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Why does Health and Safety matter even more for SMEs in NZ?

12 October 2015

Why does Health and Safety matter even more for SMEs in NZ?

"The first duty of any business is to survive. The guiding principle of business economics is not the maximisation of profits. It is the Avoidance of Loss". 
Peter Drucker (1909 – 2005) 


New Zealand has a long history of causing avoidable injuries and deaths in the workplace. Each year New Zealand workers suffer from incidents that result in:

  • More than 100 sudden deaths (a rate of 4.1 per 100,000 workers).
  • Up to 445 life-threatening acute injuries (a rate of 19 per 100,000 workers).
  • Between 700 and 1000 deaths from chronic work-related diseases such as asthma, skin diseases and asbestos-related cancer.
  • More than 6000 other notifiable accidents resulting in serious harm.
  • Between 17,000 to 20,000 new cases of chronic work-related disease.
  • 23,000 injuries, serious enough to require more than a week off work for recovery.
  • 190,000 medical claims from the Accident Compensation Corporation (ACC).

This 11% incident rate costs! Workplace incidents are estimated to cost New Zealand 3.5 billion dollars a year, almost 2 percent of GDP.

In 2013/2014 ACC accepted:

  • 8 million new claims.
  • 186,696 new claims for workplace injuries (11%).

In 2014/2015 alone ACC accepted:

  • $204,870 new work related injury claims and are processing; a further
  • $304,033 new work related injury claims; and spent
  • $1,037 million on people unable to work.

New Zealand's rates of workplace injury are around twice that of Australia's and almost six times that of the United Kingdom. New Zealand's workplace injury rates remain relatively consistent.
Why?
Let's look at some unique features of New Zealand workplaces. There are 490 thousand or so workplaces:

  • 475 thousand + (97%) employ 20 or fewer people.
  • 435 thousand + (89%) employ 5 or fewer people.
  • 333 thousand + (68%) have no employees: e.g. Are run by owner-manager or working proprietors.

Of the 2.2 million + workers:

  • 2.1 million are employed in businesses that employ 20 or fewer people.
  • 2.0 million employed in businesses that employ 5 or fewer people.
  • 1.5 million are self employed / owner operators.

Size Matters!
Organisational size is often quoted as a variable that affects Health and Safety awareness and practice. Small to medium sized businesses have trouble establishing and maintaining health and safety systems. Often owners and managers are simply unaware of their legislated responsibilities. Recent research within New Zealand has discovered that many owners and managers of these businesses believe risk control is the responsibility of the individual rather than that of the business. They do not accept the importance of implementing effective Health and Safety management systems. Workers in these businesses often regard luck to be a significant contributing factor to safety, a perception associated with risk taking. Both employers and employees in small businesses often accept occupational hazards, and risk, as simply a 'part of doing business'.
The Ministry of Business, Innovation and Employment and the Independent Taskforce on Workplace Health and Safety identified gaps in New Zealand's Heath and Safety compliance and practice. New Zealand's self regulating business environment and liberalised labour market means that owners and managers of these businesses have lacked incentives and deterrents to become aware of and establish effective Health and Safety management systems. 
It is clear that New Zealand will need to address the short fall in knowledge, skills and attitudes within small and medium sized businesses, with 20 or fewer employees, if the nation is going to meet the targeted 25 percent reduction in workplace fatalities and serious injuries by 2020. WorkSafe NZ is encouraged to make such knowledge and systems, processes and forms available and accessible. And they are encouraged to provide that incentive for business owners and managers to look for and use them. 
For its part, Vertical Horizonz New Zealand is creating programmes to inform owners, managers and workers within these organisations of their Health and Safety responsibilities. They are working to make these programmes accessible. Their courses embed useful templates for policy and processes to these organisations. And their courses will demonstrate that effective systematic Health and Safety gives certainty to a business, and helps ensure consistent, sustainable productivity.

So where is your business on Dyck's continuum?

How much help will your business need to be at Stage 5?