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Injury Cost Estimator (Direct + Indirect)

A workers' compensation claim is the part of an injury you can see on an invoice. Enter that figure, the number of injuries and your profit margin, and this calculator applies the indirect cost ratio from OSHA's $afety Pays sliding scale, then works out how much additional revenue it takes to earn the whole amount back.

$
The workers' compensation claim: medical plus indemnity. Your carrier's loss run has the figure, incurred or paid.
Injuries of similar cost. Run the calculator once per kind and add the totals, as OSHA's own worksheet does.
%
Net profit as a percentage of sales. Three percent is a common figure in construction; use yours.
Leave at 0 to use OSHA's sliding scale. Enter a figure only if you have measured your own indirect costs.

Rates and totals are calculated only from the numbers you type, so they are only as good as your OSHA 300 Log. This page is not an OSHA form, is not submitted to anyone, and does not decide whether a case is recordable — that follows 29 CFR Part 1904 and, in a State Plan state, your state's own rule. Nothing you type is sent to our servers.

OSHA's sliding scale

The indirect cost of an injury is not a fixed percentage. OSHA's $afety Pays program multiplies the direct cost by a ratio that falls as the claim grows, taken from the Business Roundtable publication Improving Construction Safety Performance and a study by the Stanford University Department of Civil Engineering.

Sliding scale of direct and indirect costs — OSHA $afety Pays
Direct cost of the claimIndirect cost ratioA $1 claim therefore costs
$0 – $2,9994.5$5.50
$3,000 – $4,9991.6$2.60
$5,000 – $9,9991.2$2.20
$10,000 or more1.1$2.10

The ratio multiplies the direct cost, it is not a share of the total: at 4.5, indirect costs are four and a half times the claim, and about 82 percent of what the injury really costs. OSHA states the reason plainly — the magnitude of indirect costs is inversely related to the seriousness of the injury.

What the indirect cost covers — and what it leaves out

Included in the ratio
  • Wages paid to injured workers for absences workers' compensation does not cover
  • Wage cost of the work stoppage the injury caused
  • Overtime made necessary by the injury
  • Administrative time of supervisors, safety and clerical staff
  • Training a replacement worker
  • Lost productivity: rescheduling, learning curves, accommodating the injured employee
  • Clean-up, repair and replacement of damaged material, machinery and property
Not included
  • OSHA fines and any associated legal action
  • Third-party liability and legal costs
  • The worker's pain and suffering
  • Loss of good will from bad publicity
  • The workers' compensation premium a claim pushes up for years afterwards — outside OSHA's list, and rarely the smallest of them

OSHA adds one more thing worth repeating to a finance department: indirect costs are usually uninsured, and therefore unrecoverable.

Why this page has no “injury type” menu

OSHA's own estimator has one — a list of average claim costs by injury type, from amputation to sprain. Those averages are supplied by the National Council on Compensation Insurance, from lost time workers' compensation claims for policy years 2015 to 2017, and OSHA's disclaimer states that NCCI's data may not be used or copied except in conjunction with OSHA's tool. So you will not find that table here, and you should be wary of the many sites that reproduce it.

If you want an average by injury type, run OSHA's $afety Pays estimator directly. If you have your carrier's loss run, use it here instead: OSHA's own worksheet offers exactly that alternative at step 1 — enter the total workers' compensation costs — and your real claim beats a nine-year-old national average every time.

Making the case with the number

The figure that changes minds is not the cost, it is the sales. At a three percent net margin, a $63,000 injury has to be earned back with about $2.1 million of additional revenue — roughly $33 of sales for every dollar of cost. Put that next to what the control would have cost and the conversation moves on its own.

  • Show the method, not just the total. Direct cost, the ratio you applied, where the ratio comes from, and the list of costs it excludes. A number someone can check persuades; a large one they cannot check does the opposite.
  • Use your own margin. Three percent is common in construction, but a specialty trade at eight percent and a general contractor at two get very different answers from the same claim.
  • Pair it with the rates. A cost per injury and a TRIR answer different questions; together they say what the year cost and how often it happened. The cases that carry the cost are the ones in your day counts.
  • Then go upstream. The prevention argument only lands if it names the hazard. That is what a job hazard analysis on the task produces, and OSHA's free On-site Consultation Program will help a small business build the program around it at no cost and separately from enforcement.

