Managerial OHS walk-arounds and D&O liabilities

The latest edition of The National Research Centre for Occupational Health and Safety Regulation’s newsletter lists two new working papers, one from Andrew Hopkins and one from Neil Foster.  Both should be obligatory reading.

Hopkins discusses how to increase the value of the “management walk-arounds” an increasingly common key performance indicator for senior executives.  Hopkins, naturally, uses the Deep Water Horizon case as an illustration of the flaws in the process but walk-arounds should not only be for large projects.

Hopkins shows that the VIPs had an inadequate understanding of safety.  They identified the slips, trips and falls hazards rather than asking questions about the potential major hazards of the facility.  This is a common trap for managers and safety professionals, for those with suitable OHS skills, and one that needs to be actively countered.  It is too easy to check the tags on fire extinguishers but miss the unsafe activity at heights.

Hopkins said that on one particular visit shortly before the oil rig exploded VIPs

  • Did not check on behaviours
  • Did not want to disrupt operations
  • Were not comfortable in checking competencies

A significant issue Hopkins raises is about “stopping the job”.  To stop any company’s operations on the basis of safety is an important action and one that should not be taken lightly.  And it should be said that to stop a job is often a “courageous move (in the Yes Minister context).  But it is an essential action that OHS professionals and managers should be suitably trained and experienced to undertake as it is one of the core obligations of the OHS profession and workplace safety law.

Hopkins quotes Trevor Kletz on the helicopter view of safety.

“A helicopter view is bad management.  All you see are forests.  If you want to know whether or not the forest is healthy you have to land the helicopter and look at the twigs and leaves.”

The issue of directors insuring against OHS fines has been a concern of the SafetyAtWorkBlog for some time.  Neil Foster analyses the issue to a much greater and more rigorous extent in his paper “Insuring Directors Against Criminal OHS Wrongdoing”.

The timeliness of the paper could not have been better as Australian companies prepare for the application of “due diligence” to OHS laws and safety management through the application of the model Work Health and Safety Act.   To a large extent lawyers have not given the issue of Directors and Officers insurance policies on OHS matters much attention as they are comfortable with legal processes that would impede the policies’ applications.  Foster acknowledges the existence of such insurance products and seeks clarification from OHS regulators on the issue.

He concludes:

“some action must be taken to make clear what has been the policy of the law for many years, that a criminal penalty must be paid by the person on whom it has been imposed.  Only then will the law “bite” sufficiently for a real difference to be made.”

Other SafetyAtWorkBlog article related to this topic can be located HERE, HERE , HERE and HERE .

Kevin Jones

reservoir, victoria, australia

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