Category: business

Not all employers are the same

Recently SafetyAtWorkBlog reported the umbrage that the Australian Institute of Company Directors (AICD) felt about executive accountability, particularly in relation to OHS legislation.  On 25 October 2009 the Australian Chamber of Commerce and Industry (ACCI) provided an example that should stop generalisations about employer associations , at least for a little while.

Below are extracts of the significant statements made by ACCI and attributed to its CEO,  Peter Anderson:

“Safe Work Australia Week [is] an opportunity for employers and employees to step back and review their approach to ensuring safety within their workplace.

It is essential that at regular intervals time is taken to step back and take a fresh look at the bigger picture of workplace safety. Safe Work Australia Week presents an ideal opportunity to do so.

Company Boards and Senior Executive teams should regularly review their organisation’s strategy, culture, systems and commitment to workplace safety and make adjustments where needed. Safe workplaces are driven from the top.

However, managers, supervisors and all employees also need to take individual accountability for workplace safety. Workplaces with the best safety records have a culture of clear and shared accountability for safety from the first year apprentice to the Chief Executive.   This is built on the empowerment and obligation of all employees to openly discuss workplace safety, report hazards and incidents, and collaboratively find the most appropriate ways of managing risks.

It is important that in the midst of the current debate about harmonised OHS legislation, the focus on day-to-day workplace safety does not slip.   Legislation is not going to drive further improvements in OHS outcomes in Australia – people’s actions will.   Governments and industry must look for ways to further provide small business in particular with the tools, information, advice and encouragement to effectively manage the challenges and complexities faced in ensuring workplace safety.”

The risk with any national week of special day is that the focus is on a specific moment rather than seeing the issue being raised as one that is relevant for an entire year.  This is very much the problem with Safe Work Australia Week but it is not alone.

Significantly, ACCI makes a clear statement about executives being involved with the management of safety in their workplaces – the attitude and approach of “proactivity” the OHS model legislation is aiming at.

Equally significantly, ACCI discusses the individual accountability of everyone in a company for OHS.  It specifies the elements in support of accountability

  • open discussion or (OHS regulators would say) consultation;
  • hazard and incident reporting; and
  • collaboration.

ACCI is on familiar turf when it says legislation should not be the motivation for change on OHS but employers and other commercial organisations must realise that self-regulation has never been more of an unpopular concept than in the wake of the global financial crisis.  No one can trust business to do the right thing by shareholders, investors or employees.  They want government to make business accountable.

The capitalist ideology says that the wealth created by business is shared with the masses through social and financial structures.  ACCI is trying to rebuild the capitalist structure into a nice, friendly, warm and comforting capitalism because if it cannot, the government will impose social obligations on them.  If the ACCI and other commercial bodies can do this, it will be impressive but the question can be asked why capitalism became so ruthless in the first place and did various employer associations advise companies to act cautiously and keep capitalism in line with the social obligations everyone has?

Workplace safety is an easy indication of the heartlessness of capitalists – increase profits by rushing production and encouraging shortcuts in safety; or not taking the time to train workers well enough that they can work without being harmed.  But if capitalists are willing to try again and NOT follow the same pathways that have been shown to lead to economic destruction, then they should have our support.

Kevin Jones

Awards nights and integrity

Industry awards are very important as they reflect special achievements in professions and, more broadly, the community.  But what makes awards so special is that they are hard to get.  This is the reason that the Nobel Prizes are so treasured (barring this year’s controversy over the Peace Prize for President Obama).

This week in Australia, there will be several awards events for those who have achieved special things in workplace safety.  There are several issues that need to be borne in mind during this “award season” and for other awards in general.

Judging Panel and Criteria

Any organisation should publish the membership of the judging panel.  Many do not and often justify this as reducing the likelihood of judges’ decisions being interfered with.  Any organisation that claims this has the wrong judges.  If the judges were people of integrity, they would operate within an ethical framework that would make them impervious to influence.  That should be why they are selected as judges.

