Category: justice

New approaches on OHS fines and penalties

At the moment Australian OHS professionals, lawyers and businesses are preparing submissions to the Government on the harmonisation of OHS laws.  One of the areas that the Government is seeking advice on is penalties.  The Discussion Paper asks the following

Q17. Are the range and levels of penalties proposed above appropriate, taking account of the levels set for breaches of duties of care by the WRMC?

Q18. What should the maximum penalty be for a contravention of the model regulations?

Q19. The intention is that all contraventions of the model Act be criminal offences. Is this appropriate or should some non-duty of care offences be subject to civil sanctions e.g. failure to display a list of HSRs at the workplace, offences relating to right of entry?

The amount of  any fixed financial penalty is not a big issue in my opinion.  There is an assumption that the threat of a large financial penalty imposed on one company will encourage other companies to improve safety.  Is anyone seriously saying that all of the financial penalties imposed over the decades are in some way responsible for an improving level of safety in workplaces?  The motivation to improve safety comes from elsewhere.

The threat of large financial penalties send companies to seek ways of insuring against having to pay a fine.  Often it is cheaper to pay an insurance premium on the slim chance of being prosecuted and fined.  I acknowledge that this has been a corporate and risk management approach primarily but there are cases where such options are being offered to small business.

Large financial penalties, such as the then record fine to Esso over its Longford gas explosion, are easily paid with little OHS improvement resulting from the fine.  It can be argued that the negative corporate exposure from the resulting Royal Commission, a reulting class action and the media coverage resulting from its unforgivable treatment of Jim Ward were stronger motivators for improvement.

In most Australian States, there is not a crime of industrial manslaughter.  This issue has faded from the political agenda but it remains very much alive in England.  On 27 October 2009, the Sentencing Guidelines Council wrote the following:

“Companies and organisations that cause death through gross breaches of care should face punitive and significant fines, a consultation guideline published by the Sentencing Guidelines Council proposes today.

Fines for organisations found guilty of the new offence of corporate manslaughter may be measured in millions of pounds and should seldom be below £500,000.

The new sanction of Publicity Orders forcing companies and organisations to make a statement about their conviction and fine introduced under the Corporate Manslaughter and Corporate Homicide Act should be imposed in virtually all cases.

The consultation guideline proposes that the publicity should be designed to ensure that the conviction becomes known to shareholders and customers in the case of companies and to local people in the case of public bodies, such as local authorities, hospital trusts and police forces.  Organisations may be made to put a statement on their websites.”

The Council recommends a minimum financial penalty and a publicity order that has teeth. More on the publicity order is below.

Council member Lord Justice Anthony Hughes clearly states the purpose of financial penalties and it is not preventative.  He said in a media statement

“Fines cannot and do not attempt to value a human life – compensation will be payable separately in these cases.  The fine is designed to punish and these are serious offences so the fines imposed should be punitive and significant to reflect that.”

Penalties as a Percentage of Turnover

Hughes says that the Council rejected a Sentencing Advisory Panel proposal that I believe should be floated in the current debate on penalties in Australia, even though it is likely to be similarly rejected.

The Panel recommended the following

“In order to achieve an equal economic impact on offending organisations of different sizes, the proposed starting points and ranges for offences of corporate manslaughter are expressed as percentages of the offending organisation’s average annual turnover during the three years prior to sentencing.  The relevant turnover is that of the company convicted of the offence or, where the offending organisation is a holding company, the consolidated turnover of the group of companies of which it is the holding company.”

Here is the penalty table

Manslaughter table

Lawyers argue extensively about the use of manslaughter in relation to deaths in workplace but the public jumps across the legalese by repeatedly asking how the death of their loved one is not manslaughter when the actions of a director or company led directly to the death?  No level of legal explanation is going to counter this need for accountability, some would say revenge.

Similarly the penalty rate listed in the table above is easier for the public to understand conceptually compared to a judge’s or lawyer’s explanation of why a financial penalty for a workplace death was less than the maximum.

Sentencing options are complex and SafetyAtWorkBlog has no legal contributors but on 30 October 2009 within a public discussion period on national OHS laws and at the end of Safe Work Australia Week, it seem thats penalties imposed from a percentage of turnover may be an attractive concept to many safety advocates and one that needs to be considered in the Australian context.

