Published on April 6th, 2016 | by Brooks Hitchcock


The Real Cost of Substance Abuse for Employers

Running a business, any kind of business, requires first and foremost, revenue, followed closely by employees that are responsible enough to carry out the daily business operations and truthfully report earnings, issues, and incidents. Just because you have trustworthy employees and a solid revenue stream, however, does not protect you or your business from unwanted and unforeseen liability expenses. These expenses can range from minimal to highly expensive, and can be caused by a vast array of issues ranging from product or service issues to workplace injuries (workman’s compensation).

One factor that continues to play a big role in workplace expenses is substance abuse. Substance abuse by employees, either on or off the job, can lead to injury and workplace accidents; affect the health and productivity of your workers, and make a negative impression on your customers, which directly affects your business. What’s more disturbing is that studies have shown that more than 70% of substance abusers are working part- or full-time jobs, contrary to the popular belief that drug users can’t hold a job or function in day-to-day activities. Let’s take a look at some of the biggest costs employers tend to experience as a result of substance abuse, and how they affect the business overall.

Major Workplace Expenses

  1. Absenteeism

On average, substance abusers and drinkers are absent from work about five days out of the month. That means that these workers absent 3-8x more often than the average worker that doesn’t abuse substances or drink more than one alcoholic beverage a day.

  1. Decreased Productivity

According to the Small Business Administration, substance abusers are more than 30% less productive on the job than their drug-free coworkers. This lack of productivity not only affects other employees, but it can also result in costly expenses for the employer or company.

  1. Workplace Accidents

Workplace accidents are up to 3.6 times more likely to occur among substance abusers than those employees that do not abuse drugs or drink alcohol. This means a much higher chance that you will have to file a workers compensation claim on behalf of said employees.

  1. Work Performance Problems

On top of absenteeism and less productivity, employees that drink or abuse drugs, either on or off the job, are also more likely to report problems related to their work performance.

  1. Workplace Theft

Theft is definitely not limited to only those who abuse drugs or drink alcohol, but these factors definitely contribute to the rate at which theft occurs in the workplace. In fact, some studies have found that up to 80% of drug users reported having stolen from their employers.

  1. Medical Costs

Substance abusers are also more likely to file claims on their workplace benefits for illnesses or injuries. In the event of an injury, a workman’s compensation claim can also be filed, which could cost even more for the employer.

  1. Higher Turnover Rate

Employees that abuse drugs and alcohol are also far more likely to have a higher turnover rate, meaning they tend to move from job to job much more frequently than the average worker. Substance abusers will tend to work for three or more employers in a given year, are much more likely to quit, or skip out on workdays.

  1. Workplace Violence

Violence in the workplace and among employees is also much more likely to occur with workers that abuse drugs or alcohol. Substance abuse is, in fact, the third leading cause of workplace violence among employees.

  1. Workplace Fatalities

In some industries, particularly those dealing with heavy, complex equipment, workplace fatalities can also be attributed to alcohol and substance abuse. Abuse of such substance actually comprises up to 40% of workplace or industrial fatalities.


Alcohol and substance abuse are very serious matters that continue to affect the mainstream American workforce. Drinking among workers can pose a threat to public safety, result in costly social and medical expenses, and impair job performance and productivity, in some cases costing more than $100 billion a year. Clear and consistent workplace substance abuse policies and drug training and education among employees can significantly reduce costly workplace expenses and improve productivity and customer service across the field. Be sure you are taking the time to invest in a drug education and compliance program for your business in order to avoid such expenses happening to your business.

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