The criteria for selecting winners in various categories should also be made available just as the criteria for eligibility is made available to nominees.  Everyone from safety professionals to athletes select categories that they have the best chance of winning.

Some nominees have coaches to assist them, some use past awards judges.  One Australian awards process not so long ago felt there was no issue with having a current judge assist a nominee.  This was dubious at the time but when the judge/coach joined the winner on the stage, the conflict was there for everyone to see.  Sadly the organisers did not see this.

Nominee feedback

Winners have a fairly clear idea why they have won but good awards event provide a critique of all nominees so that, if they want to renominate int he future, areas of improvement are identified.

Very few organisations do this which makes the losers feel like losers rather than those who were not quite good enough to win – big difference.  If feedback is not provided, a loser can feel bitter and express that bitterness against the organisation hosting the event.  Just as, for instance, young dancers may be turned off a potential career by one poorly-worded criticism, constructive criticism can keep a dancer in that career and maintain a level of confidence.

Why have certain categories

Many awards nights have too many categories and categories that are ill-defined.  A principal reason for lots of categories is so that the organisers can attract lots of sponsors and lots of  dollars.  Any awards night, particularly those of a specific industry or profession, that has dozens of awards will be too long, too boring and, quickly, irrelevant.

Eligibility

Recently one award winner in an Australian awards ceremony acceptance speech, expressed pride that her organisation had won the same award for the third year running.  HUH?  Why were they eligible each year for the same award for the same management program?  This severely hurt the credibility of that particular award category and placed a cloud on all other awards at that night.

Eligibility needs to be sensible and this relates to the need for a detailed criteria mentioned above.

If an organisation wins an award for one thing, they should be ineligible for the same award for a couple of years.  This allows for the development of alternative approaches and creative approaches to the same category.  This will lead to a richer and more diverse industry or profession.

If a winner wants to renominate after the ineligibility period, their system should have changed and improved so that the award would acknowledge this change.

It is understood that the award decision-making and judging process should be secret or else the surprise of nomination and winning is lost.  But there is also a need to establish a credibility to the awards by displaying the integrity of the judging process.  The best awards are those that have an established integrity and are not just for marketing purposes or revenue generation.

Kevin Jones

SafetyAtWorkBlog has several pieces concerning awards.  Please use the search facility to the right of this article for other articles and perspectives.

Nice comparison on Directors’ complaints

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

A consistent approach to developing public policy is required

Australia is a Federation of States.  This does not just mean that each State is a different colour of the schoolroom map.  Each State has its own duties to its citizens from within the overall scheme of running a country.

There has always been a tension between the two levels of government and currently the management of health care facilities is the cause of friction, as reported, for instance, in The Age newspaper on 23 October 2009.   The current tension in this sector illustrates a trend that extends beyond health and into workplace safety legislation, human resources and social policy.

The Victorian Health Minister, Daniel Andrews,  is reported to have said that Canberra’s “health bureaucrats [are] remote and incapable of understanding the day-to-day needs of patients.”

“”You can never take it as a given that decision makers and policy makers at the bureaucratic level in Canberra understand how you deliver care in a bed, in a ward or in a country town, because they don’t do that: it’s not their world.”

This argument echoes some of the concerns being raised over the national harmonisation of OHS laws. In such a large country as Australia there are going to be cultural, demographic and geographical variations that a centralised system cannot service.  The Federal Government is hoping to harmonise workplace safety but it has already taken over industrial relations and is strongly threatening a takeover of health.  Why the inconsistency?

On 22 October 2009 at the HR Leadership Awards ceremony in Melbourne, the CEO of Carnival, Ann Sherry, said that centralised policy makers in Canberra are making important decisions from within a rarified world.  Sherry is a member of a review panel into the Australian Public Service (APS) and she identified several features of the APS, and shortcomings, as the service aims to become “world’s best practice in public administration”.  Amongst them:

  • 42% of public servants are younger than 45 years;
  • a highly educated workforce;
  • senior public service positions are centered in Canberra.

