Category: politics

Corporate accountability – Lessons from Lehmans

Yesterday,the CEO of Lehman Brothers, Richard Fuld Jr, faced an inquisition at the House Oversight and Government Reform Committee.  It was uncomfortable to watch but fascinating.

Video of the hearings shows the questions focused on Fuld’s accumulation of wealth in the good times and the retention of wealth in the bad times. There are parallels with the non-financial accountability of corporate leaders on matters such as workplace safety and corporate social responsibility.

The chair of the committee, Henry Waxman, spoke of company documents that 

“portray a company in which there was no accountability for failure”.

Waxman said he was troubled by the attitude of Fuld where Fuld would not acknowledge any wrongdoing. Fuld did accept responsibility for the failure of the company but would not accept that his behaviour or the behaviour of the company he lead, contributed to the failure.  In other words, Fuld would not accept that his company had a culture that may have contributed to the bankruptcy.

There will be more of this type of inquiry and in many countries other than the United States.  OHS managers should not sit back and watch the chief financial officer squirm with discomfit and anxiety for the way that the financiers handle this crisis, as there are important lessons about their own accountability, responsibility and disaster planning.

Workplace depression approaches are too narrow

Further to other SafetyAtWorkBlog posts concerning Ms Paula Wriedt’s sacking, Ms Wriedt has issued a statement expressing her disappointment at Premier David Bartlett’s decision.

One comment from a newspaper columnist struck me as odd but worthy of note.  The columnist said that Paula Wriedt’s public statements have followed the line pushed by beyondblue, a depression support and lobby group.  I have had no dealings with beyondblue but note that newspaper articles often end with “For further information on depression contact…..” similarly television news reports.

beyondblue has been a spectacular success in self-promotion and, hopefully, increasing awareness of depression.  In the context of the Premier’s decision on Paula Wriedt, David Bartlett contacted the chair of beyondblue (and former Victorian Premier) Jeff Kennett, prior to his decision.  The Weekend Australian newspaper reported

“I have not taken this decision lightly; in fact, decisions don’t come any tougher than this,” Mr Bartlett said. He received support from former Victorian Liberal premier Jeff Kennett, the chairman of depression support group Beyondblue.

After speaking to Mr Bartlett, Mr Kennett told The Weekend Australian he believed the decision was a very tough call for the Premier, but added: “When you balance up all his responsibilities, the correct one. It might just be what Paula needs to start rebuilding her health.  That is, she doesn’t have other ministerial responsibilities now and she can now focus more directly on her recovery.”

beyondblue does admirable work and has acheived much but it is dominating the discussions on psychosocial issues in the workplace.  It is difficult for other groups to raise matters that are just as relevant to the workplace, if not more so, such as occupational violence, stress, dignity at work, and so on.

We are not yet clear on all the circumstances of Paula Wriedt’s suicide attempt, and we may never know.  We do not know if work stresses or private stresses caused her self-harm but that is not necessarily the point.  Occupational health and safety long ago left the confines of the workplace and controlling workplace hazards, particularly psychosocial issues, needs a bigger canvas.  There must be an approach that assists the individual in work and non-work contexts. 

Some countries and States are trying this through work/life balance initiatives but the approaches are usually skewed to focus on interventions on the individual rather than looking at the social structures.  In OHS we look at the “system of work” to determine the most effective interventions.  To affect true and lasting change, we must apply the “system of living”.  We must be careful not to over-emphasise the individual and be distracted from the cultural initiatives.

Politician who attempted suicide is “sacked”

In early August 2008, Paula Wriedt, Tasmanian MP, tried to commit suicide.  Six weeks later the Tasmanian Premier has sacked her from Cabinet, according to an ABC report.

Premier David Bartlett denies this is a sacking, more a “withdrawal of commission”.  He says it is for the good of the government and for the good of Ms Wriedt.

Ms Wriedt was asked to resign her Cabinet position but the Premier says she was “not in a position to make such a decision”.

An audio interview with the Premier put to him that his decision was “despicable” and “reflects the way the state deals with people with mental health problems”.

Ms Wriedt’s suicide attempt had already raised discussion on the workplace issues of stress, compensation, workloads and mental health.  The listener’s question in the audio interview will reflect the majority of the community’s response to the Premier’s decision and Premier Bartlett will have a difficult time explaining how his decision was for Ms Wriedt’s benefit.

Ms Wriedt’s current situation and future career decisions will provide an interesting illustration on how the public service and Tasmanian politics manages an employee with mental health issues, particularly when, on OHS matters, the public service should be exemplars.

