Category: insurance

Workers’ Compensation becomes an election issue in South Australia

On 12 February 2010, the Greens parliamentarian, Mark Parnell, accused WorkCover Corporation of failing injured workers in South Australia.  In response to the release of the Parliament’s Statutory Authorities Review Committee (SARC) inquiry into WorkCover, he said

“The Greens have been saying for a number of years now that the outsourcing of WorkCover’s claims management is a failed experiment, and must be reversed….. Until WorkCover fixes up the poor management of injured workers, it will never get out of its financial mess.” Continue reading “Workers’ Compensation becomes an election issue in South Australia”

Workplace deaths lead to reforms but not of workplace safety

Australia’s Environment Minister, Peter Garrett, has provided a clear indication that, although Julia Gillard may understand OHS, his department does not.

In 2009, several installers of domestic insulation died.  One died from heat stress from working in the ceiling space, another was electrocuted as the metal staple he was using to install foil insulation pierced an electricity cable.  Now the political heat is on the Australian Government because it was their climate change policy that led to a boom in unregistered and inexperienced insulation installers. Continue reading “Workplace deaths lead to reforms but not of workplace safety”

D/O liability insurance gets to England’s High Court

Insurance policies for directors and officers (D&O) liabilities have yet to gain much application in terms of occupational health and safety penalties.   But D&O insurance policies are in Australia and are established in other countries.

According to Wikipedia:

“Directors and Officers Liability Insurance (often called D&O) is liability insurance payable to the directors and officers of a company, or to the organization(s) itself, to cover damages or defense costs in the event they suffer such losses as a result of a lawsuit for alleged wrongful acts while acting in their capacity as directors and officers for the organization.”

A decision by the High Court in England throws further light on the application of D&O.   Continue reading “D/O liability insurance gets to England’s High Court”

Accident Comp changes put to Victorian Parliament

According to the WorkSafe Victoria website, changes to the Accident Compensation Act were introduced to the Victorian Parliament on 10 December 2009.

WorkSafe is very confident that the changes will be passed.  The summary only talks about “when” the bill is passed.  There is every likelihood it will be passed but the summary has a tinge of arrogance to it.

A summary of the proposed changes is available online.

It all sounds positive and most of it seems about financial improvements.  There are always concerns when a government move from prescriptive- to performance-based practices.  The summary describes the Return-To-Work benefit:

“Prescriptive return to work requirements will be reframed as performance based duties to improve flexibility.”

Usually this sort of change is a red flag for rorts and abuse.

The summary does say that enforcement activities will be increased:

“The Return to Work Inspectorate will have a wider range of tools to improve the effectiveness of compliance activities in relation to return to work obligations, maintaining a fair and consistent application of the law.”

However with the government’s recent spate of administrative mistakes, sloppiness and oversights exposed through the Auditor-General’s reports, accountability in this important area will need to be carefully watched.

The Minister for Workcover, Tim Holding‘s speech to the Bill’s second reading concluded (according to the draft Hansard):

“This bill providers (sic) fairer and better benefits to injured workers and their dependents, recognises that getting injured workers back to work is a central pillar of the scheme, and provides greater transparency for employers in their interactions with the scheme.  The benefit enhancements in this bill are financially responsible, affordable, and consolidate Victoria’s position as the leader in workers compensation in Australia.”

Kevin Jones

OHS criticism needs to aim “at the source”

The e-Editor for the Institute of Occupational Safety & Health, Shaun Gibbons, has commented on the recent speech by David Cameron, the Opposition Leader of England’s Conservative Party.

In this editorial Gibbons says

“Instead of cosying up to the newspapers which perpetuate the myths that somehow health and safety is to blame for much of society’s ills, Cameron should be rounding on the media for its part in falsely reporting on health and safety issues.”

If one takes “health and safety” outside the factory fence and consider it as a social attitude or as a collective term for a range of social perspectives, “health and safety” is crucial, or rather the personal fears generated by our concerns for our own health and safety and for those of our family members are a crucial consideration in how we live and work.

David Cameron is a politician and needs the media to distribute his policies and campaign strategies so he is in his natural element.

The print media, principally, does report health and safety issues in an alarming manner but as sensation, and particularly in England titillation, is what sells newspapers, it seems pointless to blame the media for what they have always done.

It will be impossible to get the media to change their attitudes to health and safety.  The struggles of Australian OHS regulators in doing so has been touched on elsewhere in SafetyAtWorkBlog.  It seems clear that if traditional media cannot be changed in this area, alternate media outlets and mechanisms need to be produced that provide information that is not adequately or appropriately covered elsewhere.  This blog is one example.  IOSH’s website is another.

