عمار حسن
06-04-2008, 09:41 AM
NEBOSH International General Certificatein Occupational Safety and Health
THE MORAL, LEGAL AND ECONOMIC REASONS FOR HEALTH AND SAFETY:
The responsibility for health and safety at work rests primarily on the shoulders of the employer. It must therefore be a prime concern of management to ensure that appropriate measures and practices are in place to create safe working conditions. This placing of responsibility on employers comes essentially from the focus given by most health and safety legislation. However, there are also compelling moral and economic reasons for employers to be concerned with health and safety: • Employers (through management) provide the premises and equipment and put in place the working practices which workers use to produce the goods and services with which employers earn profits (or, in the case of government agency employers, remain in power). To that extent they can be said to gain from the conditions at the workplace. In return, they provide an income for workers, but also have a moral responsibility to provide appropriate working conditions. This forms the basis of the employer’s responsibilities which we discuss below. • Unsafe working conditions are likely to have an impact on production – through both loss of output and a lowering of worker morale and motivation – and on sales. Increasingly, society has expectations of a socially-concerned approach to management and the conduct of business, and the customer/client base of organisations may be adversely affected by the negative image surrounding a poor health and safety record. • Apart from the financial cost of loss of output, employers may be liable for fines and/or payment of damages in respect of accidents at work.
Size of the Problem:
The introduction of legislation, together with an extensive programme of publicity and advice on accident prevention, has brought about a consistent reduction in the number of both fatal and non-fatal accidents at work. However there continues to be an unacceptably high toll in terms of death, injury and financial loss associated with incidents at the workplace. The following global statistics have been published by the International Labour Organisation (ILO) as part of their SafeWork programme (the actual figures are unimportant – it is simply to show the scale of the problem): • There are 270 million occupational accidents and 160 million occupational diseases each year. • Around 2 million people die every year from occupational accidents and occupational diseases. • 4% of the world’s gross domestic product is lost each year through the cost of injury, death, absence, etc. • There are around 355,000 on-the-job fatalities each year – half of these occur in agriculture. Other high-risk sectors are construction and fishing industries.
Direct and Indirect Costs of Accidents and Ill-Health
We have seen that the costs of failures in health and safety at work across the economy as a whole are enormous. For the individual employer, they can also be very significant. The costs may be divided into two parts: • Direct costs – These are the measurable costs arising from an accident and/or any claim for liability under the civil or criminal courts. They include sick pay, repairs or replacement of damaged equipment and buildings, etc., product loss or damage, loss of production, public and/or product liability, fines, legal fees, increases in insurance premiums, etc. • Indirect costs – These are costs which may arise as a consequence of the event, but do not generally involve the payment of money. They are often largely unknown, but it is estimated that in certain circumstances they may be extremely high. They include business interruption, loss of orders, cost of time spent on investigations, loss of corporate image. We can examine these costs by reference to different classes of accident or other health and safety events. Events Which Cause No Damage to Property or Injury to People There are no direct costs associated with this type of event. However, near misses may incur minor indirect costs in relation to a temporary stoppage of work, with the extent of the losses depending upon the duration of the stoppage and that in itself depends upon the nature and severity of the event. Events Which Cause Damage to Material, Plant or Equipment, But Do Not Injure Personnel The direct costs of this type of event include: • Value of the materials wasted. • Value of any finished products or work-in-progress lost as a result. • Cost of replacement or repair of plant and equipment. • Loss of production whilst repairs are made or replacements obtained. • Increased overtime costs incurred to make up for loss of production. In addition, the following indirect costs may be incurred: • Loss of time already spent on the job. • Loss of goodwill from customers following from delays in production and fulfilling orders – resulting in cancellations and further loss of orders. • Penalty clauses activated for failing to meet delivery dates, resulting in lower profits from sales. Events Which Cause Injury to Personnel, But Do Not Damage Property The direct costs of this type of event include: • Costs of medical treatment – first aid, ambulance, out-patient treatment, in-patient treatment (bed, nursing, doctors, specialists, consultants, medication, etc.). • Compensation payable to victim. • Fines imposed on conviction for breach of criminal law.
