How Safety & Health Factors Affect the Firm's Profitability - Research Paper Example

 How Safety and Health Factors Affect the Firm’s Profitability Introduction Industries and firms in the world practice health and safety in the work place. Employers are the ones responsible for the implementation of practices for safety, welfare and promotion of health of their workers. Depending on the nature of work, employers as well as employees should be aware of their personal safety. Laws have been passed and executed for the safety of workers. Some of these are the Occupational Safety and Health Act of 1970, the Mine Safety and Health Act of 1977, as well as the Fair Labor Standards Act covering regulations that concerns youngsters in the work force (www.business.gov, 2010). In the United States, a section of the Department of Labor, Occupational Safety and Health Administration or OSHA, is in charge of setting up regulations that will ensure employee’s safety applicable in industries and workplaces across the United States (OSHA, 2004). They prepare brochures that will guide employers and employees as well, in implementing standard procedures such as training, education and dissemination of information that will promote safety and health of workers. This study aims to express the importance of observing safety and health in the workplace. Implementations of such will greatly affect the performance of an industry in general. Not only does it provide a safer environment for the workers (from rank-and-file to top management positions), but it has an effect in the profitability of a business. In a lot of ways, businesses should give importance to the safety and health of the workers. In essence, the employees are the priority asset that a company possesses. They form the main work frame of a company. Workers render services and, in a way, manufacture products. Their expertise and know-how is indeed a valuable asset in a certain industry. However it may differ, safety and health of workers should be on top priority of corporations, specifically in the human resources and people development departments. It is necessary for corporations to have a guideline that will set standards to comply for safety, health and wellness of their people. This study will tackle the importance of providing a safe environment for workers and its effects on corporate world. Although it may not cover all industries that highly practice safety and health, it will offer examples and updates on the standards that should be followed. In addition, this will establish a link between the safety and health of workers, its effects on the performance of an individual and on firms’ assets, and in the long-run, the firm’s profitability. Safety and Health in Work place Any situation posts danger to an individual whenever and wherever it is. Being out in the open may entail possibilities of calamities that may occur. At any given moment, earthquakes can occur, tsunamis can hit, fire might breakout, storms and flashfloods can happen. These are just some of the circumstances which are most of the times unavoidable. Incidents like this might happen to anyone and anytime, so there is a probability that this will happen in a certain location during working hours. From a study conducted by Berry (2007), the most common accident that happens in a typical office is falling or tripping. Due to this what seemed like a minor injury, it sprouted to a more alarming result which is a higher percentage of lost workdays of employees (Berry, 2007). Another accident as cited in the same study is of the overexertion type, wherein employees tend to exert more effort in the attempts of forcing oneself to move intolerably heavy objects. By repeated actions, employees tend to form muscular tensions in several parts of body, in the limbs and at the back particularly. Cuts and other injuries brought about by being struck by sharp objects, paper cuts and edges of steel file cabinets can cause laceration, contusion and even infections which can be much harmful. Aside from physical implications like injuries, there are other instances when one can experience unsafe office environment, which is with air pollution inside the office. According to Berry (2007), the “sick building syndrome” or “building-related illness” is the more common terminology for airborne illnesses like cough, headache, skin diseases, internal irritations like throat infections and the like. Problems as such as often found in employees who, upon leaving the office, exhibit symptoms of sickness. Most usual illnesses experienced by employees in enclosed buildings without proper ventilation are respiratory allergies, humidifier fever, and hypersensitivity pneumonitis, just to name a few (Berry, 2007). With this, people should be well aware and alarmed of the standing of their safety and health in the company where they work. For labor-intensive jobs like construction, there is a higher chance of going to an accident with all the equipments present in the work place, that is, sharp objects, ledges, canopies, risers and the likes. If an individual working in the construction industry is not careful enough, they have lower percentage of safety and good health compared to individuals working in offices that are well-maintained and with provisions for safer and conducive working environment. Dangers and accidents in workplaces are extensive. Severe physical harm resulting from hazards in the workplace such as sudden life and death situations are examples of imminent danger (OSHA, 2002). Exposures of electrical livewires, instability of risers, ramps and the likes that enable inclination of individuals, can pose serious injuries that in turn can lead to fatal incidents and threaten safety of workers. If an employer would follow the safety and health regulations set by OSHA, the hazardous factors can be decreased and workers can feel safer in their workplaces. In turn, more secured employees will promote lower turn-around of workers in a certain company, which should be