Posted By Andrew Scargill
I am preparing an "Accident Cost Sheet" to issue to all General Managers of business untis within a group, following accidents.

The objective is to raise the awareness of hidden accident costs, such as production down time, cost of replacement, labour, my investigation time etc.

So far I have identified costs for first aid supplies, transport to hospital cost, accident investigation, cost of lost time of injured person/first aider, cost of replacment labour & training.

However, I am struggling to determine a cost for lost production.

Undoubtedly, this will be amongst one of the highest costs, and closest to the hearts of the GM's

Does anyone use a similar system, and can advise me of a costing sytem, based on averages.

Thanks in advance

Andrew Scargill
Health & Safety Advisor

Posted By Ciaran McAleenan
Andrew

In an earlier version of the UK’s HSE guidance “The Costs of Accidents at Work” there was a system for surveying the costs of accidents. It isn’t in the most recent version so I don’t know whether it was discredited or too onerous a task for the net benefit received from applying it. Whatever the reason there were some bits of information contained in it that may be of some use to you.

Firstly it is important to establish whether the accident involved a lost production output, if for instance the losses are subsequently made good and the orders are completed. The guidance makes the point that if the marginal value of production is taken to be equal to the marginal cost of labour then the “Opportunity Cost” of no production is the net cost for labour, paid for no production. The “financial cost is the actual additional cost paid to achieve the production required.

With that in mind the details of extra costs incurred could include;

· Contracted out work (Was it necessary? And what was the cost?)
· In-house labour costs for remedial work (repairs, extra tests etc.)
· Plant/ Equipment costs for remedial work (hired or purchased for the job)
· Materials, spares, consumables used (What was needed? What was lost?)
· Enhancements (Consider whether any routine work may have been completed during remedial work. This should be registered as a saving).
· Within your company there may be particular costs/ savings as a result. Don’t forget them.

I have the HSE document in my archive. If you need any more detail just let me know.

Best wishes

Ciaran

Posted By Duncan Brown
Hi Andrew

You may care to look at our video "The Secret Siphon" which was produced with CBI after they did some work with the HSE on the cost of accidents.On our website www.outtakes.co.uk, their are two references in links at www.web-safety.com (run by Philip & Ciaran McAleenan) and www.rydermarsh.co.uk to using the film to support the cost of accidents training.
Please call me on 0208 289 2466 if you wish to preview the video.

Thanks Duncan Brown