Failing to provide a safe work environment for employees will leave employers paying the consequences from both a financial and workforce standpoint. We all know that an unsafe work place can make it very difficult for good contractors to attract good tradesman; nobody wants to go to work thinking they have an increased likelihood of being injured due to the negligence of their employer.
From a financial standpoint, no employer, but especially contractors, can afford to be fined repeatedly – the fine expense can add up quickly and have a significant impact on the bottom line. This ‘extra expense’ caused by repeated violation fines can require contractors to increase their bid amounts to maintain their profit margins. A slippery slope as accounting for these fines can very well be the proximate cause for losing a bid.
Congress recently approved increasing penalty amounts in workplace safety violations effective August 1, 2016. This one time ‘catch up’ will bring OSHA fines in line with inflation for the first time in 25 years. The hard reality is that the maximum fine for repeat and willful violations range from $7,000 to $125,000. Maximum fines for serious violations would change from $7,000 to $12,700. In an effort for penalties to align with the last 25 years’ worth of inflation, OSHA has grabbed these risk managers’ attention as it further increases the need for safety on construction projects. All companies involved in construction, developers, contractors and subcontractors alike, should take notice and act accordingly. The recent congressional approval has put into focus the importance for companies to reign in safety procedures, identify critical flaws in current practices which are likely increasing their Total Cost of Risk, develop and implement standard best practices to ensure these sorts of fines do not occur.
While overall it is good that fines and penalties align with inflation thereby being more of a deterrent for repeat offenders ultimately increasing the likelihood of safer work environments for all, this regulatory change should not be met with inaction. As the apparent goal of OSHA and congress is to increase workplace safety, contractors should heed the warning and put emphasis on improving safety over the next five (5) months.
We at The ALS Group have a great deal of experience when dealing with workplace safety and its impact on your Experience Modification Factor and overall Total Cost of Risk. Contact us here to find out how The ALS Group can help your company get a handle on Workers Compensation claims, loss factors, safety best practices and eliminate OSHA fines from the bottom line equation.
To find out more about how The ALS Group can help your company lower its Total Cost of Risk, visit our website and contact us today!