• Loss of victims’ own productive capacity and possible knock-on effects to others, causing overall loss of production before production schedules and work allocations are rearranged. • Increased overtime costs incurred to make up for loss of production. In addition, the following indirect costs may be incurred: • Loss of production time due to workers stopping to assist the victim(s) and discussing the incident. • Downtime on machinery due to switching off in order to provide assistance to the victim(s). • Loss of staff from productive duties in order to investigate the incident, prepare reports, undertake hospital visits, deal with relatives, attend court proceedings. • Cost of training replacement(s). • Difficulties in recruiting suitable replacements, and possible loss of existing staff, if health and safety record is poor. • Increased overheads if plant and men are idle. • Loss of goodwill from customers following delays in production and fulfilling orders – resulting in cancellations and further loss of orders. • Activation of penalty clauses for failing to meet delivery dates, resulting in lower profits from sales. Events Which Cause Both Injury to People and Damage to Material, Plant and Equipment The costs here are likely to be a combination of those liabilities arising separately for events involving only damage to plant and equipment and those involving only personal injury.
Insurance, Costs and Liabilities
Employers usually take out insurance to cover themselves against potential losses caused by such events as fire and theft. In many countries, employers are also required by law to have insurance against certain types of liability. However, many of the costs involved in respect of accidents at work are not covered by insurance. Uninsured costs include all indirect costs as well as those relating to loss of production as a result of many types of incident. In addition, the insurance to cover loss in respect of certain events may be void where it may be shown that the employer has not taken adequate precautions to prevent the incident. It has been estimated that uninsured losses were between 8 and 36 times greater than insured losses. Fault and No-Fault Compensation Systems In many countries around the world the principle way that a worker has to claim compensation in the case of a workplace inquiry is to use the Courts. This “tort” based system is essentially adversarial and requires that someone else is blamed for causing the inquiry. In most instances it is the employer who is blamed and therefore found to be at fault. This is the principal compensation mechanism used in the UK and the USA. In other countries a no-fault compensation system is in operation. In these countries there is no requirement to blame employers or employees in order for compensation to be awarded. Instead a panel of experts make a decision on whether compensation should be awarded. The
system is non-adversarial and does not involve lawyers or the courts in most instances. These no-fault compensation systems are operated in, for example, New Zealand and Sweden.
THE MORAL, LEGAL AND ECONOMIC REASONS FOR HEALTH AND SAFETY:
The responsibility for health and safety at work rests primarily on the shoulders of the employer. It must therefore be a prime concern of management to ensure that appropriate measures and practices are in place to create safe working conditions. This placing of responsibility on employers comes essentially from the focus given by most health and safety legislation. However, there are also compelling moral and economic reasons for employers to be concerned with health and safety: • Employers (through management) provide the premises and equipment and put in place the working practices which workers use to produce the goods and services with which employers earn profits (or, in the case of government agency employers, remain in power). To that extent they can be said to gain from the conditions at the workplace. In return, they provide an income for workers, but also have a moral responsibility to provide appropriate working conditions. This forms the basis of the employer’s responsibilities which we discuss below. • Unsafe working conditions are likely to have an impact on production – through both loss of output and a lowering of worker morale and motivation – and on sales. Increasingly, society has expectations of a socially-concerned approach to management and the conduct of business, and the customer/client base of organisations may be adversely affected by the negative image surrounding a poor health and safety record. • Apart from the financial cost of loss of output, employers may be liable for fines and/or payment of damages in respect of accidents at work.
Size of the Problem:
The introduction of legislation, together with an extensive programme of publicity and advice on accident prevention, has brought about a consistent reduction in the number of both fatal and non-fatal accidents at work. However there continues to be an unacceptably high toll in terms of death, injury and financial loss associated with incidents at the workplace. The following global statistics have been published by the International Labour Organisation (ILO) as part of their SafeWork programme (the actual figures are unimportant – it is simply to show the scale of the problem): • There are 270 million occupational accidents and 160 million occupational diseases each year. • Around 2 million people die every year from occupational accidents and occupational diseases. • 4% of the world’s gross domestic product is lost each year through the cost of injury, death, absence, etc. • There are around 355,000 on-the-job fatalities each year – half of these occur in agriculture. Other high-risk sectors are construction and fishing industries.
