Escaping scrutiny
Hazards issue 108, October-December 2009
Stop press! HSE withdraws director leadership case histories after Hazards slams free PR for killer BP [more]. If you thought your life being shattered would at least prompt an official investigation, you’d be wrong. Figures obtained exclusively by Hazards show that in 2007/08, just 7.3 per cent of the 32,810 fatal and major injuries – or fewer than 1-in-every-13 – reported to the Health and Safety Executive (HSE) resulted in an investigation by the watchdog.
For major injuries alone, the chances of an HSE investigation were lower still, with just 6.5 per cent investigated. We are not talking cuts and bruised here. We are talking being trashed – burned, losing limbs, being scalped. There’s a less than 1-in-15 chance they’ll result in any official probe.
Ugly business Both Labour and Tory heavy-hitters have been courting the Federation of Small Businesses (FSB), one of a number of business lobby groups pressing to be relieved of the “burden” of health and safety. more
And if it is justice you’re after, think again. In 2007/08, the most recent year for which finalised enforcement figures are available, 97.7 per cent of fatal or major injuries resulted in no HSE enforcement action, not even an improvement notice requiring measures by the employer to make the workplace safer.
For occupational diseases and dangerous occurrences, the picture is worse still. Less than 1-in-20 of the reports to HSE made under the RIDDOR reporting regulations in 2007/08 were investigated by the watchdog. Less than 1 per cent led to enforcement action.
HSE’s defence is that more time is now spent on “frontline activity”, up from 184,843 person days in 2006/07 to 209,242 in 2007/08. But this lumps in with inspection and enforcement work the resources spent on activities including “preparation for and attendance at agricultural shows, lectures, and other awareness-raising activities” and “standards-setting work”. The inspection trend, with HSE field inspector numbers dipping markedly in recent years, has fallen dramatically and taken enforcement action down with it (Hazards 104).
It is a situation described by criminal law experts Steve Tombs and Dave Whyte as the “collapse of enforcement”. In a paper published online on 13 October 2009 in the British Journal of Criminology [1], they note: “Investigations and inspections have fallen at an unprecedented rate as political and resource pressures have taken their toll on the day-to-day work of the inspectorate; the percentage falls in enforcement activities, already from low absolute levels, can hardly be described as anything other than a collapse.
“The extent of this decline would simple not be sustainable in most other areas of law enforcement – imagine the efforts of a Chief Constable, for example, to defend declines in investigations of violent interpersonal assault, or falls in prosecutions of apprehended burglars, where these certainly would be represented as a collapse in enforcement, which, no doubt would cause a political furore.”
The Conservative Party believes something needs to be done, and is intent on creating its own political furore around the issue. But rather than bolstering HSE and repairing a tottering regulator, it appears intent on dismantling it. A Conservative government would allow firms to opt-out from HSE inspections, with qualifying firms allowed to bar the watchdog from their premises. Instead the Tories are recommending an audit system modelled on the financial sector controls that gave us Enron, Madoff and that came within a bail-out of bringing the entire banking system to its knees.
A Tory policy document, ‘Regulation in the post-bureaucratic age’, [2] a Green Paper announced by shadow business secretary Ken Clarke at the party’s October 2009 conference, says “the powers of government inspectors will be drastically curbed” with firms allowed to arrange “their own, externally audited inspections instead.” Its aim of “taming regulators” would include “replacing regulator-run public teams of inspectors with a model closer to financial controls and audits.”
It’s not just dumb, it’s dangerous
BP is a company on paper that is tailor made for the Tories do-it-yourself safety enforcement alternative.
The multinational has a team of 45 in-house safety auditors. Safety reports and claims on its website are subject to an “assurance statement” by external auditor Ernst and Young. London-based chief executive Tony Hayward (below right) “chairs the group operations risk committee (GORC) which oversees safety performance.” BP is a featured HSE case history on “director leadership” (Hazards 97).
But paper and practice are two very different things. In four years BP couldn’t even get its house in order at a US plant that blew up, killed workers and landed it with a record fine and a public drubbing in a series of highly critical official and independent reports.
