Flawed basis for OHS decision-making 6

Most strategic plans made by OHS regulators in Australia are based on workers’ compensation statistics.  Everyone agrees that this is a huge underestimation of the work-related injury and illness rates but no one yet has tackled this information deficiency.

Australia’s OHS harmonisation might attempt this but it will not be until the government harmonises the States’ workers’ compensation system that Australians can have unified and consistent statistics.  Yet even then, the reliance on workers’ compensation data will continue to understate the significance of work-related injuries on the community.

The Australian inaction contrasts to activity undertaken in the United States by the Government Audit Office (GAO).  An October 2009 report by the GAO, released online on 16 November and discussed in blogs and one US newspaper, shows the state of OHS statistical play in the US through its audit of the operations of the Department of Labor’s Occupational Safety and Health Administration.

  • OSHA only audits 250 of the 130,000 high hazard worksites each year.
  • All of the data available is provided by employers.  Workers are not interviewed.
  • If the worker has left the company’s employment, they are unable to be interviewed.
  • “OSHA also does not review the accuracy of injury and illness records for worksites in eight high hazard industries because it has not updated the industry codes used to identify these industries since 2002. “
  • Statistics supplied to the Bureau of Labor Statistics by employers are not verified. (BLS is not required to do this)
  • The GAO identified disincentives on both employers and employees for reporting illnesses and injuries – potential job loss, fear of increasing workers’ compensation premiums or losing out on work contracts.
  • The disincentives may lead to a reduced medical treatment so as to avoid injury reporting and the issues associated with the reporting. (A third of health practitioners interviewed admitted to being pressured about workplace injuries)

On this last point, those OHS professionals who advocate safety incentive schemes may wish to consider the graphic below

Pressure From Workers to Downplay Injuries and Illnesses and Awareness of Incentive Programs

Of the 47% who said they were pressured to downplay injuries and illnesses, over 60% were from workplace s that had incentive programs.  This is a serious statistic that incentive advocates must address in their programs.

Australia has tried to gain greater accuracy to OHS data over many years.  The (then) National OHS Commission published several very useful statistical reports into various industries but they could not provide an easily understood national picture because of State variations on reporting criteria.  Australia is much less complex than the US and the task of achieving better OHS statistics should be easier, as long as there is the political will.

The importance of accurate statistics in decision-making at the policy level as well as that at individual workplaces cannot be overstated.  The GAO report summarises the significance in its report.

“Accurate injury and illness records are important because they assist Congress, researchers, OSHA, BLS, and other agencies in describing the nature and extent of occupational safety and health problems.  These records are also vital to helping employers and workers identify and correct safety and health problems in the workplace.  In addition, these records help OSHA evaluate programs, allocate resources, and set and enforce safety and health standards.  Without accurate records, employers engaged in hazardous activities can avoid inspections because OSHA bases many of its safety inspections on work-related injury and illness rates.”

Kevin Jones

My thanks to Workplace Professor Blog for bringing the report to our attention.

Australian AGMs mention workplace deaths 1

Australia’s corporations are busy releasing their annual reports in October 2009.  The outgoing managing director and CEO of Boral Limited, Rod Pearse, provided his comments on the company’s safety performance to shareholders on 28 October 2009.

“Since demerger [January 2000], Boral’s safety outcomes have delivered steady year-on-year improvements and compare well with both ASX100 and industry benchmarks. Employee lost time injury frequency rate of 1.8 and percent hours lost of 0.06 have both improved by 80% since 2000 and are better than those of our competitors in like industries and in the top quartile of companies in the ASX100.”

Boral is, according to the executive statements, “a resource based manufacturing company with low cost manufacturing operations.” More…

Nice comparison on Directors’ complaints 3

In the Australian Financial Review in October 2009  there was an opinion piece (not available online) from the CEO of the Australian Institute of Company Directors (AICD), John Colvin, expressing concerns about the accountability of directors under legislation including the proposed OHS laws in Australia.

According to a report by Adam Schwab in the Crikey newsletter of 23 October 2009 (also not freely available online), Colvin wrote in the AFR:

“There are more than 660 state and territory laws which impose personal liability on individual directors for corporate misconduct. That is, a director is liable because he is a director, even when he may not have had any personal involvement in the breach…”

Schwab writes

“The AICD noted, the NSW courts have taken a hard-line enforcing the deemed liability laws.  According to AICD data, between 2004 and 2008, 144 company directors were found guilty of OHS offences, of which 115 of those prosecutions occurred in NSW.”

