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Q: Drug and alcohol policy making. Cost and benefits ( Answered 5 out of 5 stars,   1 Comment )
Subject: Drug and alcohol policy making. Cost and benefits
Category: Relationships and Society
Asked by: josephltt-ga
List Price: $50.00
Posted: 12 Sep 2005 10:28 PDT
Expires: 12 Oct 2005 10:28 PDT
Question ID: 567187
I am on the way of preparing a proposal to convince my company's
management to draw up a drugs and alcohol control policy to overcome
the drug and alcohol abuse in our workplace. I need to find actual
cost and benefits of preparing and implimenting the drugs and alcohol
policy in the work place. I am looking for few examples (2-3)
medium/large company that had implemented and enjoy the benefit of
it(It is favorable to focus on the Australian company). Thank you.
Subject: Re: Drug and alcohol policy making. Cost and benefits
Answered By: aliciadenney-ga on 21 Sep 2005 13:19 PDT
Rated:5 out of 5 stars
Hello, and thank you for choosing Google Answers!

In researching this topic, I have come across several additional
resources which I believe may serve you quite beneficially in drawing
up this prospective controlled substance policy for your workplace. 
As I am sure you have already imagined, the legal ramifications of
such are numerous, but by taking certain precautions, mostly in the
vein of being WELL-READ, I believe that you will be able to combat
such possibilities effectively, and will in turn make your company a
happy camper!

To begin with, here are some seminal pieces of literature regarding
this topic, mostly on legislation and union issues:
Taken from the Alcohol Summit, this delineates several issues of
crucial consideration when it comes to developing a policy in your

Here are some good statistics you might want to throw into your
proposal...compelling, very compelling...
According to the Council of Alcohol and Other Drugs of Australia:
"The use of alcohol and other drugs has a significant impact on
Australian workplaces in terms of accidents, lost productivity and

"It is difficult to quantify the numbers involved, but certainly many
workers in Australia experience alcohol and other drug related
problems that result in absenteeism, poor work performance, ongoing
health problems, industrial accidents and significant losses in

"While the financial cost of alcohol and other drug related harm to
Australian industry is difficult to determine, total paid labour costs
for 1998-99 have been estimated at $5.3 billion (Collins & Lapsley

"The business sector is estimated to have carried a greater proportion
of costs related to the misuse of alcohol and other drugs than the
government sector, bearing":
?39% compared with 24% of the tangible costs associated with alcohol misuse 
?30% compared with 11% of the tangible costs associated with tobacco use 
?57% compared with 33% of the tangible costs associated with illicit
drug use (Collins & Lapsley 2003).

"Based on studies conducted between 1989 and 1992, the National
Occupational Health and Safety Commission has concluded that raised
blood alcohol levels appeared to contribute to at least 4% of all
Australian working deaths."

"The commission also found that alcohol had been consumed in
connection with work in 39% of these alcohol related deaths, either
during work hours or at work-sponsored functions (cited in Phillips

"Overseas research has estimated that between 3% and 15% of fatal workplace
 are related to drug and alcohol use (International Labour Office 1996)."


The issue is, there have been no recorded successful models of drug
policy implementation in Australia, but here in the US, the land of
propaganda, these examples are plentiful.  Consider these:

*One small plumbing company in Washington, D.C., the Warner
Corporation, saved $385,000 in one year by establishing a drug-free
workplace program that included EAP services. The company attributed
the savings to a decrease in the number of accidents, which resulted
in lower workers? compensation costs and lower vehicle insurance
premiums. Warner now has a waiting list of top-flight mechanics
wanting to work in its drug-free environment, saving the company
$20,000 a year on personnel advertising costs. Additionally, the
proportion of apprentices completing a two-year training course has
increased from 25 percent to 75 percent, resulting in annual savings
of $165,000.
(source: Working Partners: Substance Abuse in the Workplace. U.S.
Department of Labor. Washington, DC. 1994)

*In 1984, CSX Transportation, a freight railroad company, implemented
Operation Redblock, a response to widespread violations of Rule G,
which prohibits the use and possession of alcohol and drugs. The
program?s 4000 volunteers are trained to confront substance abusers,
and if appropriate, refer them to the company?s EAP. Since 1990, less
than one percent of the drug tests administered to safety-sensitive
employees have been positive.
(Source: "Keeping Score." Drug Strategies. Washington, DC. 1996)

