WORKPLACE SAFETY TRAINING & ROI

Zero workplace injuries & illnesses creates major savings that grow over time. Training is an integral part of every injury illness prevention plan.

Injury cost breakdown

Direct costs associated with an accident are the most obvious. They mainly include workers' compensation payments, medical expenses, and legal liability costs. According to the National Academy of Social Insurance (NASI), the "total workers'compensation benefits [paid] were $61.9 billion in 2012." (Source PDF: NASI.)

Indirect costs are more elusive and increase over time, well beyond that of the actual incident. According to the Occupational Safety & Health Administration (OSHA), "the ratio of indirect costs to direct costs varies widely, from a high of 20:1 to a low of 1:1.... The more accidents that occur in a workplace, the higher the costs – both in increased insurance premiums and greater indirect costs."

Costs from an injury add up fast

  • workers' comp
  • medical bills
  • legal fees
  • damaged property repair
  • overtime pay to workers
  • replace injured worker
  • accident investigation
  • bad press
  • lawsuits
  • lost productivity
  • low morale
  • loss of clients
  • possible OSHA reporting (See OSHA)

What's the ROI on proactive safety training?

According to the OSHA (Occupational Safety & Health Administration) an injury resulting in a "strain" has a direct cost of $32,319 (source: OSHA eTool Safety Pays).

Consider the following ROI formula:

(Gain from Investment - Cost of Investment) / (Cost of Investment) *100 = ROI

With a training program successfully in place, let's assume the cost to train employees is measured as an investment. Let's estimate the Verticlimb cost to train all employees at $10,000. The cost of training ($10,000) is listed as the "Cost of Investment." The prevention of a single workplace injury (in this case, the diagnosis of a "strain") is considered a "Gain from Investment." The savings ($32,319) is listed as the "Gain from Investment."

Using the ROI formula, let's consder the direct and indirect costs of a common workplace injury classification of "back strain."

 ($32,319 - $10,000) / ($10,000) * 100 = 223% ROI for training

Now include *both* the indirect and direct costs of the same "back strain" injury. The indirect cost is $35,550. The direct cost is $32,319. Direct + indirect costs = $67,869. Verticlimb training costs remain at $10,000. The ROI is now 579%.

 ($67,869 - $10,000) / ($10,000) * 100 = 579% ROI for training

The direct and indirect costs may be slightly different based on industry and business operation, but the theme is still the same.... Just one workplace injury can create a negative ripple effect for months, even years, to come.

But the positive impact of safety training as a part of an overall risk management plan grows over time, making the investment even more valuable. The ROI remains.

OSHA won't find you?  

Many businesses feel that OSHA inspections and citations will not happen to them...that OSHA is for other industries. Look up the 'Frequently Cited OSHA Standards' within your industry using your NAICS code.

Our Managed LMS   Value

"The average first year cost for an LMS was $22,000 to $102,000." (2009 survey, Tagoras) This does not include the cost of courses, hiring someone to manage the system or support.

70+ Courses  HR & OSHA

So many courses to choose from. Many satisfy general industry OSHA standards (Hazard Communication GHS) and HR areas (Sexual Harassment). Choose new courses every year.