Business Insurance

Implementing a Drug-free Workplace Program

health insurance

By Todd Anderson, HR Director

Did you know . . . 
  • 60 percent of the world’s production of illegal drugs is consumed in the United States.
  • Nearly 70 percent of current users of illegal drugs are employed.
  • Nearly one in four employed Americans between the ages of 18 and 35 have used illegal drugs.
  • One-third of employees are aware of the sale of illegal drugs in their workplace.
  • Twenty percent of young workers admit to using marijuana on the job.
  • For those companies who routinely conduct random drug testing, the number of positive tests has increased over 40 percent in the past five years.

Consider this: 

The number of large businesses that have drug-free workplace programs in place today is 90 percent, while only 5 to 10 percent of small and medium-sized businesses have implemented similar programs. The irony is that about 75 percent of employed Americans work for these small and medium-sized businesses.
The Cost: Substance Abuse Adversely Affects Your Balance Sheet
Even though many employers choose to ignore the problem, substance abuse in the workplace has a real impact on their bottom line. Substance abuse drains more than $100 billion from American businesses every year in the following areas:
  • Workers Compensation Costs: 38 to 50 percent of all workers compensation claims are related to substance abuse in the workplace; substance abusers file 3 to 5 times as many workers compensation claims as non-abusers.
  • Medical Costs: Substance abusers incur 300 percent higher medical costs than non-abusers.
  • Absenteeism: Substance abusers are 2.5 times more likely to be absent 8 or more days a year.
  • Lost Productivity: Substance abusers are 1/3 less productive than non-abusers.
The Solution: A Drug-Free Workplace Program
It is Good for Employees. 
Employees are more productive and have better morale when their health and safety are protected from the increased dangers and risks that substance abusers present in the workplace. Workers will appreciate your concern for their health, safety, and well-being. Employers are looking for responsible, mature, motivated employees. These people are drawn to companies who care about their employees and the work environment.
It is Good for Employers. 
In most states, the covered employers choosing to participate in this voluntary program may be entitled to the following:
  • They may receive a premium credit on their workers compensation insurance policy.
  • The discharge or discipline of an employee who is found to be in violation of the employer’s drug-free workplace program will be considered done for cause and void the employee’s claim for unemployment insurance.
  • If an employee suffers a workplace injury and receives a positive confirmed post-accident drug test for illegal use of drugs or alcohol, or refuses to submit to a post-accident drug or alcohol test, the burden of proof is shifted to the employee.
Preparing Your Drug-Free Workplace Program
1) Plan and develop your drug-free workplace program carefully.
  • Talk to employees and supervisors about the benefits of a drug-free workplace. Stress the positive aspects of a drug-free workplace. Case studies show a well-planned program to reduce substance abuse can increase productivity, reduce accidents, and avoid increased costs due to insurance claims related to substance abuse.
  • Listen to employees’ ideas. Ask for their input: “We are going to implement a drug-free workplace program. What suggestions do you have for us as we do this?” Compliance with any change in company policy requires the understanding and acceptance of all employees. If your employees are represented by a union, the development of the policy will be a part of the collective bargaining process. A firm, compassionate program will help to provide a healthy and safe workplace for everyone.
  • Establish a relationship with a third-party organization. These organizations can coordinate the collection process, provide employees with the proper Fair Credit Reporting Act (FCRA) paperwork, and oversee the process.
  • Make sure you have the full support and participation at the highest levels in your organization. If senior management is not fully supportive, this program will fail miserably. If you implement a random testing procedure, for example, make sure employees know that everyone, including senior management, is participating.
2) Consider the resources available to you. Determine the best way to provide each of the following: 
  • An Employee Assistance Program (EAP) for workplace substance abuse treatment. If you do not currently have an EAP program, you may wish to contract with a designated treatment provider.
  • A workplace substance abuse recognition training program for supervisors.
  • A workplace substance abuse education/awareness program for all employees. Your EAP contact or a local substance abuse counselor can generally provide this training.
3) Adopt a substance abuse policy as part of your company’s policies and procedure manual. 
  • The policy should expressly prohibit the illegal use of drugs and/or abuse of alcohol by any employee and spell out the consequences of policy violations.
  • Distribute the policy to all employees and post notifications of your drug-free workplace program. Place notices in prominent locations throughout your business facilities as well as on your employment applications. All employees must be given a copy of your substance abuse policy and sign a drug and alcohol testing consent form.
  • Educate your employees and supervisors about the program. Hold a meeting for all employees – labor and management – to explain the value of maintaining a drug-free workplace. Try to answer all questions and make yourself available to meet privately with employees to discuss any concerns they may have.
  • Maintain the momentum of your program by making a long-term commitment to have a drug-free workplace. This cannot be a “flavor of the month” initiative. In order for it to be successful, it must become part of your “corporate DNA.” Ultimately, your program will have a greater impact when everyone involved clearly understands that your company is serious about addressing the problems caused by substance abuse in the workplace.
Contact your Leavitt Group advisor for more information.
The coverages discussed herein are for illustrative purposes only. The terms and conditions of your specific policy may differ from those described. Please consult the provisions of your policy for the terms, conditions, and exclusions that apply to your coverage.