In August 2009, US safety watchdog OSHA told BP it had failed to make agreed-upon safety improvements at its Texas City refinery (above left) following the March 2005 explosions that killed 15 workers. These weren’t minor, technical oversights. That’s why on 30 October 2009, the US Department of Labor announced it was issuing BP $87,430,000 [over £53m] in proposed penalties “for the company's failure to correct potential hazards faced by employees. The fine is the largest in OSHA's history. The prior largest total penalty, $21 million, was issued in 2005, also against BP.” [3]
In a stinging rebuke for the company from right at the top of the Obama administration, secretary of labor Hilda Solis said: “When BP signed the OSHA settlement from the March 2005 explosion, it agreed to take comprehensive action to protect employees. Instead of living up to that commitment, BP has allowed hundreds of potential hazards to continue unabated. Fifteen people lost their lives as a result of the 2005 tragedy, and 170 others were injured.
“An $87 million fine won't restore those lives, but we can't let this happen again. Workplace safety is more than a slogan. It's the law. The US Department of Labor will not tolerate the preventable exposure of workers to hazardous conditions.”
Acting assistant secretary of labor for OSHA, Jordan Barab, added: “BP was given four years to correct the safety issues identified pursuant to the settlement agreement, yet OSHA has found hundreds of violations of the agreement and hundreds of new violations. BP still has a great deal of work to do to assure the safety and health of the employees who work at this refinery.”
Tony Hayward was BP’s second-in-command when Texas City exploded, and became chief executive in 2007. He has been in top management positions for over a decade, and was made an executive vice-president in 2002, the year BP received a then-record UK safety fine of £1m after being prosecuted by HSE for criminal safety offences at Scotland’s Grangemouth refinery.
Hazards magazine wrote to HSE chief executive Geoffrey Podger regarding the UK safety watchdog’s continuing promotion of BP’s “leadership” position on health and safety.
The HSE’s top manager is told “BP is a text book example of ‘director leadership’ gone wrong.” The 2 November 2009 letter, from Hazards editor Rory O’Neill, adds: “I would once more urge you to stop providing credibility and succour to a serial safety offender which lacks either the capability or the will, or both, to remedy its woeful safety management performance. HSE should remove immediately the BP director leadership case history from its website.
“As a responsible regulator, I would also expect HSE to put BP on notice that the performance of its London-based board and the operation of its not-fit-for-purpose GORC committee will be the subject an immediate probe and ongoing close scrutiny. Like it or not, BP’s global failings stem from decisions made on your patch, on your watch” (see the Hazards letter to HSE in full).
But BP is not alone. With big names like Network Rail, British Gas and Corus sharing a recent history of big fines for egregious safety offences, deciding which firms qualify for “earned autonomy” might cause some qualms for even the most ardent free marketeer.
Killing off the watchdog
But Ken Clarke may not be content with just hobbling HSE. He may do away with it entirely. In his 6 October 2009 Tory party conference speech, he said: “We will give each regulator and quango a ‘sunset clause’. That means they will automatically cease to exist after a set period unless they can prove their continuing usefulness.” The policy paper says during the first turn of a Conservative government “all regulators will be re-assessed and their duties reviewed.” [4]
Even while HSE survives, its role under the Conservatives would be dramatically diminished. The policy paper notes: “Well run companies would employ professionally qualified experts in, for example health and safety or food safety, in the same way as they use accountants for a financial function to ensure that the correct internal processes are in place, and that reported results are reliable.”
Jump through a couple of hoops and the miniscule chance of an HSE inspection or any official scrutiny – and with it, any real prospect of a firm being brought to account for criminal breaches of health and safety law – will disappear entirely. Instead firms could apply for “earned autonomy” the policy paper says. “Any organisation which has undertaken a co-regulation review and has published an independently audited statement that it satisfies the required regulatory outcomes, would be allowed to refuse entry to official inspectors in anything other than an emergency.”
