Recently SafetyAtWorkBlog was able to spend some time with the Director of the Victorian Government’s Construction Compliance Code Unit (CCCU), Nigel Hadgkiss. The CCCU and Hadgkiss have been in the Victorian media recently in terms of the CCCU investigation of industrial relations matters in several Grocon construction projects and some discussions with LendLease but an often overlooked, yet significant, element of the Construction Compliance Code is the occupational health and safety obligations. The CCCU has been working on early drafts of a Health and Safety Management Plan (HSMP) with which all those operating under the Code will need to comply.
Many of the questions SafetyAtWorkBlog posed stemmed from a presentation Hadgkiss made at a breakfast seminar on which SafetyAtWorkBlog previously wrote. That article is recommended for background and context.
Nigel Hadgkiss advised that since 1 July 2012 71 companies and associated companies have “signed up” to the Compliance Code with a full awareness that OHS is a key element of compliance.
OHS obligations of unsuccessful tenderers
The Code requires companies tendering for Victorian Government construction work to follow specific OHS obligations, whether they are the successful tenderers or not. In some ways this seem unfair.
Hadgkiss believes that the tenderers to government contracts are well aware of the safety obligations from the outset. From that point they are contractually bound whether they are successful or not.
He sees the Code as part of a reform process developed by the Victorian Government aimed at achieving better standards of safety.
CCCU and ABCC
Some have described the CCCU as a cut-down version of the controversial Australian Building & Construction Commission (ABCC), even though the ABCC had no workplace safety role.
As a former executive of the ABCC Nigel Hadgkiss explained the evolution of government oversight of the construction industry. Around the time the ABCC was established, the Federal Safety Commission also commenced so safety was never part of the ABCC’s brief.
The ABCC has been replaced by a less hardline approach and Hadgkiss acknowledges that there has been considerable interest in the CCCU, the Code and guidelines from interstate companies, safety regulators and industry associations.
CCCU and red tape
The Australian business community is super-sensitive on any government initiative that may increase the costs of compliance. The OHS obligations in the Code could be construed as another level of paperwork but the last thing that Hadgkiss wants is to create an additional layer of regulation. However, he believes that by applying a rational approach any additional burden will be balanced by increased safety standards.
The construction industry often repackages safety management plans and safe work method statements from one project to the next, sometimes without even changing the project header. Hadgkiss insists that each project and contract will be assessed on a case-by-case basis and plans for, for instance, a desalination plant will not be appropriate for building a hospital. The proposed Health and Safety Management Plan obligation is not a tick and flick exercise and specific project questions will need addressing.
Hadgkiss also says that businesses have said that the HSMP is likely to be a demanding process and he is unapologetic. The plan will be part of the reassurance the client is seeking about the company’s high priority for safety.
Trust and sanctions
One of the aims of the Code is to establish a “foundation of trust” between the government, as client, and the construction companies, as providers. Hadgkiss believes that the Code encourages this trust by providing the CCCU with the authority to apply sanctions. Sanctions can be a very effective way of gaining the attention of a company’s Board, particularly those of publicly-listed companies where reputational risk is an important consideration.
A major element in this process is that a company could be excluded from future tenders for government work. Any sanctions of this type will be after an escalation process that starts at warnings about breaches of the HSMP and any recurrences. This process can be a very effective tool as companies are in business to make money and any threat to that purpose gains the attention of corporate executives.
Benchmarking and safety promotion
Hadgkiss also sees an opportunity for the benchmarking of safety performances throughout the Victorian construction industry. He would be very surprised if, particularly “Tier 1”, construction companies did not already have effective systems to identify and manage key performance indicators (KPIs) but the CCCU could provide benchmarking of these KPIs.
Hadgkiss sees a potential proactive role for the CCCU through the spread of positive injury prevention initiatives across the construction industry. The CCCU will be well-positioned to receive safety information, verify this information through the implementation of the HSMP and inform others about these improvement opportunities.
CCCU and WorkSafe
With the appearance of any new OHS-related body and process, there is a potential for confusion about how these new roles fit with established safety processes of WorkSafe and other safety regulators. Hadgkiss acknowledges that, initially, the safety roles of both WorkSafe and the CCCU may be a bit blurred to those working on a building site but WorkSafe is a reactive body, if there is an accident, WorkSafe responds and investigates. The CCCU establishes safety obligations at the very beginning of the contractual process and the safety standards will be assured through a system of audits and inspections based on the contractor’s commitments made in their HSMP. The CCCU’s safety role is to ensure the contractor is doing what they said they will do.
A lot of work has been given to the draft HSMP and Hadgkiss is in the process of sourcing additional and relevant expert resources to progress the plan to its release. A person to lead the development and application of this plan will need to have belief in, and ownership of, the safety process and understand the context of construction safety within government. He stressed that the HSMP is also not set in stone and will be moderated and revised, as needed.
As with the industrial relations role of the CCCU, Hadgkiss sees the need for a lot of community and industrial education on the HSMP and the CCCU must establish a higher profile in this area. Part of this profile will rely on choosing the right person to champion the HSMP process.
The operation of the CCCU through 2013 will be a fascinating process to watch in order to see if it achieves its aims in the construction sector through the tendering processes but also, perhaps more importantly, to see if the safety obligations spread downstream to the huge number of subcontractors on which any construction industry relies. It will also be fascinating to see how the extension of these safety obligations to unsuccessful tenderers is received.