Safety vs. the Bottom Line

Is There a Conflict?

July 2009 

By: Ulf Wolf

On paper, it would seem that perhaps there is a conflict between safety and the bottom line.

The job site is busy, the schedule is tight, and while sanding, you now need to get over another 10 feet: Unhook the harness. Climb all the way down. Release the brake. Roll the scaffold over 10 feet. Engage the brakes again. Climb back up. Put the harness back on … oh, all that wasted time.

So much easier: Don’t engage the brake in the first place, and pull the scaffold and yourself along the wall as you progress. A wall this size, you must be saving yourself—and you boss, mind you—an hour at least, maybe two.

"Don’t try to save me money,” Tim Wies tell his employees. Wies is president of T.J. Wies Contracting, Inc. in Missouri, and one of the four safety directors—all nominated for this year’s AWCI Excellence in Construction Safety Award—we spoke to regarding safety and the bottom line.

"‘Don’t think for me,’ I tell them. ‘Don’t try to help me out by cutting corners and taking risks. The hours you may save me, will cost me in the end,’” Wies says. "Say by doing something unsafe, they save me two hours of time. In my market, that’s $100, $50 an hour at cost. Now if they don’t build the scaffold properly and fall off and break a leg, that broken leg is going to cost me $15,000 to $18,000 on the insurance alone.”

The Conflict

Is there, in fact, a conflict? This was the question we put to the four nominees.

Kathy Coffey, safety director of Grayhawk, LLC in Kentucky, did not hesitate for a second: "Within Grayhawk itself there is absolutely no conflict. The owners are totally dedicated to promoting safety and educating employees, and they know that our safety record has in fact improved the bottom line.

"I think where the perceived conflict sometimes arises is when we’re working for general contractors who don’t see safety as a priority. That said, most of the general contractors we work with are wonderful. We have a very good working relationship, and they know where Grayhawk stands on safety.

"But, here is what I have observed: I see other subcontractors jeopardizing their safety program as a result of production stresses, and they don’t really know how to approach the general contractor about the resulting problem.

"They have yet to build mutual understanding with the GC. These subs need to be up front about safety going into the contract, telling the GC that they will not jeopardize their safety program for production woes. They need to work together with the GC to find a solution.”

How about working with and around other subcontractors who do not treat safety as a priority? Does that create a hazard for your employees?

"Oh, absolutely,” Coffey says. "Even if you have developed a good safety culture within your organization, when you’re working a job site with little or no safety concerns, it definitely exposes your employees to hazards.”

Such as?

"The biggest thing that I see is fall hazards: Missing guard rails, elevator shafts being left open. Also, a messy site where no one is stressing good housekeeping, which is part and parcel of a safety culture, means slip, trip and fall hazards.

"If you pre-plan the job and do not accept a ridiculous schedule, then you, as a subcontractor, are being proactive about safety instead of reactive. And that’s the whole problem: The GC squeezes them, and the first thing they want to blame it on is safety—‘causing me to do this, causing me to do that.’ That’s not true. If they had done their job up front and pre-planned well—and trained their men and women to implement safety, you would never hear that.

"Once you adopt a safety culture, then safety becomes second nature; you don’t even think about it. You would no more leave your prescription lenses at home than your hard hat and protection glasses.”

Phil Ford, safety director at M.L. Jones Acoustics Inc. in Oklahoma, has this take on the conflict: "Our safety record has improved our bottom line. There’s no doubt about it.

"We have found that if you want to compete in today’s market and bid the larger general contractors, you have to have a safety program in place—and not just on paper, as the large GCs demand it in fact.

"Additionally, having a true and known safety culture enables us to bid jobs we would not ordinarily have been able to bid. In fact, this culture has created a broader market for us. We directly attribute several jobs to the fact that the general contractor knows that we will not supply irresponsible workers who, through injury, will disrupt work-flow and cause him other problems.”

As Wies sees it, "There really is no conflict, because you can balance safety and productivity. As you enforce a safety mindset in your company, you will notice that productivity does not drop, because with this mindset of care, employees tend to do things right the first time. This, of course, leaves you less re-work and directly driving the bottom line. Further, your insurance rate will go down. So, in the grand scheme of things, a safety program simply makes sense, economically and otherwise.