A similar system in the US, on which the Tory proposals appear to be based, has been criticised for being ineffective and having high administration costs. In June 2009, concerns that audits were fixed and oversight was minimal led the US safety watchdog OSHA to launch an investigation “to address problems identified in its Voluntary Protection Programs (VPP)” [5]. Acting head of OSHA, Jordan Barab, commented: “Our evaluation of these programmes in the context of OSHA's limited resources will help ensure that OSHA will be able to reprioritise these resources in the most effective manner.”
US enforcement opt-out a failure
An investigation by the US Government Accountability Office (GAO) [6] has confirmed what union and other workplace safety advocates have charged for years - the Bush administration’s reliance on voluntary programmes did not improve worker safety and let some dangerous employers escape scrutiny. The GAO report, released in June 2009, concludes that under the Bush administration the Occupational Safety and Health Administration’s (OSHA) Voluntary Protection Program (VPP) lacked proper oversight, did not improve worker safety and diverted scarce resources from other enforcement duties.
VPP companies are able to avoid routine OSHA inspections as long as they demonstrate they have an exemplary safety and health programme, have no ongoing enforcement actions and have an injury and illness rate below the average rates for the industry.
The GAO found that OSHA did not properly ensure that only worksites that had exemplary safety programmes were eligible for relief from routine inspections. According to the GAO report, 12 per cent of the worksites participating in the programme had an injury or illness rate higher than rates for their industry, and one participating worksite had an injury and illness rate four times higher than their industry average. In addition, OSHA continued to allow some businesses to participate in the voluntary programme even though they were cited for serious safety violations.
Following publication of the latest GAO report, OSHA announced that it was to undertake a comprehensive review and evaluation of the programme [5].
UK academics Steve Tombs and Dave Whyte see another problem with self-regulatory approaches for watchdogs like OSHA and HSE.
Their October 2009 paper [1] notes “we might describe this approach as reckless and highly risky in itself given that lighter-touch regulation is likely to impact profoundly not only on patterns of compliance, but on the ability of regulators to know whether compliance is indeed being secured or not – such knowledge being central to the ‘risk based’ decision-making process that allows companies to earn autonomy, and thus exemption from external intervention: put simply, how are regulators to know about company performance if the latter are left to self-regulate, and thus able to distort or withhold evidence of non-compliance/poor performance from regulators?”
The approach is also a rehash of a Tory experiment in the UK in the mid-1980s. In the trial, construction giant Costain was exempted from HSE inspections because it argued its safety management structure and accident record were much better than the rest of the industry (Hazards 3). The trial was quickly abandoned when a worker died on a Costain site.
Removing essential workplace safety protection is not even a popular move with the electorate. While the business lobby is keen to see any regulatory controls and oversight reduced (see Business wants inspection tip-offs) and the Tories appear to be listening, the public values regulation when it comes to workplace health and safety, government research published in October 2009 found (see below).
Unions have warned the Conservative Party’s new plan to allow firms to opt-out from official health and safety oversight will be “disastrous” for health and safety. Prospect, the union that represents HSE inspectors and specialists, said health and safety inspections and firm law enforcement has contributed to the UK having one of the best workplace health and safety records in the world.
Sarah Page, the union’s national safety officer, said: “Is Ken Clarke seriously saying that employers in these industries should regulate their own health and safety arrangements and close the door to our protectors?” She added: “Clarke’s proposals are a recipe for avoidable deaths and injuries at work and catastrophic events such as Buncefield.” Alan Ritchie, general secretary of construction union UCATT, said: “These latest Conservative proposals are very disturbing. It would prove disastrous in an industry like construction.”
Unite said it was concerned externally audited inspections would not be backed up by proper “enforcement powers.” The union’s national officer for construction, Bob Blackman, said: “The Tories should be focusing on preventing accidents and deaths rather than looking at ways of saving money for the employers. The HSE is not perfect, but at least it is trusted by the workforce and carries 'enforcement powers'.”
He said the policy “goes to show the Tories’ true colours,” adding: “They are the party of the bosses and by cutting 'red tape' for employers they will be putting the lives and health” of workers at risk.
