Occupational Accidents and Their Financial Consequences

The private business sector in America is responsible for complying with the latest safety and health policies mandated by the respective state and Health Administration (OSHA). 

Companies that fail to comply with a state’s myriad of safety standards and orders can face considerable penalties for noncompliance. 

Workers in all industries across the country are exposed to a number of safety hazards unique to their occupations. Yet, some hazards exist across the board, and all employees are vulnerable as employee’s compensation claims reveal that certain injuries happen more frequently than others. Accidents can happen more often than not in warehouses, offices, or construction places – pretty much at any time, no matter the site. 

Most business owners understand that their employees are their greatest assets. By creating hazard-free environments, occupational injuries that result in lost days on the job can be reduced, and the negative impact on productivity – and ultimately the profit – can be lessened. 

The truth is that even when these professionals do take in-place workplace safety precautions and measures to avoid injuries, accidents will happen.  They’re just inevitable. It’s how these professionals prepare for and respond to these accidents that can make all the difference in achieving the best possible result. 

Direct Costs 

When a business owner takes into account the consequences of an occupational accident, the related direct costs are likely the first, and often only, the thing they worry about. And they have all the reasons to believe so! According to CompensationCalculatorUK.co.uk, direct costs associated with the personal injury claim cost businesses close to $60 billion every year. 

When an employee who suffered a workplace injury files a personal injury claim, the business owner may be liable for direct costs such as the financial amount paid to cover the medical bills for the employee and other costs associated with their injury. Direct costs also include legal costs accumulated through proceedings. 

Indirect Costs 

Such costs are often overlooked but no less harmful outcomes of an occupational injury. Even if a staff memeber does not file a claim for personal injury, business owners may still have expenses like this to worry about. From corrective measures to time off work and much more, indirect costs of occupational accidents can often exceed direct costs. 

Typically, indirect costs account for all costs associated with a company as a result of an accident in excess of any costs linked with workplace injury claim itself. Since it is not something very concrete, and no large amount of money is presented, most business owners forget that things like additional employee training and loss of productivity can financially burden their organization in the same way as to direct costs. 

Disruption in Business Operations 

No matter the incident, the sudden news led to operation interruptions and canceled meetings. Everyone calls for responsibility, for someone to blame. The owner is seeking legal advice while employees are simply too stressed to continue their work.

When an occupational accident takes place, business operations are certainly disrupted. It may take weeks, sometimes months. If someone dies, the business will have to handle all the acquired damages, from providing support to the devastated family, finding a replacement employee, to managing the insurance of the company. 

For a business, the disruptions of daily business operations can only mean a serious waste of productive hours. Even several days of disruption will make a business lose an incredible amount of lucrative working time.  

Damaged Reputation 

When an accident happens, the business comes under a cloud, spotting its reputation from the media publications and wiggling tongues. 

The audience will start being mistrustful that the owner doesn’t care about the employees and the business isn’t following safety protocols to protect its team. But for that to happen, the workplace accident has to be a major one since minor accidents are more common. 

When something serious happens, the media is likely to report the case about the business involved. The accidents may appear then in a local newspaper or in a major news channel. Even so, the media leans toward the victim, making the business the main villain who can deteriorate its reputation among important clients and business partners. 

No matter their gravity, occupational accidents can have detrimental consequences for a small company. Accidents often lead to loss of financial means, loss of productivity, and tarnished reputation. Therefore, businesses and employees should take immediate steps to prevent these accidents and ensure a safe and secure working environment. 

How to Avoid Workplace Accidents? 

Most business owners have a half-hearted approach to workplace safety, despite understanding the potential dangers that come with a work accident while under their resonsability. 

Taking out the right insurance coverage is a critical step business owners must take to ensure workplace accidents won’t bankrupt them. However, the appropriate policy doesn’t help a business reduce the risk of accidents. What minimize that risk is: 

• A safe working environment 

The most obvious step is to ensure that all employees operate in a minimum-risk working environment. But before going out and about improving your business safety, it’s important that you notice and commit to ongoing safety training with your employees. 

Getting everyone on the same page about your business’s new safety rules and encouraging them to look after their own ensures that your people know safety is a priority to you. 

• Adequate Protection and Equipment 

Most workplace injury cases happen due to ill-maintained vehicles or machines. Additionally, to the possibility of the machine itself causing an injury on your staff member, there’s also the risk of injury happening while an employee attempts to fix the machine as well. 

Performing regular maintenance and providing adequate protection to your employee will ensure your company reduces any risk and chance of legal action.  

The provision of specific headwear, harnesses, specific footwear, and even ergonomic mouses for those working at computers, may reduce the risk of compensation claims resulting from back injuries. It may seem like a costly exercise, but providing the right protection can protect your business from the worst financial consequences should the worst occur.