Politicians’ workplaces

Western Australian Premier, Alan Carpenter, is to be applauded for stating that the Parliament is a workplace.  This sounds like stating the bleeding obvious but Parliament has often turned a blind eye to this fact.

Certainly, the Premier is in election mode so there is an additional context in this period to everything he says. On 22 August 2008, he was talking about a working bar that exists in the State Parliament and how inappropriate it is. The media reported him saying:

“Parliament House is a work place, the members of parliament should not be able to drink freely during working hours,” Mr Carpenter said.  “Having a bar serving alcohol during working hours is completely out of step with community expectations. It is completely unacceptable that members of parliament are able to sit in a bar in their workplace and drink when they should be working on behalf of the community.”

There may be good reasons for having a bar in a workplace, but it may be inappropriate for workers to use the facility during business hours.  For years, many workplaces have introduced policies concerning drugs and alcohol to, in my opinion primarily, to cover themselves against legal action.  Thankfully such policies can also have a workplace safety role in the reduction of impairment.

Impairment relates to one’s fitness for work and is easiest to understand in the transport industries where one person is responsible for the safety of many members of the public.  But I have never understood why the logical extension of impairment to decision making in other workplaces has not be made.

In a workplace, such as a Parliament, or a goverment building, where decisions are made that will affect the safety and welfare of the public, decisions should be made with no impairment,  Policies should not be decided over a couple of bottles of scotch which was reported to be done by an education minister in Victoria several years ago.  Another politician was “under-the-weather” in Federal parliament some years ago, even though the current Federal Parliament has no bar onthe premises.

Considering that Parliaments are workplaces, the governments should review other hazards that are being addressed in other Australian workplaces.  The top of the list would be reasonable working hours, fatigue and stress.  In most Parliaments, the security issue is being dealt with but workplace bullying could be applicable.

Alan Carpenter’s comments were political statements in an election campaign so they have a dubious weight but let’s start thinking of Parliaments as workplaces and start seeing our politicians as exemplars in OHS.  If safety culture starts with leaders and safety champions, then can we blame workers and business operators who follow our leaders’ examples?

Who manages safety – employers or inspectors?

Over the last few days at the Tasmanian inquest into the death of Larry Knight, several geotechnical consultants and experts have been going through their reports to Beaconsfield Mine management.  These assessment reports were undertaken before the collapse that caused Larry Knight’s death.  The impression from media reports is that mine management listened to, or read, the recommendations and made a decision. That decision seems to have not given the technical advice the weight that hindsight now shows was insufficient but hindsight does that and Coroners understand this.

Also safety decisions are made by the employer in consultation with their workforce and external experts, where necessary.  Beaconsfield Mine management did this.  The decision to mine on that fateful day obviously proved wrong but perhaps the decision was understandable.

The Australian on 12 August 2008 reported that senior technical consultant Frans Basson admitted that the mine was technically “in breach of his written recommendation to management”.  I found this extraordinary as “breach” is a term more often applied to when a rule is broken.  It seems that the mine management chose not take on the recommendation of a consultant.  That happens all the time but to give the decision more significance than this is, perhaps, a little unfair.  Let’s hope this was lawyer’s hyperbole.

How to describe the comments by former Mt Lyell engineering supervisor and ex-parliamentarian, Peter Schulze is more of a challenge. Inaccurate is probably the most generous term.  At a Tasmanian Legislative Council committee on 13 August 2008, Peter Schulze criticised “all these experts who pontificate with the benefit of hindsight” about mine accidents.  Okay, the wording is extreme but he makes a similar point to mine above.

He also echoes some of the recent criticisms of the OHS regulator in Tasmania, Workplace Standards. By inverting some of his comments reported in The Advocate on 14 August 2008, he believes that current inspectors are under-skilled in the mining sector and under-paid and that there are not enough.  I would support him in his calls for additional enforcement resources but he is confused over the role of the inspectorate.

The primary responsibility for safety in a workplace is held by the employer – the controller of the workplace and main beneficiary of its productivity.  Peter  Schulze says that 

“The inspectorate tends to isolate itself from accidents and comes in to blame the company … rather than being a party (to safety procedures and checks) and accepting some responsibility.”

Why on earth should a government department accept any responsibility for the operations of a privately-run business when there is legislation that states the responsibility rests with the employer?