Gibbons gets closer to the core issue elsewhere in his editorial:

“…seeing through the predictable soundbites which came from his speech last week, Cameron has actually highlighted an important cultural issue that IOSH does welcome: people’s growing confusion and damaged confidence when it comes to managing day-to-day risk. With the fear of litigation at the heart of this debate, the speech did give IOSH the opportunity to make its call for us all to move away from a culture of blame to one that’s based on better ‘risk intelligence’.”

He is right in saying that society has an (increasingly) skewed perception of “day-to-day risk” but he is more correct when identifying that

“the fear of litigation [is] at the heart of the debate.”

IOSH and other safety professional organisations need to get a better understanding of the insurance and legal industries so that they are able to temper some of the extremism from these sectors that is sacrificing long-term cultural and societal health for short-term gain.

SafetyAtWorkBlog’s editor, Kevin Jones, wrote in National Safety magazine about the pernicious growth in the expansion of directors’ and officers’ liabilities insurance policies to cover the legal expenses AND fines from OHS prosecutions.  Either safety organisations are unaware of the impact of these products, do not understand them or do not care, as the silence has been deafening.

Kevin Jones

The Senate inquiry into Australia Post should provide important lessons in OHS, HR, RTW and LTIFR

For decades OHS professionals have known that the Lost Time Injury Frequency Rate (LTIFR) does not accurately measure the safety performance of an organisation.  LTIFR can be manipulated and is responsive to single catastrophic events.  The consensus has always been that LTIFR is one indicator of safety improvement but should not be relied upon at that same time as acknowledging there is no real alternative to the LTIFR.

From an Australian Senate inquiry that is currently running and sparked, to some extent, from an ABC current affairs report in September 2009, it seems that the Australian postal service, Australia Post, is doing just that.

One of the attractive managerial elements of LTIFR is that it provides a figure from which incentives and rewards can be provided.  This is attractive to both OHS managers and employers because LTIFR provides a tangible benchmark.

Safety incentives and rewards have been contentious for decades but have come to the fore in this inquiry due to this type of accusation from one of the Australian trade unions, the CEPU ( Communications, Electrical and Plumbing Union):

Australia Post boasts that Lost Time Injury records are the lowest they’ve ever been. But those results haven’t been achieved by a safer workplace – rather by manipulating the injury management process to force people back to work and deny employees their rights.

Meanwhile, the same managers receive cash bonuses for reducing Lost Time Injuries in their sections.

The CEPU has documented extensive abuse of the injury management process.

Facility Nominated Doctors

Workers are being bullied into attending company-paid Facility Nominated Doctors.

FNDs are instructed to get people eligible for workers compensation straight back to work, before they’ve had to time to recover.

Australia Post has a commercial contract with InjuryNET, a private organisation, which gives Post access to a network of doctors.

InjuryNET guarantees it will reduce Lost Time Injury rates, lost hours and duration until return to pre-injury duties.

Where workers are not eligible for workers compensation, company doctors are instructed to find them unfit for duties, so Australia Post can direct them off work without pay, or sack them.

The CEPU has obtained email evidence that managers use the injury management process to get rid of ‘undesireable’ (sic) employees.

This is the language Australia Post management uses to describe injured workers.

Many of the attachment the CEPU has provided to the Senate Inquiry are not being publicly released because they include details of many cases of alleged mismanagement.  The CEPU has posted an example of Australia Post’s approach to injured workers on Youtube.

The Australian Government responded to pressure from unions and elsewhere and established the Senate inquiry with the following terms of reference.

“The practices and procedures of Australia Post over the past three years in relation to the treatment of injured and ill workers, including but not limited to:

  1. allegations that injured staff have been forced back to work in inappropriate duties before they have recovered from workplace injuries:
  2. the desirability of salary bonus policies that reward managers based on lost time injury management and the extent to which this policy may impact on return to work recommendations of managers to achieve bonus targets:
  3. the commercial arrangements that exist between Australia Post and InjuryNet and the quality of the service provided by the organisation:
  4. allegations of Compensation Delegates using fitness for duty assessments from Facility Nominated doctors to justify refusal of compensation claims and whether the practice is in breach of the Privacy Act 1988 and Comcare policies:
  5. allegations that Australia Post has no legal authority to demand medical assessments of injured workers when they are clearly workers’ compensation matters:
  6. the frequency of referrals to InjuryNet Doctors and the policies and circumstances behind the practices:
  7. the comparison of outcomes arising from circumstances when an injured worker attends a facility nominated doctor, their own doctor and when an employee attends both, the practices in place to manage conflicting medical recommendations in the workplace; and
  8. any related matters.”