Schwab then provides a comparison of risk that I wish I’d thought of:

“That means the proportion of directors convicted over these so-called onerous laws is 0.0068%.  To compare, there is roughly a 0.04% chance of someone being struck by lightning.  Therefore, based on the AICD’s own data, company directors are six times more likely to be hit by lightning than to be prosecuted.  It also shouldn’t be forgotten, directors’ liabilities are almost always covered by indemnity insurance and most prosecutions result in a mere financial penalty.

While the NSW OHS laws result in occasional harsh results, to extrapolate one set of allegedly ill-advised laws across the country is much like a cry of wolf.”

This perspective will be an important one to remember when considering the submissions being lodged with Safe Work Australia on the OHS model laws by 9 November 2009.   The corporate submissions particularly but also those from the OHS law firms that spruiker the exposure of company directors ruthlessly whenever OHS and accountability is discussed.

Some of us remember the “glory days” when industrial manslaughter was widely considered in some Australian States. (There is a noticeable absence of controversy of the industrial manslaughter law that is operating in the Australian Capital Territory)

Also important is the point that Schwab makes about indemnity insurance for Directors and Officers, a matter that has been discussed elsewhere in SafetyAtWorkBlog.

The amount of “get-out-jail-free” options available for directors should encourage more attention to alternative, non-financial penalties for breaches of OHS law.  Over the last 24 hours the United States has been talking about replacing executive cash remunerations with stocks so that director’s incomes are reliant on the share price of the corporation which, in turn, relates to the quality of leadership from the director.

As long as Australia’s principle OHS penalties involve money, directors can buy their way out of trouble.  If Australia’s Prime Minister, Kevin Rudd, can face an entire country and apologise for the bad behaviour of others, and the bad policies of other governments in relation to the interaction with indigenous peoples, why should company directors not have a similar obligation when their poor management of a workplace kills someone?  If corporate executives are that keen on leadership, let’s see them apply some of the leadership that Rudd showed, and accept responsibility when they should.

Kevin Jones

Comcare’s RTW performance has some worrying trends Reply

RTWMatters, an Australian return-to-work website, has analysed some of the data that has been released through the annual data – Aust & NZ RTW Monitor.  The statistics show that the Australian Government’s workers’ compensation insurer, Comcare, has performed well on some performance indicators but others are raising concerns, particularly

  • “The cost of claims has risen from $15 000 in 2005-06 to almost $20 000 in 2008-09. This is substantially higher than the national average.
  • Around 1/3 of Comcare workers can identify a person who made it harder to RTW, which is higher than the national rate. Over the last three years there has been a significant increase in Comcare employees reporting their employer has hindered return to work.
  • Over the last two years, Comcare workers have found it increasingly difficult to find the information they need to make a claim.
  • Comcare workers rated their insurer customer service lower than the national average, with communication, advice about the claim and understanding the situation rated lowest.”

Paul O’Connor, at last week’s Comcare Conference in Canberra was very upbeat but was well aware of the challenges ahead particularly for the next five years during a period when the Australian government will attempt to harmonise the OHS laws in each jurisdiction.  It should be noted that Paul has been Comcare’s CEO since 1 September 2009.  He was formerly with the Transport Accident Commission in Victoria.

O’Connor quoted the Australian Finance Minister, Lindsay Tanner, during his conference presentation.  (The Tanner quotes are from August 2009)

“It is unlikely that we will see any major reform in this area in the near future, as Australia’s various governments are grappling with the challenging task of building uniform national industrial relations and occupational health and safety systems.

“Nevertheless, the current campaign for a national catastrophic injury compensations scheme should trigger a wider debate about injury compensation in our society generally. The present system is fragmented, inequitable, inefficient and arbitrary. Reform could be some time coming but it’s certainly long overdue.”

RTWMatters has identified that more groundwork is going to be needed in the lead-up to the reform process if any measurable improvements are to be achieved.  In their media statement, they say

“Real collaboration requires that all stakeholders be able to access information to assess the impact of legislative and systems changes on workers compensation and return to work outcomes.”