more profitable for a company. In the event that an imminent hazard exists, employers are expected to implement necessary preventive measures to avert accidents and deter hazards to employees after receiving appropriate trainings. There are several standards set by OSHA so that both employees and employers are aware of the consequences and their rights of what protection should they receive come times of emergency. This study will cite examples of standards that are set for the medical field, with some examples on other industries. According to an OSHA article entitled Job Safety and Health, there is an estimated 6,000 employees every dying due to injuries inflicted by dangers from the workplace (OSHA, 2002). In addition to that, exposure to hazards in the workplace caused some 50,000 fatalities of employees. Aside from the fact that there is a large number of fatalities in the workplace in the United States, companies around the country suffer losses amounting to an estimated US$125 billion in a year for non-lethal injuries suffered by workers, not including the costs incurred by businesses from deaths of employees. This is one strong point on why employers should keep in track and monitor the safety and health of their workers. If an office is a safe place and is conducive to working, there will be lower injuries experienced by employees. Aside from that, employees will be more productive in their outputs. Say, in a labor-intensive factory exists 100 workers manufacturing garments and one of the main machines is defective, it would pose not only danger when an individual who does not know that the machine being operated is faulty, which is due to lack of signage and precautions of the working condition of the machine. It may also result in lower productivity of employees, hence lower output. It may also imply higher costing if a defective machine incurs higher electricity voltage as well as additional wage for extra workers who are underused due to inefficiency of the whole facility. This is just one of the situations that can occur in real life, that is, the relationship of safety and health in the workplace coupled with the profitability of a firm. HEALTH AND SAFETY IN THE MEDICAL INDUSTRY It is a fact and a must that the medical sector is required to apply safety and health practices in the workplace. As ambassadors of good health, the medical industry should exhibit cleanliness that promotes safety and health not only for workers but for their customers, and in this case, their patients. A clean environment in clinics and hospitals encourage and improve status of health of patients. In many ways, cleanliness will push to a better environment where workers and patients will, in a way, feel better about their condition. With this, OSHA made available brochures as guide for the medical sector to provide them with standards to adhere to make the work place safer. Bloodborne Pathogens Standard (29 CFR 1910.1030) In a glance, this standard requires businesses to provide and annual exposure plan as well as proper use of universal precautions (OSHA, 2004). Moreover, this implies that medical and dental offices to use a better and safer needle and sharps. Aside from ensuring use of safer paraphernalia, they also suggest use of protective agents for personal use such as gowns, gloves, and other protections for the eyes and face. Working in an environment where people suffer from different ailments, whether communicable or not, workers are entitled for hepatitis B vaccines for greater immunization. Exposure incidents in the workplaces are followed by medical reports as an update of the said incident as well as proper management of wastes. Hazard Communication Standard (29 CFR 1910.1200) Simply put, all employees have the right to know their entitlements to buffer workplace hazards. This standard enables workers to learn information to different exposures. Hazard Communication Standard includes a written communication program for the awareness of workers (OSHA, 2004). In addition, it makes aware the hazardous chemicals that are present in the offices such as alcohols, disinfectants, anesthetic agents, and the likes. Ionizing Radiation Standard (29 CFR 1910.1096) The Ionizing Radiation Standard covers facilities that are equipped with X-Ray machines. As this machine emits radiations, it is said that over-exposure to facilities like this would entail hazards to one’s health. In this regulation, it provides businesses surveys and information on the different radiations emitted in facilities with such equipments. This limits entry to facilities and exposure of employees to such hazardous radiations, hence, lower risk on safety and health of an individual. Wearing of film badges or pocket dosimeters are required by this standard whenever a worker will facilitate testing in x-ray equipped rooms (OSHA, 2004). Exit Routes Standards (29 CFR Subpart E 1910.35, 1910.36, 1910.37, 1910.38, and 1910.39) Basically, this regulation expresses that it is required that employees are knowledgeable of the accessibility of their workplaces. It is very important for workers to be aware of safety routes in case of emergencies like fire, earthquakes and other calamities. Provision for signage should be applied with detailed plan come emergency situations. OSHA offers consultations that can help out in planning the familiarization of accessibility of areas. Moreover, asking for help from local agencies like the fire or police service would greatly improve safety in the workplace. One is that workers would feel safer and secured since they are familiar with the floor plan. Second is that, in case of emergencies, local services could easily aid business in need of their service if they were able to have previous ocular inspection of the facilities. With this, it is required for buildings to provide plans and enough exit routes that can accommodate a number of employees at a given time occupying space (OSHA, 2004). A planned diagram that shows routes for evacuation that will be clearly visible