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Safety Management Insights

The Costs of Not Enforcing Safety Policies and Procedures

Posted by Don Brown on Mar 24, 2016 9:00:00 AM

safety-policies-for-employees.jpgThe details, costs and levels of severity may vary by company and industry, but every business will have its own safety policies and procedures. While every enterprise needs to strictly enforce its policies, however, many do not. These companies eventually find themselves in hot water with government agencies, at the centers of lawsuits for serious injuries, illnesses and unnecessary deaths.

Failure to provide a safe workplace doesn’t just lead to legal troubles and unnecessary accidents, either. It severely and negatively impacts a company’s bottom line. OSHA fines and litigation costs are bad enough, but the true costs appear in compromised productivity. To create the safest, most productive workplaces possible, employers need to understand the costs of not enforcing safety policies and safety procedures.

Common Violations

One of the best ways to avoid costly mistakes is to know what to look for. According to a joint study by OSHA and Safety+Health magazine, the top 10 most common violations of 2015 were:

  1. Fall Protection
  2. Hazard Communication
  3. Scaffolding in Construction
  4. Respiratory Protection
  5. Lockout/Tagout
  6. Powered Industrial Trucks
  7. Ladders
  8. Electrical – Wiring Methods
  9. Machine Guarding
  10. Electrical – General Requirements

Fines and Penalties

What do these and other common violations actually cost? Fines and penalties are steep, and companies with multiple violations can accrue totals in the hundreds of thousands and higher. According to OSHA, fines are as follows:

  • Serious Violation. Violations that result in serious bodily harm or death can carry mandatory penalties of up to $7,000 each.
  • Other than Serious Violation. Even when a violation is unlikely to lead to severe physical harm, it can still cost up to $7,000. They may, however, be adjusted downward based on the employer’s good faith, lack of violation history and the severity of the violation.
  • Willful Violation. When an employer is negligent or purposefully disregards a safety regulation, penalties range from $5,000 to $7,000. If a willful violation results in a worker’s death, it is also punishable by six months’ imprisonment, a court-imposed fine or both. That fine can climb as high as $250,000 for an individual and $500,000 for a corporation.
  • Repeated Violation. Employers who repeat the same offense can be fined up to $70,000 per violation — 10 times the amount for an initial violation!

Economic Costs

If the costs to individuals and companies seem high, consider the overall economic impacts of noncompliance. According to OSHA, businesses spend $170 billion per year on costs associated with occupational injuries and illnesses. What’s more, lost productivity from those incidents costs an additional $60 billion per year.

That money comes straight from company coffers, and it would be far better spent on the provision of safe workplaces and the creation of preventative policies. In fact, OSHA itself offers a Voluntary Protection Program (VPP), and businesses that partner with the VPP have 50 percent fewer lost workdays than the averages for their industries. Their incident rates are also 50 percent below the national average.

The Small Costs of Big Savings

Improving and following safety policies and procedures certainly requires a significant investment. In the long run, however, that investment pales in comparison to the savings and productivity improvements companies can realize through safer workplaces.

Take the recent story of the death of an assembly technician, for instance. A 31-year-old worker at Ferro Magnetics Corp. was electrocuted while testing transformers. According to the OSHA citation, his death might have been prevented if the company had supplied adequate protective equipment, followed safety procedure and provided training. Ferro now faces fines and penalties of $106,400, which could have been avoided with perhaps a few thousand dollars’ worth of equipment and labor.

The easiest way to enforce your company’s safety policies and procedures is to keep track of them in an organized, central location that all of your employees can access. BasicSafe’s Policies and Procedures Management software can help you manage and update all of the necessary documentation to keep your workers up to speed.

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