Tag: CEO

Australian Standards and OHS harmonisation

This morning in Melbourne, WorkSafe Victoria conducted a three-hour seminar on the harmonisation of Australia’s OHS laws.  The speakers and panelists were John Merritt of WorkSafe, Tracey Browne of the Australian Industry Group and Cathy Butcher of the Victorian Trades Hall.  Tripartism at its best.

The large auditorium was filled with hundreds of attendees, very few were the familiar faces of the OHS professionals who can often dominate such events.

A question was asked to the panel about the application of the Australian Standard for Plant.  The question was, basically, will the Australian Standards be referred to within the upcoming OHS regulations?  The panel unanimously said no.

This was the clearest indication yet that the rumour about Australian Standards not being given legislative legitimacy through legislation is correct.  Tracey Browne however provided the rationale.  She said

“The important thing is that as soon as we incorporate an Australian Standard in a regulation, we create a whole different legislative status of something that was never designed to be a safety regulation….

This doesn’t change the fact, though, that it is the “state of knowledge” and when you look at what you are doing in relation to what is reasonably practicable, you need to take into account all the things you know or ought to know.  So if you are [for instance] bringing plant into Australia, and that is your business, then you need to know what the Australian Standards are and make sure that’s part of your consideration.”

Standards Australia is undergoing a considerable rethink due to a big loss of funds and in response to the changing regulatory structure in all sorts of industry and financial sectors.  The challenge is acknowledged by the CEO of Standards Australia, John Tucker ,when he discusses a “new way of operating“.

Kevin Jones

Not all employers are the same

Recently SafetyAtWorkBlog reported the umbrage that the Australian Institute of Company Directors (AICD) felt about executive accountability, particularly in relation to OHS legislation.  On 25 October 2009 the Australian Chamber of Commerce and Industry (ACCI) provided an example that should stop generalisations about employer associations , at least for a little while.

Below are extracts of the significant statements made by ACCI and attributed to its CEO,  Peter Anderson:

“Safe Work Australia Week [is] an opportunity for employers and employees to step back and review their approach to ensuring safety within their workplace.

It is essential that at regular intervals time is taken to step back and take a fresh look at the bigger picture of workplace safety. Safe Work Australia Week presents an ideal opportunity to do so.

Company Boards and Senior Executive teams should regularly review their organisation’s strategy, culture, systems and commitment to workplace safety and make adjustments where needed. Safe workplaces are driven from the top.

However, managers, supervisors and all employees also need to take individual accountability for workplace safety. Workplaces with the best safety records have a culture of clear and shared accountability for safety from the first year apprentice to the Chief Executive.   This is built on the empowerment and obligation of all employees to openly discuss workplace safety, report hazards and incidents, and collaboratively find the most appropriate ways of managing risks.

It is important that in the midst of the current debate about harmonised OHS legislation, the focus on day-to-day workplace safety does not slip.   Legislation is not going to drive further improvements in OHS outcomes in Australia – people’s actions will.   Governments and industry must look for ways to further provide small business in particular with the tools, information, advice and encouragement to effectively manage the challenges and complexities faced in ensuring workplace safety.”

The risk with any national week of special day is that the focus is on a specific moment rather than seeing the issue being raised as one that is relevant for an entire year.  This is very much the problem with Safe Work Australia Week but it is not alone.

Significantly, ACCI makes a clear statement about executives being involved with the management of safety in their workplaces – the attitude and approach of “proactivity” the OHS model legislation is aiming at.

Equally significantly, ACCI discusses the individual accountability of everyone in a company for OHS.  It specifies the elements in support of accountability

  • open discussion or (OHS regulators would say) consultation;
  • hazard and incident reporting; and
  • collaboration.

ACCI is on familiar turf when it says legislation should not be the motivation for change on OHS but employers and other commercial organisations must realise that self-regulation has never been more of an unpopular concept than in the wake of the global financial crisis.  No one can trust business to do the right thing by shareholders, investors or employees.  They want government to make business accountable.

The capitalist ideology says that the wealth created by business is shared with the masses through social and financial structures.  ACCI is trying to rebuild the capitalist structure into a nice, friendly, warm and comforting capitalism because if it cannot, the government will impose social obligations on them.  If the ACCI and other commercial bodies can do this, it will be impressive but the question can be asked why capitalism became so ruthless in the first place and did various employer associations advise companies to act cautiously and keep capitalism in line with the social obligations everyone has?

Workplace safety is an easy indication of the heartlessness of capitalists – increase profits by rushing production and encouraging shortcuts in safety; or not taking the time to train workers well enough that they can work without being harmed.  But if capitalists are willing to try again and NOT follow the same pathways that have been shown to lead to economic destruction, then they should have our support.