*After implementing a comprehensive drug-free workplace program in
response to a workers? compensation discount law, W.W. Gay Mechanical
Contractors in Florida saved $100,000 on workers? compensation
premiums in 1990, and also has experienced increased productivity,
reduced absenteeism, and fewer accidents.
(DeLancey, Marci. Does Drug Testing Work?. Institute for a Drug-Free
Workplace. Washington, DC. 1994)

*Only four years after implementing a workplace substance abuse
program which included drug testing, Jerry Moland of Turfscape
Landscape Care, Inc., in Chandler, AZ, says that his company is saving
over $50,000 a year due to increased productivity, fewer accidents,
and less absenteeism and turnover.
(Source: Working Partners, ibid)
*According to the American Management Association?s annual Survey on
Workplace Drug Testing and Drug Abuse Policies, workplace drug testing
has increased by more than 1,200 percent since 1987. More than 81
percent of businesses surveyed in 1996 were conducting some form of
applicant or employee drug testing. Likewise, the perceived
effectiveness of drug testing, as assessed by human resources
managers, has increased from 50 percent in 1987 to 90 percent in 1996.
(Source: AMA Survey on Workplace Drug Testing and Drug Abuse
Policies." American Management Association. N.Y., New York. 1996)

*The Ohio Department of Alcohol and Drug Addiction Services conducted
a follow-up survey of 668 substance abuse treatment residents one year
after completing treatment. Findings indicated that absenteeism
decreased by 89 percent, tardiness by 92 percent and on-the-job
injuries by 57 percent.
(Source: Falco, M. The Making of a Drug-Free America: Programs That
Work. New York, NY. Times Books, 1994)

Unfortunately, josephltt, there are simply no examples of successful
Australian models available online.  If you would like, I can call
companies in Australia to see if they would be willing to disclose
this information.  For the time being, you have here at your disposal
several examples of American success with drug policy.

On the following link, you will find further fodder for your case:

I hope you have a sufficient amount of evidence provided here to help
you and your company implement a successful drug policy.  If not, ask
for clarification, and I will do my best to manifest Australian

Thank You!

Request for Answer Clarification by josephltt-ga on 03 Oct 2005 09:11 PDT
Hi mate, sorry for asking for clarification this late. i wish to find
out what are the cost of implement the programe? What are the
quantitative benefits. favorable in showing how much cost saving after
spending a sum. (cost of implement-cost of not implement= benefits)

Clarification of Answer by aliciadenney-ga on 03 Oct 2005 12:44 PDT
For your answer clarification, I am going to use the fees of OHS
Services (, as they are the biggest drug-testing chain in
the US.

According to their site, one must examine the cost of implementing a
drug policy as it relates to the cost of NOT doing so. The following
was written by
OHS, Inc. is a national company with drug testing clients in all 50
states, and we charge from a low of $25 per drug test to a high of
$65.  The "volume" of testing done by the client annually is the
primary variable which applies.  As with my competitors, a
substantially lower per-test price is offered  to a company doing
5,000 to10,000 or more tests annually than to a company doing only
500-1,000 drug tests...or only 5-10 tests each year.  Our cost for
"specimen collection" at the clinic we must use nearby the client's
location(s) also impacts the price (up or down) we ultimately charge. 
Those costs (the specimen collection, alone) vary around the country
from as little as $7 to as much as $35, although the national average
is about $16.

Today, I estimate that average price per drug test nationally overall
(large corporations and medium-sized  to very small businesses
included) is about $44 per test.  That includes cost of collection and
lab analysis, but not necessarily the cost of optional Medical Review
Officer (MRO) services which usually add about another $2-$3 per test.
 MRO services are required by federal law of companies testing
employees regulated by the U.S. Department of Transportation (big rig
truck drivers, airline pilots, oil/gas/pipeline workers, and so
forth).  Using an MRO is also required by state law in at least nine
states of all companies - including those that are not DOT regulated -
if they drug test their employees.

The cost of NOT implementing:
There are have been many such studies, from different sources
including government agencies, university studies, and non-profit
organizations.  All of them independently come up with quite similar
findings of workplace drug-users being "35%" or "33%" or "30%" less
productive...also resulting in poorer quality production of company's
products or services, and greater frequency of accidents, more
injuries, plus damaged-lost-stolen company equipment and supplies.

It is especially tragic that druggies at work who steal from their
company also tend to steal from their fellow employees-  their
co-workers.   Why?  They steal to help "supplement" the cost of their
drugs not offset by their employer's wages.  They also tend to
"recruit" other employees and try to "deal" drugs to them at a profit
for that same reason.

