The Business Case for Workplace Alcohol Prevention

Workplace alcohol abuse need not be accepted as an inevitable cost of doing business.

• By Barry Knott
• Oct 01, 2012

Our workplaces and roads are safer now than they have been in two generations. Reported worker deaths in America declined 29 percent from 6,632 in 1994 to 4,690 in 2010.¹ During the same period, total traffic related deaths fell by 20 percent, from 40,716 to 32,708.² The progress on both fronts is impressive considering the growth of the American workforce and the increase in the number of licensed drivers over the past several decades.

Less impressive is the progress made in reducing the proportion of alcohol-related workplace and traffic fatalities. Forensic evidence collected by the National Highway Traffic Safety Administration (NHTSA) shows that alcohol-related traffic fatalities as a percentage of total traffic fatalities have improved only modestly, from approximately 41 percent to 38 percent, between 1994 and 2010.² Alcohol also remains the third-leading cause of preventable deaths in the United States behind tobacco use and poor diet/lack of exercise.³

One of the few workplace studies conducted in this area, not surprisingly and not coincidentally, suggested that 40 percent of all industrial fatalities (and 47 percent of industrial injuries) are also linked to alcohol consumption.⁴

The 40 percent linkage to alcohol in both workplace and road fatalities is strong evidence that alcohol abuse is pervasive. Forty percent is also a powerful statistic to impress upon management, safety professionals, and our workforces the extent of the problem and the corresponding opportunity for improvement. Workplace alcohol abuse need not be accepted as an inevitable cost of doing business.

How Does Your Industry Fare?
The percentage of heavy alcohol varies use across major occupational categories, including the Manufacturing, Service, and Public Administration categories. "Heavy" was defined in a SAMHSA study as drinking five or more drinks at the same time or within a couple of hours of each other on five or more days in the past 30 days.⁵

Consumption varies considerably by industry and by establishment size. The highest percentage of workers abusing alcohol were found in establishments of less than 25 employees (9.7 percent), while organizations of 500 or more employees had the lowest worker abuse (6.8 percent).⁶ Clearly, smaller organizations have the greater opportunity for improvement. Small firms are perhaps less likely to have an employee alcohol policy, proactive alcohol education, and EAP programs in place. Firms without substance abuse programs tend to attract those with substance abuse problems, further driving their numbers. At the same time, the results from the large organizations also leave considerable room for improvement.

Alcohol versus Illegal Drugs
Alcohol is by far the most widely used drug in the United States. Estimates are that 11 percent of workers have a problem with alcohol.⁷ The International Labor Organization estimates that 3 to 5 percent of the average workforce globally is alcohol dependent, and up to 25 percent drink heavily enough to be at risk of dependence.⁸

According to the National Institutes of Health, in 1998, alcohol abuse alone cost American businesses roughly $86.3 billion in lost productivity due to alcohol-related illness and death. Of the total $185 billion economic costs of alcohol abuse cited in the study, less than 1 percent was spent on alcohol prevention programs and training.⁹

While the illegal use of drugs gets most of our collective attention, alcohol abuse is the greater driver of harm and cost in the workplace. The economic cost to society from both alcohol and drug abuse was estimated at $246 billion in 1992. Alcohol abuse and alcoholism alone cost an estimated $148 billion, while drug abuse and dependence cost an estimated $98 billion.¹⁰ A similar Canadian study reported that in 2002, the estimated cost of alcohol abuse was $14.6 billion in Canada and the cost of drug abuse was approximately $8.2 billion.¹¹ Workers with alcohol dependence or abuse outnumber workers with substance dependence/abuse (including marijuana) by a factor of almost 3 to 1.¹²

Do You Have a Drug and Alcohol Testing Program?
Twenty-nine percent of the 1,058 HR professionals reporting in a 2011 cross-industry survey by DATIA (the Drug and Alcohol Testing Industry Association) do not have pre-employment or post-employment drug testing programs.¹³ The chart below shows the reasons given by this group for not conducting testing. Only 2 percent of those not currently testing plan to do so in the future. The responses reinforce the need for more compelling communications to business owners and managers on the business case for drug testing. The responses also hint at the "can't be bothered" attitude that substance abuse professionals sometimes encounter.

My organization does not believe in drug testing: 24%
Not required to do drug testing by the state: 18%
No return on investment: 16%
Too costly: 16%
Not applicable/not necessary: 11%
Administratively difficult: 7%
Planning to conduct drug testing in the future: 2%
Other: 5%

Alcohol Abuse and Productivity
The benefits of workplace alcohol programs are most often summarized in order of greatest benefit as increased productivity, reduced costs, greater employee retention and better morale, job satisfaction, and employee retention. On-the-job alcohol abuse and heavy drinking outside the workplace significantly affect worker productivity as a result of absenteeism, accidents, poor job performance, disability, and premature death.

