The Rise in Major Injuries could have Significant Financial Implications for Businesses
In reference to the article in The Straits Times dated 20 Jan 2023, the Ministry of Manpower (MOM) in Sep 2022 introduced a six-month heightened safety period to address workplace safety concerns. Despite this, recent figures show that the number of major injuries has actually risen during this period.
According to MOM, there was an average of 49.1 major injuries per month from January to August 2022, compared with 55.3 such incidents between September and December.
Possible Types of Business Costs Incurred
As major injuries increase, insurers may have to increase the premiums for work injury compensation insurance to commensurate with the increased claims and risk environment. Companies may also face fines and penalties for failing to meet safety standards, which can add to the financial burden. In addition, the company’s top management can be held liable for breaches of workplace safety regulations.
The Workplace Safety and Health Act holds employers responsible for providing a safe working environment for their employees.
Under the WSH Act, employers are required to conduct regular safety audits and take steps to prevent accidents and injuries. Employers who fail to comply can be fined, prosecuted, and imprisoned in cases of serious breaches.
Furthermore, there could also be indirect costs, such as loss of productivity and revenue due to the absence of injured workers. Also, MOM announced in Sep 2022 that companies with serious lapses that lead to severe or fatal accidents will be barred from hiring new foreign workers for up to three months.
To further compound the cost, businesses may also face higher costs associated with implementing safety measures and training programs to prevent injuries and fatalities. Companies that operate in high-risk sectors e.g. construction industry may also face additional expenses related to more frequent mandatory safety timeouts and increased scrutiny from regulators.
What Can Businesses Do About This?
Companies should focus on implementing and enforcing proper safety protocols, providing regular training and education for employees, and regularly reviewing and updating their safety procedures to stay up to date with industry guidelines and best practices.
Additionally, companies should prioritize the participation and accountability of top management in maintaining a safe workplace. In buying or renewing their work injury compensation insurance, it is important to ensure that all employees are insured with their occupations and annual earnings correctly declared so that they can be fully covered by the insurance policy.
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