Druggies will always deny at least some of the foregoing, claiming
that they actually can work better, longer, and are "sharper" at work
due to their workplace drug-use.  They're wrong of course, and simply
in denial.  Mind-altering drugs (legitimately prescribed or illicit)
are called "mind-altering" for very good reason.


It is further broken down into a hypothetical situation here:
As our example, let's use a company with 100 employees.  (You can
later project this up or down  to a company with only "10" employees
or with 1,000, 10,000, or 100,000 employees.)

Using 100 employees as the number in our sample company, assume a 30%
annual attrition rate (resigned/fired/new hires added).  Assume an
"average" cost of $44 per each pre-employment drug test and per each
random drug test (industry standard is to always test "randomly" each
year at a test "rate" of 50% of the total number of employees).  The
same $44 cost per tests would apply to each "reasonable suspicion" and
"post-accident drug test, too.

Given the above example, there will be a total of 80 pre-employment
and random tests (30+50) performed for the company annually.   Then
assume another 10 drug tests annually are ordered as "post-accident"
and another 10 tests are ordered each year due to "reasonable
suspicion".  (Or, shuffle those numbers back or forth.  The point is,
"assume" another 20 drug tests annually, combined either for that
first reason or that second one).

So, to incorporate a solid and very highly effective, year-around
Drug-Free Workplace program, we are now at "100" total drug tests done
annually for the typical company with 100 employees.  At $44 per test,
that means the company is investing $4,400 per year in what would be -
I assure you - a very highly effective Drug-Free Workplace program.

Let me clearly define what I mean by, "very highly effective".  

In the first 3-4 months of newly-instituted random drug testing of
their employees, every company can normally anticipate (i.e.,
"expect") drug "positive" rates of at least 5% to as high as 22%. 
That's initially.

If it is a "construction" company, it would not at all be unusual that
the early positive rate will be as high as 18%-26% of all existing
employees who get tested.  And, if it is a "restaurant", they could
anticipate a positive rate perhaps as high as 12%-16%.  These two
industries (construction and food services) rank as number one and
number two in overall workplace drug abuse.  That is per actual stats
determined by national labs which do millions of drug tests annually. 
On the other hand, when testing employees at a secretarial service
word-processing firm or a department store, the anticipated "initial"
positive rate might be as low as 5%-7%.

When I assert that the Drug-Free Workplace program as in the above
scenario of a company of 100 (or "10", or 1,000 or 10,000) will result
in a "very highly effective" Drug-Free Workplace, I mean exactly this:

By the end of the first full year - at latest - the rate of drug
"positives" coming back on the lab reports will drop by 50% to as much
as 80%.  Drug positive rates of 26% will drop to as little as 5% and
positive rates of 5% will drop to as low as 1%.  That's "first year"
improvement.  Further, such dramatic improvement will certainly be at
the very least "maintained" - if not  bettered - in year two and
subsequent years as long as the a drug testing program such as I
described above remains steadfastly in place throughout the year. 
That means maintaining  pre-employment AND random AND reasonable
suspicion AND post-accident drug testing all year around!

So...what happens to those employees caught "positive"?  They get
fired and go to work at some other company that does NOT drug test. 
What about new employees replacing them?
Well, most individuals who "do" drugs don't even apply for an opening
at a company that advertises in the local paper's Help Wanted section
as a "Drug-Free Workplace".

Given the chance for a job at a company that does NOT drug test its
employees, druggies will almost always apply there instead!

Exceptions to that practice include drug-users who go "off" drugs for
a few days before job interviewing, so their system will be clean when
taking a "pre-employment" drug test.  And these "exceptions"
(drug-users that pass a pre-employment drug test) are one of the
primary reasons that  "random" testing and "reasonable suspicion"
testing and "post-accident" testing are all absolutely essential
elements in developing and maintaining a very highly effective
Drug-Free Workplace.)

Soon, the company that once had 100 employees that included a
half-dozen to two dozen people who "did" drugs in the workplace and
perhaps even "dealt" drugs in the workplace becomes a "Drug-Free
Workplace".  The result?  Company production increases and quality of
products and services improve...sick days are fewer, injuries
decrease, the number of Workers' Comp claims get reduced, the
company's Workers' Comp and health insurance premiums stabilize,
company equipment and supplies stop being damaged or disappearing as

There's even more reward than that.  A sometimes not considered
wonderful additional benefit to the now Drug-Free Workplace Company
comes with all of this, too: overall employee morale improves

Why?  Because, those employees who do not do drugs usually know
"which" employees do.