The road to reform that Geoff Fary described as very difficult will be an important one to watch.

Kevin Jones

[Kevin Jones is a feature writer with RTWMatters]

Alarming statistics on young workers and compensation 1

Safe Work Australia has issued some important statistical reports on workplace injury statistics.  One statistic, in particular, stood out:

“…young workers aged 15 to 24 incurred much higher rates of injury than other age groups and were the least likely to apply for workers compensation”

The injury statistic is not surprising and is consistent with other data but why are young workers “least likely to apply for workers compensation”?  Are they unaware of their rights?  Do they work in a situation where claiming compensation is taboo?  Is illiteracy a deterrent?  Has their employer deterred them from applying?  Is their type of work illegal, casual, or in the black market?

SafetyAtWorkBlog asked Safe Work Australia, if not through workers compensation, how are young people funding their medical/rehabilitation costs.  A spokesperson provided the following non-age specific response:

“We are unable to provide an answer to this question as the data has not been analysed separately by age.

However, the last section of the report on workers’ compensation applications shows the various forms of financial assistance that all injured workers used.

For all injured workers, 34% received workers’ compensation, 39% did not access any financial assistance (these were mostly injuries involving no time lost from work) and the remaining 27% did access some form of assistance. Within this latter group regular sick leave was the most common.

Of the injured employees who did not access workers’ compensation, 18% used their regular sick leave, 9% accessed Medicare or other social security benefits, 7% had costs paid by their employer, 5% used other resources such as money from family and friends while 4% access private health insurance or income protection insurance.

Respondents to the survey could select more than one response to this question.”

Inverting some of these stats raises some concerns. (Please note that statistics is not the strongest skill of SafetyAtWorkBlog, so please correct any issues through the comments section below).

For all injured workers, 66% did not receive workers compensation. This should be a big red flag to OHS regulators and deserves more analysis.

Of the 66% over half  (57%) funded their injuries without recourse to health insurance, sick leave, employer contributions, support from family or friends, Medicare or social security.  Expanding the young worker question above to workers generally, how are these injured workers funding their rehabilitation from outside the regulated and social support mechanisms?

Some years ago SafetyAtWorkBlog attended an international conference on OHS.  There were many people at this Melbourne conference who spoke about the Asian and African countries where injured workers must rely on family, or other social security mechanisms, for an income, as workers’ compensation was non-existent.  This is one element of  economic integration into the Asian region that Australia should not be tolerating.

A spokesperson for Safe Work Australia told SafetyAtWorkBlog (read slowly as there are numbers involved):

“The survey estimated that 689,500 workers were injured at work during 2005-06. Of these, 625,900 were employees and hence eligible for workers’ compensation. However, 388,100 did not apply for compensation and 23,800 applied but did not receive compensation.

This means that 66% of injured employees did not receive compensation. While this equates to 60% of injured workers not receiving compensation it is not correct to use this figure as 12% of workers were not eligible for it.

Looking only at the 411 900 injured employees who did not apply for workers’ compensation

  • 75,700 accessed regular sick leave
  • 30,100 had their employer pay their costs
  • 35,500 used Medicare/social security
  • 18,200 used private health insurance/ income protection insurance, and
  • 18,700 accessed money from other sources such as family and friends.

Please note that when looking at these figures that 42% of injuries involved no time off from work and hence costs would be very small.

Analysis of additional data from the survey, that has not been included in this round of reports shows that over 60% of injured workers aged 15 to 24 felt their injury was too minor to claim or that they felt it was not necessary to claim. This is double the percentage for all workers. While this may sound like young people had more minor injuries, this is not the case. Young workers had the same proportion of injuries that involved no time off work as the workforce as a whole and the same proportion that involved longer periods of time off from work.”

The last paragraph cycles this article back to the start.

….over 60% of injured workers aged 15 to 24 felt their injury was too minor to claim or that they felt it was not necessary to claim. This is double the percentage for all workers.

There is something missing from how OHS is promoted to young workers.  The quote above indicates that young workers know about OHS but do not understand OHS.  But that’s not something that can be provided in a 30 minute TV ad, a medium that young people are increasingly less interested in.

Perhaps, we should be spending less time telling people not to stick their hands in a guillotine and more time empowering them in their workplace rights.