Direct and Indirect Costs of Accidents and Ill-Health
We have seen that the costs of failures in health and safety at work across the economy as a whole are enormous. For the individual employer, they can also be very significant. The costs may be divided into two parts: • Direct costs – These are the measurable costs arising from an accident and/or any claim for liability under the civil or criminal courts. They include sick pay, repairs or replacement of damaged equipment and buildings, etc., product loss or damage, loss of production, public and/or product liability, fines, legal fees, increases in insurance premiums, etc. • Indirect costs – These are costs which may arise as a consequence of the event, but do not generally involve the payment of money. They are often largely unknown, but it is estimated that in certain circumstances they may be extremely high. They include business interruption, loss of orders, cost of time spent on investigations, loss of corporate image. We can examine these costs by reference to different classes of accident or other health and safety events. Events Which Cause No Damage to Property or Injury to People There are no direct costs associated with this type of event. However, near misses may incur minor indirect costs in relation to a temporary stoppage of work, with the extent of the losses depending upon the duration of the stoppage and that in itself depends upon the nature and severity of the event. Events Which Cause Damage to Material, Plant or Equipment, But Do Not Injure Personnel The direct costs of this type of event include: • Value of the materials wasted. • Value of any finished products or work-in-progress lost as a result. • Cost of replacement or repair of plant and equipment. • Loss of production whilst repairs are made or replacements obtained. • Increased overtime costs incurred to make up for loss of production. In addition, the following indirect costs may be incurred: • Loss of time already spent on the job. • Loss of goodwill from customers following from delays in production and fulfilling orders – resulting in cancellations and further loss of orders. • Penalty clauses activated for failing to meet delivery dates, resulting in lower profits from sales. Events Which Cause Injury to Personnel, But Do Not Damage Property The direct costs of this type of event include: • Costs of medical treatment – first aid, ambulance, out-patient treatment, in-patient treatment (bed, nursing, doctors, specialists, consultants, medication, etc.). • Compensation payable to victim. • Fines imposed on conviction for breach of criminal law.
• Loss of victims’ own productive capacity and possible knock-on effects to others, causing overall loss of production before production schedules and work allocations are rearranged. • Increased overtime costs incurred to make up for loss of production. In addition, the following indirect costs may be incurred: • Loss of production time due to workers stopping to assist the victim(s) and discussing the incident. • Downtime on machinery due to switching off in order to provide assistance to the victim(s). • Loss of staff from productive duties in order to investigate the incident, prepare reports, undertake hospital visits, deal with relatives, attend court proceedings. • Cost of training replacement(s). • Difficulties in recruiting suitable replacements, and possible loss of existing staff, if health and safety record is poor. • Increased overheads if plant and men are idle. • Loss of goodwill from customers following delays in production and fulfilling orders – resulting in cancellations and further loss of orders. • Activation of penalty clauses for failing to meet delivery dates, resulting in lower profits from sales. Events Which Cause Both Injury to People and Damage to Material, Plant and Equipment The costs here are likely to be a combination of those liabilities arising separately for events involving only damage to plant and equipment and those involving only personal injury.
Insurance, Costs and Liabilities
Employers usually take out insurance to cover themselves against potential losses caused by such events as fire and theft. In many countries, employers are also required by law to have insurance against certain types of liability. However, many of the costs involved in respect of accidents at work are not covered by insurance. Uninsured costs include all indirect costs as well as those relating to loss of production as a result of many types of incident. In addition, the insurance to cover loss in respect of certain events may be void where it may be shown that the employer has not taken adequate precautions to prevent the incident. It has been estimated that uninsured losses were between 8 and 36 times greater than insured losses. Fault and No-Fault Compensation Systems In many countries around the world the principle way that a worker has to claim compensation in the case of a workplace inquiry is to use the Courts. This “tort” based system is essentially adversarial and requires that someone else is blamed for causing the inquiry. In most instances it is the employer who is blamed and therefore found to be at fault. This is the principal compensation mechanism used in the UK and the USA. In other countries a no-fault compensation system is in operation. In these countries there is no requirement to blame employers or employees in order for compensation to be awarded. Instead a panel of experts make a decision on whether compensation should be awarded. The
system is non-adversarial and does not involve lawyers or the courts in most instances. These no-fault compensation systems are operated in, for example, New Zealand and Sweden.