Budget decisions are never simple to make, and many businesses are still adjusting to life and business at this point. Employees’ safety should be the greatest priority during the planning process, even if employers are looking for ways to cut costs if revenue has been impacted.
Employees will face new challenges every day as the nature of work changes. Unfortunately, injury risks are as high as they've ever been, and failing to develop a proactive workplace safety strategy would almost certainly result in excessive expenditures down the road.
Safety should never be overlooked. If safety is not prioritized, employees and managers will not be able to produce a safe work environment. It's improbable that the necessary preparations have been made if the budget — and, indeed, the entire project — hasn't been planned around safety. When creating a budget for a project, safety must be taken into account from the beginning.
1. Align your safety objectives with the organizations
It has never been difficult for businesses and organizations to establish their short-term objectives explicitly.
Take note of the following factors as you design your safety budget:
• Staffing levels: Can your facilities remain at their present staffing levels, and if so, what adjustments will be necessary to maintain production? These changes come at a cost, and they will impact whether or not your company is equipped to meet its objectives.
• Forecasted revenue/income: These data will define how much leeway you have in your budgeting process.
• New investments are being made: Is your company looking to diversify its revenue sources or incorporate new technology? Create projects that advance the organization's and department's objectives.
• Benchmarks for safety: Determine your objectives for incident rates, employee turnover, workers' compensation costs, and lost productivity.
Without knowing the costs, your company suffers when it comes to employee safety and wellness, it's impossible to make a reasonable budget that will create a strong safety culture. Direct cost considerations are simple to calculate and include:
• Personal protective equipment (PPE) education and training
• Payments and premiums for workers' compensation, as well as compensation/salary for safety experts
• Programming for safety
Indirect costs are more unpredictable, making them more challenging to include in a budget that effectively forecasts your company's safety requirements. However, because indirect costs can shorten direct expenditures by 200-400%, accounting for them is crucial in building a successful budget. The following are some of the causes that drive up indirect costs:
• Absenteeism, weariness, or chronic pain among workers result in lost productivity,
• Low productivity and low morale.
• High turnover is linked to safety problems.
3. Budget options should be prioritized based on functionality and safety risk.
Determine which procedures, departments, and safety initiatives are most important for your facilities' safe operation. Making rash budget cuts is an easy method to increase injury rates if you haven't considered how much savings would affect your employees' material safety. Instead, defer spending for low-risk regions and focus on investing in and preserving your operations' most safety-critical components.
Budget options should be prioritized based on functionality and safety risk. Determine which procedures, departments, and safety initiatives are most important for your facilities' safe operation. Making rash budget cuts is an easy method to increase injury rates if you haven't considered how much savings would affect your employees' material safety. Instead, defer spending for low-risk regions and focus on investing in and preserving your operations' most safety-critical components.
There are important things to consider when building a safety budget:
• What equipment and personal protective equipment (PPE) will be required?
If the right equipment isn't available, employees won't be able to use it. In addition, equipment that has become obsolete and is no longer safe must be replaced.
• Is the current project, as well as the deadlines, secure?
Consider the fact that safety may take longer, which must be factored into both budgets and timeframes.
• Do employees require additional man-hours to ensure their safety?
You may need to recruit more safety officers or give employees more personal time for safety: this is factored into wage estimates.
• When should inspections be completed?
Inspections may be sufficient during necessary times, or you may discover that the worksite is hazardous enough to require an extra check.
Many organizations find themselves cutting shortcuts on safety because they believe it is too costly. They may believe that bidding on jobs with safety in mind is impossible because they will be outbid. The truth is that safety is as costly as it needs to be. Safety is not a choice. It is an unavoidable cost.
Furthermore, safety provides a better return on investment than many firms believe. A single accident can cost a corporation millions of dollars in equipment and medical expenditures and lost productivity, and a tarnished reputation. Over time, an organization's reputation for safety grows on all levels, from client trust to employee happiness.
Businesses will get better at making sure safety becomes a priority. They will have better ways, machines, and tools. Safety pays at the beginning.