Peter sees the system as being adversarial.  There are clear roles for the differing elements in a workplace but conflict is resolved through negotiation, consultation and resolution.  An adversarial climate in a workplace indicates a dysfunctional workplace but this does not mean the regulatory system is at fault.  Safety management systems are a systematic management of a workplace with the aim of improving safety.  Management is the key and this rests with the employer.

What New South Wales unions need to give up for harmony’s sake

Gerard Phillips, a partner in the Middletons law firm, wrote in the 7 August 2008 edition of the Australian Financial Review about the belligerence of the trade union movement in New South Wales in relation to the harmonisation of OHS Laws in Australia.

He addresses two legal barriers to harmonisation that he believes should end.  In New South Wales unions have the legislative right to prosecute safety breaches.  Gerard argues that harmonisation won’t be achieved without the unions relinquishing this right.

It has been clear for months that New South Wales will have to give up some elements of its OHS legislation in order to allow harmony.  If it needs to save face, it would be lobbying now for enough resources at a national level to mount rigorous OHS enforcement.

As the Victorian OHS law is the front runner for a national OHS legal model, unions can take some solace from the extension of Victoria’s right of entry provisions that, prior to 1984, were tipped to generate industrial warfare In Victorian worksites.  There were, at the time, many lawyers touting for business by recommending a tightening of paperwork, vetting all credentials before letting “them” on your site and accompanying “them” wherever they go.

Business achieved some important concessions with the registration of ARREOS (Authorised Representatives of Registered Employee Organisations) and a legal comeback if the ARREOS breach their authority, but an ARREO visit can still be daunting as WorkSafe found in February 2008.

WorkSafe advises that

An ARREO may enter a workplace during working hours to enquire into a suspected contravention of the OHS Act or regulations. The suspected contravention must relate to or affect the work being carried out by people who are:
• members of the registered employee organisation;
• subject to a certified agreement which binds the registered employee organisation; or
• eligible to be members of the registered employee organisation and are not subject to a certified agreement.

Gerard Phillips also can’t see why a union should have prosecutorial powers that no one else, other than the OHS regulator, has.  Although he acknowledges that for enforcement to work any prosecutor must be “appropriately funded”.  If the New South Wales government decided to reduce WorkCover NSW costs by sharing responsibility, I don’t think the economic benefit outweighed the political damage.

Phillips also sees no great difficulty in the onus of proof being held by the prosecutor.  This authority is already in the legislation of Victoria and Western Australia with no complaints from the union movement that safety standards have declined as a result.  The unions will need to give ground on having the onus rest with the business owner, and the employer groups will dance a gig when they do.

I remember Australia’s Royal Commission into the building industry where employer groups asserted, with little proof, that OHS is used by unions for purposes of industrial action.  Terence Cole in his final report illustrated the accusations well.

“….employers have raised concerns about the unions raising industrial concerns under the guise of safety issues, and the adoption of the role of safety policemen by unions to the exclusion of the statutory inspectorates. The issue of safety is a constant source of friction in the workplace, either because it is not being appropriately addressed, monitored, enforced, or is being abused.”

This may or may not be true, however unions in New South Wales risk providing the truth that employer associations have long desired if they continue in holding onto a strong poker hand when the other players have changed to playing whist.

Gasflow resumes from Varanus Island

Apache Energy has advised that gas flow has been reinstated on 6 August 2008 following the June 3 pipeline explosion on Varanus Island.  This has been achieved earlier than forecast.

Apache Energy’s MD, Tim Wall, said he was 

“…pleased to welcome the Premier of Western Australian, Hon Alan Carpenter MLA and the Minister for Energy, Hon Fran Logan MLA to site today to witness first-hand the restoration and repairs to the Varanus Island facility.”

According to a media statement, the partial resumption of supply is expected to be ramped up a further 120 TJ/day to 240 TJ/day by mid-August and pre-incident rates of production by the end of the year.

Alan Carpenter told reporters

“This is a significant relief for gas users as well as the economy of Western Australia…The worst of the situation is clearly over; we still have a long way to go.”

Mr Carpenter could also have been talking about his political future as only a day later he called a snap election for September 6.  The resumption of gas flow must have been one of the factors encouraging this call, which has been described as “panicked” by many commentators, although far less influential in his decision-making than the resignation of the short-term opposition leader, the world-famous chair-sniffer Troy Buswell.

© Workplace Safety Services P/L (ABN: 68091088621) and SafetyAtWorkBlog, 2008-2024. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Kevin Jones and SafetyAtWorkBlog with appropriate and specific direction to the original content.

Concatenate Web Development
© Designed and developed by Concatenate Aust Pty Ltd