Jeremy Procter, Convenor of the European Standards Committee responsible for Machine Guards, and Managing Director of Procter Machinery Guarding, explains how installing guarding in compliance with current standards and regulations can pay for itself several times over.
When you see the phrase 'health and safety' do you think 'overhead' or 'investment opportunity'? If you tend to view expenditure on health and safety as a necessary evil, you are probably in the majority. But there are many ways in which spending a little on properly managing health and safety can pay dividends. And to convince non-believers, the Health and Safety Executive has recently unveiled a new website dedicated to promoting the business benefits of health and safety.
Included on the site are case studies that show how health and safety can make a substantial difference to a company's bottom line. Take, for example, St Regis Paper, which is part of DS Smith plc. In 1995/1996 there were two fatalities in St Regis, leading the company to recognise that a step change in its health and safety performance was needed to combat its increasing accident and injury rate.
St Regis instigated a series of health and safety action plans to: improve management systems and procedures; work closely with the HSE and PABIAC (the Paper and Board Industry Advisory Committee); improve machinery guarding on paper mills and associated equipment; re-focus the regular site health and safety meetings between site managers, safety advisors and safety representatives; provide all employees and managers with health and safety knowledge and skills; and actively involve all employees.
The business benefits resulting from these actions included: a 73 per cent reduction in employee insurance claims from 833 to 222 per 100,000 employees; a reduction in the rate of increase of Employers Liability Insurance premiums; and an 18 per cent reduction in the numbers of days lost to injuries (adjusted to account for a smaller workforce). Although consultancy fees of around £100,000 were paid to help improve the management systems, and training for managers cost around £75,000, some £500,000 has been saved from days lost since 1997 (or an annualised rate of £100,000 per annum). This on-going saving, plus the large drop in civil claims, will make substantial savings for the company into the future.
In terms of the company's safety record, the actions led to a 61 per cent drop in RIDDOR injuries from 4.9 to 1.9 per 100 employees and a 64 per cent reduction in the overall accident rate from 2.37 to 0.85 per 100,000 hours worked.
The St Regis case study is certainly impressive, but smaller companies may wonder whether the same principle really applies on a smaller scale. However, a couple of facts on the HSE's new website are worth highlighting: uninsured losses are ten times the cost of insurance premiums paid (source: HSE); and uninsured losses from accidents in smaller firms add up to £315 per employee per year (source: Norwich Union Risk Services). There is also a handy Incident Costs Calculator that enables users to work out the cost of an accident.
So what happens if some typical figures are entered on this ready reckoner? Let us imagine that an employee is lubricating the bearings on a conveyor that moves small pallets between two processes. Because he is distracted, the fingers of one hand are pulled into an unguarded nip point and his fingers are broken.
It might take half an hour of a first-aider's time, four hours for somebody to accompany the injured man to hospital, half an hour for somebody to isolate the conveyor and make the area safe, and two people might be unproductive for two hours due to the processes either side of the conveyor being stopped while a safe workaround is established.
If one person can take the place of the conveyor for three days (paid overtime on time-and-a-half) until guarding can be fitted, there may still be management time of one and a half hours to assess and reschedule production, six and a half hours to investigate and report the incident, plus four people involved in a health and safety committee meeting to discuss it. A manager may also spend two and a half hours with an HSE inspector. Bear in mind also that the injured employee will be off work for, say, one week, and he will need to be replaced by someone paid overtime at time-and-a-half.
Even without taking into account any prosecution costs, fines or insurance premium increases, the cost will be around £1100 (based on an hourly rate of £8 for workers and £25 for managers). In comparison, the cost to have simple fixed guards installed, with remote lubrication points fitted so that the conveyor can be maintained while running, might be around £500.
It has to be appreciated that every incident is different, and the figures entered in the HSE's ready-reckoner will vary from employer to employer, but the message is clear: properly managed health and safety can save you money. And just because you have a good safety record, it does not mean that you are immune from accidents. You may have been lucky so far, and there may be accidents waiting to happen throughout your plant. The answer is to look beyond what has happened in the past and consider what could happen if your luck runs out. After all, the result could be a great deal worse than some broken fingers and a £1100 loss.
To find out more about guarding and other products and services from Procter Machinery Guarding, email email@example.com or telephone +44 (0)2920 882222.