The last characteristic Sherry said has led to a disconnection between service design and delivery, echoing, to some extent, the concerns of Daniel Andrews on health policy.

It seems that there are many reviews and investigations occurring into how various industries and sectors in Australian business and government should be structured for the future, a future that is likely to be very different, climatically, economically and demographically.  But there is not a consistency in approaches, or at least one that is readily understood, even though the Australian Prime Minister, Kevin Rudd, talks repeatedly about “nation building“.

The Australian Government has the best chance in a long time to set the country on a path of sustainable growth.  The United States, under President Barack Obama, has a similar opportunity.  Governments have an obligation to plan for the long-term benefit of their countries ands citizens, not the short-term gains of their political donors, political parties and lobbyists.  This obligation  is as relevant in occupational health and safety as it is anywhere.

Kevin Jones

The OHS obligations of global corporations

BHP Billiton has issued a media statement concerning the death of a miner, Gregory Goslett, at its coalmine in Khutala in South Africa.  Due to the number of deaths the company has had over the last two years, attention on any safety issue at BHP is intense.  BHP’s short statement reads:

“It is with deep regret and sadness that BHP Billiton announces a fatal incident at its Khutala Colliery opencast operations in South Africa. At approximately 05:02 am on Tuesday, 20 October 2009 Gregory Goslett (27), Mining Operations Supervisor, was fatally injured whilst driving a light vehicle at the mine.

An initial investigation indicates that Gregory was travelling in a light vehicle when a piece of coal fell from a loaded 25 ton haul truck travelling in the opposite direction. The piece of coal went through the windscreen of the light vehicle and struck Gregory causing fatal injuries to him.

The company is offering all comfort, assistance and support to Gregory’s fiancée Tarryn, his parents and those affected at the operations. Our thoughts are with Gregory’s family, friends and colleagues at this difficult time.

Mining at the opencast area has been suspended and investigations are underway.”

The Age newspaper points out that

“The accident was of the type that BHP has previously moved to eliminate from its Pilbara iron ore mines in Western Australia after several deaths last year…..”

“A key safety change made by BHP in the Pilbara in response to last year’s run of fatal accidents was the improved management of the interaction of light vehicles with heavy vehicles.”

The circumstances of Goslett’s death illustrates the obligations, some would say challenges, that multi-jurisdictional corporations need to ensure that safety improvements are consistently applied across their workplaces, regardless of location or remoteness.

BHP Billiton has been tragically reminded of this but BHP is only one corporation in the global mining industry.  Safety solutions and initiatives must extend beyond jurisdictions, countries and commercial entities to each workplace where similar hazards exist.  (The oil refinery industry was reminded of this with the Texas City Refinery explosion) The communication and sharing of solutions is a crucial element of the safety profession around the world.

Kevin Jones

Employer concerns on OHS law review

In support of the Safety Show mentioned in a previous article, the organisers have issued a media release which provides illuminating quotes on the issue of the Australian Government’s program for review of OHS laws:

One of those keen to comment is exhibitor at The Safety Show and chief executive of the Australian Federation of Employers and Industries, Garry Brack [significantly NOT a speaker at the Safety Conference ED.].

“We are concerned about the content of the model laws,” Mr Brack says. “New South Wales’ OHS Act is the most difficult piece of legislation in the developed world and we believe this is a lost opportunity to wind up with more balance.”

“If an employee does the wrong thing, the employer is found guilty. We’re not arguing that employees should be prosecuted but reject the notion that employers should be liable when employees fail to meet safety requirements.”

Clearly Brack has not compared the NSW OHS Act to the Federal Taxation legislation.

Brack reflects many of the perspectives of those who deal with OHS in the State of New South Wales.  The pent-up frustration is clear and the employers do not believe the reassurances from the Federal Government.

Brack also illustrates the desire for prescription in OHS law.  If people, in this case employers, know how to comply with a law, they are more likely to do so.