Kevin Jones

Injuries cost business 6% of their profit 7

At The Safety Conference in Sydney in October 2009, Dr Ian Woods, a senior research analyst for AMP Capital Investors, will advise Australian employers that the cost of workplace injuries on their businesses could be around 6% of their profit.

According to a media release in support of the conference

Dr Woods signals three occupational health and safety costs of concern to investors: workers’ compensation premiums, indirect costs, and the costs of alleviating workplace incidents.

“The indirect and unbillable costs associated with workplace injuries are like an iceberg,” he says.  “They represent a huge percentage of the total cost that’s impossible to assess until you run into trouble.”

“The disruption to production caused by workplace injuries cost Australian businesses an estimated $490 million in 2000-01.  The extra administration cost another $360 million.  Incidents can also trigger loss of goodwill, strikes, recruitment issues and dozens of other immeasurable costs.  The United Kingdom’s Health and Safety Executive indicated that the cost of uninsured losses is 10 times the business cost of insurance premiums paid for the same period.

“An injury with $1,000 in direct claims costs will also bring about $5,000 of indirect costs.  Assuming a 5% profit margin, that equates to $100,000 of turnover.  This simple return on investment (ROI) illustrates how valuable preventive measures are to financial bottom lines.

“Still, there is more to investing than just the economic case for improving OH&S performance.  As well as the economic costs, inequality of benefits, costs and suffering are key issues.”

Some of the concepts sound familiar.  Around the turn of the century there was increasing interest in corporate social responsibility and ethical investments and OHS was mentioned regularly as a corporate element that investors would seriously consider.

A good example of the feeling at the time can be seen in a 2002 interview for SafetyAtWork magazine, Paul Gilding of ECOS Corporation* talked about workplace safety.  He was asked about linking workplace safety with sustainable business.

Pages from Safe Companies Ecos Corporation March 2002 coverPG: This is a real fascination for us.  We first came across workplace safety as a major issue for one of our clients, DuPont, where safety culture is so embedded in their business that you can’t walk into their offices without picking it up.  We realised that, as sustainability experts, we had hardly ever come across that issue.  The people who talk about sustainability also talk about corporate social responsibility, human rights in developing countries, climate change, biotechnology, ethics, every issue you could think of but they very rarely, except in a token way, talk about workplace safety.

We first thought why should this be a sustainability issue and then we thought why wouldn’t it be?  We’re talking about the way corporations behave, the effect they have on society, the effect they have on the community they work in, yet we’re not talking about the fact that they are killing and hurting their own people.  This is a surprising omission when it is so fundamental to sustainability.

This perspective has transformed into the widespread advocacy of “safety culture”.

2i14-3 horstAround 2001 Westpac Banking Corporation was developing an OHS index that measured the share performance of the top 100 companies.  Interest in this has faded over the last ten years to such an extent that it is difficult to locate any reference to it.  However, the Westpac index was discussed at many OHS conferences at that time and gained overseas attention as shown in these comments by the former Director of EU-OSHA, Hans-Horst Konkolewsky to Safety At Work magazine in 2001. [Full interview is available]

Q: One of Australia’s major banks, Westpac, is establishing an OHS index that shows relations between this index, the All Ordinaries share index and a company’s share performance. Have you seen this sort of thing in the European region?

HHK: We haven’t seen it explicitly. This bank has taken the lead. I saw on my way to Australia that there seems to be an F4 investment initiative to assess companies’ performance but more broadly with environmental performance, social performance, child labour issues, but also safety and health.

This is one of the many ways we can improve awareness and create a preventive culture starting through the investment area. In Europe, we have had quite a number of different approaches where companies have issued social statements or accounts where they have informed about their employees’ satisfaction with their work, working conditions, customer satisfaction with servicing, their relationship to the society, activities related to employment problems and so on. There are a number of examples that point in the same direction.

I must say that I believe that this can be a rather strong movement if investors and customers, through their demands and market mechanisms, can improve safety and health.

A capital-idea coverA more detailed report that places OHS strongly within the CSR discipline is a 2002 report, now available through an Australian Government website, called “A capital idea -Realising value from environmental and social performance“.

