due diligence – Page 20 – SafetyAtWorkBlog

HIP Royal Commission – Risk Registers

Cover of ReportoftheRoyalCommissionintotheHomeInsulationProgram SafetyAtWorkBlog has written previously about the evidence of Margaret Coaldrake to the Royal Commission into the Home Insulation Program (HIP) given at the public hearings and also the occupational health and safety role of risk management and risk registers. The release of the Royal Commission’s final report on 1 September 2014 provides further details on a risk management process that is common to all large projects.

Commissioner Ian Hanger spent considerable time on the issue of the risk register as this was one of the crucial elements in the project’s whole decision-making process up to Ministerial level.

Risk Register

Commissioner Hanger was scathing of the risk management process that not only ignored the risk of worker fatalities but purposely dropped this risk from the register. He was unforgiving in his criticism of Margaret Coaldrake. He criticised her judgement. In working with her Minter Ellison colleague Eric Chalmers:

“it was up to [Coaldrake] to make sure that she and the people working with her were qualified to provide the service that Minter Ellison consultants had been retained to do.” (para 7.11.15)

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Fear of exposure rather than pride in their work

“Due diligence” is an established business management concept that only recently came to be applied to occupational health and safety (OHS) in Australia through the Work Health and Safety (WHS) harmonisation process. It’s credibility comes from the Corporations Act, principally, but also Consumer Protection and, partly, Environmental laws.

iStock_000015900242Small The attention given by OHS/WHS professionals and senior executives to due diligence is already changing how workplace safety is managed in a positive way but recently the

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Ministerial responsibility in finance but not in workplace safety

Ministerial responsibility seems to be advantageous in financial policies but irrelevant to workplace safety going by actions by Australia’s political leaders. This week former senior (Labor) parliamentarians, Mark Arbib, Peter Garrett, Greg Combet and Kevin Rudd, will be fronting the Royal Commission into Home Insulation to explain their lack of due diligence on workplace safety matters. This is only a week after the Federal (Liberal) Government released a Commission of Audit report that promoted ministerial responsibility.

The popular perspective is that these ministerial decision-makers will be held to account for the deaths of four young workers but this is unlikely to occur because State occupational health and safety (OHS) laws establish a direct OHS relationship between employers and employees and the senior politicians did not employ anyone who was installing home insulation. The argument at the Royal Commission mirrors the chain of responsibility concept except that in work health and safety (WHS) legislation, government ministers are not covered by the definition of ‘officer’ and therefore have less OHS/WHS responsibility that anyone heading up a company or organisation.

Labour lawyer

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“It’s easier but it isn’t easy” – OHS leadership tips from IOSH

The Institute of Occupational Safety and Health (IOSH) recently uploaded a swag of videos to YouTube, ostensibly, to promote its upcoming conference. One video asks if it is harder or easier to inspire leadership on OHS matters. Most speakers believe it is easier because:

there is a stronger social expectation of higher safety standards,
managing people is more inclusive,
technology allows more effective communication,
leaders are coaches,
people have a greater awareness of how to be safe.

Some believe it is harder because:

it is more difficult to have faith in corporate leaders,
companies have a more complex structure of accountability and responsibility,
there is greater cynicism of corporate leaders due to the GFC in 2007.

One speaker at IOSH’s upcoming conference says “It’s easier but it isn’t easy” acknowledging past improvements and future challenges.

The IOSH videos are promoting the conference but there is food for thought in all of them. Conferences in Australia have tried similar teaser ads (some including the author) for conferences but not to the extent that IOSH has through YouTube. As safety conferences seem to be fading in both length and influence in Australia, such videos will become rarer but, as with rarity, the content may become more valuable.

Kevin Jones

“Safety is paramount”, “safety is our number one priority” = bullshit cliches

After a major incident or at an Annual General Meeting, it will be common to hear a senior executive state something like “Safety is our number one priority”. This is unrealistic and almost absurd because even in the most worker-friendly company, the continued existence of that organisation is the real and ultimate goal. Most corporate leaders believe these safety clichés because they think they reflect their own values but the statements are misrepresenting occupational health and safety (OHS) and need to be questioned.

Corporate leaders who say such statements are not hypocrites. They are more likely to not understand the consequences of their statements. If safety really is the number one priority, an executive should be able or expected to close the company if its work cannot be conducted safely. If a company’s people are paramount to the success of the company, how does it handle an accusation of bullying against a manager? Which of the people does the Board or the company choose to keep and which to lose? Should it keep the “evil” sales representative because the rep is its most effective salesperson or sack the rep because he or she is abusive?

These are executive decisions that need to be worked through if any company is to develop an effective operational culture that truly values the safety of its workers. It is vital that the reality behind the statements is analysed and acted upon, or perhaps such statements should not be uttered in the first instance.

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Prediction on accountability and a political kick in the balls

Responsibility highlighted in green There will be two areas of occupational health and safety attention in the early months of 2014 in Australia – workplace bullying laws and the Royal Commission into Home Insulation Program. The labour law firms are gearing up for a “bumper year” as one said prior to Christmas and the business groups are already lobbying/complaining/whingeing about the workplace bullying laws administered by the Fair Work Commission. However the Royal Commission has the potential for the biggest social and ideological impact so, as the new year begins, I will attempt some predictions of the Royal Commission’s findings based around some of the terms of reference.

Substantial Change

‘the processes by which the Australian Government made decisions about the establishment and implementation of the Program, and the bases of those decisions, including how workplace health and safety and other risks relating to the Program were identified, assessed and managed;’

This paragraph is the one that could have the most long-term effect on governance, due diligence and procurement. There are many suggestions on these issues in the sphere of project management but trying to keep the discussion in OHS, there are some useful comments on the Government procurement of services. Australia’s Federal Safety Commission acknowledges that procurement is an important stage in project design. WorkSafe Victoria’s “handbook for the public sector – health and safety in construction procurement” says

“As procurers, governments can promote better health and safety by requiring projects to include a range of safety measures, such as specifying the safety budget, building layout or the use of certain

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Media coverage on workplace bullying needs more depth and analysis

The Australian media has given workplace bullying the front page, probably because it is a slow news period and there have been no major disasters this Christmas period. However the coverage is of the new rules and opportunities for assistance offered by changes to the Fair Work Act that commence on 1 January 2014, rather than about prevention.

Most of the comments from the business groups in the article by The Age newspaper will be familiar from the last few months. Generally they object to what they see as red tape and increased regulation. Some also believe that workplace bullying should be handled through human resources rather than as an occupational health and safety (OHS) matter.

Red tape and unnecessary bureaucracy is a legitimate concern but one that, in large part, the business sector has allowed to happen. As discussed previously, much of the red tape originates from the risk management strategy of business where, when an issue or hazard cannot be eliminated or it is too difficult to try, insurance or liability protection is obtained. As others have said, too often the risk management of safety is corrupted to become risk management of legal issues. Continue reading “Media coverage on workplace bullying needs more depth and analysis”

Category: due diligence

HIP Royal Commission – Risk Registers

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Fear of exposure rather than pride in their work

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Ministerial responsibility in finance but not in workplace safety

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“It’s easier but it isn’t easy” – OHS leadership tips from IOSH

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“Safety is paramount”, “safety is our number one priority” = bullshit cliches

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Prediction on accountability and a political kick in the balls

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Media coverage on workplace bullying needs more depth and analysis

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