What’s the True Cost of Your Corporate Safety Program

Written By: Bastian Solutions

safety in the workplace, safety equipmentFew of us have been able to escape the unwanted, but necessary, cost-cutting initiatives of our employers during the past three years of the recession.  In the interest of self preservation, we have combed through each line item of the corporate budget looking for hidden treasures to help sustain us until consumer demand returns.

In addition to reducing the true costs of our goods and services, we have also turned to cost avoidance initiatives to help shore up the bottom line by delaying a multitude of expenditures, such as upgrading machinery, hiring new employees, and training efforts.  This short-sited approach is great in the near term, but in the rush to save one dollar today, we often times fail to fully consider the long-term implications.

Consider this scenario, in August 2010, the U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) announced that BP Products North America Inc. would pay a full penalty of $50.6 million stemming from the 2005 explosion at its Texas City, Texas refinery — the highest fine ever issued by OSHA and paid by an employer.

While this particular disaster is an extreme case of the high costs of not addressing known safety concerns, it is not an isolated incident.  In fact, if you watched the evening news at all over the last year you have probably taken note of the increase in safety related disasters, both in the oil refining and mining industries, which have all been linked to the lack of adequate safety investments.

In response to the increase of such disasters, OSHA announced in June 2010 that it would establish the Severe Violator Enforcement Program (SVEP).   The program’s mission is to increase enforcement on significant hazards and violations by concentrating on employers who have demonstrated indifference to their occupational safety and health obligation through willful, repeated, or failure-to-abate violations1 such as:

  1. A fatality or catastrophic situation
  2. Operations or processes that expose employees to high-emphasis hazards
  3. Exposing employees to the potential release of a highly hazardous chemical
  4. All egregious enforcement actions 1

It’s clear that going forward OSHA is going to step up its enforcement, and corresponding citations to help ensure that these types of incidents do not occur in the future.

I don’t want to give the impression that these types of breakdowns in corporate safety programs are limited to large Fortune 500 companies with complex manufacturing and material handling operations; they are not.  It is important for small businesses to take note of these lessons learned since the operations of small businesses may be impacted even more from having to bear the costs of receiving an OSHA citation.

To illustrate the types of OSHA violations that may be more prevalent in the average business, the following are the top 10 most frequently cited standards in fiscal year 2010 (October 1, 2009 through September 30, 2010):

  1. ScaffoldingSafety in the Workplace, Electrical cords
  2. Fall protection
  3. Hazard communication standard
  4. Ladders
  5. Respiratory protection
  6. Control of hazardous energy (lockout/tagout)
  7. Electrical, wiring methods, components and equipment
  8. Powered industrial trucks
  9. Electrical system design
  10. Machines

One of the most significant ways to avoid receiving a costly OSHA citation is to ensure that each of your employees receives proper safety training.  The OSHA Outreach Training Program is the primary way to train workers in the basics of occupations safety and health.

Through the program, employees can complete 10-hour and 30-hour courses in Construction or General Industry Safety.  These classes are conducted at training centers throughout the U.S. or even at your own facility by authorized OSHA instructors.  You can locate an authorized OSHA instructor near you through the Outreach Training Program or contact Bastian Material Handling to enroll in our OSHA Safety Training Program.

1. United States Department of Labor. “Severe Violator Enforcement Program (SVEP).” Occupational Safety and Health Administration – Home. June-July 2010. Web. 20 Dec. 2010. <http://www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=DIRECTIVES&p_id=4503>.

Bastian Solutions is an independent system integrator dedicated to helping our customers increase their productivity through proven automation, information systems, and sound operating procedures.

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