11 Tips To Using The Incident Rate Formula In Your Business

Posted 12.11.21 by:

An incident rate formula is a powerful tool that managers can use to understand their business’s incident rates better. This article will briefly review the incident rate formula and offer several benefits to applying this formula within an organization. Then detail 11 tips managers can benefit from following for utilizing this powerful tool.

The incident rate formula is one that you can apply in multiple industries to understand incident rates better, and the benefits of applying it far outweigh any obstacles managers may see. Companies using this incident management tool are finding success in everything from effective incident investigation to improved risk mitigation for future work.

Let’s briefly review the incident rate formula. We will offer several key reasons why companies should implement its use within their organization. We will also detail 11 tips for how managers can best utilize the power of an incident rate calculation within their company culture. Then we’ll conclude with a summary of what makes this powerful little equation so valuable across industry lines.

What Is The Incident Rate Formula?

(Number of Injuries and Illnesses X Gross Possible Total Work Hours) / Employee Actual Hours Worked = Incidence Rate

  • Number of Injuries and Illnesses – The total of injuries and illnesses (non-fatal)
  • Gross Possible Total Work Hours – The total number of hours your team will work in a year if no lost time occurs. Example: 40 staff who work 40 hours per week for 50 weeks of the year (52 weeks in the year minus 2 weeks vacation) have a GPTH (gross possible total hours) of 80000.
  • Team member Actual Hours Worked – Including the annual total of hours employees actually worked gives us an idea of time off due to illness. It doesn’t consider additional days taken off due to natural illnesses like those staff who call in sick to work. However, it is still a strong indicator of the overall health of your workforce. (source)

Why Use The Incident Rate Formula

Managers who decide to incorporate an incident rate formula into their business toolsets are starting with numerous advantages when investigating incident rates.

Identify Trends To Support New Projects Pre-Emptively

Managers can identify trends in incidents across divisions and calculate the risk involved in a project before it is even started through a carefully developed incident rate calculation. 

Improve Decision-Making Accuracy

Organizations using this tool are able to track incident rates over time with accuracy that improves decision-making processes when planning for future work or possible projects by better-identifying risks throughout their organization’s history.

Gain Perspective

Incident rates are essential for many companies to understand the efficiency of their operations. For example, if a company has an incident rate that is too high, it could indicate potential opportunities for improvement or malfunctioning equipment. On the other hand, incident rates that are too low might indicate over-capacity in certain areas, which can lead to reduced efficiencies and slower production times.

There are two main benefits any organization should consider when looking into applying the incident rate formula within its processes: 

A higher incident rate indicates there may be room for operational improvement. A lower incident rate means equipment is operating more efficiently than usual.

11 Tips For Managers To Implement And Use The Incident Rate Formula In Their Organization

Don’t Pass On Using Metrics.

Apply incident rate formula to identify trends in incident severity and frequency.

Set Clear Definitions

Set clear incident severity definitions to the workforce in training and during performance reviews. Ensure they understand how incident severity can change depending on internal or external factors, such as weather conditions causing a power outage at an organization with multiple locations across various country regions.

Ensure that your staff follows incident management protocols before entering data into the company incident recording platform, so all information is captured about each incident correctly.

Use IRF Data To Develop Safety Initiatives

Use information from incident analysis reports when developing new safety initiatives or training programs throughout your business. Ensure employees are aware of these changes and how they can be beneficial to them and the company overall.

Gather As Much Information As You Can

When using trend data from the formula, ensure you have enough data points before making decisions based on statistical significance. The more observations there are over time, generally speaking, the better chance we can draw accurate conclusions about what is really going on.

Compare Your Numbers. 

Look around at other businesses in your industry. What do they do? How are they reporting incident data back to management? Not only should you examine other companies in your industry, but you can use reported data from the OSHA to better understand how your organization lines up to industry averages.

Here’s a link to the OSHA statistics you can use for comparison purposes with your IRF (incident rate formula):

Click Here For The OSHA Statistics Page

Involve Team Members In The Formula Calculation Process

Use the incident rate formula to involve multiple employees in incident analysis – this will help create buy-in, improve morale, and it’s also an excellent opportunity for managers to develop their people.

Involving team members in an incident reporting framework is not without its challenges. This fact becomes apparent when trying to convince staff to buy into reporting incidents like near misses. Often the fear of reprisal will outweigh team members’ desire to report a near-miss. 

This lack of reporting specific and potentially staff-induced hazardous situations is one of the most significant challenges to including staff in the overall incident reporting process. That’s why it is so crucial to increase your team member’s involvement in the process right from day one.

Don’t Be Afraid To Get Assistance.

If you aren’t confident about using the incident rate formula, get assistance from your Safety Manager or someone very familiar with incident management processes. Having an outside perspective can be invaluable!

Steve Jobs of Apple once said, “It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do.” The truth behind this statement is what makes some of the most successful organizations on the planet as successful as they are. Never fear getting help from experts. (source)

Include Metrics Like Cost To Your Metrics

Be sure that when reporting incident data back to senior leadership/management, you include relevant information related to incident severity (i.e., cost of injuries). You should include both frequency AND seriousness to have total visibility into what is happening within your business.

Understand The IRF

Be sure you understand the incident rate formula (IRF) and how it works before deciding whether or not you will use it within your organization. Just bookmark this guide to help guide you through understanding using the formula to analyze your business.

Click Here To See The 2020 Incident Rates By Industry (OSHA)

Use Numbers Over Time

Consider using this formula as a way to identify trends related to incident severity over time so that your business can improve its incident management efforts to drive down incident rates.

Go Digital For Incident Reporting

Use a digital reporting system that provides reports within the platform. Having a mobile form automation app to analyze your incident data and provide reports is crucial to cross-reference with your incident rate formula calculations.


The incident rate is a statistical measure that can be applied to various industries with incident management as the primary focus. The incident rate formula measures the number of incidents over a particular timeframe and is used in incident analysis where complex problems are being addressed. There are many benefits to using the incident rate formula, including an increased prediction of future incidents, improved risk management practices with incident recovery strategies, and reduced costs with techniques involving prevention or recovery.

By using our tips above, your ability to implement and manage the IRF formula within your incident reporting regiment will be well-positioned for success. If you include using a mobile form automation application for your incident reporting like the 1st Reporting App, try it today to see how it can significantly affect your business reporting efficiency.

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