While it is commonly observed that the vast majority (70 percent-plus) of problem drinkers are employed, it does not follow that most of the negative outcomes are primarily from chronic drinkers. Greater productivity losses may come from occasional alcohol abusers because their numbers are so large. A 2006 national survey indicated that work-related impairment directly affects an estimated 15 percent of the U.S. workforce. From the survey results, it was estimated that 2.3 million workers drink before work, 8.9 million workers drink during work hours, and 11.6 million workers come to work with a hangover.¹⁴

There's no substitute for the basics in addressing alcohol abuse in any workplace:

• Have and enforce an alcohol policy. There is considerable variation in the existence and enforcement of alcohol policies in workplace, in employees' awareness of them, and in their enforcement.
• Restrict alcohol availability. You might be surprised at how easy is it for employees to bring alcohol into the workplace, to drink at workstations, and to drink during breaks. Late shifts with minimal supervision are even more vulnerable.
• Good work practices lessen the chances of on-the-job drinking. Workplace stress, boredom, and isolation have been observed to contribute to employee alcohol abuse, as have sexual harassment, verbal abuse, and unprofessional behavior.

Medical Costs
It is well known that heavy alcohol use contributes to many medical problems and increases the chances of unintentional injury both on and off the job. Problem drinking by a family member also can contribute to negative outcomes in the workplace.

American businesses absorb much of the health-related costs of heavy drinking in the form of higher health insurance premiums for employees and their families. In the 2011 DATIA study referenced earlier, 14 percent of organizations reported high workers' compensation incidence rates prior to implementation of drug testing programs, whereas only 6 percent of organizations reported similar rates after implementation, a decrease of better than 50 percent.¹³

Most states offer workers' compensation discounts in the range of 5 percent to employers upon certification as a drug-free workplace. Progressive insurance companies may offer similar discounts.

A majority of states allow an insurance company to deny workers' compensation benefits to employees who test positive for alcohol (and drugs) following an accident, provided the employer has a workplace substance abuse program in place allowing it to arrange for post-accident testing.

The Morning After: Hangover and Withdrawal
The two main factors behind hangovers are dehydration and the toxic effects of ethanol in the body. Dehydration can be short term, but only time can reverse the toxic effects of alcohol. Alcohol-induced sleep may not be restful and can lead to the fatigue that often accompanies hangover.

It can take up to one hour for the body to rid itself of the alcohol in just one standard drink. A late night of heavy drinking can easily find the reveler in the morning with a BAC over the legal limit. Even modest alcohol impairment combined with a lack of sleep makes for a deadly combination on the road and possibly at work. Early studies into the effects of hangovers on work performance "concluded that hangovers are a significant contributor to job performance problems, yet discussions of alcohol's impact on the workplace rarely recognize the costs of hangovers."¹⁵

Hangovers affect cognitive and motor functions. Cognitive problems include poor concentration, possibly leading to slower work speeds, poor judgment, and mistakes. Tiredness and feeling ill frequently lead to sick days, late arrivals, long lunches, early departures, and falling asleep on the job. Employees with alcohol problems are also more likely to spend work time on non-related work activities. Impaired motor skills can cause accidents and injuries, which in safety-sensitive positions can endanger the lives of work associates and the public.

Alcohol misuse is a leading cause of disciplinary procedures.¹⁶ In a 2007 UK survey, one-third of workers admitted to being hung over on the job; 15 percent had been drunk at work, and 10 percent reported having a hangover at work at least once per month.¹⁷ It is not unusual for employees to admit to having covered for someone suffering from a hangover or correcting mistakes they have made. The "hangover cost" to employers is sustained through reductions in the quantity and quality of work and indirectly through the impact on company morale and job satisfaction.

The Holiday Party
Alcohol at work celebrations can be well-intended but an expensive mistake. In some states, social host laws can find the company responsible if an employee drinks too much at the company social event and then injures himself or another person. Employers also need to be concerned that they may be facilitating sexual harassment.

If you are planning to serve alcohol at a company sponsored event, then follow some basic rules:

• Check your insurance to see whether it covers third-party liquor liability.
• Have and enforce a drink limit. Serve food. Have plenty of soft drinks available.
• Have the party outside the office in premises with licensed servers.
• Ensure your employees know your alcohol policy and that it covers office parties.
• Consider limiting drinks to a specific number of pre-issued drink tickets.
• Arrange for designated drivers or free taxi rides home for any employee desiring or needing such.

Driving Under the Influence
Employers, especially those with large driving fleets, recognize vehicle crashes as the leading cause of occupational fatalities in the United States.¹⁸ Contributing factors include fatigue, stress, extended hours, prescription drug use, and alcohol consumption. Employers without fleets and not subject to DOT regulations often perceive a DUI as an "off the job" problem and not part of the employer's business. However, employers often pick up the consequences of DUI in medical costs, work loss, higher insurance, a reduced workforce pool, and concern about the company's reputation.

Opportunities for improvement in this area include:

• Establish a driver safety program at work. An excellent starting point is the whitepaper "Guidelines for Employers to Reduce Motor Vehicle Crashes," a joint effort by NETS, NHTSA, and OSHA to reduce motor vehicle-related deaths and injuries in the nation's workforce. (http://www.osha.gov/Publications/motor_vehicle_guide.pdf)
• Increase employee knowledge of the personal and employer cost of road crashes. Focus on drunk driving because of its large role in on-the-job and off-the-job road crashes.

This article originally appeared in the October 2012 issue of Occupational Health & Safety.