Non-drug-users will not usually "squeal" on drug-users to management. 
But deep down, they resent having to work harder or longer each day to
make up for the production slack the drug-user causes.  They resent
the constant mistakes druggies make that require constant help in
correction.  Non-drug-users resent the double-duty workdays they must
incur because their drug-using co-worker frequently calls in sick as a
result of having gotten so buzzed at home the previous night. 
Drug-users drag down employee morale.  Believe it.

In fact, a 1998 national study by the United States Chamber of
Commerce found that more than ninety-percent (>90%) of employees ARE

That, of course begs the question:  "WHY" DOES THE OTHER PERCENT OBJECT? 

I suggest that the answer - for the most part -  is not on the grounds
of any personal "philosophical" or "moral" or "constitutional"
principles they might hold dear.  A few objectors likely have those
high-principled "reasons", I'll concede.  However, I suggest that the
majority of those who object to employee drug testing represent
employees who "do" drugs in the workplace...and they want to continue
doing (and perhaps "dealing") drugs without hindrance.

Another item on the plus side of ?reasons? for corporate drug testing
is this:  more than 40 U.S. states will consider denying Workers? Comp
benefits to an injured employee whose injury was caused while positive
on illicit drugs (i.e., the best reason for a company always requiring
a ?post-accident? drug test).

Additionally, more than 40 states will consider denying the payment of
unemployment benefits if the employee was terminated for illicit drug
use (i.e., the best reason for a company always requiring a
?reasonable suspicion? drug test whenever such suspicion reasonably
exists).  Even the smallest companies can save thousands of dollars
each and every year by diligently doing these type of drug tests when
the circumstances dictate the need!

Finally, let's look a bit more closely at the average $4,400 annual
outlay that a company of 100 likely needs to invest to reach this
point we've brought them to, i.e., a solid, very highly effective,
year-around drug testing program.  Based on 365 days, the hard cost of
drug testing for the company dilutes to only $12.05 per day.  That's
for the entire company.  With 100 employees, that's about twelve cents
($0.12) per day per employee...or, less than one-half the cost today
of making a local call from a street corner payphone.
Looking once again at "multiple separate studies done by various
government agencies, universities and other organizations"...they have
all concluded that EACH druggie in the workplace can cost an employer
an AVERAGE of $11,000-$13,000 annually (although one study reported
the dollar amount averaged ONLY "$8,000" annually each).

Eight to thirteen thousand dollars?  How on earth?  The
answer...production losses, work quality deficiencies, increased
health and injury issues, more frequent sick days, damaged equipment,
and other problems workplace drug-abuse causes were already enumerated

But in addition to deteriorating product quality and customer service,
you can add missed deadlines with a company's customers?and with it,
an ever-increasing negative customer satisfaction.

Unfortunately, customer dissatisfaction is one growth-sapping
byproduct of workplace drug abuse that a company often will not even
realize - nor ever identify as the culprit - until it is too late to
save the company from recurring, spiraling losses.  Sometimes, it?s
even too late to save them from going completely under-  out of
business.  Bottom line: in the short run AND in the long run,
workplace drug testing does not cost at all.  It pays.

Edward W. Poole
OHS Health & Safety Services, Inc.
d.b.a., Health-Tests DIRECT)
1835 Newport Boulevard, Suite D-258
Costa Mesa, California  92627 USA
949.764.9301 ext. 205 1.800.456.4.OHS (647)
Fax: 949.764.9306 and 949.764.9307

This same group will even write your policy for you:

The Fifteen Essential Elements of a Successful Policy:
1. Prepare a written "Drug-Free Workplace" Policy for your legal
protection, copy it to all employees; have the acknowledgment of their
review and understanding of it signed and dated by them and placed in
their personnel file.
2. Post "We Are a Drug Free Workplace" or similar signs in the parking
gate entrance, the entrance to your building and/or the lobby, the
coffee room, and above the employee time clock.  (The law in two
states actually requires conspicuous posting of this type.)
3. Circulate substance-abuse prevention education materials (e.g.,
pamphlets/videos) to all supervisors, managers, and other employees
once annually; a short 'reminder' notice of your Drug-Free Workplace
company policy - and perhaps some drug-abuse facts - should be
included inside pay envelopes at least once per calendar quarter.
4. Perform pre-employment drug testing on every new hire.  Those
testing 'positive' for drugs should have their employment offer
immediately rescinded no matter how qualified they might otherwise
appear to be for the position and no matter how badly you need to fill
the position!
5. Include this statement in ALL your help wanted ads:  "Employment
subject to passing a drug test.", or, "We drug test all new hires.",
or similar notice.  (Laws of four states require from 10 days up to 60
days notice be given to an employee prior to beginning a drug test
program.  Call us at 1-800-456-4647 x 205 if you need more information
about this.)

