Prevention System Updates

GHS cost/benefit analysis promises big savings

Release Date:  Sep 15, 2014

Converting the existing Workplace Hazardous Materials Information System (WHMIS) to the Global Harmonized System (GHS) will yield benefits of almost $400 million over 20 years, states a regulatory impact analysis statement published in the Canada Gazette. A share of these benefits will result from fewer personal injuries, acute and chronic illnesses, and fatalities.

WHMIS is a Canadian system for classifying hazardous workplace products and communicating information to people using the products via labels, training and material safety data sheets (MSDSs). It helps ensure workers understand the hazards posed by chemicals they work with and other essential information. Canada's transition from WHMIS to GHS, a global system, will likely take effect in about two years.

The statement estimates the cost of reclassification and training at $286 million over 20 years. However, these costs will be more than offset by benefits of $687 million.

Where savings will occur

Here's a breakdown of estimated savings for workplaces that use hazardous chemicals:

  • $3.4 million annually from easier and faster updates of safety data sheets (SDSs) and labels, starting in 2019 and beyond
  • $82.1 million annually in productivity and health and safety benefits, starting in 2017.

The analysis also identified savings opportunities for exporters and importers:

  • exporting — eliminating the cost and time involved in reclassifying and relabelling workplace hazardous chemicals leaving Canada, and the need for retesting and reclassification of products due to differences in classification criteria between systems
  • importing — eliminating the cost and time involved in reclassifying and relabelling workplace hazardous chemicals coming into Canada. These costs can discourage companies from marketing their products in Canada. Alternatively, companies pass the costs on to Canadian distributors and, eventually, purchasers.

The savings could be significant. According to Industry Canada, Canadian chemical manufacturers exported $24 billion to the U.S. alone in 2013. The industry also imported $28 billion worth of chemicals from the U.S.

Learn more about the transition to GHS

These WSPS resources can help you prepare:

Find out more about the expected impact by downloading the regulatory impact analysis statement.