Corporate responsibility – Page 22

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.

Foster’s unforgiveable fatality

Foster’s Brewing has received one of the largest fines for a health and safety infringement in Victoria’s history, $1.125 million. In 2006 Cuu Huynh was jammed by the neck between the doors of a de-palletiser and a handrail and died as a consequence. The same circumstances injured another worker in 2002.

A major reason for the large fine is because, as WorkSafe’s John Merritt put it

“The problem had been identified, someone had been hurt previously, the solution was known and it wasn’t fixed until after a man had died. The opportunities to make improvements were repeatedly deferred.”

Foster’s chose to upgrade the de-palletiser involved in the 2002 incident but neglected the other de-palletisers in the same plant. This is where stupidity or laziness enters the equation. The OHS Plant Regulations allow for the risk assessment and findings on one type of machine to be applied to the same machines without revisiting the assessment process. Foster’s chose not to learn from a mistake.

It seems what is “reasonably practicable” for one machine is not so for another.

Readers would be aware that I support companies who choose to keep with the status quo through a risk assessment process, as long as they own up to when that decision may be proven wrong; in the case of Foster’s fatally wrong.

There is no indication that Foster’s will appeal the fine. This is to be applauded as, on top of the fine, the company has had to spend almost $4 million in plant safety upgrades. This is a substantial cost that probably would have been cheaper in 2002, or even earlier, but it remains little comfort to Cuu Huynh’s family.

Below are some of the points that WorkSafe is making in relation to Foster’s handling of safety on their depalletisers.

An employee was hurt in similar circumstances on another machine in 2002. While safety was improved on that machine, improvements were not made to the machine which killed the man in 2006.
Operators were required to enter the operating area of their machines to remove broken bottles and plastic binding tape and ensure sensor lights worked. Workers estimated they would do this up to 20 times per shift.
There was no adequate visual and no audible warning of the opening of the pneumatic doors, unguarded chain sprockets created hazards, while safety devices were easily over-ridden to prevent sudden stoppage of the machine which caused bottles to fall over and break;.
Written standard operating procedures (SOP’s) for operating the depalletisers and cleaning them during breaks in production had been produced, but they did not deal with clearing jams during production. A specific SOP covering this was produced after the workers’ death.
Various operators told WorkSafe they were unfamiliar with the SOP’s and did not have sufficient English to read them. Much training was done ‘on the job’.
Workers were allowed to leave work an hour earlier on the last shift of the week if they had completed cleaning the machine. As a result they would clean the machine while production continued. The man who died was on this position.

This is a litany of poor safety management that any company should be ashamed of. Of particular concern, and should be noted by other companies and OHS regulators, is that written instructions for the machine were inadequate and in a format that could not be easily understood by the machine operators.

One of my safety colleagues has mentioned to me the absurdity that the first of WorkSafe’s new Compliance Codes is expected to be on workplace amenities. This workplace element rarely leads to death or injury and the release of a “minor” code does not auger well for the rest of the codes. It is understandable that Amenities may be one of the easier-to-produce codes but, to my mind, the most neglected guidance material in the last 20 years has been the provision of safety information in languages other than English – a workplace issue that WorkSafe has indicated was directly relevant to the death of Cuu Huynh.

For all of those corporations that say that safety is the first priority and that production will be suspended if a safety hazard is identified, Foster’s did not follow its own policies. According to its own HSE Policy

“We will work towards our goals through a process of continuous improvement and, in particular, fulfil these commitments by:

1. Meeting or exceeding all health, safety and environment regulations in each of our workplaces around the globe.”

Cuu Huynh’s death has shown, as mentioned by WorkSafe above and mentioned in media reports

“…the workplace culture encouraged the machine operators to maintain production by not stopping depalletisers when they were clearing jams or cleaning the machine.”

Production, at Foster’s, was more important than safety.

