WORKPLACE VIOLENCE PREVENTION: Assessing the Risk to your Business



Assessing the Risk to your Business

By W. Barry Nixon, Executive Director of National Institute for Prevention of Workplace Violence

Over the last two decades, the Department of Labor and National Institute for Occupational Safety and Health (NIOSH) have provided insightful information on workplace violence fatalities and non-fatal incidents. While these statistical reports have provided essential details, in most cases businesses have not been able to translate them into cogent plans to address this ever-present problem. This article will focus on helping those charged with the responsibility for addressing workplace violence to understand the potential business and financial impact of violence on their work environment.

The impact can be analyzed in four steps:

1. Assessing the risk to the business

2. Identifying the business and financial impact of workplace violence

3. Mitigation approaches to avoid or reduce the risk of incidents occurring

4. Dealing with the aftermath of an incident

This discussion addresses the first step. Let’s start out with a definition of workplace violence:

*“Acts of aggression or violence including assaults, threats, disruptive, aggressive, hostile, verbal or emotionally abusive behaviors that generate fear that occur in, or are related to the workplace and entail a real or perceived risk of physical, emotional and/or psychological harm to individuals, or damage to an organization’s resources or capabilities.”*

Starting from this definition, let’s turn our attention to the core focus of this article – the financial impact that violence can have on an organization.

Historical data reveals the daunting costs of workplace violence.

* According to the Bureau of Justice Statistics, about 500,000 victims of violent crime in the workplace lose an estimated 1.8 million workdays each year. This represents a $55 million impact as a result of loss of productivity and increased healthcare expenses.(1)

* Domestic violence costs businesses approximately $6 billion annually in healthcare costs, lost productivity, and missed work time.(2)

* The average out-of-court settlement for ‘negligence’ litigation is approximately $500,000 and the average jury award is around $3 million.(3)

* For 6 to 18 weeks after an incident, there is a 50% decrease in productivity and a 20% to 40% turnover in employees.(4)

Specific cost figures for a specific workplace violence incident are very tough to get because companies are reluctant to reveal proprietary information and potentially expose imperfections in their operations, safety procedures, and employee practices. Most firms that experience a serious incident will move quickly to minimize the negative publicity and the impact on their business. Their actual costs are likely to be buried in various innocuous-sounding budget entries so that the business can project the image that ‘all is well’ to avoid spooking their customers and shareholders. However, as the historical data indicates, the costs are not small.

A prudent business person will therefore consider carefully how to incorporate this information into the business plan. A full assessment involves three phases:

* identification of possible risk (determining the likelihood of an incident occurring);

* identification of level of vulnerability; and

* identification of the impact of an event on business operations.

The focus should be on developing plans to protect the following five key business assets – people, facilities, technology, information, and networks.

Assessing Your Risk

The initial step is to assess the potential threat of workplace violence based on the nature of your business and on the types of facilities and their locations. The possible types of workplace violence include the following:

* violence perpetrated by a stranger (generally robbery is the goal);

* violence perpetrated by a current or former employee;

* violence perpetrated by a relative, spouse, ex-spouse or individual with a personal relationship with an employee; and

* violence perpetrated by a customer, client or contractor.

All organizations have exposure to all four types of violence although to varying degrees. For example, if you are a retail business that handles lots of cash, the nature of the threat posed and type of potential violence you face will differ from the threat that hangs over a manufacturing plant. Likewise the threat posed to a warehouse located in a high crime area will be different from that posed to an office building in a busy downtown area.

Each type of workplace violence requires a different type of assessment. Numerous variables will impact these assessments, including the type of business, the type of facilities you operate, the level and nature of security at those facilities, hours of operation, level of staffing, presence of valuables or cash, and location.