References
Workers’ Comp. Costs – The Iceberg Effect
Worksite injury cost is recorded as either Direct or Indirect cost. Direct cost is easier to measure because it represents the amount spent on workers’ comp. claims and medical expenses. Indirect cost includes costs associated with employment-related accidents that are not covered or paid by workers’ compensation. Indirect cost data is more difficult to obtain because the data is not often captured or quantified as it accrues. Even though it is difficult to measure, it is still important to estimate Indirect costs. Indirect cost is several times more than Direct cost. Indirect cost is often expressed as a ratio of Indirect to Direct workers’ compensation costs. The Industrial Athlete uses the auto industry ratio of 3 to 1. That is, for each $1.00 of Direct workers’ compensation cost, there is a corresponding Indirect cost of $3.00 dollars.
Savings Calculator
The Savings Calculator can estimate your Total Worksite Injury Cost (Step 1) and Quantify the Impact of Worksite Injury Cost on Company Profits (Step 2). To use the calculator, do the following:
- In Step 1, enter Your Direct Workers Comp Costs without commas or decimal points.
For example $100,000.00 would be entered as 100000. - Click on Run Step 1.
- Your Total Worksite Injury Cost will be calculated and presented in the “Total Worksite Injury Cost” Box in both Step 1 and Step 2.
- To calculate the True Cost of Worksite Injuries on your business, enter your % profit margin in the box provided.
- Click on Run Step 2. The final figure represents the True Cost of Worksite Injuries.
- Continue to the Savings Calculator -
If, for example, you had Direct Workers Comp of $100,000 and your company had a 10% Profit Margin, you would need sales of $4,000,000 to cover the Cost of Worksite Injuries.
Continue to the Savings Calculator -
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