Company directors and OHS obligations

Since the final report of Australia’s Review into Model OHS Law, discussion has been remarkably quiet.  The ACTU was scheduled to meet for discussions on the report last Monday and no public statements have been made.  Most of the labour law firms have been quiet also.  It is fair to say that most are trying to digest the 480 page report.

But one employer group has provided an opinion piece in the business pages of The Age newspaper on March 2 2009.  The article says little that is new but it is mischievous in some of its comments. 

John  Colvin, CEO of the Australian Institute of Company Directors, writes of his concerns about increased exposure for the Institute’s members.  Colvin is concerned that upcoming OHS laws may be unprincipled and counterproductive.

The Model OHS Law report has said that it supports the statement of OHS principles as are already in place in the Victorian OHS legislation.  According to WorkSafe Victoria

“The Act sets out the key principles, duties and rights in relation to occupational health and safety. The general nature of the duties imposed by the Act means that they cover a very wide variety of circumstances, do not readily date and provide considerable flexibility for a duty holder to determine what needs to be done to comply.”

These principles are

4. The principles of health and safety protection

(1)    The importance of health and safety requires that employees, other persons at work and members of the public be given the highest level of protection against risks to their health and safety that is reasonably practicable in the circumstances.

(2)    Persons who control or manage matters that give rise or may give rise to risks to health or safety are responsible for eliminating or reducing those risks so far as is reasonably practicable.

(3)    Employers and self-employed persons should be proactive, and take all reasonably practicable measures, to ensure health and safety at workplaces and in the conduct of undertakings.

(4)    Employers and employees should exchange information and ideas about risks to health and safety and measures that can be taken to eliminate or reduce those risks.

(5)    Employees are entitled, and should be encouraged, to be represented in relation to health and safety issues.

The article is mischievous in a number of areas.  Colvin mentions how the current laws vary from state to state.  He mentions that

Some carry personal criminal liability for directors, even where they may not have had any personal involvement in a breach. In some states, they reverse the onus of proof, removing the presumption of innocence, and offer narrow legal defences and limited appeal rights.” (my emphasis)

Colvin is talking primarily about New South Wales, the State that everyone agrees has the OHS law that is most onerous for employers.  However, the New South Wales union movement has been remarkably quiet and flexible on the issue of its OHS laws.  There has been some rhetoric for the benefit of its members and to retain some ideological “face” but the union movement across Australia is coming to accept the reality of better OHS outcomes from nationally harmonised legislation.  

Repeatedly the National OHS Law Review panel stated that it has based its decisions on the structure of the Victorian legislation as, for one reason, it has undergone the most recent legal review.  Colvin’s focus on New South Wales OHS law is outdated, reflective, and unhelpful.

Colvin mentions a survey that found

“..more than 65 per cent said the risk of personal liability occasionally made them take an overly cautious approach in the boardroom and another 13 per cent said this happened frequently. Almost two-thirds felt this had inhibited an optimal business decision to a medium to high degree.”

This indicates that the risk of being prosecuted on OHS breaches is being discussed at board level – great result.  Whether this translates to the board improving the OHS performance of their company is doubtful as Colvin’s article implies that directors are looking at ways of avoiding responsibility and liability rather than accepting the reality of their OHS obligations and working to improve them.

Colvin says that

“Directors should not be held criminally liable for a company’s misconduct simply because they are a director.”

Directors are not prosecuted for OHS breaches because of their status or position.  They are prosecuted because of the decisions that they make and the ramifications of those decisions.  If a director is dismissive of OHS issues and palms them off to someone else in the organisation and an incident occurs, should not the director be called to account for why they considered the safety of their workers to be unimportant, even when for over thirty years directors and executives have had responsibility for OHS compliance?

Colvin believes that holding directors accountable implies that directors have more control over the actions of their employers than they do.  Current business and management theories promote the position that directors should be more in touch with what is happening on the shopfloor.  The theories promote informed leadership and an increased awareness of how the company and its people work, they promote a level of engagement that creates a positive workplace culture and displays leadership.   Colvin seems to be encouraging the opposite.

He ends his article with

“More fundamentally, it unfairly treats directors more harshly under the law than the rest of the community.”

He misunderstands the application and aims of OHS law.  All people in a workplace have a responsibility to ensure a safe and healthy workplace for themselves, for employees and for members of public on and off their worksites.  Directors have more detailed obligations, but not less, because they have control of production and benefit more from the success of the company than do the employees. 

Ultimately, Colvin’s article reflects the misunderstanding of OHS that directors and companies have had for decades.  Companies need to realise that the best performing companies in OHS, and those with the best productivity, are those that have embraced their obligations for safety and have incorporated the principles within their own culture. 