to employees will be helpful and at the same time would ensure safety of workers. EMPLOYERS AND THEIR ROLE ON THE SAFETY AND HEALTH OF THEIR WORKERS It is an employer’s responsibility to provide a safe place for their employees to work in. In the United States, almost every employee from the private sector is covered by the Occupational Safety and Health Act of 1970, excluding self-employed individuals and local government employees. There are several standards that private companies should comply with and it will be tackled in the later part of this section. Basically, employers are responsible for providing a workplace for their employees where they can feel safe and away from hazardous substances and grave physical injuries that may be caused by incidents in the workplace. Aside from the standards mentioned in the section earlier, this section will discuss generally known standards that should be observed by employers. It is a practice to provide workers physical examinations annually that would be a one’s basis on the improvement of their health. In addition, companies should be well aware that they are to provide safe and well-maintained equipments for usage of their employees. Not only is it for the safety of the users, but it will also have a great effect on the end result of whether it is a manufactured product or a construction of an infrastructure. In an article by OSHA entitled Job Safety and Health, the organization requires companies to provide training to its employees of their standards so that working individuals would be aware of their rights and standard procedures whenever an emergency happens and to keep them updated of the benefits that each and everyone can avail from their employers. Moreover, OSHA requires companies to keep track of their annual casualties and injuries inflicted on their workers by preparing reports of work-related accidents, especially for hazardous jobs. If a company fails to provide safety to their employees, workers can report their employers are violates standards of the OSH Act of 1970 (OSHA, 2002). Employees have the right to receive proper training from companies for them to feel safer and secure in their chosen working environment. Summing it all up, employers play a major role on the protection and security of their employees when in comes to their health in the workplace. It is their duty to be updated in government stimulated standards that are prepared for the welfare of the individuals who belongs to the workforce of a country. It is, after all, to protect the interest of the company and one of their largest assets, the labor force. THEORIES ON PROFESSIONAL SAFETY AND HEALTH According to experts, safety and health in the workplace does not only depend on the security an individual receives from their employers. In a lot of ways, professional have infused behavioral psychology in instilling behaviors to workers, that is on how to react to an occurrence of an event, be it and emergency or when handling unexpected circumstances in the workplace. Thus, it says that investing in a good behavioral psychology program will probably reduce the likelihood of risk happening in a workplace. From the article by Johnson (2003), he explained the effectiveness of psychological techniques such as integrating industrial and behavioral mentality. In this study, he focused on defining that behavior dictates and/or causes at-risk actions of workers, hence, poor psychology to employees mean higher risk in the workplace. Johnson (2003) cited two theories that are applicable in explaining human behavior towards motives, response and intent. Behavior-based safety is believed to be one of the essential learning as unsafe acts account to a large ratio of the accidents in the workplace. One of the theories is the value-attitude-behavior hierarchy model that states that a certain behavior of an individual was derived from the instilled personal values of an individual. This argues that a resulting behavior of an individual was consequent to a personal value applied in reacting towards an event, thus, causing a certain behavior to be demonstrated. The other, the theory of planned behavior, is somehow patterned to the value-attitude-behavior hierarchy model; however it utilizes other factors that may affect an individual’s decision on how to react to an event. Subjective norms such as peer pressures in performing such behavior and attitude towards a given behavior become the basis of the final behavior (Johnson, 2003). An individual who is in a situation, say commitment of error, would highly likely take into consideration the norms this individual grew up with; if the behavior to be enacted will be in sync with what people normally perceive as correct. In addition to that, the current environment of the circumstance will also be given a consideration in deciding how to react. It if will me a matter of public humiliation, then this individual thought about the perceptions of people who is witnessing the event. Therefore, peer pressure creates an impact on deciding of an individual’s behavior. Applying this to the workplace, it is necessary for a worker to know their motivation on doing such a thing when facing at-risk accidents. Being physically and mentally alert will not only minimize the occurrence of risk in the workplace but it will also be useful when it comes to resolving dilemmas that might cause risk and endanger physical health of the workers. Attitude and behavior towards an accident might just be one of the mentalities required to be instilled in employees so as to prepare everyone that may be covered in times of emergencies. Earlier theories on accidents, where it is said that behavior-based safety came from, started with the studies conducted by H.W. Heinrich and Frank E. Bird Jr. H.W. Heinrich’s study became the model of Frank E. Bird Jr. curiosity in determining the connection between the accidents that happened within the workers. Heinrich’s triangle had an association of a major accident to 29 minor injuries, with