Publicity Orders

On the issue of publicity orders, many Australian jurisdictions have had this option for a while.  Indeed, the issue of enforceable undertakings is getting a broader hearing after some of the recent actions by Comcare against John  Holland Group and others.

It is always important to look at the most recent actions and decisions in OHS law and regulation from outside one’s own jurisdiction so that innovations are not overlooked.  It seems that the Sentencing Advisory Panel has looked at lots of  jurisdictions in making the following requirements.

The Sentencing Advisory Panel listed specific requirements of a publicity order to be applied within a specified timeframe:

  • a quarter-page advertisement in a local or regional newspaper, in the case of an organisation operating in one area; or
  • an eighth-page advertisement in three specified national daily newspapers, in the case of an organisation operating nationally; and
  • an eighth-page notice in a relevant trade publication; and
  • a prominent notice in the organisation’s annual report (also in electronic format where applicable); and
  • where applicable, a notice on the homepage of the organisation’s website for a minimum period of three months.

The panel also closed a possible (out) for offending companies.

” The making of a publicity order does not justify a reduction in the level of fine imposed on an organisation for an offence of corporate manslaughter.”

The ads on home pages, local newspapers and trade publications (if there are any) seems very reasonable but the media option that may be most influential is the inclusion in the company’s annual report.  Acknowledging a workplace death and expressing regret in an annual report is admirable but “a prominent notice in the organisation’s annual report” goes straight to the shareholders who often have the ear of the corporation.  Just look at the influence being applied by them at the moment on executive salaries.

Now is the right time for Australia to consider alternative OHS penalty options.

Kevin Jones

NSW contractor representative talks bluntly about the politics of OHS laws

Ken Phillips, executive director of Independent Contractors of Australia, wrote an opinion piece in The Australian on 6 October 2009 that demands attention.

Phillips supports the Federal Government’s program of harmonisation of OHS laws in that it will remove what he sees as the injustices of the OHS legislation in New South Wales.

“The situation is different in NSW, which has OHS laws unlike any other in Australia.  OHS prosecutions elsewhere are criminal matters, but in NSW prosecutions are conducted in industrial relations courts, not criminal courts, with no right to a jury or to appeals……

This has led to the layering of gross injustices on top of workplace tragedies in NSW. Take one example.  A NSW plumber has a criminal conviction against him after a hot water valve he installed in an aged nursing home failed. An elderly woman was scalded and tragically died.  The court found the plumber had properly installed and maintained the valve.  The valve failed because of a microscopic fracture in an internal sealed component. Yet NSW OHS law required that the plumber be declared guilty.”

Phillips sees the union movement’s response to harmonisation as short-sighted.  He describes the union advocacy of the  NSW laws in terms of class, a concept rarely voiced in Australia outside academic sociological circles or the basements of  Trades & Labour Councils.

“It’s a law and process based on old-fashioned political notions that employers always put profits above worker safety and that employers must be threatened with harsh legal retribution to make them heed safety regulations.  This is class obsessed, hate-filled labour at its worst, embedding its hatred in law.  It selectively destroys the application of criminal justice to achieve its tribal ends.”

The language is inflammatory but reflects the level of concern felt by many business operators in New South Wales who are fearful of OHS rather than engaged in positive safety management.  The absolute level of safety demanded by the OHS law is indicative of what can happen when an aspirational concept is realised.

It is not so long ago that one employer association director in New South Wales stated on national television that OHS laws are not needed because employers do the right thing.

The harmonisation process, as SafetyAtWorkBlog has said previously, is intended to be a process of negotiation towards a common goal of safer workplaces.  The union movement is undoubtedly in the ascendant having helped the Australian Labor Party (ALP) break the conservative governments of the 1990s, and believes that the ALP owes it.

Trevor Cook, writing in The Australian, estimates that the union campaign in the 2007 election generated a 2% swing to the Labor Party.  He succinctly describes the achievement after years of the Left’s political parties placating the business sector:

“They treated unions as just another interest group.  Against that background, the 2007 election in Australia was a rare and remarkable event.  It had been decades since a social democratic party anywhere in the world had fought and won an election where industrial relations was a leading issue.”

