The Iceberg Principle

Direct Costs

  • Workers' Compensation Costs Due to Temporary Income Benefits
  • Decrease in Employee Productivity
  • Medical Costs
  • Wage Costs for Substitute Employees
  • Insurance Premiums

Indirect Costs

  • Lost Time by Employees
  • Time Spent on Investigation by Supervisor/Management
  • Temporary Worker Training
  • Hiring Costs
  • Overtime to Make Up Production
  • Failure to Meet Deadlines
  • Damage to Tools/Equipment
  • Loss Of Good Will
  • Overhead Costs Due to Disruption
  • Downtime

Industry studies have shown that businesses face between $2 and $5 of indirect costs for every $1 of direct costs.