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Train. Protect. Prevent.

Building a Safety CultureEliminating Accidents and Injuries

Why a Safety Culture?• Safety Culture Predicts Safety Performance!• Key to preventing Accidents and Injuries• Builds Trust within the organization • Employees will be safe for themselves not because there is a policy• Safety becomes the first thought before starting any task!• Employees understand the company values safety!

How Will a Safety Culture Impact My Company?

• Developing a strong safety culture has the single greatest impact on accident reduction• Fewer at-risk behaviors, lower accident rates, low turn-over, low absenteeism, lower Workers Compensation Costs and higher productivity• Safety will play an integral role in your daily operations• Managers will demonstrate their commitment to safety • Workers will take ownership of their safety

How Will a Safety Culture Help Reduce Injuries?

• Sends a message to your employees that they are the most important asset• Helps align everyone in the company towards the common goal of arriving home safe, every day, every shift• Developing and promoting your Safety Identity builds accountability and sharpens employee awareness of potential hazards• Employee families will support the initiative and will help promote the importance of arriving home safe

How Will a Safety Culture Help Save My Company Money?

• By tying safety performance goals to your incentive plans you will raise awareness to hazards• Sharpened awareness to potential hazards will reduce the amount of accidents and injuries, which will create savings on Workers Compensation/Self Insurance Premiums• A decrease in accidents and injuries through a strong Safety Culture will reduce your direct and indirect injury cost.

Why Should I Promote a Safety Culture?• Identifies your business as a company with values. This will promote a positive outer marketing apperance• Ultimately leads to recognition from outside entities which will lead to positive publicity• Radiates company pride throughout the organization• Speaks volumes to your customers • Builds moral through the constant celebration of improving your safety goals

The Direct Costs Of Health And Safety In The Workplace Are:

• Workers’ Compensation/Self Insurance Premiums• Medical Costs if your company is self insured or participates in the Ohio 15k program• Possible fines as a direct result of an accident of injury• Money spent on a Health and Safety Program• Money spent on a Health and Safety Incentive Program

The Indirect Costs Of Health And Safety In The Workplace Are:

• Indirect loss of time• Contingent Costs• Direct loss of time• Damage to equipment and waste of material• Increased overhead

• Estimating the Impact of Accidents on Your Profits and Sales Direct Cost– Total value of the insurance claim for an injury or illness

Direct Cost (Medical costs and indemnity payments) $1,101.00

• Indirect Costs– By multiplying the direct cost by a cost multiplier. You will

calculate the indirect cost of this injury or illness Direct Cost Cost Multiplier $0 - $2,999 4.5 $3,000 - $4,999 1.6 $5,000 - $9,999 1.2 $10,000 or more 1.1

Direct Cost x Cost Multiplier = Indirect Cost$1,101.00 4.5 $4954.50

Total Cost (direct cost + indirect cost) = $6055.50

Direct and Indirect Costs of Injuries

Safety Pays! Injury Type: Laceration

– Average Direct Cost: $1,101.00

– Average Indirect Cost: $4,954.50

– Estimated Total Cost: $6,055.50

– The net profit margin for this company = 6.00 %.

THE TOTAL ADDITIONAL SALES REQUIRED BY THIS INCIDENT IS ESTIMATED TO BE:

– Sales needed to cover Indirect Costs = $82,567.00

– Sales needed to cover Total Costs = $100,917.00

• The extent to which the employer ultimately pays the direct costs depends on the nature of the employer's workers‘ compensation insurance policy. The employer always pays the indirect costs.

• This report is produced by OSHA's Safety Pays software.

Case Study of Large Mechanical Contractor in Ohio

• This contractor started their “safety culture” initiative in 1999• Prior to 1999 • Employees would actually leave their worksite if OSHA

arrived for an inspection• Safety was addressed only when required by a customer

or OSHA• Executives and Management didn’t demonstrate a

commitment to safety

• Prior to 1999 Continued• Employees viewed personal protective equipment and

safety as something that “was uncomfortable” or “slowed them down”• Injuries started to mount up, especially ones that could

have been prevented if the employee would have been wearing the proper personal protective equipment

• Post 1999• This contractor has become a partner in Safety with

OSHA through the Voluntary Protection Program• Safety is addressed in the estimation stages of any job

that is bid• Job Hazard Analysis’s are performed before any change

in the work area, or work type• Executives demonstrate a commitment to safety• Management demonstrates a commitment to safety• Workers take ownership of their safety in the workplace• Company requires all subcontractors to adhere to the

same safety guidelines as the company’s employees

How does a Safety Culture benefit this company?

• Reduction in Accidents and Injuries• Improved Employee Morale• Improved Productivity• Workers Compensation Savings!• EMR (Experience Modification Rate) • In 1999 this companies EMR was 1.03

2002 2003 2004 2005 2006 2007 2008 $-

$1.00

$2.00

$3.00

$4.00

$5.00

Workers Compensation Savings per $ of Safety Costs 7 Year Average Savings per $ of Safety

Costs= $3.32

• Savings is figured by the Workers Compensation Premium that would be required if the companies EMR remained at 1 minus the actual Workers Compensation cost to the company

•The savings is then divided by the actual safety cost of the company to determine the amount of savings per dollar invested in safety each year

• For every dollar invested in safety has returned, on average $3.32 to this contractor over a 7 year period

2002 2003 2004 2005 2006 2007 2008 $-

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

Workers Compensation Savings per Employee (Compared to EMR = 1.0)

7 Year Average Savings per Employee = $983

• This Graph uses the same savings model as the previous graph. Savings is figured by the Workers Compensation Premium that would be required if the companies EMR remained at 1 minus the actual Workers Compensation cost to the company

• The actual safety costs of the company are then subtracted from the savings. Then that number is divided by the average number of employees.

• For every employee this company saved an average of $983 per year after their safety costs

How Do I Start Building My Safety Culture?

• Develop a Formal Safety Program• Develop an Executive Safety Mission Statement• Develop a Safety Slogan• Develop Incentive Programs• Conduct Weekly Safety Talks• Perform Job Hazard Analysis • Develop a Safety Training Program• Create a Disciplinary Program• Install Self Inspection Procedures • Contract an Outside Company to Perform Safety Inspections• Require All New Employees Complete a Safety Orientation Prior To Work Assignment

Questions?