If you are managing risky environments in industries like rails and utilities, implementing effective worksite safety protocols can make all the difference. We understand the difficulties faced every day while maintaining effective operations with large teams of contractors and subcontractors. On first glance, an investment in worksite safety improvements may seem like an unnecessary expense but we’ve pulled together reasons why the ROI far outweighs the initial costs.


One company that participated in OSHA’s Voluntary Protection Program saved roughly $930,000 per year and reported 450 fewer lost-time injuries than its industry average.


Plus, as workers’ compensation costs increase and become more and more prevalent due to injuries on the job, OSHA continues to ramp up its enforcement efforts for companies that ignore safety altogether. In 2010, for instance, OSHA conducted 41,000 inspections resulting in over 96,000 safety and health violations, which was a 15% increase over the previous 5-year period.

When comparing the costs of implementing safety protocols versus the cost of a workplace incident in the rails and utility sector, you’ll likely always end up dishing out more dollars compared to what’d you save with prevention.

Worksite Safety: Types of Costs for Workplace Injuries

Before understanding the benefits of investing in worksite safety, you’ll need to know about the common costs that can occur when managing large contractor teams on vast sites like those in the rails and utility industries.

• Direct Costs

There are the direct costs involved in workplace injuries, which should be planned. These can be either expected or more common. For example, workers’ compensation is an expense that your organization will be required to pay, which is ultimately a protection for you. Expect to pay roughly 3% of total compensation for your team members for the insurance coverage.

In addition to workers’ compensation, you may also run into a situation in which it will be less of a headache to reach a settlement than battle out a dispute in court. For example, if one of your contractors gets a back injury while on the worksite, they can file for workers’ comp, but they may also try to get additional compensation directly from you, the employer.

• Indirect Costs

You’ll also need to include the not-so-obvious costs such as days out of work if a contractor gets injured on the job. This can directly lead to decreased productivity. In fact, rails and utilities are had the highest segment of workers out of the job in 2014. According to the U.S. Bureau of Labor Statistics, roughly 200 team members out of 10,000 were out of work for an average of 10 to 12 days. That’s nearly four times as much as office jobs. Those days off the job are costing your organization time and money.

There are also other costs that can occur if an injury occurs on the worksite including accident investigation and corrective action, training and retraining, repairing damaged property, the negative effects of decreased employee morale, which can lead to increased absenteeism.

Worksite Safety: ROI of Money Invested into Worksite Safety Programs

• Cash ROI

You may see benefits fast when you make a direct investment in worksite safety. According to Liberty Mutual, every dollar invested in safety can return three dollars. That’s a direct benefit that can easily be measured and appreciated. For example, one fall protection program implementation reduced an employer’s accident costs by 96%, taking costs from $4.25 to $ 0.18 per person-hour.

Also, investing in worksite safety can lead to lower workers’ comp costs. According to a 2012 study by California’s Division of Occupational Safety and Health (Cal/OSHA), there was a 9.4% drop in injury claims and a 26% average savings on workers’ compensation costs in the four years after investments in safety precautions on the worksite.

• Increased Employee Productivity

Similar to the indirect costs listed above, there are indirect ROI benefits when your organization invests in worksite safety. For example, when you make the work environment safer by taking a proactive approach, you increase morale and can reduce injuries. For one organization, that led to a 13% increase in employee productivity, which has a huge impact on your organization’s bottom line.

• Less Waste in Work Product

When worksites are safer by choice and through direct improvements, there can also be a direct impact on the amount of waste of actual products used during the job. According to OSHA, there was a 16% decrease in scrap product when the Ford New Holland implemented the OSHA Voluntary Protection Program (VPP).

• Greater Innovation

One of the most unexpected outcomes of investing in worksite safety is the increase in innovation. Overall, implementing programs such as better training protocols and monitoring can lead to better business performance outcomes, such as lower overall costs, innovation, continuous improvement, and higher profitability.

Don’t leave safety to chance. Start making proactive investments and choices to protect not only your workers but also your organization from liability and risks. To learn about direct ways in which you can mitigate risks on the worksite, contact our team today!



**This article is for informational purposes only. It is not intended to constitute legal advice.