LTIFRs – still the corporate benchmark

What I and my OHS colleagues found peculiar at Day One of the Safety In Action Conference was that most of the CEO presenters continued to use LTIFRs (Lost Time Injury Frequency Rates) as the primary safety performance indicator.

In Australian OHS fields, LTIFR has been established as an inaccurate indicator of safety performance but, apparently, it is the indicator that Board members like.

At lunch Michael Thompson of the ASSE said that the continuing prevalence of LTIFR is our fault, the fault of OHS advisers. We have allowed LTIFR to persist far beyond their relevance and use. I think he is probably right as OHS organisations have not pushed alternatives or educated the MBAs and future directors.

The use of Positive Performance indicators has been the way forward for some time. It was sad that PPIs weren’t emphasised more in the CEO stream of Day One.

Safety in Action Conference Report – Day One

The Safety institute of Australia has tried a different approach with their 2008 safety conference on April 29. It’s first day was dominated by a single stream of CEOs and senior executives talking about how they see safety. I expected a day of cliches but these were refreshingly minimal. There were a few mentions of “safety culture” and even more mentions of “leadership” but surprisingly very few speakers spouted the DuPont safety jargon that has dominated corporate safety presentations for many years.

Ziggy Switkowski was a real win for the SIA but sadly he spoke principally about climate change. I found his talk very interesting but it was only when he spoke about his advocation of safety at a board level that the relevance of his presence and experience had the audience sit up.

Switkowski’s presentation has set the agenda for the integration of environmental considerations in safety conferences and the SIA’s planning but the value of his climate change presentation will become obvious in the next few years.

The presentation by Peter McMorrow of Leightons was the stand out presentation of those I saw. His display of the personal commitments and safety pledges that Leighton executives need to sign off set the bar for the other CEO presenters. McMorrow’s links between safety and profitability were particular good.

I am constantly suspicious about corporates who say ” safety before all else” because there are more examples of companies sacrificing safety for profits than good corporate citizens. Peter Sandman, and others, have said in the past that the principal (sometimes the only) obligation on corporations is to the shareholders, and shareholders watch the share price. McMorrow seemed to provide an example that breaks the status quo but it wasn’t convincing.

Also, there was no mention of the recent prosecutions of Leightons by WorkSafe Victoria where the judge was highly critical of the level of operational awareness of the senior managers in the company. It seems that corporate and social goodwill were not the only motivators in providing organisational safety change at Leightons but the omission is telling.

Safety, Maintenance and Business Continuity

America and Europe have a huge advantage over Australia – they know how to respond to a broad range of disasters. Australia has had its share of bushfires and cyclones but because the country is so large and the geology so stable, the large metropolitan centres of Sydney and Melbourne have been spared. This stability has led to less emphasis on the fragility of infrastructure by business operators than there should be.

In the Herald-Sun newspaper on 12 April 2008, there was a cover story on the organizational neglect of the State’s electrical infrastructure. This was emphasised recently when it took 6 days for many homes to have power restored after a serious storm, a storm that was of the level that Sydney experiences regularly and that the tropical areas of Australia and designed to withstand.

A government inquiry will be held into the delay but this is unnecessary. Privatised corporations are notoriously neglectful of the need to maintain infrastructure services as there is little profit in holding resources in reserve for large-scale disasters. Numerous inquiries into the disasters on the privatised rail networks in England have shown the corporate values of privatised transport companies, some of whom have investments in Australia.

The poor and unsafe conditions of the infrastructure are not the fault of the companies if we take it that their raison d’etre is to make profit. But we cannot extend the same understanding to governments who forsake the public good for the sake of an improved bottom line.

Poor maintenance leads to unsafe conditions which lead to disasters. As safety professionals we need to stress that adequate levels of maintenance are a core part of any preventative strategy. Not only will it reduce the social impact of any disaster but it maintains a robust corporate economy, reduces employees’ exposure to trauma and establishes a company as an important community asset.

