A common question we are asked is “How much is this going to cost?” Well, health and safety costs money doesn’t it? Installing safety devices, training, monitoring, checks and inspections, not to mention time spent on paperwork, it all adds up. So how can health and safety save you money?
Well yes, it is true to say that health and and safety management and measures cost money. But there is also a return on investment – the ROI, and of course, a cost to not having any health and safety measures in place.
Take this simple example, there is a cost of £50.00 to replace a guard on a piece of machinery. There is no other purpose for the guard except to stop the risk of entanglement or personal injury to an employee. £50.00 is the cost.
So why not save yourself money and not put the guard in place – there are 3 guiding principles in health and safety – the legal requirement, the economic requirement and the moral requirement. The question is always – “have you met your health and safety requirements?”. If you don’t put the guard in place and a person is injured then the person is off work for two weeks, you bear the costs involved of downtime, staff cover, equipment damage and investigation – not forgetting that you have to report this accident to the Health & Safety Authority. The total costs could be around £750.00. Now add in any possible payouts for fines and legal costs that may follow and the increase in insurance premiums.
Look at the £50.00 safety measure that could have prevented that accident, and automatically you have saved yourself €700.00.Penny wise and pound foolish! You are probably thinking that this makes sense but you might just see that £50 cost, and not really consider that you have just saved your business a whole lot of money and hassle.
This is just a simple example, but you can learn from other health and safety failings to appreciate the cost of failing to put in place good health and safety management.
With health and safety the return on investment is rarely immediate. There is a risk of much higher costs in the future, due to that health and safety failing.Health and safety measures might not just save you money against future costs. Health and safety measures might also save you money from costs that are already eating into your business profits.
For example, a business might identify a problem with manual handling within the workforce. Regular absences due to back issues, slips, trips and falls, and general accidents and ill health surrounding the movement of materials on site.
Adding up the costs of absences, loss of productivity, downtime, staff cover, staff turnover and recruitment costs, over a year period, is costing this fictional business in the region of £50,000 additional costs.
Once this has been identified, the business invests £10,000 in extra measures including new equipment, training, a campaign to raise awareness and better monitoring.
The results were that the company saved a staggering 50% of the costs they were experiencing due to poor manual handling practices.
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The above might be a fictional example, but the potential cost savings are real.
When looking at the cost of health and safety, don’t just think about how much you will need to spend to put better health and safety practices and procedures in the place, but also the savings that you could make.