The review into model OHS law has indicated the way of the future and company directors would be well-served to realise this and get on board.  Being left behind will benefit no one, especially the shareholders.

Kevin Jones

CEO loses job over safety failures

Health funding and management is a constant political issue.  The attention increases hugely during election campaigns like the one that is currently occurring in the Australian state of Queensland.

This week the leader of the opposition parties, Lawrence Springborg, called for the release of a government report into the sexual attack on a nurse and security in Torres Strait islands.  SafetyAtWorkBlog has written repeatedly on OHS issues associated with the attack in February 2008.  Springborg has pledged increased safety resources for remote area nurses.

Queensland Health reports on 25 February 2009 that the CEO of the Torres Strait District’s health service CEO has been stood aside as a result of the government’s investigation.  The statement reads

“Director-General Michael Reid said the Crime and Misconduct Commission had reviewed the report by the Ethical Standards Unit and was satisfied with the investigation.
“Some allegations that members of the Torres Strait and Northern Peninsula Health Service District executive did not act appropriately were upheld by this investigation,” he said. “We accept this investigation has found serious faults in the way Queensland Health staff responded to this critical incident and we are taking immediate action.”
The CEO of the Torres Strait-Northern Peninsula District has been stood down, effective immediately, while her role with Queensland Health is under further consideration.”

Many of the issues raised relate to possible corruption and improper behaviour by the Queensland Health and others.  These are the political points that Springborg is likely to chase.  

In terms of occupational health and safety, the focus of this blog, Queensland Health says

“There is substantial evidence that there has been a systemic failure by the Torres Strait and Northern Peninsula Health Service District to acknowledge and address workplace health and safety issues within the District over a long period of time.”

“There is sufficient evidence to conclude, on the balance of probabilities, that members of the Torres Strait and Northern Peninsula Health Service District (TSNPHSD)
Executive responded inappropriately and insensitively when notified of the alleged rape of a Remote Island Nurse on Mabuiag Island on or around 5 February 2008.”

“Further, there is sufficient evidence exists to find, on the balance of probabilities, that the repatriation of the remote area nurse from the outer islands as not managed or coordinated at a level cognisant with the seriousness of the events which had occurred.”

It is no wonder the CEO of the health service has lost her job.  It is a little surprising that more, and more prominent, heads have not rolled.  It is suspected that this may be one of the aims of the opposition politicians during the current election campaign.

To return to our core issue of OHS and accountability, this result clearly indicates that senior executives, particularly in the public sector in this instance, must take a preventative approach to the health, safety and security of their staff, wherever the employee is located.

Kevin Jones

Beaconsfield Mine Collapse – Coroner’s Report Released

On 26 February 2009, the Tasmanian Coroner, Rod Chandler, released his findings in to the death of Larry Knight in the Beaconsfield mine collapse of April 2006

The Coroner found that 

“the evidence does not permit me to make a positive finding that any person, corporation or other entity, by their conduct, directly contributed to Mr Knight’s death.”

The report is available for download HERE

SafetyAtWorkBlog will bring more information on this important decision over the next few days.

UPDATE

The brother of Larry Knight, Shane, and union representative Paul Howe, have expressed their disappointment with the findings of the Tasmanian Coroner.  In an interview with journalists there was mention of the inadequacies in the risk assessment process, the poor resources of Workplace Standards Tasmania, the lack of attention given to safety advice from multiple consultants.

Shane Knight continues to believe that the mine management was responsible for the death of his brother.

Paul Howes called on the government to end the approach of self-regulation and called on business to not put profit before safety.

Safety Interviews

A couple of weeks ago I conducted interviews with several speakers in the Safety In Action Conference to be held in Melbourne, Australia at the end of March 2009.  The finalised videos are below.

Helen Marshall is Australia’s Federal Safety Commissioner who has a challenging job monitoring major government construction sites.

Dr Martyn Newman is a a fascinating speaker on the issues of leadership and emotional intelligence and how safety professionals can benefit for applying these concepts to their corporate aims.

Jill McCabe is a recent member of WorkSafe Victoria who provides quite startling survey information on the attitudes of supervisors to workplace safety.

Barry Sherriff is a partner with law firm Freehills and was recently also one of the review panellists into Australia’s OHS law review.  Since this video, the final report of the panel has been publicly released and Barry will be discussing harmonisation at the Safety In Action conference.

John Merritt is the Executive Director of WorkSafe and a strong advocate of workplace safety.  

Although part of my job is to help promote the Safety In Action conference, I have tried to provide a resource that will not be temporary and is actually useful to safety professionals everywhere.