From the union perspective, the Minister for Workplace Relations, Julia Gillard, needs to “pay the piper” after the unions rid the country of the conservative rats.  The substantial challenge for Gillard is to avoid the second phase of the Hamelin story, before the entire union movement rescinds its support and takes her “children” – the future industrial relations structure.

Kevin Jones

The harmonisation challenge in Australia gets more difficult

There are few motivations that are more effective for improving workplace safety than facing a grieving relative.

On 17 September 2009, the impact of the OHS law harmonisation on workers and their families came to the fore in an article in the Sydney Morning Herald (SMH) entitled “Deaths at work put sharper focus on liability”.  The workplace support advocates make a clear case for holding those who control the workplace accountable for injuries, illnesses and fatalities that occur in their businesses.

A letter sent to the Federal Minister for Workplace Relations, Julia Gillard, by the Workplace Tragedy Family Support Group reportedly says

”Dealing with a serious injury or the death of a family member is difficult, particularly if there is no sense of justice.  Employees must be able to seek justice against employers who do the wrong thing,” said the conveners’ letter.

Families wanted to know the responsible organisation had been held to account, the letter said.

Justice, but not revenge.  The avoidance of this justice and accountability through companies choosing to go out of business has been highlighted in New South Wales many times, so it is understandable that the reduction of the avenue to pursue justice that may occur in the OHS harmonisation process can generate such letters to politicians.

A significant element in the SMH article is the inclusion of the union perspective.  Trade unions often provide grieving relatives the only support, particularly in the period shortly after a workplace fatality.  And there is the shared grief of losing a loved one and losing an often long-serving union member.

This article and the letter to the Minister add an important emotional and social element to the development of the new national model OHS laws.  Whether the government will incorporate mechanisms to achieve justice in the legislative framework or in secondary processes could give a good indication to the broader political picture of workplace safety over the next decade.

Kevin Jones

An Ombudsman for the safety profession

WorkSafe Victoria is very keen for the safety advice and management discipline to become professional.  It is providing considerable technical and financial support to the Safety Institute of Australia and other members of the Health and Safety Professionals Alliance (HaSPA).  The current status of HaSPA in Australia has been discussed in other SafetyAtWorkBlog articles.

HaSPA likes to compare itself to other managerial professions such as accounting, medicine and the law, and is trying to establish a contemporary profession.  One of the professions mentioned, law, an established profession for hundreds of years, is seriously considering the introduction of an ombudsman, a concept that should have been established already for the safety sector.

According to a media report in The Australian on 4 September 2009:

A taskforce of federal and state officials is working on a plan to create a national legal ombudsman with unprecedented power over the nation’s lawyers.

If the plan goes ahead, the ombudsman would be able to set standards for all lawyers, oversee the handling of all complaints from consumers and intervene with the profession’s state-based regulators.

One option being considered would establish the office of the legal ombudsman as a new national institution drawing authority from a network of uniform state laws.

This would unify the regulation of lawyers and give state governments a role in confirming prospective candidates for the new national office.

Lawyers, rather than taxpayers, could be asked to pay for the cost of establishing their new regulator.

The taskforce, which has been appointed by federal Attorney-General Robert McClelland, is examining the possibility of establishing the new office as the centrepiece for the promised regulatory overhaul of the legal profession.

OHS law in Australia is undergoing its most major national review in decades.  Shouldn’t the safety profession also develop the “Office of the Safety Ombudsman”?  The legal profession is doing all the work on a model.

Australia has a tradition of effective industry-based ombudsmen.  A list is available online but the most publicly well-known would be the Telecommunications Industry Ombudsman.

[In the last couple of years the safety profession has heard from the Victorian Health Services Commissioner, Beth Wilson, on the purpose and role of the commission and how the safety profession can learn from her support, adjudication and  advocacy.  The commissioner is not an ombudsman but there may be a role for a safety commissioner to address WorkSafe’s concerns over the quality of safety advice being provided by safety professioanls to business.  A video of Beth Wilson briefly discussing the role is available on YouTube.]

The application of an Ombudsman model in the safety profession should be discussed but similar objections will be raised to those of the legal profession in the article quoted above.  Underpinning the objections is that an established profession is resistant to change and suspicious of relinquishing the power it has established over its lifetime.

