SMOKING IN THE WORKPLACE
COSTS EMPLOYERS MONEY
Businesses today desperately seek ways to contain the costs they must pay for health insurance for their employees by limiting coverage, subscribing to HMO's, and increasing deductibles. CEO's cast anxious glances over their shoulders as foreign competition increases and the ability to cut costs and increase productivity becomes crucial to survival. Dr. William L. Weis, Associate Professor of Business Administration at the Albers School of Business, Seattle University, has a suggestion which could significantly affect line items in the budgets of American businesses:
The idea is not a revolutionary one, and it is a timely one. The Surgeon General's Report of 1986, The Health Consequences of Involuntary Smoking, noted that "Policies regulating smoking at the workplace for the protection of employees' health are a trend of the 1980s. As of 1986, smoking is restricted or banned in 35 to 40 percent of private sector businesses and in an increasing number of Federal, State and local government offices....Actions to restrict or ban smoking at the workplace are supported by a large majority of both smokers and nonsmokers."
Weis, Kristein and others have found that smoking activity by employees increases costs in many areas. Some of these areas are:
Absenteeism: On average, smokers are absent 50 percent more often than nonsmokers. As long ago as 1974, Dow Chemical Company found that cigarette smoking employees were missing 5.5 more work days per year than their nonsmoking peers. Costs for these absences include temporary replacements and lowered productivity and morale among employees who are on the job and must cope with the absences.
Productivity: One has only to visualize the smoking ritual to realize the time lost by smokers. Add to that inefficiency and errors caused by higher CO levels in smokers, eye irritation, and lower attentiveness. Research is documenting lower productivity in smoking employees and increases in productivity when smoking is limited or banned.
Insurance: Additional health-care cost per smoker in this country is slightly over $300 per year in 1983 dollars, and this estimate is conservative. Some insurers, recognizing the differential in mortality rates between smokers and nonsmokers, are offering up to 45 percent discounts on premiums for term-life coverage for nonsmokers with medical examinations.
Incremental health insurance costs incurred on behalf of nonsmokers who must breathe the smoke in the workplace involuntarily are not a part of the considerations above. They represent another area of potential savings when smoking is either banned or restricted in the workplace.
Economist Marvin M. Kristein, Ph.D., of the American Health Foundation, found that smokers can cost employers an extra $45 per year for accidental injury and related workers' compensation costs. Smokers have twice the accident rate of nonsmokers due in part to loss of attention, smoking hand occupied, eye irritation, and cough. Researchers have estimated fire accident costs due to smoking to be $10 per year per smoker. Dr. Weis says that health and fire insurance premiums can be 25 to 35 percent lower for smoke-free businesses, and morbidity and fire statistics suggest that premium discounts should be as high as 70 percent. Disability and early retirement payments can be cut by as much as 75 percent. Up to three-fourths of the early retirements are probably coming from smokers, who comprise only one third of the work force. The propensity for smokers to become disabled and retire early is almost six times greater than for nonsmokers.
Ventilation: The American Society of Heating, Refrigerating and Air Conditioning Engineers notes that "higher ventilation rates are specified for spaces where smoking is permitted because tobacco smoke is one of the most difficult contaminants to control at the source." Requirements for outdoor air are two to three times greater when smoking is a factor, and filters must be cleaned or changed much more frequently.
Maintenance Costs: Employers who have banned smoking report dramatic decreases in the maintenance costs of their businesses. Building maintenance services are enthusiastic about the change in the amount of cleaning required. Furniture and drapes last longer and have to be cleaned less often. Many chores done on a monthly basis can be scheduled semiannually or annually.
Employers considering limiting smoking should consider the following points. If a collective bargaining agreement exists, consult with union officials. Introduce a thorough program of employee education on the dangers of workplace smoking; stress health effects on smokers and nonsmokers. Decide how the policy will be implemented--either smoking and nonsmoking areas or a totally smoke-free environment with a smokers' lounge or corridor and reasonable smoking breaks (10 minutes every two hours). Consider implementing smoking limitation in steps (e.g., begin by prohibiting it in conference rooms and common areas). Employer-financed smoking cessation programs are well-received and effective, as smokers who wish to quit may be further motivated by the new limitations. Above all, try to maintain an atmosphere of participation among all levels of employees.
While there are no guarantees that a smoking limitation policy will turn businesses around, once your firm establishes a policy, personnel and maintenance costs will decline; actual physical depreciation on furniture and equipment will slow substantially; insurance rates can be slashed through renegotiation for new fire, health, accident and disability coverage; employee morale will improve; and customers and clients will adjust, without adverse repercussions, to the new policy. In other words, it's good business.
Note: This leaflet, distributed as a public service, contains general information. If you have any legal problem related to smoking, you should consult an attorney who will advise you as to the law applicable in your jurisdiction.
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