Determinants of Occupational Health and Safety Compliance by Malaysian SMEs

Occupational safety and health (OSH) are a critical component of effective business governance. Efficient management of occupational safety and health fosters potential for growth and sustainability, and conversely. Disregarding occupational safety and health negatively impacts all stakeholders, from individual workers to national healthcare systems. This indicates that stakeholders can benefit from enhanced OSH compliance via consistent approaches. The primary principle of global OSH compliance is the mitigation and reduction of accidents, incidents, and diseases. A comparable viewpoint is relevant for small and medium-sized firms (SMEs), including those in Malaysia. This study investigated the factors influencing OSH compliance among Malaysian SMEs using a quantitative research methodology. The impact of five critical determinants: top management support, human resource practices, training and education, organisational attitude, and organisational awareness, on the attainment of OSH compliance was evaluated, drawing from literature support. A survey was done utilising convenience sampling with 400 SMEs in Malaysia. Data was gathered from 380 responding SMEs and examined using structural equation modelling (SEM) with partial least squares (PLS). The statistical findings indicated that human resource practices, organisational attitudes, and organisational awareness were key predictors of occupational safety and health compliance in the sampled Malaysian SMEs. The significance of administering OSH focused human resource policy, particularly the HR practice of endorsing safety and related training programs, has facilitated enhanced support for OSH training programs and employee awareness. The findings indicated that SMEs’ practice of displaying hazardous warning signs and promoting incident reporting has resulted in improved occupational safety and health compliance. The level of SMEs’ awareness regarding the necessity to review standard operating procedures before initiating work, safety information related to hazardous materials, understanding the risks associated with chemical substances, and the segregation of waste materials prior to disposal has facilitated effective OSH compliance among the participating SMEs. The investigation yielded multiple implications derived from the results obtained.

DOI: https://doi.org/10.59857/IJABS3019