applied first-aids, and 300 incidents within the environment. Bird, on the other hand, started out the bird’s accident ratio triangle which tackled about the ratio of the major to minor to no-injury accidents with statistical data presented for a stronger argument. In an article by Roughton (2008), he presented the study done by Bird which includes statistics of the gravity of effect a single major accident can be paired with almost 10 minor injuries. What is important that Bird’s study cited was that in every major accident, there occurs a great number of property damage (Roughton, 2008). Aside from the costs a company would incur in the medication of individuals, roughly millions of dollars would be shelled out in the renovation and replenishment of the properties that were damaged along with the occurrence of the major accident. There were instances when a property as grave as incurring a large sum of money annually just by the renovation of the destroyed or affected property became referred as “near-accident” instance when in fact, it should be considered as an accident when it can do more damage not only to properties but to workers as well, then creating a chain effect from major to minor to incidents (Roughton, 2008). However, this may vary depending on the number of people and the size of a company involved. In bigger companies, there will be a higher probability that bird’s accident ratio triangle would occur, including the drawing of large costs in the renewal of facilities and the workers. This, on the other hand, may not occur in small businesses that involve only few individuals. In a figure illustrated in the article by Roughton (2008), a pyramid typically involves fatality, lost workday, recordable injuries, incidents, at-risk behaviors. In this line-up, it proves costly for a company to not invest in providing a good set of behavior-based safety. If the fatality was mainly caused by unsafe practices and inability to proceed with usual procedures practiced in the workplace, this will be costly as there will certainly be damages to be paid. Lost workdays will come in if an accident is so major that properties got damaged, hence, employees will not be able to function well without the efficient facilities. There will be opportunity loss for the employees to be productive and a loss on the company as there will be idle days, say for production and manufacturing. Recordable injuries will have social cost on the company. Having a reputation of having unsafe facilities and unsecured employees will most definitely affect a company’s performance in the market. Incidents and at-risk behaviors will be costly as well as employees might require companies to provide them medications for minor injuries incurred from the major accident that disrupted the whole operation of the company. CONCLUSION This study aimed to provide the importance of safety and health of employees in the workplace. There are vast of standards that are applicable to employees all over the world that are very much supported by their government agencies in charge of the labor force of a country. In the United States, the Department of Labor’s Occupational Safety and Health Administration is in charge of the over-all protection of employees to hazards and injuries incurred in the workplaces. This section of the government set out rules and regulations that companies should comply for them to operate at optimum. Ensuring an employee’s welfare should be a top priority of the employers. Although there are vast cases of accidents and injuries that may occur to employees, from the simple tripping to a complicated contamination of communicable diseases within an enclosed office, government agencies are the ones responsible for making sure that listed companies especially those involved in hazardous activities comply and ensures their employees their safety. In cases that employees suffer from injuries and other hazardous activities, it may incur additional cost for companies. In an event that there are malfunctions in the equipments, companies would cash out expenses for the repair of machineries and equipments. If ever there will be casualties and accidents that occurred, employers will be in charge of the medication of an individual involved in the accident, which will be an additional cost to the company. Aside from this, job turnovers will be rampant on unsafe places. If an individual feels unsafe with the working environment, it will result in a higher rate of separation. Hence, a higher cost maybe incurred in the process of hiring a new personnel, which may demand higher wage, training and orientation of the company’s work ethics and process. In this light, employers should be well aware of what their responsibilities are. As an employee, individuals are entitled to a good compensation and assurance that the place where they work, apply their knowledge and enhance their skills further, should be a place where they feel safe and stimulating. Though this must mean a newer and safer facility for the company, providing workers the best and most efficient workplace will have a long-term effect not only on the workers but in the image of a company as well. According to the rules and regulations set by OSHA, private sector companies have a huge responsibility for making employees safe and this is not only practiced in the United States but in almost every countries around the world. A firm’s profitability is not limited to the income incurred over the short-run, but the investment they build with the employees, their safety and health, and the quality service they will provide to their respective communities. REFERENCE ACT Work Safety Commissioner, Help to Make Your Workplace a Safe Place, Safe Work Month, Retrieved November 25, 2010, from Government of Australia Website: http://www.worksafety.act.gov.au/files/file/Safe%20Work%20ACT%20Month/AWS%2037566%20Take10@10%20Brochure_DC_04-1.pdf Berry, C. (2008). A Guide to Office Safety and Health. 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