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Understanding The True Cost of a Poor Workplace Safety Culture
There’s no denying that workplace safety is important, but it’s unfortunately common for businesses to ignore its necessity. In a time where Americans believe their safety at work is “more important than ever,” 5,190 fatal work injuries were recorded in the U.S. in 2021.
That’s an 8.9 percent increase from 2020, and to make matters worse, 82 percent of employers in a WSPS survey stated that they wanted to focus on implementing better health and safety protocols in 2021.
If we look at this positively, it means that employers are willing to improve their safety cultures, but it also implies that they’re lackluster enough to require improvement. But what is a safety culture, and why do you need to implement one in your organization as soon as possible?
What is a Safety Culture?
A safety culture is a culture that creates rules, regulations, protocols and policies that ensure the safety of its staff. A healthy safety culture will effectively communicate company values, show leadership in operations and communication and explain what’s expected of employees.
What’s more, a safety culture will encourage involvement in the safety management process, increase awareness of potential risks and educate workers about safety management systems. With this information in hand, an employee will understand how to implement safety protocols.
For a safety culture to succeed, its leaders must lead by example. That means pointing out when unsafe practices occur, following them to a “T” and rewarding safe employees.
The True Costs of a Poor Safety Culture
A business that has a poor safety culture won’t just sacrifice its profits; it’ll also put human lives at stake. If you don’t implement a safety culture, the following things are likely to happen.
Higher costs that eclipse gains. A study of over 100,000 Oregon-based businesses found that companies won’t implement a safety culture because “it costs more to ensure worker wellbeing than to ignore it.”
However, that statement doesn’t reflect reality. It actually costs employers in the U.S. $171 billion a year to pay out costs associated with disabling or non-fatal workplace injuries.
A fatal injury can cost a company $1,150,000, and the average cost of a worker’s compensation claim can total $40,051. To be clear, these costs only represent the direct cost of filing a claim or a report, but many employers still have to pay for lawyer's fees, lost productivity and more.
Decrease in productivity. Companies also feel that ignoring safety protocols makes their workers more productive because they don’t have to stop to follow the rules, but the reverse is often the case.
Suppose you have a construction company that specializes in landscaping. You can instantly improve your close rates and profits in the landscape business if you strive to uphold a high customer experience metric.
To do this, you need happy and healthy employees. A happy employee is more likely to be productive and invested in their job and their company’s customers.
Increased injury and death. It’s clear that when attention is paid to safety, lives are saved. A report by OSHA showed that the number of injuries and deaths in the workplace has dropped by 60 percent since 1970. That’s great news, but there's always room for improvement.
It’s also important to note that the rate of deaths and injuries has increased slightly since 2020 due to employers ignoring COVID safety standards.
More damaged products. Tired employees coupled with low safety standards will result in poorly made products. When employers don’t take their safety culture seriously, they end up paying thousands, even millions, to repair the damage caused by recalled products. A Vornado recall, for example, was issued after a 90-year-old man died after his heater caught fire. Prior to this, the company received 19 reports of the heaters catching fire.
A negative reputation. A negative reputation can temporarily or permanently affect your bottom line. In fact, many businesses never recover from a negative reputation caused by poor working conditions.
A report from Morning Consult shows that 90 percent of consumers say it’s essential for brands to take care of their employees, and 49 percent said they consider how a business treats its employees before making a purchasing decision. If a negative news article or a scathing opinion piece comes up when a customer searches for a company, they’ll take their money elsewhere.
Increased legal issues. When multiple injuries and deaths are a result of poor safety practices, the law inevitably gets involved. Long legal battles are going to drain your wallet, often for years to come. The 2010 Deepwater Horizon oil spill, for example, caused the death of multiple workers.
It cost BP around $70 billion to clean up the oil spill, and over a decade later, they’re still paying out claims. The worst part about this mess is that the whole thing could have been prevented.
Not only that, but the vast majority of workplace incidents are preventable, as most of them are caused by human error. With proper training, employers can reduce the number of legal issues.
Increased worker turnover. Workplace stress leads to an increase of almost 50 percent in voluntary turnover, and it’s easy to see why an unsafe environment would cause an increase in stressors. Businesses should make safety a priority as it costs much more to replace an employee than it does to retain them.
Disengaged workers are also more likely to be found in companies that don’t have a safety culture. When employees are disengaged, they make more mistakes, miss work more often, and cause more accidents. Remember that engagement and safety always go hand-in-hand.
A Safety Culture is Necessary to Save Lives and Money
Safety should be an employer’s utmost priority, but we understand that money talks. Fortunately, businesses can save lives and money if they take the time to implement a safety culture. While creating an optimal safety culture takes time and patience, it’ll be worth it in the end.