Question

Many people assume that when employers economize on safety programs the money they save improves profits, but that’s not the case. For one thing, poor safety practices raise wage rates, because wage rates are higher on jobs with riskier working conditions, other things equal. And poor safety and the injuries and illnesses it begets actually drive up costs, including medical expenses, workers’ compensation, and lost productivity. Consider the evidence. One study found a 9.4% drop in injury claims and a 26% average savings on workers’ compensation costs over 4 years in companies inspected by California’s occupational safety and health agency. A survey of chief financial officers concluded that for every one dollar invested in injury prevention, the employer earns two dollars; 40% said “productivity” was the top benefit of effective workplace safety. One forest products company saved over $1 million over 5 years by investing only about $50,000 in safety improvements and employee training. In the United States, work-related hearing loss costs employers about $242 million a year in workers’ compensation claims alone, costs that are probably avoidable through earmuffs, earplugs, and training. So one of the easiest ways to cut costs and boost profits is to spend money improving safety.

Assuming this is true, why do so many employers apparently cut corners on safety?

Answer 1

Employers are legally responsible to ensure a safe and healthy workplace. Despite that, they try to avoid putting in safety measures to reduce costs and save time.

The employers cut corners primarily because they are looking for shortcuts to maximize their productivity and business revenue. The businesses are taking a myopic view of business practices. They initially do not take the safety concerns seriously and are more focused on maximizing profits at any cost. They are assuming they will be safe without taking any precautions. Generally, the team is under pressure to minimize costs in the short run and to maximize output and returns. The supervisors and managers along with the decision-makers decide to eliminate safety parameters and show their efficiency levels. This results in the reduction in short term costs and overall the employee are rewarded for saving costs. Besides, most employers feel that their organization will not face the safety issues which other organization are facing. They feel they are safe and continue violating the safety concerns. The red alert is when a mishap takes place and huge damages are to be paid. Also in some cases, the employers are not fully aware of how they can save costs by putting in safety programs at the workplace.

To conclude the employers take short cuts to minimize costs, cut corners and to save both time and money. They are taking a short-term view of safety concerns and in the result have to pay huge damages to handle crises.