The Cost of Workplace Violence
California now requires employers to “establish, implement, and maintain an effective workplace violence prevention plan.” But an effective workplace violence prevention program isn’t just the law, it’s smart business too.
Remember that old adage, “an ounce of prevention is worth a pound of cure.” When it comes to workplace violence, there really is no pound of cure. Certainly not for the employee victimized by workplace violence.
And not for the employer either.
In this piece, we’ll look at the cost, both economic and human, that even a single incident of workplace violence has on an organization and its employees.
California’s new workplace violence prevention requires employers to have an effective workplace violence prevention program. My free California employers workplace violence prevention checklist will help you do that.
The Damage Caused by Workplace Violence
The US Department of Labor notes the emotional impact of workplace violence in its Workplace Violence Program, “Profound loss of life or physical or psychological repercussions felt by the victim as well as the victim’s family, friends, and co-workers; the loss of productivity and morale that sweeps through an organization after a violent incident; and the public relations impact on an employer when the news of violence reaches the media.”
According to the US DOL, the damage caused by an incident of workplace violence, isn’t just general in nature as it results in:
- Temporary/permanent absence of skilled employee
- Psychological damage
- Property damage, theft, sabotage
- Productivity impediments
- Diversion of management resources
- Increased security costs
- Increased worker’s compensation costs
According to a study done in the early 2000s, by the National Institute for the Prevention of Workplace Violence, some of the harm caused to an employer is quantifiable:
- For 6-18 weeks after an incident there is a 50% decrease in productivity at the workplace.
- Following an incident there is a 20-40% turnover in employees creating the need to hire and train in new employees.
Further, following an incident, an employer can face a variety of litigation claims. Those claims vary depending upon who was harmed by the violence, the nature of the violence, the awareness of risk for violence, and lack of training in dealing with violence including:
- 3rd party liability
- Negligent hiring
- Negligent retention
- Negligent supervision
- Negligent training
In a negligent hiring lawsuit back in 2016, a Texas jury awarded $1million, when an employee was killed on the job by co-worker, because the employer, “failed to provide training or education on identifying and handling this type of violent behavior in the workplace.” And because the employer, “failed to listen to numerous workers at the facility who repeatedly reported the erratic and unstable behavior.”
Today, workplace violence litigation settlements of $500,000, and trial awards of $3,000,000 are fairly typical.
And in California, the costs of not following the new workplace violence law can be steep, as can fines for workplace violence incidents where the employer is found to be in violation of the law. As of January 2024, Cal/OSHA’s fines for workplace violence incidents are:
- $15,873 for general and regulatory violations including posting and record keeping violations.
- $158,727 for willful and repeat violations. The minimum penalty is $11,337
- $25,000 for serious violations.
Based on these facts, it’s clear that even a single incident can have catastrophic consequences for both employees and employer.
Any Employer, Anywhere Can Be Impacted by Workplace Violence
While there’s no pound of cure once a workplace violence incident occurs, the ounce of prevention matters greatly to all employers, large, medium, and small.
And that’s because, as the US DOL notes that, “No employer is immune from workplace violence and no employer can totally prevent it.”
People eat at restaurants everyday and never give violence a thought.
But, according to the FBI, restaurants were the 8th most common setting for violent crime, accounted for about 2% of all violent crime in 2020. And despite the pandemic that year, when many restaurants operated in a limited fashion, or closed, there were 10,490 violent crimes in U.S restaurants.
And most restaurants have parking lots, which are the 3rd most common setting for violent crime, especially for employees.
Traditionally the rule of thumb was that for every dollar spent on workplace violence prevention, an employer reaps three times the benefit. But, according to the National Institute for Prevention of Workplace Violence, the cost of remedying the harm from a workplace violence event is many times the cost spent to prevent an incident from occurring.
Its study, The Financial Impact of Workplace Violence, compared the various expenditures needed for violence prevention actions, and the funds spent by an employer to recover following a significant incident, and it found that for an employer with 10,000 employees the cost for prevention was $183,770 vs $4,695,817 for the cost of recovery.
The costs to recover from an incident that study found was 25xs the costs associated with prevention.
Regardless of the size of an organization, comparing prevention costs to the financial costs and human toll of violence incidents shows whether an employer has 10 employees, 100 employees, or 1000 employees, the cost of prevention is always dwarfed by the cost of recovery.
California’s workplace violence prevention law requires to employers to train employees in strategies to avoid physical harm from workplace violence. Learn more about the types of trainings in strategies that are effective at keeping employees safe from physical harm from workplace violence.
My CA Employers Workplace Violence Prevention Took Kit will take you step-by-step through everything you need to create your workplace violence prevention plan.
Mike Corwin helps California employers implement an effective workplace violence prevention plan that keeps employees safer as required by the new workplace violence prevention law.