If the safety advocates are truly committed to establishing a contemporary profession, the concept of a safety ombudsman must be discussed or else  the system of self-regulation will continue and so will the lack of independence, the lack of accountability, the limited communication and the lack of faith by the general community that safety professionals can be trusted to do a good job.

Kevin Jones

The importance of handling professional complaints professionally

Any member of any profession can be subject to the complaints process of that profession’s governing body.  A complaints procedure is an essential element of any organisation.  In fact, one could argue that the professionalism and maturity of an organisation can be judged by how that organisation investigates and handles a complaint.

Not only must a complaint be handled professionally, it must be seen to be handled professionally.

Regardless of whether a complaint is valid or baseless, it is essential to have

  • Clear guidelines on how to make a complaint and the consequences of lodging a complaint;
  • Defined complaints handling procedures;
  • Complaints procedures that have been tested through desktop exercises and simulations;
  • An independent assessor/mediator;
  • An understanding that of natural justice;
  • An independent appeals process; and
  • The commitment to support, in practice, the professional ideals espoused.

Many executives, particularly of volunteer organisations whose good intentions are often not supported by the necessary administrative procedures, resources or skills, run the risk of exacerbating both frivolous and valid complaints.

As can be seen by some of the articles in SafetyAtWorkBlog, from James Hardie Industries to restorative justice to handling aggressive customers, people expect a certain dignity and accountability in their professional dealings.  A major element of safety management, and basic professionalism, is the ability to apologise when mistakes have been made.  For only through an acknowledgement of mistakes can the integrity of a process be (re)established.

Australia’s Prime Minister, Kevin Rudd, has shown the power of the apology when he acknowledged in 2008 the injustices done to Australia’s indigenous population.  It took courage to apologise for actions done long ago by someone else.  The ability to apologise shows a maturity and professionalism that is still lacking from many Australian organisations, voluntary and corporate.

Kevin Jones

Restorative Justice and workplace fatalities – Part 1

The city in which SafetyAtWorkBlog is edited, Melbourne, is struggling to manage a spate of street violence – some racially-based, a lot influenced by alcohol and drugs.  The Age newspaper carried a feature article on 25 August 2009 discussing the concept of “restorative justice”, a concept that is barely known outside of some legal or civil liberties areas, in relation to handling offenders and victims of street violence.

Pages from RJ_and_Work-Related_Death_Consultation_ReportOnly last week, there was an important launch of a research report into the application of restorative justice for those affected by workplace fatalities.  It is a fascinating new area of application for restorative justice in Australia and one that seems a more natural fit than for the more common acts of violence.

The research project builds on a lot of the work already undertaken into workplace fatalities by the Creative Ministries Network. Their research, mentioned in the project report, has shown

“…that families and company directors, managers and workers grieving a traumatic death suffer more prolonged and complicated grief due to delays in legal proceedings, public disclosure of personal information, lack of information, and increased stress from involvement in the prosecution process and coronial and other litigated processes.”

Over the next few days SafetyAtWorkBlog will run a series of articles on the concept and its application as well as being able to make available copies of the research reports and transcripts of interviews with research participants.

As SafetyAtWorkBlog has no legal expertise restorative justice needed some investigation.  Below are some useful definitions and descriptions:

“Restorative justice is a theory of justice that relies on reconciliation rather than punishment. The theory relies on the idea that a well-functioning society operates with a balance of rights and responsibilities. When an incident occurs which upsets that balance, methods must be found to restore the balance, so that members of the community, the victim, and offender, can come to terms with the incident and carry on with their lives.”

“Restorative justice brings victims, offenders and communities together to decide on a response to a particular crime. It’s about putting victims’ needs at the centre of the criminal justice system and finding positive solutions to crime by encouraging offenders to face up to their actions.”

“The term “restorative justice” is often used to describe many different practices that occur at various stages of the criminal justice system including:

  • Diversion from court prosecution (i.e. to a separate process for determining justice);
  • Actions taken in parallel with court decisions (e.g. referral to health, education and employment assessment, etc.); and
  • Meetings between victims and offenders at any stage of the criminal process (e.g. arrest, pres-sentence and prison release.”