"Today, with workers’ comp insurance and healthcare costs, accidents are hugely expensive. Therefore, I don’t think safety and productivity are mutually exclusive. In fact, I think they go hand in hand.”

Shelly Sigurdsson, safety director at Expert Drywall, Inc. in Washington, agrees: "There is no conflict. In fact, if you don’t stress and implement a safety culture, it will definitely affect the bottom line adversely. If you don’t invest in safety, your claim costs will spin out of control, while investing in safety helps the bottom line tremendously.”

The Hidden Cost

Apart from the more obvious cost savings: Workers’ comp insurance and medical expense, there are other—and sometimes larger—costs that are not immediately apparent.

"When an employee is injured on a job site, and it’s of a serious nature, you can write off that day,” Coffey says. "You may have 500 men on that job, but if the accident is severe, once the ambulance has left, they’re not really working. They gathering: ‘Did you see what happened to Joe? They say he fell. They took him out of here in an ambulance.’

"And talk about bottom line: That’s 500 men at $30 an hour standing around for six hours. How much did that cost you? And heaven forbid if the person died. That will ruin the whole week.

"General contractors normally don’t understand the traumatic impact that a workplace accident has on all the trades on a job site. And if there is a fatality, then what are you dealing with?

"One day a person dies on the job. No work done for the rest of that day. The next day OSHA will show up, or the same day. And they will shut the whole job down for another day. Then the investigation, all that. It is a huge hidden cost.

"But it is a real cost when you sit down and think about it, or if you walk around the job site after an accident. You see men and women standing around, and they’re not smiling.”

Wies makes a similar observation: "If it is a severe accident, work stops that day, and if it’s a horrible accident or a fatality, it will cause grief and distress on the job site for days, if not weeks. It’s hard to put a finger on cost, but you know it’s happening. The accident becomes the topic of the site, and everybody will have an opinion and will want to weigh in. It’s a very real cost that normally stays hidden only until the end of the week—if you’re tracking that job—you say, what happened this week? An accident, that’s what happened.”

Sigurdsson has seen the same thing: "A gruesome accident will not only slow the site down for the day, but—especially if it’s a fatality—you can count on that job being shut down for a week or more. If it is not a fatality, still, you’ve lost the rest of the day. It’s all people will talk about, the morale goes out the bottom.”

The Family
But more important to each of the AWCI safety-award nominees is the impact an accident can and will have on the injured employee and his or her family.

Coffey says, "Expert Drywall—and I’ve been with them for 20 years now—is a family oriented business. I see my employees as extended family. I want them to maintain their lifestyles. I want them to be able to go and play ball with their kids, to be able to travel around to their soccer tournaments, to be able to pick up their little 2-year-old daughter.

"An injury puts a completely different dynamic on the family. It can ruin it. That’s why, when it comes to safety, we care about our people first and foremost. If we don’t have our people safe and working for us, then what do we have as a company? The company is our people.”

Ford, too, puts the employee and his family above all else. "I’ve seen people lose a finger or a limb, and that is not just an injury but it can also alter a whole life; it can destroy a marriage. It’s not just the injury, but also the ripple effect from it. That, for me, is the bottom line, why I care so much about it. I want to see the guy go home whole.”

Wies, who owns his company, shares this concern: "Even though we’re 200 or 300 people, I consider us a small family business. I consider everybody who works for me a friend, and I don’t want to see any of them hurt. As I tell them, ‘The worst day in my life would be having to call your wife or your husband, mother or father, sister or brother, and tell them that you were severely injured or killed on one of my projects. I can think of nothing worse. So, please whatever you do in the field to help the company, I beg you: Never put me in a position where I have to make that call.’”

Reluctant Employees
What about those employees who don’t want to be bothered with safety?

Wies has run into some of those. "I find that to be an age issue. In my experience, the younger workers have less of a problem with safety than the older, more experienced men, who are often the ones reluctant to make the change.

"The younger, more up-to-date men see the industry evolving, not only in the equipment used but also in the techniques employed, so they really understand that safety is simply part and parcel of the evolution of our industry.