Workplace safety is a never-ending effort, and foresight in the shape of safety programming pays off in the form of drastically cheaper costs. For example, repetitive strain injuries and musculoskeletal diseases are costly, with the average price per medically consulted workplace accident reaching $41,000 in 2018. (according to National Safety Council data).
A single injury sustained by a worker can be financially crippling for a small to medium-sized business, let alone the indirect expenses of lost workdays, which totaled 103 million in 2018.
Safety professionals around the country are focusing more on employee safety and health as a result of the changes in conditions and new difficulties.
It is in the best interests of an organization to budget for safety. There are several advantages:
• Employees are safer and happier as a result of the changes.
Employees recognize that when their employers respect them, they will work harder.
• Finally, it's more likely that the budget will be realistic.
Eventually, the company will have to spend money on safety. A project may go over budget if these costs are not included.
• A single, substantial expense is less likely to deplete the budget.
If a safety event occurs, the consequences will be severe. These consequences are less likely to occur if money is spent on the safety of workers.
• It is less likely that the project will be delayed.
Projects will have to be delayed if any safety incidents occur. Equipment used will have to be fixed, and employees may have to be absent for a while.
Budgeting for safety is a conscious effort, not something that "simply happens." The company must balance short-term costs with long-term benefits. They must as well examine its return on investment. Budgeting for safety means the company will have to pay more money upfront. However, it also means the company will be taking on significantly less risk.
By investing in safety software, organizations can reduce their risk in exchange for a low, static cost. Safety solutions can collect real-time, valuable information to help the organization make ongoing safety improvements. In addition, the processes can be automated to make work easier. It's one more illustration of an advanced expense that prompts benefits for a long time.
Companies today need to put safety at the forefront of their concerns, and that starts with a budget. With safety software purpose-built to manage risk by collecting real-time actionable data, organizations can improve their safety management and employee engagement, ultimately reducing their risk and improving their ROI.
Workplace safety is becoming more critical than usual. Beyond the clear upright and moral objectives to not cripple your workers in pursuit of profit, many employers, even small businesses, now understand that it doesn't take many injuries to put the company in real financial peril. But unfortunately, safety isn't foremost in the minds of a lot of entrepreneurs.
For some, a serious physical issue to an employee is a long shot and barely worth stressing over. For others, the risk of injury seems unequal compared to the financial rewards gained; besides, insurance will cover it if workers get hurt. Some still believe that there is no way a job would be done safely without spending the money they don't have.
The thought that an organization should pick between operating properly and generating a profit is an old and firmly held attitude that, sadly, is frequently incorrect. Here are seven things that any company may take to lessen the risk of employee injuries without incurring a high cost:
1. Hire Smarter
It's simple to hire warm bodies when sales exceed production capacity. However, when you carefully screen individuals to verify that they have the necessary abilities and experience for the position, you reduce your chances of hiring an inept employee who is significantly more likely to get injured.
Employee training should be included in safety expenditures. In other circumstances, such as CPR training, the training will have to be done by a third party. Otherwise, any training that can be done in-house will be less expensive than hiring someone to do it for you. Use a qualified employee to train if possible; otherwise, third-party training must be budgeted for.
The most expensive aspect of training is time. The cost of each hour of training for each employee must be considered in the budget. Before establishing a safety budget, managers must first determine how much training is genuinely required and how intrusive that training will be.
Plant productivity may decrease or stop entirely if the entire plant or a significant department needs to be taught. A safety budget that excludes training would be insufficient and might lead to significant injuries.
3. Prioritize Maintenance
Maintaining the facility and its systems in good working order is a cost-effective strategy to avoid mishaps.
Accidents are less likely to occur when equipment and processes operate efficiently and effectively. In addition, plant managers that emphasize maintenance extend the equipment and system's life cycle.
Maintenance should be included in safety budgets since it decreases the need to replace expensive equipment regularly. More work gets done within a short time when equipment is running at full capacity. Additionally, there is less downtime in the facility when equipment is maintained, resulting in higher output.
4. Request for Safe Practices at Work
Start by believing that there is always time to complete things safely and that working dangerously is never acceptable, and then put what you teach into practice. You send the wrong message to your workforce if you prioritize productivity over safety the first time the issue arises. You want them to understand the vision of a safe workplace and be involved in helping to make it a reality. Workers will only back you up if they believe in your goal.
