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How to Calculate a Severity Rate

All employers should have a high regard for the safety of their workers, in part
because accidents involving workers reduce productivity and hurt the company's
bottom line. In addition, federal regulatory agencies require that companies in certain
industries keep extensive records of accidents in which workers are injured or unable
to perform their duties. A company's severity rate describes the extent of the injuries
its workers suffer in terms of the number of days lost due to injury and the number of
incidents reported.

Lost Work Days

Workplace accidents can leave employees out of work for days, weeks or even
months. The severity rate for workplace injuries uses the number of lost work days as
its first point of comparison. A lost work day equals the number of hours an
employee loses due to injury, multiplied by the number of hours in a standard
work day. For instance, if a worker loses 28 hours of work due to injury, and the
standard work day is 8 hours, the number of work days lost due to the injury is 28/8, or
3.5 days.

Total Hours Worked

Safety managers can calculate the total hours worked by adding the number of hours
worked by all employees across a specific branch or department, or over the entire
company. For example, Fictional Construction has 50 full-time employees who work
40 hours per week for 50 weeks a year, and 40 seasonal employees who work 25
hours per week for 12 weeks a year. The total number of hours worked for Fictional
Construction is (50x40x50) + (40x25x12), or 100,000 = 12,000, or 112,000.

Calculating Severity Rate

The severity rate is based on a company that has 100 full-time employees working
2,000 hours per year, for a total of 200,000 man hours per year. This measurement
lets government regulators and safety agencies assess companies of different sizes
on an equal footing. For instance, Fictional Construction reported 70 lost work days
due to accidents in 2014. The number of lost hours based on 100 full-time employees
would be 70 x 200,000, or 1,400,000 lost hours per 100 employees. The severity rate
is measured by taking the lost hours and dividing it by the number of hours worked.
The severity rate for Fictional Construction would be 1,400,000/112,000, or 12.5 days
per incident.
Uses for Severity Rate
The severity rate helps managers assess the dangers inherent in their workplaces. If
the severity rate is low, then the average accident leads to a minimal disruption in
production. When the severity rate is high, managers will see that an average safety
incident can lead to major production losses. At Fictional Construction, an average
accident leads to a worker being out for 12.5 days, or 2.5 work weeks at five days per
week. High severity rates can lead to loss of business, employee dissatisfaction and
scrutiny from government agencies such as OSHA.