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How Workplace Injuries can Affect Your Business?

In the US, private sector employers are required to conform to the latest workplace health and safety regulations enforced by the Occupational Safety and Health Administration (OSHA). This is needed to protect workers from the risk of severe injuries and fatalities, which can occur due to a variety of safety hazards in the workplace. Some of the most common hazards include falls from working at height, trios from electrical wires or cords, and so on.

Depending on the severity of an injury, different types of workplace injuries can have a snowball effect. Not only can these injuries negatively affect the staff by causing them pain and suffering, business owners also face serious repercussions because of workplace injuries, especially if they are caused by some form of a company’s negligence. Continue reading to learn about how workplace injuries can affect your business and how you can avoid them.

Workplace Injuries 101

To begin with, workplace injuries can lead to two types of costs—direct and indirect. Let’s take a look at both of these costs in detail.

Direct Costs

OSHA Fines

If workplace injuries arise from a company’s negligence and failure to implement adequate safety measures in compliance with OSHA regulations, then the employer shall pay the fine. Penalties for non-conformance with OSHA safety rules include:

  • General violations—up to $7K per violation
  • Serious violations—up to $25K per violation
  • Repeat or willful violations—up to $70K per violation
  • Failure to minimize the risk— up to $15K per day
  • Failure to report injuries or death of an employee—minimum penalty of $5K

Keep in mind, these penalty amounts may vary, depending on the severity of the violation. For example, a  severe injury sustained by an employee can result in millions of dollars of fines, along with imprisonment.

Workers’ Compensation

If a worker is injured on the job, they are eligible for workers’ compensation. This is a direct cost as the employer has to bear the medical expenses until the worker recuperates. Furthermore, such injuries can have a detrimental effect on the bottom line of the company. Like any other insurance type, workers’ compensation rates can increase due to repeat accidents. An increase in recurring payments for workers’ compensation can prove to be disastrous for your business’ financial standing.

Furthermore, if the worker dies after getting injured or while the medical treatment is underway, then the employer shall pay death benefits to the surviving family members of the deceased. The family members of the deceased may be entitled to more benefits than those provided by the workers’ compensation coverage, which can add to your cost.

Apart from these issues, another aspect that can hurt your financial position is the legal implication of workplace injuries.

Costs for Legal Services

Legal counseling comes with a considerable price tag, which can’t be denied. In some situations, you may need to seek legal services to protect your business interest and resolve workplace injury settlements. This is particularly true in the case you don’t carry workers’ compensation insurance or when certain types of injuries are not covered by workers’ compensation insurance but are being claimed by the injured worker.

Indirect Costs

Did you know that the indirect cost of a workplace accident can sometimes be four to ten times higher than the direct cost incurred? This is because trained employees are your greatest assets. Besides this, the dollar cost of new recruitment and training is higher than retaining a trained employee. Studies show that replacing an employee can cost a business 6 to 9 months’ of their salary on average. Let’s dig deeper to understand this better:

Productivity Loss

Once a trained employee is injured, they may need plenty of time to recover and get back to work. This can lower your business productivity, especially if that employee was responsible for handling technical issues at work. In order to complete those tasks, you may assign additional responsibilities on a temporary basis to other co-workers, which will further add to their job responsibilities.

Training Replacement Employees

If the injured worker suffers from permanent disability and is unable to perform the duties that they did previously or if the injuries prove to be fatal, then you may need to replace them with a new recruitment. Hiring and training a new worker comes with a huge cost. Induction and on-the-job training can be time-consuming and for a couple of months, the new employee may not deliver the kind of results and productivity as the former employee.

In addition to the entry wages that you have to provide the trainees, you will also have to cover the costs of staff training and off-site courses.

Accident Investigation

This cost is inevitable. Regardless of the severity or nature of the injury to the employee, you will have to conduct an accident investigation to ensure accurate accounting of the claim. Thus, this is the additional cost that employers have to incur anyway.

Repair and Replacement of Damaged Property or Equipment

If a workplace injury to a worker is caused by a malfunctioning, defective or damaged machinery/equipment, they will need to be replaced or repaired to prevent injuries to other workers. Sometimes, the repair or replacement of faulty equipment and machinery can result in huge financial expenses.

How to Avoid the Costs Associated with Workplace Injuries

The best approach is to get in touch with us. At GSC On-Site Services, we have a team of experienced injury prevention specialists who can help you identify safety hazards and implement the best strategies to minimize the risk of injuries in your organization while staying OSHA compliant.

Give us a chance to serve you. Contact us today. Our team will visit your work premises and provide you with clear evaluation and assessment, addressing all risks and hazards. At GSC On-Site Services, our goal is to help employers ensure maximum workplace safety.