SMEs have further to go with their health and safety provisions

Many small and medium-sized enterprises (SMEs) still have work to do on key health and safety provisions, new research reveals

Less than a third (31%) of those polled by insurer Hiscox name health and safety as their highest priority, with 25% ranking it low or medium

Counting the costs of workplace accidents

Workplace accidents and illnesses remain a significant drain on Britain’s well-being and resources. SMEs are at risk of both financial and reputational costs. Despite ongoing efforts to raise awareness, work-related illnesses and injuries caused the loss of 36.8 million working days in 2021/22, according to the Health and Safety Executive (HSE).

The Hiscox Risk Readiness Report now sheds new light on the challenges and barriers facing SMEs in this area.

The survey of 1,500 business owners and senior decision-makers shows the average SME experienced 3.2 accidents during the previous 12 months. Many were left counting the costs, with businesses taking an average financial hit of £17,185.

Firms in the transport and logistics and energy and utilities sectors endured significant financial headaches, with 20% dealing with costs of more than £100,000.

20% of these firms are dealing with costs of more than £100,000

Those in marketing, advertising and PR lead the way when prioritising health and safety. Some 53% of these companies have made it their highest priority. Half (50%) of law enforcement and security SMEs, and 47% in environment and agriculture reported the same thing.

More to do on risk assessments

Many SMEs have been slow to prioritise risk assessments, despite the potential costs of health and safety breaches.

A risk assessment policy is a way for employers to document workplace risks – and identify potential solutions to mitigate them. It can help a business to meet its legal duties to review health and safety risks. The HSE recommends consulting both staff members and health and safety representatives as part of this process.

Despite the benefits of risk assessment policies, just 66% of SMEs currently have one. What’s more, only 16% intend to introduce one over the coming 12 months, against the 64% who do not.

Perhaps unsurprisingly, these policies are more common among risk-apparent and public-facing industries. For example, nine in 10 (92%) engineering and manufacturing firms have one. The same goes for 84% of hospitality/events management firms and 82% of accountancy, banking and finance companies.

The Hiscox report also indicates that certain firms could do more to keep their policies updated. While 41% have updated them in the past year, almost one in 10 (8%) said it was two to five years ago. The watchdog recommends annual reviews of risk assessment policies.

When developing their policy, 39% updated a previous plan, and 33% engaged an external consultant. Meanwhile, 26% made use of specialist software.

Firms report patchy health and safety provisions

First aid facilities top the list of health and safety provisions. This shouldn’t come as a surprise, though, given the Health and Safety (First Aid) Regulations 1981 mean employers are legally required to provide adequate and appropriate support.

Hospitality and events management (75%), engineering and manufacturing (68%), and property and construction (62%) are among the top first aid providers. Business consulting and management (40%) and marketing, advertising and PR (30%) appear towards the bottom.

Only 28% of SMEs offer access to dedicated health and safety staff members

Other health and safety provisions remain patchy. Only 42% of SMEs provide information to their staff through posters and leaflets. Further down the list, just 36% deliver annual training, with 28% offering access to dedicated health and safety staff members.

After experiencing an incident, one-third (33%) of firms conduct an internal investigation. The same proportion make recommendations to prevent similar incidents from happening in the future. Over a quarter (27%) file an online report with the HSE.

Encouragingly, more than three-quarters (78%) of businesses are aware of the need to report major injuries that involve hospitalisations or fatalities. Some 55% said they would submit an online report to the HSE following such incidents.

Dealing with the fallout from accidents

A range of steps and insurance policies can help to financially shield SMEs from health and safety breaches. For example, public liability insurance can help deal with compensation costs if customers are injured or suffer property damage as a result of their work. As the Association of British Insurers highlights, this can cover incidents either on a company’s premises or during off-site events and activities.

However, 24% of respondents to the Hiscox survey lack public liability insurance at present. And more than two-thirds (67%) of them don’t intend to buy it in the coming year.

SMEs in the accountancy, banking and finance sector (85%) are among the most likely to have public liability insurance. Property and construction (83%), and hospitality and events management (82%) also have a strong uptake.

Of course, health and safety provisions aren’t just about protecting a company’s bottom line in the short term. Accidents can have far-reaching consequences, with a third (34%) of firms enduring a drop in performance indicators. Some 28% of SMEs reported difficulties attracting new customers, with 22% facing bad publicity. In 29% of cases, material solvency or viability was placed in jeopardy.

Preparing for the unexpected in the workplace

The costs of work-related injuries continue to mount for British businesses, reaching £7.6 billion in 2019/20. Yet, many SMEs still have some way to go in this area, according to the findings from Hiscox.

Hiscox’ Risk Readiness Report offers a reminder of the importance of workplaces reaching their health and safety provisions. SME leaders have a vital role to play in safeguarding customers and staff, along with their own finances.

References

1. https://www.hiscox.co.uk/business-blog/hiscox-risk-readiness-report
2. https://www.hse.gov.uk/statistics/
3. https://www.hse.gov.uk/involvement/riskassessments.htm
4. https://www.hse.gov.uk/simple-health-safety/risk/index.htm
5. https://www.hse.gov.uk/firstaid/legislation.htm
6. https://www.abi.org.uk/products-and-issues/choosing-the-right-insurance/business-insurance/liability-insurance/public-liability-insurance/
7. https://www.hse.gov.uk/statistics/overall/hssh2122.pdf