“Smaller employers don’t have the financial resources and in-house expertise to interpret what is ‘reasonably practicable’. They say ‘Tell us what we have to do’. They don’t wanted to return to the lunacy of years ago where every nut and bolt was defined but they do need a more prescriptive approach and help from regulators.”

He highlights a concern about the OHS laws shared by SafetyAtWorkBlog, small business has always struggled to provide an appropriately safe workplace.  “Reasonably practicable” does not help.  However, Brack’s desire for prescription is nostalgic at best, some would say fantasy.  This government has no intention of taking a seemingly regressive step to prescription and Brack has been aware of this for years.  At some point one has to accept reality and work with what is being offered.

Variations

Another exhibitor discussed the expectation that States will still add their own variations to the model OHS laws.  This option has never been hidden by the government or the various review panels.  In fact, this flexibility has been a major point in the government’s choice on harmonisation rather than uniformity.

“National legislation is highly desirable to avoid the massive duplication of work for national organisations,” Mr [Bill] Henman [of the College of Warehouse Training] says. “Unfortunately, the legislation will be enforced by various state jurisdictions and this will result in variation between states in interpretations, penalties and the finer points of the legislation. The devil is in the detail. [ED. please kick the next person who uses this cliche] Different penalties in different states currently affect the priorities of safety managers and standardised penalties would provide better outcomes.”

Henman needs to read the legislation and supportive documents to see that standardised penalties are proposed.  Though Henman is considering one of the most important issues that does not seem to be in consideration in much of the commentary on the legislation to date – improved safety.

“It’s very hard to say whether these new laws will make workplaces safer. The culture of those less safety conscious workplaces where the employer bends the rules has to change. One would hope the new laws will help engender better safety cultures.”

The Master Builders Association of NSW‘s OHS risk management officer, Tim Stootman, echoes the perspective of Garry Brack, looking at the  legislation through the experience of a New South Wales employer:

“Master Builders supports the review of OHS laws and believes that this is an opportunity for better, rather than greater, OHS regulation,” Mr Stootman says.  “Better, rather than greater, regulation will assist to improve OHS performance in the construction sector.

Master Builders supports the rejection of what could be called a ‘highest common denominator’ approach to OHS duties.  Essentially, this approach would have seen an absolute duty of care on employers to ensure the health and safety of their employees and provides unions with the right to bring a prosecution for a breach of the OHS law, the latter a provision adopted in recent changes to the law in the ACT.

The Draft National Model OHS Act is a positive step towards harmonisation of OHS laws in this country.”

Submissions to the government on the draft Safe Work Bill are being regularly posted at the Safe Work Australia website.  SafetyAtWorkBlog is watching the submissions and will draw attention to some of the more useful comments in the submissions.

Kevin Jones

Prosecution results from fall through roof

On 22 October 2007, a commercial premise in Southbank, Victoria, was to undergo renovations which included replacing the asbestos roof with an iron roof.   Two men were employed as project managers and during the roof replacement, according to WorkSafe Victoria.

“…the dogman fell [through an unguarded shaft] a total distance of 8 metres and as a result he broke 3 bones of his right wrist and a fractured scapula as well as sustaining bruising to the body and serious lacerations to the head.”

On 16 October 2009, the Magistrates’ Court fined the specialist roofing company contracted for the task $A15,000.  The prosecution summary says that as the company specialised in roofing, the hazards of working on an asbestos roof, and unprotected edges, would have been well-known.

The two project managers were fined $A7,500 each as they were not sufficiently experienced for their project management roles.  The lack of fall protection for those working on the roof was of particular note according to the Prosecution Summary from WorkSafe Victoria.

More details on the prosecution are available from the WorkSafe hyperlinks in this article.

It would be interesting to run this prosecution summary as a hypothetical under the proposed National OHS Model law to provide a contrast between the old and new laws particularly on the following matters, although many more could be considered if further details were available:

  • who controls the workplace
  • competence
  • suitably qualified
  • role and enforcement of JSA’s
  • contractor management

Kevin Jones

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