Kevin Jones

Nice comparison on Directors’ complaints

In the Australian Financial Review in October 2009  there was an opinion piece (not available online) from the CEO of the Australian Institute of Company Directors (AICD), John Colvin, expressing concerns about the accountability of directors under legislation including the proposed OHS laws in Australia.

According to a report by Adam Schwab in the Crikey newsletter of 23 October 2009 (also not freely available online), Colvin wrote in the AFR:

“There are more than 660 state and territory laws which impose personal liability on individual directors for corporate misconduct. That is, a director is liable because he is a director, even when he may not have had any personal involvement in the breach…”

Schwab writes

“The AICD noted, the NSW courts have taken a hard-line enforcing the deemed liability laws.  According to AICD data, between 2004 and 2008, 144 company directors were found guilty of OHS offences, of which 115 of those prosecutions occurred in NSW.”

Schwab then provides a comparison of risk that I wish I’d thought of:

“That means the proportion of directors convicted over these so-called onerous laws is 0.0068%.  To compare, there is roughly a 0.04% chance of someone being struck by lightning.  Therefore, based on the AICD’s own data, company directors are six times more likely to be hit by lightning than to be prosecuted.  It also shouldn’t be forgotten, directors’ liabilities are almost always covered by indemnity insurance and most prosecutions result in a mere financial penalty.

While the NSW OHS laws result in occasional harsh results, to extrapolate one set of allegedly ill-advised laws across the country is much like a cry of wolf.”

This perspective will be an important one to remember when considering the submissions being lodged with Safe Work Australia on the OHS model laws by 9 November 2009.   The corporate submissions particularly but also those from the OHS law firms that spruiker the exposure of company directors ruthlessly whenever OHS and accountability is discussed.

Some of us remember the “glory days” when industrial manslaughter was widely considered in some Australian States. (There is a noticeable absence of controversy of the industrial manslaughter law that is operating in the Australian Capital Territory)

Also important is the point that Schwab makes about indemnity insurance for Directors and Officers, a matter that has been discussed elsewhere in SafetyAtWorkBlog.

The amount of “get-out-jail-free” options available for directors should encourage more attention to alternative, non-financial penalties for breaches of OHS law.  Over the last 24 hours the United States has been talking about replacing executive cash remunerations with stocks so that director’s incomes are reliant on the share price of the corporation which, in turn, relates to the quality of leadership from the director.

As long as Australia’s principle OHS penalties involve money, directors can buy their way out of trouble.  If Australia’s Prime Minister, Kevin Rudd, can face an entire country and apologise for the bad behaviour of others, and the bad policies of other governments in relation to the interaction with indigenous peoples, why should company directors not have a similar obligation when their poor management of a workplace kills someone?  If corporate executives are that keen on leadership, let’s see them apply some of the leadership that Rudd showed, and accept responsibility when they should.

Kevin Jones

A consistent approach to developing public policy is required

Australia is a Federation of States.  This does not just mean that each State is a different colour of the schoolroom map.  Each State has its own duties to its citizens from within the overall scheme of running a country.

There has always been a tension between the two levels of government and currently the management of health care facilities is the cause of friction, as reported, for instance, in The Age newspaper on 23 October 2009.   The current tension in this sector illustrates a trend that extends beyond health and into workplace safety legislation, human resources and social policy.

The Victorian Health Minister, Daniel Andrews,  is reported to have said that Canberra’s “health bureaucrats [are] remote and incapable of understanding the day-to-day needs of patients.”

“”You can never take it as a given that decision makers and policy makers at the bureaucratic level in Canberra understand how you deliver care in a bed, in a ward or in a country town, because they don’t do that: it’s not their world.”

This argument echoes some of the concerns being raised over the national harmonisation of OHS laws. In such a large country as Australia there are going to be cultural, demographic and geographical variations that a centralised system cannot service.  The Federal Government is hoping to harmonise workplace safety but it has already taken over industrial relations and is strongly threatening a takeover of health.  Why the inconsistency?

On 22 October 2009 at the HR Leadership Awards ceremony in Melbourne, the CEO of Carnival, Ann Sherry, said that centralised policy makers in Canberra are making important decisions from within a rarified world.  Sherry is a member of a review panel into the Australian Public Service (APS) and she identified several features of the APS, and shortcomings, as the service aims to become “world’s best practice in public administration”.  Amongst them:

  • 42% of public servants are younger than 45 years;
  • a highly educated workforce;
  • senior public service positions are centered in Canberra.

The last characteristic Sherry said has led to a disconnection between service design and delivery, echoing, to some extent, the concerns of Daniel Andrews on health policy.

It seems that there are many reviews and investigations occurring into how various industries and sectors in Australian business and government should be structured for the future, a future that is likely to be very different, climatically, economically and demographically.  But there is not a consistency in approaches, or at least one that is readily understood, even though the Australian Prime Minister, Kevin Rudd, talks repeatedly about “nation building“.

