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The economics of safety

Cheryl Rost, Safety and Risk Management manager, recently provided an overview of the department’s escalating accident numbers and associated costs for ITD’s field employees during the annual “Toolbox” meetings.

She challenged employees to develop specific actions or “crew plans” to reduce accidents and asked for the plans to be forwarded to the their respective district safety coordinators for review. Eventually the suggestions will be reviewed by distract management.

“One of the goals is to share what works with all employees as one piece of our continuous improvement process,” she explained. “ ITD can improve our overall safety program and reduce injuries and property losses, if every employee is involved. It is the only way for ITD to sustain a strong, positive safety culture."

Why emphasize employee safety and reducing related risks? Rost provides the following article for reinforcement:

"Why We Must Rethink Our Approach?" October 2008
From SafetyXChange by John K Cameron,

Why put so much time, money and effort into an occupational health and safety program? Wouldn’t an organization be better served investing these resources somewhere else? In my eyes, there are three justifications for a health and safety program.

The moral Justification: Protecting people is the right thing to do.
The Compliance Justification: Safety is required by law.
The Business Justification: Keeping the workplace healthy and safe improves the bottom line.

Let’s look at each of these in some detail.

The Moral Justification
Of course, protecting people is the right thing to do. No business owner, CEO, manager or supervisor worth his salt would hesitate for a moment to stand up and make a great and glorious speech about working safely and how important is to the organization that nobody gets hurt on the job.

The problem is that talk is cheap. Saying that safety is important and that nobody should get hurt doesn’t make it happen. That’s not to suggest that the speech makers aren’t sincere and well intentioned. But the speech is just the beginning not the end. The real challenge is to back up the rhetoric with concrete action.

In many cases, that involves implementing the latest “safety system” with all of its attendant procedures, rules and regulations and measurable objectives.

Bulletin: “The System” alone does not and cannot solve the problem.

The Compliance Justification
The compliance justification is also a given. Obeying the law is something we’re taught to do from an early age.

The problem is that obeying the law is not synonymous with ensuring safety. The law is only a minimum standard. Thus putting policies and procedures in place, delivering training and documenting our efforts help us avoid liability, rather than prevent injuries. Like the speeches we discussed above, compliance efforts represent only the beginning. The challenge is to make the “System” work for the long term prevention of injury and illness.

Everything we do in occupational health and safety must be focused on prevention.

The Business Justification
The cost of accidents is horrendous. Most organizations have no idea what [injury] accidents are costing them even though the information is sent to them every month by their Workers’ Compensation Board or insurance agency. Do you know your organization’s WC premiums and pay-outs, short- and long-term disability costs, modified duty costs, etc.? And then there is the cost of property loss, equipment damage and tort claims due to vehicle crashes.

If not, find out. It’s affecting your bottom line!

The problem is that this information is usually kept by the financial department and filed neatly away. Dig it out, chart it, graph it, discuss it in your management meetings, put it on the agenda and publish this information to senior management, middle management and then to each and every one of your employees.

There is a lot we can do to change our mind-set and improve our bottom line. We have to start reducing accidents, reducing our WC, STD, LTD and Modified Duty costs. We have to prevent vehicle crashes and other property losses. We have to become pro-active rather than re-active. Let’s take health & safety beyond being just a moral and compliance issue to a business issue.

Conclusion:
“Safety is the control of recognized hazards to obtain an acceptable level of risk.”

This definition, which comes from the National Safety Council, is one of the best definitions of safety I know. The definition does not talk about the elimination of all hazards and risks. It recognizes that there are inevitable hazards in everything we do, at work and at home. The key to the definition is the concept of control - to “recognize” the risks we face and to ensure that those risks are at an “acceptable” level.

We can’t eliminate all accidents and there are no quick fixes. What I’m suggesting is that we can prevent many of them. My point is that we can reduce the number of disasters and the family suffering they generate and that we can and must improve our bottom line.

I am also suggesting that the way to achieve these goals is not primarily through the application of complicated or high-tech solutions. It starts with something much simpler: a change in the mind-set throughout the organization, the establishment of a positive safety culture in which everyone takes ownership and responsibility for the health and safety of themselves and those around them.