Why do companies decide to manage hazards in the workplace? Is it to avoid OSHA liability? To save money on workers’ compensation? To attract and retain workers? This is the question that a study from the RAND Corporation sets out to answer. First published as a student's doctoral dissertation in 1998, the study analyzes data from a survey of 2,000 members of the National Federation of Independent Business. Here are some of the findings:

• Decisions about hazard abatement are driven more by internal variables such as the size of the enterprise and riskiness of its operations than by external factors like fear of liability and the desire to reduce workers’ compensation costs;
• The bigger the firm, the more likely it is to spend money on hazard abatement;
• The riskier the firm's industry, the more likely it is to spend money on hazard abatement;
• Changes in OSHA policies and the fear of inspections have limited impact on management decisions about whether to spend on safety; and
• Among external influences, financial incentives under workers' compensation are far more effective than fear of OSHA.

SOURCE: Sims, "Hazard Abatement as Function of Firm Size," RAND Graduate School, Nov. 1998, http://www.rand.org/pubs/rgs_dissertations/2008/RAND_RGSD227.pdf

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