Effect on Costs and Employer: Accidents are harmful when we take into account the business of the concern. It adds to the costs of production directly as well as indirectly. The employer has to bear the followings costs:
a. Medical expenses to be paid to the victim
b. Compensation of injury on the basis of disablement
c. Fines which may be imposed upon the industry for neglecting safety measures.
d. Loss of damaged materials and machinery involved in the accidents.
Indirect costs: indirect costs of the accidents have been estimated to be higher than direct costs. Indirect costs include the followings.
a. Time lost by management and other personnel in helping the injured person on the spot.
b. Investigating the accident .
c. Preparing the reports of the accidents.
d. Time lost by the workers in observing and discussing the accidents.
e. Training and placement of new employees
f. The injured person on return to turn out interior products
g. Psychological effects on return to duty may work with reduced efficiency
h. If the accident is very severe and deliveries are delayed he customers may be lost.