Some submissions to the inquiry have been made publicly available, including a submission by Australia Post.  The company responds to each of the allegations included in the terms of reference.   A frequent response from Australia Post is that its actions do not breach the law be it privacy legislation, workers’ compensation or its own policies.  This defence is common for companies and organisations but it is often contrary to many of the arguments from the workers.

In the video above Brett Griffin describes the treatment from his managers at Australia Post as “wrong”.  It may be wrong but is it illegal?  This is the question that most Courts and judges face.

However this inquiry ends, the management of its employees seems not to have been to an acceptable level.  The safety and HR Management system seems not to have been working properly.  The evidence for this is the number of disgruntled employees and ex-workers and the existence of the Senate inquiry.

Clearly Australia Post’s conduct was not “best practice”.   In the company’s recently released annual Corporate Responsibility Report it says this under the section for People Management:

“The effective management of our human resources is, therefore, of vital importance to our brand strength, community engagement, service performance and financial returns. Over several decades, we have developed a set of policies and programs that are designed to protect and reward our people – including progressive industrial relations policies; proactive management of occupational health and safety; continuation of our successful injury management, rehabilitation and return-to-work programs; a strong commitment to diversity; structured workplace learning; and effective grievance procedures.”

RTWMatters said in an article on its website (subscriber access only) in late September 2009 this about Australia Post:

“Some of our team have had first-hand experience with Australia Post’s return to work. In the select number of cases they have dealt with the Australia Post system has been found to be frustrating and seemingly lacking in genuine interest in the employee. Perhaps our team has seen only isolated examples, not representative of the general approach – if so our opinion may be swayed by the appropriate data. Our experience is that the Australia Post system focuses on ‘process before people’.”

The “Senate Inquiry into Australia Post’s treatment of injured and ill workers” will undoubtedly provide important lessons that will be relevant globally on safety incentives, LTIFRs, return-to-work practices in a large organisation, rehabilitation provider conduct, and, most importantly, how to manage injured staff.  What should not be lost in any inquiry of this type is that the inquiry exists because people have been hurt and, they feel, unfairly treated.

Kevin Jones

[Kevin Jones is a feature writer for RTWMatters]

All non-confidential  submissions can be accessed as they are uploaded at http://www.aph.gov.au/senate/committee/eca_ctte/aust_post/submissions.htm

Tory leader calls for a “forensic examination” of health and safety culture

David Cameron, the leader of England’s Conservative Party, has spoken about the health and safety culture that he says is restricting personal and business options in England.

In the full speech, Cameron clearly outlines an ideological agenda but it is a mistake to see this as an attack on the OHS regulator.  Below is an edited summary of the most relevant bits of his speech:

“In almost every area, the Conservative Party aims to remove the obstacles that prevent people from making their own decisions.

That’s why we plan a radical redistribution of power, giving control over education, housing and policing to local people.

…there is a growing sense that too many areas of our life are governed by petty rules, regulations and tick box bureaucracy that flies in the face of common sense, undermines discretion and prevents us from getting on with our lives.

We see it in our police force,… our prisons, …our schools, [and] our hospitals

[the the over-the-top health and safety culture] is… infuriating. It … stifles judgement and discretion……is a straitjacket on personal initiative and responsibility……and is a big barrier to the creation of the big society.

…something has gone seriously wrong with the spirit of health and safety in the past decade.

…it is clear that what began as a noble intention to protect people from harm has mutated into a stultifying blanket of bureaucracy, suspicion and fear that has saturated our country…

How has this over-the-top health and safety culture become embedded in our national way of life? [emphasis added]

  • [European] bureaucratic rules
  • The Labour Government

But the biggest cause of this excessive health and safety culture is the way these rules have been interpreted and used.

What is more the problem is the perception we have allowed to develop that in Britain today, behind every accident there is someone who is personally culpable……someone who must pay.

[It is encouraged by]

  • adverts on television
  • the commercialising of lawyers’ incentives to generate litigation
  • the rising premiums and concerns of the insurance industry.
  • high-profile claims and pay-outs.

This has all helped to create a legal hypersensitivity to risk, accident and injury. And this has had a direct knock-on effect on the health and safety culture.

So it is not just the regulations from Brussels, or even the distrustful, interfering government that has created this culture, or the insurance industry, ……it is that everyone’s so worried about being sued that they invent lots of their own rules on top of the regulations that already exist.

… perhaps the most damaging consequences of this excessive health and safety culture have occurred in our society.

… the health and safety culture actively undermines responsibility.

CONSERVATIVE APPROACH

First, establish clear and specific principles about when health and safety legislation is appropriate, and when it is not, so we can evaluate whether existing or future legislation is necessary.

Second, we will propose practical changes in the law to both help bring an end to the culture of excessive litigation while at the same time giving legal safeguards to those who need them most.

