The Polytechnic University of Timisoara

Faculty of Mechanics

Specialization: Labor Relations, Health and Safety

Engineering at Work

The costs of work accidents

Coordonator ştiinţific: masterand

Prof.univ.dr.ing. Dumitru Mnerie Ing. Adrian Stânga

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Industrial accidents. Some statistical data:

1. Costs related to work accidents $ 48 billion

2. 7.100.000 injured workers per year
3. On average, 3 workers injured per 100 workers
4. An accidental death every 51 minutes
5. Serious injury every 19 seconds

Work-related accidents are a major economic burden for employers, employees

and society. In most of the cases, the costs incurred by victims of work-related
injuries or occupational diseases cannot be assessed. It is much easier and more
efficient to prevent an accident at work than to compensate the injured person.
Companies spend huge amounts for the costs associated with work-related injuries
and occupational diseases, expenses that come directly from the companies’ profits.
Work-related accident expenses are reflected in:

- the costs of retraining

- compensatory payments
-absenteeism and lack of productivity

Ad decrease profits.

In order to be able to tackle the problem of the labor protection efficiency, it is

necessary to be able to establish a cost of the security, respectively of the insecurity,
that is compared with the expenses incurred for the prevention.

The cost of security / non-security is actually the cost of accidents and illnesses
eliminated / produced, respectively the value of all the losses generated by the
accident / illness.

Basically, security means the absence of these events.

There are companies that create occupational health and safety management systems
that can reduce the costs of accidents and occupational diseases by 20-40%.

After the accident, there is a recovery period, which involves large medical expenses
and a shorter or longer period of absenteeism. If the work-related injury has
contributed to the loss of income, this can greatly affect the family trying to cover the
expenses related to the accident and keep up with the daily expenses.

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These factors can exacerbate stress and affect the relationship with family and
friends. Also, the morale of the injured person will be greatly affected. Depending on
the work accident that occurred and the way the company handled the consequences,
employees may fear or resent the employer.

If the accident is serious enough, lasting effects on work performance can also occur,
which prevents the employee from fulfilling his work obligations as he did before the
accident. This causes the employer to train other employees to replace him.
Osha has developed a program called Safety Pays, which covers different types of
common accidents and the actual costs associated with an accident. Once completed,
the program provides the direct, indirect and total estimated costs of an accident,
along with the amount needed to cover these costs. This is an excellent tool to
understand how much injury costs and why you should be proactive about the
company's health and safety program, thus avoiding work accidents. This is
extremely important when talking about business.

He was an Assistant Superintendent of the Engineering and Inspection Division of

Travelers Insurance Company when he published his book “Industrial Accident
Prevention, A Scientific Approach ” in 1931

Heinrich (1959) was the first to measure the costs of work-related injuries in his
studies of individual work-related injuries. In his research Heinrich used the database
of an insurance company he worked for. In 1931 Heinrich published the book
"Preventing industrial accidents, a scientific approach" then reprinted four times.
In this paper, Heirich relied on the analysis of over 60,000 accidents at work.
He used his work to argue that most of the costs of work-related injuries are hidden,
meaning they are difficult to identify and quantify for employers.
Visible costs have been referred to as direct costs and are said to include insurance
compensation and medical expenses.
The hidden costs have been called indirect costs and are said to include, among
others, the time lost during the accident, the victim, as well as the costs of repairing
and replacing damaged and material capital. Heinrich also hypothesized that indirect
and direct costs are linearly linked, so that indirect costs are usually four times higher
than direct costs.
Direct or insured costs are those costs covered by insurance for work-related injuries
and occupational diseases. The insurance has the following objectives:
a) prevention of accidents at work and occupational diseases;
b) the medical and socio-professional rehabilitation of the insured, victims of work-
related accidents and occupational diseases, and the recovery of their working
capacity;
c) granting long-term and short-term cash benefits, in the form of allowances and
other aids, under the conditions provided by this law.
Indirect costs are all additional "uninsured" costs associated with an accident. Indirect
costs are usually much higher than direct costs. They can even be 10 times larger.
Another important aspect is that, unlike direct costs, indirect costs are uninsured ...

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they come from the company's budget itself. These are the costs that can lead to
severely affecting the company's profits.

Examples of indirect costs:

- Loss of production time;

- Loss of productivity due to an injured employee;

- Cleaning up the accident site and resuming interrupted operations at the time of the
accident;

- Hiring or training a new worker in order to replace the injured person until he / she
returns to work;

-Material damage. Time and cost for repairing or replacing damaged equipment,
materials or other goods;

- The cost of the salary paid in full or in part to the employee who suffered an
accident at work, plus the compensatory payment;

- The emotional affectation of the employees contributes to the decrease of the

productivity;

- The cost of completing the documents generated by the accident, etc.

Recent researchers have collected and analysed the indirect and direct costs.
For example, Levitt (1981) examined the direct and indirect costs of 49
construction accidents in the United States. On a review of their data, Laufer
calculated a
the cost ratio insured by only 1: 3.
In New Zealand, Leathers and Williams (1984) surveyed 222 farmers on their indirect
labor costs and calculated a low indirect / direct cost ratio of 1: 2.

Leopold and Leonard (1987) investigated 394 construction accident cases in the
United Kingdom. They generally defined the costs to cover the repair and
replacement of equipment and the payment of wages for absent days. As a result,
the indirect relation with the direct cost was necessarily incomparable with that of
other studies. However, they separated the uninsured and insured costs to reach a
ratio of 1: 4.5 for companies that had an accident year in the previous year. For 40%
of the companies that did not have an accident, there were no uninsured costs; the
insurance costs were the total costs.

Improving the prevention of accidents at work

Statistics and dynamics of accidents on manufacture and occupational diseases

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should be collected and analysed carefully. However ,the search and the punishment
of
the guilty should not be the purpose and the result of such analysis,
but management improvement, perfection of the industrial and labor safety system.
Thus, the fear should not be the predominating factor, but positive motivation in
actions of people.

Share of road accidents

Semester 1 of 2019 2018

Total accident 2,231 5212
Road accident 301 = 13.5% 694 13.3%

Road accidents represent 13.5% of all work accidents

The problems of road accidents:

The road accident is considered only if the trip was made during ????? and on
the normal route from the employee's home to the workplace organized by the
employer and vice versa.

questions:
- But if it was necessary to divert the route? Who determines if the diversion has been
justified?
- How do I determine that an accident occurred within the defined time frame?
- If the worker comes with the blindfold, should I believe he hasn't seen the pole ?
- Are special instructions needed for the worker to be informed how to use their own
bicycle?

Conclusion:

Work protection has two important characteristics: protection and compensation after
the accident. In case of road accidents, the protection against the accident is null.
Work-related accidents also have social costs.
Prevention should be done mainly through positive stimulation

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 Bibliografy:

Mossink, J. C. M., & de Greef, M. (2002). Inventory of socioeconomic costs of work

accidents. Office for Official Publications of the European Communities.
Brody, B., Létourneau, Y., & Poirier, A. (1990). An indirect cost theory of work accident
prevention. Journal of Occupational Accidents, 13(4), 255-270.
Santana, V. S., Araújo-Filho, J. B., Albuquerque-Oliveira, P. R., & Barbosa-Branco, A.
(2006). Occupational accidents: social insurance costs and work days lost. Revista de saude
publica, 40, 1004-1012.