SAFETY PAYS – BHP Case Study

In 1993 BHP Engineering embarked on a safety improvement program and monitored the changes that resulted, taking into account of parameters such as work place culture, safety management systems, employee behaviour, injury performance and costs.

Costs were measured in the following 6 categories:

1. Management function costs:
   • OHS staff & incidentals
   • OHS infrastructure such as management and reporting systems
   • Company-wide systems such as perception survey and safety audits
2. Injury prevention costs:
   • Purchase and implementation of risk-specific systems and training
   • Cost- benefits analyses of all new policies and standards
3. Emergency response costs:
   • Preparation and implementation of emergency response plan
   • Investigations
   • Management follow-up
4. Injury Management costs:
   • Workers compensation costs and premiums
   • Common law settlements
   • Rehabilitation
   • Replacement of injured employees
   • Sick leave
5. Lost productivity costs
6. Community costs:
   • Injured worker costs such as lost wages, incidental and lost opportunity costs.
   • Government subsidies and social security costs

Through a combination of performance indicators and system measures BHP were able to verify the effectiveness of their safety interventions and understand what was happening below the surface of the organisation, accelerating the change process and achieving higher levels of performance.