Tip: Use the high quality YouTube settings if you can.  It makes these much easier to view but does not improve the appearance of the interviewer.

Kevin Jones

 

Lessons from a draft medical code of conduct

The safety industry in Australia may be seeking to become a recognised profession but, as with most business processes, continuous improvement is an important element of remaining current.

The Australian Medical Council has released a revised draft code of conduct with which several members of the Australian Medical Association (AMA) disagree.

According to an AMA media release,  Professor Paul Komesaroff, Director of Monash University’s Centre for Ethics in Medicine and Society, and Associate Professor Ian Kerridge, Director of Sydney University’s Centre for Values, Ethics and the Law in medicine, believe the draft Code

“was likely to be counterproductive for four main reasons:

  • it was very unclear how standards could be enforced; 
  • the Code was based on a single concept of ethics, lacking a sufficient appreciation of our multicultural diversity; 
  • it contributed to an insidious, creeping authoritarianism; and, lastly, 
  • the code would suggest that good practice involved following the same rules in all circumstances rather than responding to individual circumstances and needs.”

The professors said

“Codes of conduct can either expand the ability of individuals to make their own decisions and maximise their opportunities for ethical action, or they can claim authority beyond their capacity and encourage the belief that good practice simply involves following a formula and applying the rules.”

The medical code of conduct is only a draft so there should be robust debate.To do so publicly may appear unseemly to some but ultimately, when issues are resolved, the public (the clients) can bear witness to the exhaustive and open process organisations have used to establish professional standards.  

The lesson for embryonic professions like safety is to follow the advice I provdie consultants of any profession – look outside your comfort zone to better understand what you do.

The quote above suggests that a registered profession does not need to be regimented and controlling.  To be described as professional is a compliment, but the risk is that “professional” can come to mean blinkered and, ultimately, fearful.  A profession risks becoming infected by “an insidious, creeping authoritarianism”.

Many in the safety profession are promoting “leadership”, “innovation”, “resilience”.  Perhaps we should be promoting an inclusive terminology that has an established and, usually, reputable history, like medicine.  Safety “profession” can include all of the modern business jingo in a proven framework rather than confusing ourselves, our clients and our regulators, with “Newspeak“.

Now that would be doubleplusgood.

Kevin Jones

Response to National OHS Law Review

In the Australian Financial Review on 17 February 2009 (page 8 but not accessible online) Steven Scott reports that the Western Australian Treasurer Troy Buswell is in a stoush with the Federal government over OHS laws.  They are not.  Buswell is quoted as saying

“My view is that it’s much more appropriate to make sure you get it right…  We will not be supporting the establishment of Safe Work Australia until we are in a position to commit ourselves to the full harmonisation process.”

Buswell wants more time and more information.  He is also concerned about the (related) industrial relations changes.  Only last week, Buswell was at a Senate Committee supporting West Australian businesses.  The Treasurer’s stance is at least consistent and prepared for flexibility.

Michael Tooma, a labour lawyer with Deacons in Sydney, is reported as saying  that 

“These right of entry provisions could be used for ulterior purposes, either for a recruitment drive or as a way of causing industrial agitation….. It gives unions the right to use OHS as a Trojan Horse for the purpose of entry onto sites.”

In his initial analysis of the final report Tooma wrote

“The Panel took the view that union right of entry contributes in a positive manner to OHS compliance at a workplace level.  It recommended that the model Act provide right of entry for OHS purposes to union officials and/or union employees formally authorised for that purpose under the model Act.”

and that 

“These recommendations have the potential to industrialise the safety agenda.”

The review panel is acting on the fact that workplace safety is already industrialised and that those who continue to split to two areas are denying reality.  OHS cannot be managed successfully without also working with the human capital and industrial relations context.

The right-of-entry provisions in any legislation is a hotly contested ideological battle and there is plenty of evidence through the many submissions to many OHS and IR reviews of this.

Right-of-entry is not a threat of punishment and is readily avoided through workplaces having active and functional methods of consultation and safety management.

Similarly, concerns are being raised over the introduction of Provisional Improvement Notices (PINs) in some jurisdiction.  PINs are an acknowlegement of a breakdown in communication and a dysfunctional safety management system in the workplace.  In some workplaces PINs are never applied because everyone talks about safety in an open and accountable fashion.

Many of the concerns being raised over this final review panel report can be addressed by safety professionals and advocates publishing examples of how alarming legislative provisions have proven to be non-starters.  The power may be on the legal register but are infrequently applied.

When the new right-of-entry provisions were being introduced in Victoria, many lawyers and employer representatives said the world would collapse.  It hasn’t and the sensible control and oversight of the process is now recommended across Australia.

