Saving Money and Saving Lives

 

Budgeting For Safety - Making Every Dollar Count

 

Now is the time of year when companies close out one fiscal year and begin planning for another one. Just like at home, at times it can be challenging to distinguish needs from wants and sometimes necessities like safety seem to be an unreasonable stumbling block to big plans.  The expensive helmet to go with the dreamed of motorcycle, for example. A few important things to consider:

Cost-Effectiveness

Budgeting or revising budgets, it can be easy to overlook safety costs. But an effective safety plan should help avoid injuries, save on medical costs, and keep employees happy - benefits which in the long run more than compensate for the cost of safety measures.

As is true with equipment or marketing budgets, safety budgets should consider that safety expenses are ongoing expenses. Aside from training costs and equipment purchases, safety-related tasks may require labor hours as well. Therefore, it is vital that you estimate all associated costs before including them in your budget; doing so will ensure you have sufficient funds to provide for them over time.

As part of their task, companies should implement net present value methods and benefit/cost analyses to evaluate safety improvement projects economically justified. Unfortunately, however, such analyses don't take into account factors like reduction of fatal crashes relative to nonfatal injuries, or changes in employee morale.

Be sure to ask your workers about their safety needs and concerns. Doing this is an invaluable opportunity to understand their priorities, ensure you're providing enough resources, and assess employee satisfaction levels regularly. Conduct an employee satisfaction survey periodically.

Reducing Risks

Budgeting for safety begins by identifying the risks posed to workers and members of the public in your workplace. Knowing which hazards require more protection through equipment, procedures and training.

Make informed decisions regarding which safety-related expenses to prioritize by paying attention to recommendations and reports released by professional organizations such as IOSH and HSE. Their reports can offer insight into common issues that impact businesses as well as areas for potential improvement, providing the ability to create more targeted and cost-effective safety plans for your company.

As part of your budgeting efforts, be sure to include all costs associated with running your safety program, such as employee time. Not only should this include meetings and inspections of equipment; it should also take into account paper records, PPE purchases and any other activities required to keep employees safe at work which might not appear directly within company numbers but are nonetheless integral parts of making sure everyone remains healthy at work.

Consider also the impact of unexpected expenses that may pop up suddenly, such as travel bans and lockdowns during a pandemic like COVID-19. Doing this allows you to adapt your safety strategy as necessary without waiting until next budget cycle to address it.

Training

Keep safety a top priority. Safety investments not only prevent workplace injuries but can help lower worker's comp claims and employee turnover costs in the long run.

As part of ensuring proper safety procedures are in place, investing in adequate training for employees is also critical. This may involve offering new employees training as they begin, providing refresher courses on updated processes to current workers, or offering ongoing feedback to all staff - this will enhance overall productivity as well as identify any immediate needs that might need immediate attention.

Planning a safety budget requires consideration of ways to reduce costs without compromising training or equipment quality. Options might include working with vendors who offer bulk purchases discounts, sharing costs with nearby businesses or adding automated processes into the worksite that increase efficiency.

Safety should never be taken for granted and any budget shortfalls could have severe repercussions for a business. While this can be challenging in an economically challenged climate, when companies seek ways to cut expenses; when compared with the costs of an avoidable incident it becomes much simpler justifying an effective safety program.

Equipment

Budgeting processes for both municipalities and small businesses can often present numerous obstacles. These challenges range from finding ways to balance upfront costs with long-term gains, as well as maintaining the budget throughout the year. When it comes to safety, these concerns become even greater; any effort made by companies trying to save money by purchasing discounted personal protective equipment (PPE) or forgoing training could end up costing them even more in the end.

One of the greatest mistakes companies can make when planning projects is neglecting safety concerns in terms of planning stages. When this is neglected, employees may find it more challenging to complete project goals on schedule without incurring unanticipated expenses and delays or cancellation of projects altogether.

Management must factor in the return on investment that comes from having an effective safety program when creating their budget. They can do this by assessing investments necessary to increase workplace safety such as training, equipment and inspections - and by considering indirect costs caused by safety problems; according to independent studies every dollar invested in safety can save between $4-6 in expenses in other ways - this information should help management make more confident decisions when creating their safety budget.