"They know that if they are to move up in this industry, they have to accept safety as a part of it, while the older ones, a few years from retirement, don’t want to put up with the "inconvenience” of hard hats and glasses. To them it’s an aggravation. For the younger guys, safety is just the way it is.”

How do you handle the older guy, then?

"Oh, they comply, too. It’s just that you hear a lot more about it.”

Sigurdsson has seen them, too. "I’m really strict with things like safety glasses, hard hats: If they don’t use them, I’ll write them up. I don’t mess around.”

Training is always an issue. Where, and at what cost.

Ford had this to say: "Training can be an expensive proposition. The owner of our company implemented in-house training that has proven effective.

"It would be quite expensive to send all of our employees to an outside source. It is also more effective to do it in-house since we are able to train our employees specifically to our scope of work and dealing with the hazards we meet. Outside training facilities provide only an overview of general hazards that are not specific to our scope of work.”

Wies counts himself lucky: "We do some in-house training but we’re a union shop, and fortunately, here in the St. Louis area, the trades that we represent do a tremendous amount of training themselves.

"All the Carpenters here in St. Louis are OSHA 10 certified through the union’s journeyman upgrade training. Also, in St. Louis we’re blessed with good labor-management relations. While the Carpenters have taken care of theirs, the Painters agree they should be there, too. But that hasn’t happened yet, so we brought that training in-house, and have now brought all of our painters, plasterers and laborers up to OSHA 10 standards, as well. So, it’s a combination of in-house and union training.

"Also, twice a year we have a company-wide safety meeting where all employees attend. We bring in speakers from our insurance company, our superintendents address them, I talk to them. We’ve also had the union executive secretaries/treasurers from each trade, as well as Terry Nelson, who heads up the Carpenters in St. Louis, come in and talk. We serve coffee and such, and provide booths and demonstrations of new safety equipment, and how to use it properly.”

It’s Personal
For each of these four nominees, safety is more than just a job. It has grown into a personal passion.

"My interest in safety,” Coffey says, "stems from lessons learned in life. When I was a young woman, I worked in a sawing factory. One day I saw a woman get three of her fingers cut off. They whisked her away to the hospital and that was that. Management never talked about why it had happened.

"Her fingers were cut off by a shearing machine, where the guard—although it was equipped with one—was never put to use. The company treated the incident as ‘no big deal,’ and this set me thinking: How can somebody losing three fingers be viewed as acceptable. To me, at the time and from there on until now, that is NOT acceptable.”

Ford says, "When I first came into the business—this was before the OSHA was enacted in 1970—the contractor more or less told you what to do. If you had any objections, you were informed that if you didn’t want to do it, there were two guys just outside, ready to do it. Like now, there were more people than jobs at that time.

"But as time went by, the trend shifted to more jobs than people, and as the OSHA act took hold, deaths alone were cut in half in the first few years after enactment, and that is what convinced me: A focus on safety really works.”

Wies entered the trade around the same time: "When I initially entered the field about 25 years ago, safety was not part of anybody’s culture. It was not important. People had started to talk about it, but it was a joke. A safety meeting meant someone bought some beer and you took half an hour off at the end of the day, kicked back and listened to someone talk about safety. That was the culture at that time.

"Today, as you look back at all the risks you took back then, you realize there never was a good reason for those risks.”

Sigurdsson is fueled by her work as an instructor at the Union Apprenticeship School, and taking care of new tradesmen right from the beginning.

"I’ve seen incidents,” she says. "I saw a guy fall on a job, an iron worker, and land right in front of my crew. He died. I mean, he was gone. His mom came to the job a little later to see where her 30-year-old son had fallen.

"So, I take it personally. I have seen what happens when somebody falls and gets injured, and the toll it takes on their lives. I don’t want that to happen to any of my guys out in the field.”

Safety vs. the Bottom Line — What Conflict?
As if the costs saved on insurance, workers’ comp, medical cost and lost labor—including the cost to train replacements—were not evidence enough of there being no real conflict.

But on top of that, a well-trained, safety-oriented employee will also—almost as an extension of his responsibility for his own and others’ safety—take care to do the job right the first time. That means fewer punch lists, less re-work, sweeter bottom line.

Case dismissed.

Coeur d’Alene, Idaho–based Ulf Wolf writes for the construction industry as Words & Images.