[Of course, one can also read the Wikipedia entry)

The intention of restorative justice has more often been to reduce the likelihood of a re-offence.  The application of restorative justice for workplace fatalities seems to be slightly different.  In America, it would be difficult to avoid using the word “closure” (a phrase SafetyAtWorkBlog refuses to use as there is never a close to grief, only a way of living with it) as one of the aims of the workplace fatality application.

There are many effects of a workplace fatality on executives and companies.  It is hard to imagine a company that, after one fatality, would not do all it could to avoid another.  Restorative justice has the potential to heal the surviving victims – family and company.  It can also reduce the animosity that often results from the traditional adversarial justice system, particularly for those participants who may not have been exposed to such processes before.

Kevin Jones

Peanut allergy fatality saga to continue

Safety management in the education sector seems to be one of the hardest management challenges.  There are overlapping safety obligations through OHS legislation, education department guidelines, public health matters and meeting the demands of parents and students.

700 Peanuts - Federal Court coverA decision in the Federal Court of Australia on 30 June 2009 illustrates the challenges.

A 13 year old boy from Scotch College, in Melbourne, Nathan Francis, died after eating from a ration pack of beef satay on a Defence Forces camp.  The school, which was supervising the camp, were aware of the boy’s severe allergy to peanuts.

The Australian Department of Defence was fined over $A200,000.

The full judgement of the court raises several  issues that are relevant to the management of safety of people in one’s care.  The judge has recommended a State coronial inquest to determine the roles and responsibilities of Scotch College in Nathan’s death.

Justice for Nathan and his family is likely to have many more months to go. [ SafetyAtWorkBlog will follow the issue.]

A fantastic audio report on the decision is available at the ABC website. The payment of the fine back to the government is not dealt with in this blog.

The first section of the judgement (below) indicates what the judge believes are the failures that need to be addressed through an appropriate safety process:

  • Communication;
  • Instruction;
  • Provision of appropriate supplies;
  • The importance of labelling; and
  • Following procedures and guidelines

Some readers may find that this prosecution could make an interesting case study for safety management.

Kevin Jones

Justice North found that the Federal OHS Act was breached by the Commonwealth government through the Chief of Army.  The respondent

(a) supplied Cadet Nathan Fazal Francis, Cadet Nivae Anandaganeshan and Cadet Gene van den Broek with one-man combat ration packs (CRP’s) containing a satay beef food pouch which contained peanuts or peanut protein for their consumption despite having been informed that the said cadets were allergic to peanuts;
and, in so doing, it failed to:

(b) warn parents of the [Australian Army Cadets] AAC cadets about the contents of the CRP’s;

(c) warn AAC cadets about the contents of CRP’s;

(d) warn AAC cadets with pre-existing food allergies of the contents of CRP’s;

(e) make appropriate use of information provided by AAC cadets and parents of AAC cadets regarding pre-existing or known allergic conditions and correlate that information with the potential risk of being exposed to allergies through the supply of food contained in CRP’s;

(f) ensure that the contents of CRP’s allocated to AAC cadets did not include food products or allergens that may have triggered allergic responses by removing or requiring the removal of peanut-based food products from CRP’s;

(g) prevent distribution or provision of peanut-based food products to AAC cadets with pre-existing allergic reactions by:

i. inspecting the contents of CRP’s to be allocated to those individual AAC cadets who had given notice of allergic conditions;

ii. isolating cadets with pre-existing medical conditions and/or notified food allergies at the time of distribution of CRP’s and issuing them with CRP’s that did not contain peanut products or other food allergens;

iii. removing all CRP’s known to contain peanut protein or other food allergens from circulation amongst AAC cadets;

iv. requiring all AAC cadets with notified allergic conditions to provide their own food supplies;

(h) issue any or any adequate instructions or provide adequate supervision regarding distribution of CRP’s;

(i) issue any adequate instructions or provide adequate supervision regarding consumption of contents of CRP’s;

(j) prevent the consumption of CRP’s containing food allergens by AAC cadets with food allergies;

(k) distribute CRP’s after consulting or considering pre-existing medical conditions; and

(l) take into consideration the findings of a report dated 22 November 1996 by the Australian National Audit Office entitled ‘Management of Food Provisioning in the Australian Defence Force’.

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