Dr Wood’s presentation will build on these reports and the work of overseas OHS organisations in trying to provide a cost estimate for workplace injuries.  Let’s hope that there are specifics and that there is enough audience enthusiasm to generate a sustainable interest.

Kevin Jones

* cannot verify that this report is still available online

SafetyAtWorkBlog gets praise for independence Reply

Today, the Australian Chamber of Commerce and Industry (ACCI) released a four-page document criticising the campaigning techniques and statistical foundation of the Australian Council of Trade Unions (ACTU).  Nothing unique in that ideological battle, however, what grabbed our attention was that SafetyAtWorkBlog is mentioned specifically.

ACCIBriefing_8Sep2009 coverI contacted the ACCI this morning and thanked them for reading the blog and for describing SafetyAtWorkBlog as a “respected website”.  We’ll accept praise from anyone as our major indicator of success mainly comes from the steady increase in our readership statistics.

The ACCI makes considerable mileage out of a SafetyAtWorkBlog article that discusses the survey results that the ACTU released in support of some of its campaigning for further changes in the national OHS laws that are currently being drafted.

Several comments are useful in relation to the ACCI paper

SafetyAtWorkBlog obtained the survey results by requesting them through the ACTU and being provided them by Essential Media.  We have a policy on any media releases that quote statistics.  If the statistics are not readily available, or at least the relevant OHS parts of survey results, we do not usually report on the issues raised or we make a point of stating that the statistical assertions are not able to be verified.

The ACCI paper echoes many of the points raised in the blog article.  Our main point was to question the wisdom of using statistics as support for a campaign when the statistics do not, necessarily, support the  campaign objectives, or, in the least, may provide alternative interpretations.

The Essential Media report provided to SafetyAtWorkBlog could have been more detailed and the ACCI certainly wants more than we have seen.  Releasing such a paper criticising the ACTU for not sharing research data puts the ACCI in a position now where it cannot deny the public release of its research data, at least, on matters relevant to OHS.  The questions from ACCI have set a precedent for openness and information sharing.

Whether marching in the streets in support of an OHS campaign is effective, or warranted, or not is almost a moot point.  Many of the televisions stations covered the union marches in Australia earlier this week.  The 7.30 Report felt there was enough of a profile raised by the union campaign that it followed up many of the concerns raised with a long article in its show on 8 September 2009.  The media exposure has been able to further raise the profile of OHS as a contentious issue that is being acted upon by government.  It should raise the “seven out of ten” OHS awareness factor, quoted by the ACCI, a few points at least.

Given the criticism of the ACTU, one could genuinely ask, how the ACCI is increasing awareness of OHS matters in the community as well as its membership?  It is not expected out in the streets but the occasional media release or four-page rebuttal does not have the same affect as a march of hundreds of people on the television.

In all of this to-ing and fro-ing, SafetyAtWorkBlog takes pride in its independence and as a forum for expressing views on a social and industrial issue that has only ever before been discussed by political ideologues from fixed perspectives.

Perhaps safety professionals could apply the wisdom of Oscar Wilde to safety

“The only thing worse than being talked about is not being talked about.”

It seems to me that OHS has not been talked about for far too long.

Kevin Jones

NZ proposes new exposure levels on formaldehyde Reply

The New Zealand of Department of Labour is continuing its negotiations on new exposure levels for formaldehyde.

The latest proposed exposure levels for formaldehyde are 0.3 ppm (8 hour TWA) and 0.6 ppm (STEL).  Currently the levels in New Zealand are 1ppm (ceiling).

According to US OSHA, it’s exposure standard is


TWA: The employer shall assure that no employee is exposed to an airborne concentration of formaldehyde which exceeds 0.75 parts formaldehyde per million parts of air (0.75 ppm) as an 8-hour TWA.


Short Term Exposure Limit (STEL): The employer shall assure that no employee is exposed to an airborne concentration of formaldehyde which exceeds two parts formaldehyde per million parts of air (2 ppm) as a 15-minute STEL.

WorkSafe BC says

BC‘s current 8-hour TWA of 0.3 ppm is well below levels capable of causing adverse health effects and protects the worker from the pungent, unpleasant odour of formaldehyde.

NZ DoL is also discussing dropping there exposure levels for soft wood dust from 5mg/m3 to 1mg/m3.

