The Cost of Accidents at Work

The Division of Vital Statistics reports that accidents are the leading causes of death for persons in their teens and up to age 45. In industry, there is no intent to kill or injure workers yet accidents kill and maim people. Many of the injuries reported as sprains and strains often involved the back. The incidence of fatalities and injuries (along with potential monetary losses) may increase as operations become more complex. The cost of accidents in the workplaces of the United States is approximately 150 billion annually. Some examples of costly accidents are  

Multimillion-dollar personal injury awards are not unusual. To the cost of the loss awarded by a court must be added that of the defense. Not every plaintiff in an accident suit has 

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Any accident or incidence of ill-health will cause both direct and indirect costs and incur an insured and an uninsured cost. It is important that all of these costs are taken into account when the full cost of an accident is calculated. In a study undertaken by the HSE, it was shown that indirect costs or hidden costs could be 36 times greater than direct costs of an accident. In other words, the direct costs of an accident or disease represent the tip of the iceberg when compared to the overall costs (The Cost of Accidents at Work HSG96). 

Health and Safety Executive, Guidance booklet HSG 96. The costs of accidents at work, HSE Books, Sudbury (1997)... 

It is widely accepted and understood that safety events (accidents, incidents, fires, environmental damage, etc.) cost money. The financial costs to an organisation following a fire are substantial. There is a perception that the majority of such costs are insurable however, as can be seen from the research undertaken on behalf of the HSE, The Cost of Accidents at Work, there are numerous areas which are not covered by insurance. 

Regardless of whether people are injured or not, there will be a financial cost to organisations. The Accident Prevention Advisory Unit (APAU) of the Health and Safety Executive (HSE) has carried out extensive research into the cost of accidents at work, the results of which are summarised in the publication The Cost of Accidents at Work (HS(G)96). 

Health and Safety Executive (1993) The Costs of Accidents at Work.. London HMSO. 

Communities, E. 2004. Statistical analysis of socioeconomic costs of accidents at work in the European Union. Luxembourg. Eurostat. 2013. Available [http //epp.eurostat.ec.europa.eu/portal/page/portaF eurostat/home/2013]. 

The fact that an accident has occurred and resulted in legal action being taken is unsatisfactory. An award cannot repair an injury the outcome of an action is uncertain and the considerable cost and ingenuity expended in the investigation, developing the pleadings and the trial itself, could have been used more positively in trying to avoid such accidents. Towards this end the Flealth and Safety at Work etc. Act was enacted in 1974. 

According to International Labour Organization every day, 6,300 people die due to occupational accidents or work-related diseases, what constitutes more than 2.3 million deaths per year. In addition, 313 million accidents happen on the job yearly what often leads to extended absences from work. The human cost of accidents is estimated at 4 per cent of global Gross Domestic Product each year (Safety at work 2013). Thus, there is a need to increase the awareness of the scope and consequences of work-related accidents, injuries and diseases, and make an attempt to find an explanation for them and their causes. 

Many organisations pay great attention to accidents at work and the cost, both direct and indirect, of these accidents. On the other hand, the management of absence is commonly neglected on the basis that the problem is insoluble and outside the control of management. However, absence from work on the part of staff and others can be a substantial cost to an organisation. It can take a number of forms ... 

Injuries and illnesses resulting from accidents are extremely costly, and many employers are unaware of what their human and financial costs actually are. Accidents are more expensive than employers realize. Both direct and indirect components must be considered in the total costs for injuries and illnesses, which is difficult to do, given that countless hidden costs are involved. In 1993 the economic cost for injuries alone from accidents was estimated at more than 110 billion. According to the Journal of Environmental Health, work injury costs in 1994 rose to 121 billion in medical care, lost productivity, and wages." ... 

In Holland in 1962 studies showed that the costs of an accident could be rated at about 2000 guilders. A quarter of that amount represented the costs of wages and three quarters the indirect costs on the work, including replacement of machines and replacement of works. 

Direct costs of accidents include monetary compensation for the companies, the financial loss for the country s health care and injured workers loss of working capacity. The European Agency for Safety and Health at Work estimates that 4.6 million of accidents happen each year in the EU. They result in 146 million loss in working hours. This amount is roughly equal to around 2.6-3.S % of the EU Gross National Product (GNP) every year (Rikhardsson 2006). 

A I have asked our Corporate VP for Operations to take day-to-day oversight of the work. I expect to review progress every month. I will make sure that the project has all the resources and management commitment needed to make it succeed. I have already planned for an annual reduction in accident and incident related costs of at least 10 percent each year. I have given my personal commitment to the board that we will achieve this. 

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