How it's calculated

Total direct cost
total direct cost = direct cost of one injury x number of injuries
Step 4 of OSHA's $afety Pays worksheet. The direct cost is the workers' compensation claim — medical plus indemnity.
Indirect cost ratio (sliding scale)
direct cost $0–$2,999 → 4.5 · $3,000–$4,999 → 1.6 · $5,000–$9,999 → 1.2 · $10,000 or more → 1.1
The scale $afety Pays uses, from the Business Roundtable's Improving Construction Safety Performance and a Stanford University Department of Civil Engineering study. The ratio falls as the claim grows: the less serious the injury, the higher the ratio of indirect to direct costs.
Indirect cost
indirect cost = total direct cost x indirect cost ratio
Step 5. Note that the ratio multiplies the direct cost — it is not a share of the total.
Total cost
total cost = total direct cost + indirect cost
Step 6.
Additional sales needed to cover the total cost
sales = total cost x 100 / profit margin (%)
Step 8. At a 3% margin, every dollar of cost takes about $33 of extra sales to earn back.
Additional sales needed to cover the indirect cost alone
sales = indirect cost x 100 / profit margin (%)
Step 7. This is the part insurance does not reimburse, so it is the part that comes straight out of the margin.

Frequently asked questions

Direct costs are the workers' compensation claim — the medical treatment and the indemnity paid to the worker. Indirect costs are everything else the injury sets off: wages paid for absences workers' compensation does not cover, the wage cost of the work stoppage, overtime caused by the injury, supervisor and clerical time, training a replacement, lost productivity while work is rescheduled, and cleaning up or replacing damaged material and equipment. OSHA lists exactly those seven in the background notes to its $afety Pays program.

With a sliding scale applied to the direct cost: a claim under $3,000 is multiplied by 4.5, a claim of $3,000 to $4,999 by 1.6, a claim of $5,000 to $9,999 by 1.2, and a claim of $10,000 or more by 1.1. The ratios come from the Business Roundtable publication Improving Construction Safety Performance and a Stanford University study. They fall as the claim grows because the fixed disruption an injury causes — the stopped crew, the paperwork, the retraining — weighs much more heavily against a small claim than a large one.

Because the indirect costs do not scale with the medical bill. A hand laceration that costs $1,500 to treat still stops the crew, still takes a supervisor half a day, still needs someone else trained onto the task — so the indirect side dwarfs the claim. A $200,000 claim carries the same kinds of disruption, but they are small next to the medical and indemnity cost. OSHA states the relationship plainly: the magnitude of indirect costs is inversely related to the seriousness of the injury.

Because a cost is not paid out of profit, it is paid out of sales. If your net margin is 3 percent, a $63,000 injury has to be earned back with about $2.1 million of additional revenue — the arithmetic is cost multiplied by 100 and divided by the margin. That is the number that makes the case to an owner or a client, and it is the number OSHA's own estimator is built to produce.

OSHA's estimator offers one, built on average claim costs supplied by the National Council on Compensation Insurance from lost time claims for policy years 2015 to 2017. OSHA also states that NCCI's data may not be used or copied except in conjunction with OSHA's own tool, so those figures are not reproduced here. Use OSHA's estimator if you want an average by injury type; use this page with the real claim cost from your carrier's loss run, which OSHA's worksheet accepts as the alternative input and which is closer to your actual experience anyway.

Four things OSHA names: the cost of OSHA fines and any associated legal action, third-party liability and legal costs, the worker's pain and suffering, and loss of good will from bad publicity. There is a fifth that shows up later — an experience modification rate that rises after a claim raises every workers' compensation premium for years. None of that is in the number this page returns, so treat the result as a floor.

No, and the two systems do not line up. Recordability is decided by 29 CFR 1904.7 — death, days away, restricted work or transfer, medical treatment beyond first aid, loss of consciousness, or a significant diagnosis. Compensability is decided by state law. A case can be recordable with no claim filed, and a compensable claim can fall outside the recording criteria. OSHA prints the point on the log instructions themselves: listing a case does not mean the case is eligible for workers' compensation, and it does not mean anyone was at fault.

That is what the arithmetic is for, and it is the argument OSHA built the program to support — but keep the claim honest. This is a cost estimate with a stated method and named limits, not a return-on-investment model. Present the direct cost, the ratio you applied and where it comes from, the sales figure, and the list of costs the ratio leaves out. A number someone can check is far more persuasive than a large one they cannot.

Sources & references

Content checked against these sources — last reviewed August 28, 2026.

By — Editorial team of SteelToeTools.com (published by LSEA SAS) Updated v1