The Australian Government has the best chance in a long time to set the country on a path of sustainable growth.  The United States, under President Barack Obama, has a similar opportunity.  Governments have an obligation to plan for the long-term benefit of their countries ands citizens, not the short-term gains of their political donors, political parties and lobbyists.  This obligation  is as relevant in occupational health and safety as it is anywhere.

Kevin Jones

Employer concerns on OHS law review

In support of the Safety Show mentioned in a previous article, the organisers have issued a media release which provides illuminating quotes on the issue of the Australian Government’s program for review of OHS laws:

One of those keen to comment is exhibitor at The Safety Show and chief executive of the Australian Federation of Employers and Industries, Garry Brack [significantly NOT a speaker at the Safety Conference ED.].

“We are concerned about the content of the model laws,” Mr Brack says. “New South Wales’ OHS Act is the most difficult piece of legislation in the developed world and we believe this is a lost opportunity to wind up with more balance.”

“If an employee does the wrong thing, the employer is found guilty. We’re not arguing that employees should be prosecuted but reject the notion that employers should be liable when employees fail to meet safety requirements.”

Clearly Brack has not compared the NSW OHS Act to the Federal Taxation legislation.

Brack reflects many of the perspectives of those who deal with OHS in the State of New South Wales.  The pent-up frustration is clear and the employers do not believe the reassurances from the Federal Government.

Brack also illustrates the desire for prescription in OHS law.  If people, in this case employers, know how to comply with a law, they are more likely to do so.

“Smaller employers don’t have the financial resources and in-house expertise to interpret what is ‘reasonably practicable’. They say ‘Tell us what we have to do’. They don’t wanted to return to the lunacy of years ago where every nut and bolt was defined but they do need a more prescriptive approach and help from regulators.”

He highlights a concern about the OHS laws shared by SafetyAtWorkBlog, small business has always struggled to provide an appropriately safe workplace.  “Reasonably practicable” does not help.  However, Brack’s desire for prescription is nostalgic at best, some would say fantasy.  This government has no intention of taking a seemingly regressive step to prescription and Brack has been aware of this for years.  At some point one has to accept reality and work with what is being offered.

Variations

Another exhibitor discussed the expectation that States will still add their own variations to the model OHS laws.  This option has never been hidden by the government or the various review panels.  In fact, this flexibility has been a major point in the government’s choice on harmonisation rather than uniformity.

“National legislation is highly desirable to avoid the massive duplication of work for national organisations,” Mr [Bill] Henman [of the College of Warehouse Training] says. “Unfortunately, the legislation will be enforced by various state jurisdictions and this will result in variation between states in interpretations, penalties and the finer points of the legislation. The devil is in the detail. [ED. please kick the next person who uses this cliche] Different penalties in different states currently affect the priorities of safety managers and standardised penalties would provide better outcomes.”

Henman needs to read the legislation and supportive documents to see that standardised penalties are proposed.  Though Henman is considering one of the most important issues that does not seem to be in consideration in much of the commentary on the legislation to date – improved safety.

“It’s very hard to say whether these new laws will make workplaces safer. The culture of those less safety conscious workplaces where the employer bends the rules has to change. One would hope the new laws will help engender better safety cultures.”

The Master Builders Association of NSW‘s OHS risk management officer, Tim Stootman, echoes the perspective of Garry Brack, looking at the  legislation through the experience of a New South Wales employer:

“Master Builders supports the review of OHS laws and believes that this is an opportunity for better, rather than greater, OHS regulation,” Mr Stootman says.  “Better, rather than greater, regulation will assist to improve OHS performance in the construction sector.

Master Builders supports the rejection of what could be called a ‘highest common denominator’ approach to OHS duties.  Essentially, this approach would have seen an absolute duty of care on employers to ensure the health and safety of their employees and provides unions with the right to bring a prosecution for a breach of the OHS law, the latter a provision adopted in recent changes to the law in the ACT.

The Draft National Model OHS Act is a positive step towards harmonisation of OHS laws in this country.”

Submissions to the government on the draft Safe Work Bill are being regularly posted at the Safe Work Australia website.  SafetyAtWorkBlog is watching the submissions and will draw attention to some of the more useful comments in the submissions.

Kevin Jones

HWCA could be influential in Australia’s workers’ compensation reforms

Australia and New Zealand have a small strategic organisation called the Heads of Workers’ Compensation Authorities (HWCA, pronounced “howca” by those in the know).  It is a regular meeting (some say “love-in”, others say “coven”) of the CEOs of the various workers’ compensation bodies in Australia and New Zealand.  Over the next five years, as the Australian Government begins to harmonise/reform the workers’ compensation system, HWCA will be important to watch.