6. Post "We Drug Test to Keep Our Company a Drug-Free Workplace" or
similar signs prominently for all job candidates to clearly see at the
entrance and inside ALL hiring offices.

7. "Randomly" drug test (laws permitting) at least 50% of your
employee base annually.  Depending on the number of employees you
have, perform random testing at least once monthly or every week. 
OHS, Inc. routinely provides computerized random "selections"
quarterly, monthly, or weekly for all clients who test randomly. 
Industry experts agree that on-going random testing is the single-most
effective deterrent to on-going workplace drug-abuse.

8. Test an employee for "reasonable suspicion" whenever reasonable
cause is justified by virtue of their display of any performance,
behavioral or physical "indicators" of drug-use.

9. Arrange substance-abuse awareness training for every one of your
supervisors and managers at least once per year.  Such training will
help them to identify the 'indicators' of drug-use among their crew
and teach them the most effective methods of isolating and preventing
a possible drug-use related workplace problem before it becomes a
crisis for your company.  OHS can arrange such training for your
supervisors and managers through an instructor who will visit your
location(s), or, we can arrange "E-Training" (at much lower cost) for
your management people "on-line"-  via the Internet.  (Annual
drug-abuse "awareness training" of company supervisors and/or all
company employees is required by law in four different states.  OHS,
Inc. provides such training nationwide.  CLICK HERE for a description
and pricing of this specialized training.  Call us at 1-800-456-4647 x
205 if you need more information about this.)

10. "Post-accident" drug test an employee whenever justified by
serious injury, damaged/loss of property, or life.

11. Use ONLY federal/state certified labs for the analysis of all
specimens that are sent to a lab.  (Laws in five states and in one
U.S. Territory require that all elements of a company drug testing
program - including the choice of testing lab - strictly follow U.S.
Department of Transportation guidelines.)

12. Have all specimens that initially test "positive" (including those
based upon results of so-called "on-site" drug test devices or 'kits')
re-tested by a certified's called "confirmation" testing.

13. Utilize the services of a Medical Review Officer (MRO) for all
positive results.  CLICK HERE to learn more about how essential a MRO
is to the credibility of the workplace drug testing process and
fairness to the employee.

14. Ensure that all test results of employees are kept strictly
confidential!  Inform ONLY those with a "need to know" of final drug
test results; maintain ALL results with strict security.

15. Impose ALL terms of your company's written testing policy
strictly, fairly, and equally with ALL employees-  do not engage in
favoritism, and make no exceptions.

Here is a specific example of a cost-benefit breakdown:

The Company The Warner Corp., Washington, D.C.; a 50-year-old
plumbing, heating, and air-conditioning repair company with revenues
of $16 million and 220 employees

The Program Instituted in 1985; based on regular drug testing through
urinalysis. A positive test calls for mandatory discharge.

The Cost An estimated $12,000 per year

The Return An estimated $385,000 per year, resulting from decreases in
workers' compensation claims, vehicular accidents, auto-insurance
premiums, absenteeism, and training costs for new employees

In fact, I think you should read the whole article, as there are
several specific examples of precisely the information you seek. 
Please, read!

If I am able to track down specific Australian companies with
successful programs, i will post such as commentary.

For a view from the other side:

I hope this is what you need in order to push for your company to
develop an effective program!

Thanks again for choosing Google Answers!
josephltt-ga rated this answer:5 out of 5 stars and gave an additional tip of: $5.00
Thanks for your help~!! Much appreciated.

Subject: Re: Drug and alcohol policy making. Cost and benefits
From: aliciadenney-ga on 03 Oct 2005 11:56 PDT
Hey there!
No problem in requesting a clarification--that's why we're here!

I am working on your clarification, but in the meantime, I came across
this which would be of great use to you and your employer in the
development of this proposed policy:
It's a drug policy builder! :)

More soon.

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