furthermore, 37% of the workplace deaths that took place in California that year resulted from vehicle accidents, and violent assaults accounted for one in five deaths in 2017. *1
The Direct Costs of a Workplace Incident in California
California employs a no-fault worker’s compensation system. This means that employees cannot sue their employers in court if an injury occurs on the job. This system is paid for by California employers and covers all direct outcomes of job-related accidents including medical treatment costs, disability payments, life pension payments, re-training costs, and death costs, including burial expenses. It is a requirement that California employers purchase worker’s compensation insurance. Although this program does an adequate job of covering the direct costs of an injury in the workplace, often the indirect costs go far beyond the direct costs.
Indirect Cost Considerations
Indirect costs can add up to 4 to 10 times the dollar figure of direct costs. It’s important to appreciate that regardless of the accident, your company will have lost one of its key assets for an unknown period of time. Some of the greatest impacts of this include lost productivity, administrative time, and reduced employee morale.
Lost Productivity: When an employee is unable to fulfill their job duties, it would be impossible for productivity to remain at its current level. A likely scenario might involve other employees taking on additional duties, which would impact both the quality of work and their abilities to accomplish their own tasks.
Administrative time: Documenting the accident is all part of the process. This component results from the hours spent processing the paperwork associated with the incidents. The opportunity cost of the time spent doing this could be substantial.
Damaged employee morale: Although rarely considered, this is another significant indirect cost. The aftermath of the accident will linger in the workplace. This can create a very negative and potentially toxic atmosphere which can again lead to reduced productivity and issues with employee satisfaction. Given that a fellow employee has been injured doing the same duties other employees in the company perform, this is understandable. If employers do not have a plan in place to address the aftermath of a workplace incident, their business could be jeopardized.
We can see that the costs associated with a workplace incident are considerable. When we add up both the direct and indirect costs, the final total could be enough to really put your company at financial risk. It’s essential that employers take the time to implement a safety solution to protect workers and their bottom line.
STILL NEED TO CONVINCE YOUR BOSS?
Schedule a consultation today and let us provide you a custom cost-benefit analysis for your company.
*1 Bureau of Labor Statistics [2017]. Nonfatal occupational injuries and illnesses data by industry