UP Copyrights 2009

Faculty of Applied Engineering and Urban Planning

Civil Engineering Department

2nd Semester 2008/2009
CH 3:

The True Costs of Construction Worker Injuries

Lecture 5 - Week 4

Eng: Eyad Haddad

Construction Safety Management

1

The True Costs of Construction Worker Injuries

True accident costs are difficult to ascertain.
Accident prevention is accepted as the
responsibility of management.

Accidents are very costly and reduce

profits.
2

Direct Costs of Injuries

Those costs associated with the treatment of the injury
and any unique compensation offered to workers as a consequence of being injured.

This type of cost can be directly counted.

)........ - (
. Insurance

Indirect cost of injuries

Indirect cost are those for which there is no
retrieval mechanism to accurately associate them with injuries.

1.
2. 3.

Cost of lost time of injured worker.

Cost of lost time of other workers who stop work. Cost of time lost by foreman, supervisor, or other executives.

4.
5.
6.

Cost due to damage to equipment, tools, property and materials.

Etc..page 55

4

Workers compensation
Employers regard workers compensation as an
insurance policy for their employee when they are on the clock.

The premiums paid by the employer based on:

1- The manual rate for a particular craft.
. 100 18

2- The experience modification rate (EMR) which reflects

the past accident experience of that particular employer.
5 ) (

The manual rate

Reflects the claims history of a particular craft The manual rate is stated as the cost of insurance per
100$ of payroll.

The computation of the manual rate for certain craft is

based on the past experience of claims for that

particular craft.
. 6

Experience Modification Rate (EMR)

Reflects the claim history of a particular employer for a
three-year period that does not include the immediately preceding year.
.

EMR gives indicators about the safety performance Evaluates the frequency and the severity of injuries. Injury claims are defined as a loss ratio.
7

Previous studies of the true costs of injuries

H.W Heinrich (1941) Sheriff (1980) Bird and Loftus (1976) Leopold and Leonard (1987) Robinson (1979)

Recent Research on the cost of injuries

Construction Industry Institute CII in conjunction with
Washington university (Hinze and Appelgate 1991) Conducted a research in order to quantify the true costs of construction workers injuries.
(185 Questioner, studding 834 injuries, 34 )

In the data analyses two concepts were used indicated as: 10

11

In the data analyses two concepts were used indicated as:

1) Medical case injuries (those requiring

only a doctors attention before the injured worker returns to work)

2) Lost work day cases (those in which the injured

worker could not return to work the following workday or where the worker had to be reassigned to a different type of work because of the injury)

12

Cost of injury according to CII

Source of injury Injured worker Workers crow Crew in vicinity Replce. Worker Admin. Staff Damage prop. Others & Claims Indirect cost Direct cost Medical case 176.93 51.4 4.19 .71 51.3 100.80 57.07+171.20 613.60 519.15 Lost workday 815.58 178.90 34.27 21.74 135.90 174.62 252.20+12,610 14,223.36 13 6,910

Example
- 34 medical case injuries, 8 lost work-day cases,
calculate the total cost of project injuries Medical case injury cost = 34(614+519)= 38,522 $ Lost-workday injury cost = 8(14223+6910)= 169,064$ Total cost of project injuries = 207,586 $

14

Additional analysis
No significant differences between the
indirect to direct cost ratios of different crafts.

Cost ratio increase on cost-reimbursable

contracts and on larger projects.

15

Models for estimating the field indirect cost of injuries

1- For medical-case injuries Field indirect cost = $150+15F+30H+100A 2- For lost-workday injuries Field indirect cost = $625+20F+20H+50V Where: F = number of hours lost to receive care H = number of hours lost on the day of injury A = number of hours spent by admin. to assist V = number of hours spent by admin. to investigate 16

Continue

Medical case injuries Field indirect cost = 150+80H+80A Lost-work day injury Filed indirect cost = 625+100H+100V

17

Example

Field indirect cost = 625+20(F+H)+50V = 625+20(30+6)+50(2) = 1,445 $ Total indirect cost = 1,445 x 9 = 13,005 $ Total direct cost = 13,005\ 2.058 = 6,319$ Total cost = 19,324 $
18

Comments
Indirect costs of injury are significant. Sensitizing supervisory personnel to the true cost of injury will
improve safety. Some costs are not known
loss of pay for injure worker; Pain and suffering; Adverse effects of the injury on the other family members; Personal negligence suits; Damage to company image; Reduce profit margins to the firm; Removal of the firm from biding shortlists; Reduce moral of company employees and Possible criminal charges.

A large number of fraudulent workers compensation claims are

filed each year.
19