1 / 14

Cost of Occupational Accidents: An Activity Based Analysis

Cost of Occupational Accidents: An Activity Based Analysis. Pall Rikhardsson MSc PhD The Aarhus School of Business Department of Accounting par@asb.dk. Presented at the Safe Community Conference 2001 Viborg County Denmark. The SACA project.

bly
Download Presentation

Cost of Occupational Accidents: An Activity Based Analysis

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Cost of Occupational Accidents: An Activity Based Analysis Pall Rikhardsson MSc PhD The Aarhus School of Business Department of Accounting par@asb.dk Presented at the Safe Community Conference 2001 Viborg County Denmark

  2. The SACA project • The Aarhus School of Business and PricewaterhouseCoopers • 9 case companies • 27 occupational accidents • 31 interviews

  3. The SACA project • Aims • Test a method for assessing company occupational accident costs • Indicate size of these costs • Assess the effects of stakeholder interest in occupational accidents on company costs

  4. The SACA metod Accident Activity- analysis Cost analysis Results

  5. Compensation Fines Costs when victim returns to work External manpower Colleagues overtime Preventive education/training Extra safety meeting Presents and flowers to victim Investment in new machines/technology Cost of employing a new employee Information meeting and communication Company time - meeting with H&S authorities Colleagues visit victim Production loss due to replacement personnel Extension of safety meetings Change in technology/new instructions Training of replacement personnel Information to staff functions Company time - meeting with police Colleagues discuss the accident Administration -legal department Supplementary salary to victim Extra costs of salary administration Administration, department manager Time used by helping colleagues CEO/manager time Information to upper/top management Administration - safety manager Internal investigation and safety forms Lost hours on day of accident - victim 100 % salary to victim, first 14 days 5 0 30 25 20 15 10 Activities • 6 activity groups • Absence • Information • Administration • Preventive • Production loss • Other

  6. Costs • Time • Materials • External services • Other

  7. Distribution of accident costs 1% 14% Absence Information 3% Administration Preventive actions Loss of production Other 13% 4% 65%

  8. Total accident cost pr. company Accidents in the year 2000 Range of total accident costs (DKK) Average total accident cost (DKK) Company Contruction 1 149 3.006.52 - 8.976.505 5.681.171 Contruction 2 6 25.038 - 161.706 71.530 Contruction 3 12 29.820 - 1.542.708 585.236 Service 1 43 414.950 - 5.919.251 3.846.794 Service 2 5 34.695 - 107.910 75.300 Service 3 3 26.964 - 277.344 110.424 Production 1 40 222.280 - 3.746.920 1.507.853 Production 2 7 85.442 - 1.373.841 520.828 Production 3 5 14.660 - 287.250 123.998

  9. Total accident cost pr. employee 14.000 Lowest/employee 12.000 10.000 Average/employee 8.000 DKK Accident cost pr. employee Highest/employee 6.000 4.000 2.000 - C1 C2 C3 S1 S2 S3 P1 P2 P3 Company

  10. Conclusions (1) • The SACA method can be used for accident cost analysis in most companies. • Cost behavior varies due to e.g.: • Accident type and duration of absence • Wage structures and policies • OHS management system scope • Production process vulnerability

  11. Conclusions (2) • Costs of occupational accidents differ regarding management visibility • The average ratio of visible/invisible costs is 1:1,5 • These costs are usually not insured

  12. Conclusions (3) • Few companies use the accounting information system for accident cost management in spite of being technically possible • The reason given is limited managerial and practical feasibility • A feasible way might be to periodically calculate costs of selected accidents and then estimate total costs

  13. Conclusions (4) • Reported level of general stakeholder‘s interest in company occupational accidents is negligible • Only customers and labour unions have expressed explicit interest in accidents • Effects on costs are non-existing • Accident prevention is seen as potentially more important in the future

  14. Pall M. Rikhardsson MSc PhD Associate professor The Aarhus School of Business Department of Accounting Fuglesangs Allé 4 8210 Aarhus V Denmark Tel.: + 45 89 48 66 88 Dir.: + 45 89 48 63 76 Fax: + 45 86 15 12 90 Mobile: +45 28 59 98 32 e-mail: par@asb.dk http://www.hha.dk/EOK/REGN/STAFF/PAR_FORM.HTM

More Related