In early October 2009, HWCA met and endorsed a coordination strategy, that has yet to be publicly released.  The main objectives of the strategy were noted in a media release (also not yet publicly available) to mark the latest meeting.

  • “To deliver best practice services to injured workers and employers to assist recovery: and
  • to build sustainable workers’ compensation schemes.”

The terminology of the first objective may provide a good indication of the type of organisation HWCA seems to be.  “Best practice services”???  “Best practice” is one of the worst corporate jargons being used at the moment.  This article at Wikipedia outlines the context of the phrase well.

“As the term has become more popular, some organizations have begun using the term “best practices” to refer to what are in fact merely ‘rules’….”

In other words, HWCA has a strategy to do what its member organisations should have been doing all along – enforcing the rules of good customer service and providing the best level of service to injured workers.

Perhaps it is the second strategic objective that best illustrates the aims of HWCA – to make sure that the workers’ compensation schemes do not lose money.

According to the communique that is released after every meeting (top points for open communication)

“HWCA agreed the Bio-psychosocial Rehabilitation Working Group would develop a national action plan regarding prevention of long-term disability and work loss, which will support the strategy.”

Prevention is the role of the OHS authorities in Australia and the Department of Labour in New Zealand.  Clearly HWCA will be discussing these strategic aims with those in charge of preventing injuries and illnesses.  But can the various WorkCovers and WorkSafes cope with biopsychosocial hazards?  Surely HWCA will also be talking with all the NGOs who lobby on depression, anxiety, fatigue, stress, wellness, happiness ………….. (Get ready for even more influence for BeyondBlue)

Consultation will also be needed with the various government departments involved with health promotion, public and occupational.  Not to mention the unions, employer associations and health professional bodies.

A strategy of such magnitude would require considerable resources and horse-trading through government ranks in all jurisdictions.  It is hard to see this being achieved through a meeting of Chief Executive Officers, and should such a strategy be pushed through individual workers’ compensation bodies anyway?

To achieve true reform of workers’ compensation and to resist the substantial pressure that is likely to come from the Australian and international insurance companies, the Australian government is going to need considerable negotiating skills.  Because of the involvement with the financially influential insurance companies, it is doubtful the intended reforms will be achieved. (HWCA already has discussions with the “Heads of Compulsory Third Party Insurers” according to the communique)

Almost as a post-script, it is noted that Greg Tweedly, CEO of WorkSafe Victoria, takes over the chairmanship of HWCA from the CEO of WorkCover NSW, Jon Blackwell.  Tweedly is a very busy CEO and will become more so, if the rumour proves true that he will be joining the National Board of the Safety Institute of Australia.

As the chairmanship moves from New South Wales, so will HWCA’s administrative support.  The next HWCA meeting is scheduled for 5 February 2010 and will be coordinated through the Victorian Workcover Authority or Comcare.

Kevin Jones

France Telecome becoming a case study

The managerial turmoil at France Telecome over a spate of work-related suicides is likely to become a case study in failed change management, firstly, and public relations, secondly.

A report in The Guardian on 6 October 2009, points to a (French) video of the company’s chairman and CEO, Didier Lombard, speaking to Telecome’s managers in January 2009.  The paper reports that Lombard says

“those who think they can just stick to their routine and not worry about a thing are sorely mistaken”.

The article goes on to say

“He went on to suggest that staff outside Paris spent their time at the beach, fishing for mussels, adding those days were “over”.”

The last quote sounds like a joke between colleagues but as suicides had already occurred at the time of this speech, it was in poor taste even then.

For those outside of France, Lombard was set on the path of making the company relevant to contemporary ICT needs.  A short article from 2005 says

“France Telecom Chief Executive Didier Lombard is merging telephone, Internet and mobile offerings under the Orange brand as part of a three-year program called NExT, an acronym for New Experience in Telecom services.”

There are similarities with a range of telecommunications companies that needed to change – British Telecom, New Zealand Telecom and Telstra to name a few.  Telstra’s management change earlier this century with Sol Trujillo and Phil Burgess caused considerable shareholder and political turmoil with their change strategies.

Organisational change from administrative agencies to commercial entities can be a life challenge but it can be done with time and careful planning.  The suicides at France Telecome seem to be an extreme example of how this process can be mishandled.  However, just as with cancer clusters, the actual cause is often difficult to identify and sometimes can remain a mystery or coincidence.  The circumstances at France Telecome need to be carefully studied from when the change management process began, well before the first suicide.

At the moment we are in the period of shock and panic responses by the company.  Every suicide heightens this panic.  Hopefully the measures being put in place now by the company will achieve a more considered, and long-lasting, corporate result.

Kevin Jones

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