HEALTH AND SAFETY CHANGES

there are three particular scenarios where this is the case.

The first is when consumers have a lack of information, or are unable to understand technical information, about a product or a service they are purchasing.

The second situation in which official action on health and safety is appropriate is where there is an imbalance of power.

The third situation in which there is a case for health and safety oversight is when someone might have a clear motive – normally profit – to put someone else in danger.

That’s because keeping people safe is often more expensive than exposing them to risk.

[REVIEW]

I have asked Lord Young to lead an extensive review on this subject for the Conservative Party. He has a track record of deregulation and cutting bureaucracy. He also has experience in the legal profession and will judge these issues with the care and attention they deserve. And he will look at everything from the working of the Health and Safety Executive, to the nature of our health and safety laws, litigation and the insurance industry.

There are some specific questions I have asked David Young to investigate urgently.

The first question is: how can we best protect what are effectively ‘Good Samaritans’?

In Australia, concern about the effect of increasing payouts for medical negligence led to a full review of civil liability.  Its final report concluded that when an individual is acting in good faith – as a Good Samaritan – and takes reasonable actions to help someone, then they should not be found negligent.

Second, can we help alleviate some of health and safety oversight that currently burdens small, local and voluntary organisations?

Third, do we need a Civil Liability Act?

I know the over-the-top health and safety culture that has grown in our country in recent years provokes a lot of understandable anger.  But anger itself is not solution.  Instead we need a forensic examination of what has gone wrong and the steps we need to take to put it right.”

Cameron’s speech has some valid points even if the ideological path that he has followed to get here may be unpalatable.

What separates this from a Jeremy Clarkson rant is that he is not targeting any one particular bureaucracy or social group.  He acknowledges that there are a range of social factors that have, over time, created what he believes is an “over-the-top health and safety culture”.   Cameron may have chosen extremes to illustrate his points but most OHS professionals would not be averse to a review of OHS laws particularly if such a review included other social structures that make their lives difficult but over which they have no influence.

Along the way, the chance for the political boot up the jaxy of the regulators and the unions, and those dreadful Europeans, will be irresistable for the Conservatives, but if planned for occupational health and safety may salvage some useful tools.

It must be remembered that the Conservatives are not in power in England but even from here in Australia, the Prime Minister Gordon Brown looks like a dead man walking.

Some commentators have already responded to the “outrageous” suggestions in Cameron’s speech.  More union response similar to this from Grahame Smith, General Secretary of the Scottish Trades Union Congress, can be expected.

“The families of the tens of thousands of workers who have been killed and maimed at work will find these comments deeply offensive. David Cameron has sent a chilling message to the working people in the UK that any future Conservative Government will attack the health and safety laws that trade unions have spent decades fighting for.

“This is not about draconian legislation. This is about the failure, or unwillingness, of employers, community groups and others to grasp the very basics of our health and safety system.

“We have witnessed what poor regulation has done for our finance sector and the economy. We do not want to see this attack on health and safety legislation having a similar catastrophic effect on human lives. Our economy will recover. Individuals killed at work and their families never recover from the consequence of poor health and safety regulation.

“We would say to David Cameron if you want to learn about the true consequences of health and safety failures read Hazards Magazine and come to Scotland and meet families who have lost loved ones due to health and safety failures by employers. Don’t subscribe to the trivial nonsense which is churned out by sections of the media.”

Smith is correct to remind Cameron to not rely on the media from which to develop policies, particularly the English print media.  Smith comparison of OHS legislation to financial market regulation is also valid.  Legislation should never be used as a blanket control mechanism but requires targeting.

Another union, Prospect, had this to say

On behalf of 1,650 HSE inspectors, scientists and other specialists, Prospect negotiator Mike Macdonald said: “There is a world of difference between petty bureaucracy enacted under the label of health and safety and HSE regulation designed to prevent deaths in the workplace.

“Measures aimed at preventing death and injury at work run the risk of being overshadowed by inappropriate obsessions by local authorities with minor issues that are often an excuse for withdrawing services on the grounds of cost. Given the importance of health and safety to the British economy and UK businesses we would welcome any changes that boost workers’ safety as well as business competitiveness.

“But confusing the two continues to perpetuate a negative image of health and safety regulation and masks the bigger picture: as the figures for 2007/08 show 32,810 employees were exposed to fatal and major injuries at work.”

If (when) the Conservatives come to power in England, Cameron and Lord Young will need to structure an inquiry that is inclusive and designed to be constructive.  Many people will approach such an inquiry with decades of suspicion and many memories of despair and disappointment. In many ways the laws require a rationalisation, not a revolution and this is what Cameron needs to “sell” as he gets ready for the next election, due in the first half of 2010.

Kevin Jones

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