5. Provide the right tools and equipment
Without the necessary tools and equipment, you can't expect your staff to take reasonable measures (such as tying off while working at heights). However, compared to the cost of trauma surgery, steel-toed shoes or safety glasses are a bargain. Moreover, there is a solid human passion for practicality, and many workers may risk using the incorrect tool or taking a shortcut to complete the task.
6. Demonstrate that you value a job done safely
If you consider your "A-team" as the folks who will do whatever it takes to get the work done, you may be unintentionally establishing a culture that disregards safety. Consider rewarding employees who provide suggestions for working safely instead of rewarding those who get the task done. Avoid providing rewards for zero injuries because you are promoting zero-reporting, which raises your risk of injury.
7. Look for ways to get the jobs done more safely
Just as you should always look for different ways to get the work done quicker at a lesser cost, you should also look for ways to eliminate risk. Please spend some time with employees to brainstorm ideas in which the job can be carried out more safely; solicit their concerns about the safety of the job, and act on their suggestions.
8. Keep in mind there are plenty of right responses
Frequently, employers see safety as an absolute - either a job is safe, or it's not. However, the truth is safety is relative. Every job is accompanied by its own risks, and therefore no job is totally secured. But there are ways of approaching a job that make it safer than doing it another way. Conversely, there is no completely unsafe job, and we should shrug off risky tasks as unavoidable.
9. Plan For Prevention, not Reaction
Safety concerns are often ignored unless a plant has previously experienced a serious accident. Plants should not function in this manner. Creating a safety budget should prevent accidents rather than rectify them. Employees deserve a safe place to come to work every day, and the only way to do that is to have a well-thought-out safety budget that includes the necessary equipment and training.
For some employees, safety might be a difficult sell. Some workers have a fatalistic mentality, believing that "you gotta die of something," while others are willing to take irrational, even hazardous risks. However, entrepreneurs must always keep in mind that employees are not only putting their own lives and the lives of their coworkers in jeopardy, but they are also jeopardizing the company's future.
There is no clear plan for how every employer should respond to today's changing environment. Creating a workplace safety plan and budget that focuses on the quick fix and savvy speculation in proven safety programs will equip your company to confidently move forward into the future with a workforce protected by a solid safety plan. In addition, you'll see benefits in the shape of lower injury rates, lower organizational expenses, and a stronger workplace safety culture if you focus the future on Empowering people to be owners and stewards of safety through Education and Engagement.
Find out how to manage your business' health and safety better
Many employers are concerned about their reporting obligations for COVID-19/Coronavirus/SARS-CoV-2 under RIDDOR in the ongoing pandemic. You may be pleased to know that you do not have to report everything to the Health and Safety Executive (HSE). We'll provide more info about when, what, and how to report.
The most common concern we've seen recently from employers is whether they need to report all COVID-19 and coronavirus testing results to the HSE. The short answer is no. According to the HSE: “There is no requirement under RIDDOR (The Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 2013) to report incidents of disease or deaths of members of the public, patients, care home residents or service users from COVID-19. The reporting requirements relating to cases of, or deaths from, COVID-19 under RIDDOR apply only to occupational exposure, that is, as a result of a person's work.”
Generally speaking, the ordinary RIDDOR rules already cover COVID-19. You should only make a report under RIDDOR when one of the following circumstances applies:
• an accident or incident at work has or could have caused the release of coronavirus (SARS-CoV-2). (Report as Dangerous occurrence)
• a worker is diagnosed with COVID-19 due to occupational exposure. (Report as Disease)
• a worker dies because of occupational coronavirus exposure. (Report as Work-related death due to exposure to a biological agent)
The bottom line is that existing rules cover most COVID-19 measures, and most of the COVID-19 guidance comes from public health authorities rather than the HSE. The environment remains chaotic, but you can minimize your legal exposure by continuing your existing compliance steps. This will include communicating with your insurer about risks, following public health guidance, and communicating regularly with your workers or unions on any of their concerns.
© Gavin Coyle, 2021
© Gavin Coyle, 2021