The cancer risks of formaldehyde have been investigated over some time and the weight of evidence shows that this chemical is a probable human carcinogen.

Kevin Jones

Meditation is a proven stress reduction method for workplaces 3

Meditation is not on the regular agenda at SafetyAtWorkBlog.  If there was time to meditate, the time would probably be spent losing weight in the gym but there is fascinating research that provides some evidence of meditation’s benefit  in reducing work-related stress.

At the Safety Conference in Sydney at the end of  October 2009, Dr Ramesh Manocha of Sydney’s Royal Hospital for Women will release research that

“found that after eight weeks of mental silence meditation training called sahaja yoga, occupational stress scores improved [decreased?] 26 per cent.  A non-mental silence relaxation program reaped a 13 per cent gain, while a waiting list control group lifted just 1 per cent.”

The language sounds slightly “new-age” but what makes the difference in this circumstance is that the initial research was undertaken with three groups mentioned above and, importantly, with a control group.

Below is a TV interview with Dr Manocha on the first stage of research.

When looking at workplace stress, people reduce stressors but Dr Manocha says this often requires impossible organisation restructuring due to internal political pressures.  These techniques can be applied on a personal level that employees can take with them through their various life-stages.

Dr Manocha then applied the meditation training in real corporate situations.  According to a media release provided in the lead-up to the conference:

“In a later field trial of mental silence meditation by 520 doctors and lawyers, more than half of the participants whose psychological state (K10) scores indicated they were “at risk” were reclassified as “low risk” after two weeks of meditation.”

It’s the application of this meditation in the workplace context that gained the attention of  SafetyAtWorkBlog and what will be presented at the conference.  The gentle skepticism evident in the TV interview above is understandable but in a time when safety professionals demand evidence, we must look seriously at evidence when it is presented.

More information on The Safety Conference is available HERE.

Kevin Jones

Australian Statistics – Part 4 – Shiftwork 3

Safe Work Australia has released four statistical reports into worker health in Australia.  These are important and useful reports that will assist many companies and safety professionals to better address workplace hazards.

Pages from ShiftworkThe last of the four statistical reports looks at shiftwork.

The impact of shiftwork on work-related injuries in Australia

The main findings of this report are summarised below:

  • In 2005–06, 16% of Australian workers worked under shift arrangements yet they had 27% of the work-related injuries.
  • Shiftworkers had higher rates of work-related injury than non-shiftworkers.
    • Incidence rates
      • Shiftworkers: 114 injuries per 1000 shiftworkers
      • Non-shiftworkers: 60 injuries per 1000 non-shiftworkers
    • Frequency rates
      • Shiftworkers: 69 injuries per million hours worked
      • Non-shiftworkers: 35 injuries per million hours worked
  • Female shiftworkers had higher frequency rates of work-related injury than male shiftworkers. This finding is counter to the rates of work-related injury in male and female non-shiftworkers.
    • Shiftworkers
      • Female: 81 injuries per million hours worked
      • Male: 62 injuries per million hours worked
    • Non-shiftworkers
      • Female: 31 injuries per million hours worked
      • Male: 37 injuries per million hours worked
  • Female shiftworkers were particularly at risk of work-related injuries in Clerical, sales and service occupations, while male shiftworkers were particularly at risk in Labourer and related worker occupations.
  • Both shiftworkers and non-shiftworkers were more likely to incur work-related injuries during their first six months of employment than after their first six months of employment. Furthermore, a greater proportion of injuries that occurred to shiftworkers occurred in the first 6 months of employment than occurred to non-shiftworkers in the same initial period of employment.
  • The frequency rate of work-related injuries that occurred to shiftworkers is negatively related to normal working hours: Shiftworkers that worked only a few shifts per week had considerably higher frequency rates of work-related injury compared to shiftworkers (and non-shiftworkers) whose normal working hours were between 35 and 40 hours per week.
  • Shiftworkers who worked less than 30 hours per week were typically young (less than 25 years old) and large proportions worked in Elementary clerical, sales and service worker, Intermediate clerical, sales and service and Labourer and related worker occupations.
  • High incidence rates of injury were not due to lack of Occupational Health and Safety (OHS) training. More shiftworkers received OHS training than not, and a greater proportion of shiftworkers received OHS training than non-shiftworkers.