Accountability for industrial accidents in Malaysia

This last week, the New Strait Times reported on an initiative by the Malaysian government to increase companies’ responsibility for workplace safety by making “professionals” “responsible for accidents in the workplace”.

It may be a terminological argument about whether safety professionals or risk managers or company directors are to be held personally responsible for safety infringements and incidents

It may be a terminological argument about whether safety professionals or risk managers or company directors are to be held personally responsible for safety infringements and incidents – a discussion that is echoed in many jurisdictions around the world. It is likely to result in some reassessment of management responsibility in Malaysian companies. I would also speculate that the applications for OHS manager jobs may decline in Malaysia.

The article quotes the Human Resources Minister Datuk Dr S. Subramaniam as saying “If a crane accident occurs at a construction site, we want the engineers involved in ensuring the crane’s safety to be answerable.”

The initiative is clearly one that is directly related to the limited resources available to a safety regulator when every business is a workplace. Again this is a problem shared by regulators worldwide.

What is interesting is that this position has not (yet) evolved into one of corporate killing or industrial manslaughter legislation or corporate accountability, as it has elsewhere. Always the case by employer groups is that such a level of accountability would deter businesses from entering activities which would present an unacceptable level of risk, thereby harming economic growth. I suspect that the level of economic growth in Malaysia and the Asian region is likely to keep the debate going for quite some time without any resolution.

Note: a short video of Datuk Dr S. Subramaniam speaking at the April 2008 conference is available HERE at the 2.43 minute mark

OHS and Climate Change

Many of my OHS colleagues have responsibility for environmental safety, some to the extent of being rebadged HSE or OHSE. I have been an ardent advocate of managing business safety and risk issues in a coordinated and integrated manner. Historically, I would have applied the risk management standard as the umbrella framework, others do not.

The balancing act for health, safety & environment managers is to consider a vast array of matters without losing the focus of the core task, in my case workplace safety, for others this may be public liability, or triple-bottom-lines etc. Depending on the industry you work in, environment can have a greater or smaller role in your business.

I remember working on safety management for a transport company where I reported to the quality manager. I can report to lots of different titles but in this case the quality manager allocated an uneven priority to safety compared to other business elements. He saw quality as by-far the most important element, perhaps it was because he was uncomfortable in other areas outside of his expertise, I don’t really know. But his attitude did not allow for integration only sublimation. I remember his attitude when I have to consider elements beyond my expertise and have them fit into the business strategy in which I have responsibility for safety or maybe risk.

Time management and the prioritizing of tasks is never far away from occupational safety and business operations. It is important that environmental impacts of your business, and those on your business, are discussed in a serious manner at all levels of your company. If it is not on the agenda, it is not in people’s minds. Indeed some have said that the environment is the new OHS. I am not so sure as environmental issues have a global impact where OHS is limited to a smaller community.

In the context of community, an important consideration is whether the implementation of environmental strategies will re-organise business structures to the extent that there are staff losses. In a relatively small nation like Australia, if the environmental management trend continues to grow at the same time, the social impact from unemployment could be significant. However similar concerns have been voiced in recent memory over the level of automation in workplaces and the impact of automatic teller machines on the banking sector. In a fairly short amount of time, the workforce is redistributed to areas of need but for the unemployed and their families this short period can be very painful.

I was taught that risk management can be a major force for good by tying important business elements under the one, fairly broad, set of criteria. When I entered the real world of risk management I encountered as much narrow-mindedness in the risk management profession as I had seen elsewhere. I hope that as the environmental business issues gain prominence that the other disciplines listen, consider and, maybe, embrace the environmental so that all the important elements in our lives and our businesses are weighed, balanced and integrated. Work/life balance is far more than just hours of work and time with the kids.

Tag: Corporate responsibility

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

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Foster’s unforgiveable fatality

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LTIFRs – still the corporate benchmark

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Safety in Action Conference Report – Day One

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Safety, Maintenance and Business Continuity

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Accountability for industrial accidents in Malaysia

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OHS and Climate Change

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