Do you know the true cost of injuries in the work place?
Workers’ compensation insurance premiums can be costly for employers. The real cost of a workers comp injury includes direct and indirect costs.
- Direct costs are made up of medical expenses, costs for legal services, indemnity payments, and rehabilitation.
- Indirect costs of workplace injuries are more damaging, they are not covered by your workers’compensation policy and they come out of your bottom line. Some examples of indirect costs are training replacement employees, accident investigation, repairs to damaged property or equipment, and even poor community relations or an injured business reputation.
The Cost of Claims Calculator can help you determine the direct and indirect costs of on the job injuries: https://www.osha.gov/dcsp/smallbusiness/safetypays/estimator.html
A simple cost calculator puts both costs into perspective. The average work related injury results in $25,000 in direct costs will have indirect costs of $27,500 based on industry studies. A company with a 4% profit margin would need to make nearly $1.3 million in additional revenue in order to offset the direct and indirect costs of just one injury. This is important information your managers and supervisors need to understand. At UNICO we can provide this valuable work comp training.
A particularly helpful tool employers can use to estimate the cost of an injury in the workplace is the “$afety Pays worksheet provided by OSHA. The worksheet allows you to select a type of injury from the drop down menu, enter your profit margin and the number of injuries.