It is perhaps time for WorkSafe Victoria to re-emphasise the success of the right-of-entry management process it has operated under for several years.  John Merritt, CEO of WorkSafe Victoria has spoken very positively of the process.  An information sheet on the issues for employers is also available.

Kevin Jones

National OHS Review – initial comments

Several OHS colleagues on an international discussion forum have expressed some opinions on the final report of the Australia’s National Model OHS Law review.

Safety Alerts

One asked that better and more frequent safety alerts be published by the regulators and that those reports be based on fatalities, injuries and near misses.  

There is an inconsistency of  incident reporting in Australia.  For instance, emergency service departments have different ways of notifying the media of incidents.  Most rely on regular (multiple times each day) visits to their websites.  This option doesn’t work unless one has tracking software or are doing nothing else.  Several distribute email bulletins on a daily basis.  Most of the bulletins deal with traffic incidents, floods or bushfires, but several also report on emergency incidents to individuals and, although not explicit, many occur in workplaces.

Incident alerts from emergency services are good because it is a service that OHS regulators and enforcers also receive and act upon.

For many years, various Australia safety organisations have published OHS solutions databases or, initially, folders.  The maintenance of these have fluctuated over the years in relation to technological change and political interest.  It is pointless trying to establish a fixed-point or hard-copy library when the Internet is now the primary resource tool.

It should be added that considerable information can be garnered from court reports of OHS prosecutions however, the Magistrates’ Courts do not provide publicly accessible court reports so any matters heard at that level are rarely reported, except by someone who is sitting in the court.  To gain a proper understanding of the OHS legislative process, coverage of all levels of legal action should be encouraged.

Risk Management

Another colleague expressed concern about the use of “risk” throughout the report.  Below is a section of the report that explains the review panel’s approach:

“In Chapter 30, we discuss the role of the risk management  process in the model Act.  As we noted in our first report, risk  management is essential to achieving a safe and healthy work  environment. We found that risk management is implicit in the  definition of reasonably practicable, and as such, need not be  expressly required to be applied as part of the qualifier of
 the duties of care.  Further, as we discuss in this report, risks  can be successfully managed without mandating hazard  identification and risk assessment in all cases, particularly  where the hazards are well known and have universally  accepted controls.

 Therefore we recommend that the model Act should not  include a specific process of hazard identification and risk  assessment, or mandate a hierarchy of controls, but that the  regulation-making power in the model Act should allow for the  process to be established via regulation, with further guidance  provided in a code of practice, as is contemporary practice.
 The application of risk management process should however be  encouraged…” (page xviii)

Throughout the review process the Victorian OHS Act was the most influential piece of legislation and that Act removed the previous requirement to assess workplace risks to determine the most appropriate control measure.  WorkSafe Victoria had, for years, advocated in its publications and guidelines to “Find-Assess-Fix”.  The “Assess” was dropped in many instances as the suitable control measure had been well-established just not widely applied.  

The WorkSafe position was in response to those business operators who may say “I don’t care how hazardous the bloody thing is just fix it!”  It was hoped that this would save time and “unnecessary” paperwork, and that other State jurisdictions would take the same approach.  None did, and the removal of “Assess” confused businesses and safety professionals as it is a major inconsistency with the Australian Standard on Risk Management.

WorkSafe tried to calm the confusion by saying that they still though assessing risks was a good idea for many new and developing hazards, just that assessment could be done away with as a legislative requirements in most instances.

It seems like the National Review Panel supports the Victorian approach to risk assessment.  Not so long ago, the New South Wales government subsidised a lot of training for farmers and others in the agricultural sector on risk assessment.  Now it will have to re-explain.

The other concern with the panel’s approach to risk assessment is that it sees risk management as fitting within “reasonably practicable”, a concept that SafetyAtWorkBlog is not convinced helps in managing safety.  “Reasonably practicable” is a concept that is defined and refined through prosecutions and court processes, therefore, it can change and it is best interpreted by lawyers.  OHS legislation was designed to be readily understood by the layman for where the responsibility for safety sits with the employer and, to a lesser extent, the employee.  As soon as law firms are brought into the process, information is locked away under lawyer-client privilege, the cost of safety skyrockets and any safety management lessons are delayed until the court case is heard (or not heard) years later.

It should be remembered that the National OHS Model Law was about the law relating to workplace safety not the implementation of safety management.  It is this differentiation that needs to be constantly pushed to the government to avoid workplace safety becoming a management task that cannot be undertaken without a lawyer watching intently over one’s shoulder all the time.

Kevin Jones

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