Academics Steve Tombs and David Whyte believe HSE itself, however, has made life easier for the Tories by accepting the ongoing erosion of its regulatory role. Their British Journal of Criminology paper says the watchdog “has at best failed to resist the imposition of a twin-track regulatory agenda, with its emphasis upon targeting the worst performers, and the wider context of deregulation within which this has circulated.”
They warn that “through such positions, HSE is unwittingly exposing at best the vulnerabilities, at worst the contradictions” of a self-regulation model, with the result it “has so ideologically and materially undermined its enforcement capacity that it is now, we would submit... unable to fulfil what it is tasked to do, that is, to maintain a credible threat of enforcement.”
The Conservative Party, for its part, wants to mimic a US system of self-regulation that is under investigation and bordering on disrepute. One inevitable consequence would be to mimic another failure of US regulation – the failure to adequately protect the lives and health of the working population. The UK has one of the best workplace safety records in the world [7]. The US, by contrast, kills at work at a rate not seen in the UK for decades [8].
References
1. Steve Tombs and David Whyte. A Deadly Consensus: Worker safety and regulatory degradation under New Labour, British Journal of Criminology, 2009; doi: 10.1093/bjc/azp063 [abstract] • [pdf]
2. Regulation in the post-bureaucratic age, Conservative Party, October 2009 www.conservatives.com • [pdf].
3. US Department of Labor’s OSHA issues record-breaking fines to BP, US Department of Labor news release, 30 October 2009.
Beyond prison?, Hazards, number 97, January-March 2007.
4. Ken Clarke: Britain will be a decent place to do business again, Conservative Party news release, 6 October 2009.
5. OSHA’s Voluntary Protection Programs: Improved oversight and controls would better ensure program quality, GAO report, June 2009 [pdf].
6. US Department of Labor's OSHA begins evaluation of Voluntary Protection Programs, OSHA news release, 18 June 2009.
7. HSE news release • Health and safety: Statistics 2008/09, National Statistics, 28 October 2009 [pdf]
Päivi Hämäläinen, Kaija Leena Saarela and Jukka Takala. Global trend according to estimated number of occupational accidents and fatal work-related diseases at region and country level, Journal of Safety Research, volume 40, pages 125–139, 2009 [pdf].
8. US Bureau of Labor Statistics Census of Fatal Occupational Injuries, BLS, USA, August 2009 [pdf].
Business wants inspection tip-offs
The business lobby is using the economic downturn to push for a removal of safety “burdens” – and is calling for appointment-only inspections by workplace regulators. In a new policy paper launched ahead of the Conservative Party’s October conference, the Federation of Small Businesses (FSB) singled out health and safety as “the biggest burden on small businesses in terms of time.”
As well as a moratorium on new regulations, the FSB says it wants a “cessation of routine inspections during national emergencies.” Calling for “compulsory booked inspections”, it says: “All routine inspections should be booked in advance, so that a business is able to prepare for the meeting. This is not an opportunity for businesses to change what they are doing in order to suddenly comply, rather if they are only given a few days notice it is simply a chance to ensure that they have enough staff, gather paperwork, or re-arrange meetings.”
FSB adds: “The government should consider the cost of inspections as an integral part of the cost of regulation and seek to reduce this burden.” It called for a reduction in inspections in the order of 25 per cent.
Regulatory Reform – a route to economic recovery, FSB Policy paper, October 2009. www.fsb.org.uk
Regulation is popular and lifesaving
Nearly two-thirds of people in Britain agree they benefit from regulation in their everyday lives and 70 per cent think the benefits of regulation outweigh the burdens, according to a new report from the Department for Business (BIS).
‘Better regulation, better benefits: getting the balance right’ concludes “health and safety regulation changes business behaviour. Fatalities decreased by threequarters and injuries at work have fallen by 70 per cent since 1974,” when the Health and Safety at Work Act was introduced.
The report adds: “Regulations add value where they change behaviour. Changing behaviour means ensuring that organisations or individuals comply with these regulations. Academic experts agree that compliance cannot be predicted just by reading rules, but is strongly affected by the motivations of regulated businesses and the approaches to offering support to comply and to enforce them.”
Research for the report found “70-85 per cent agreed ‘overall the benefits outweigh the burdens’ for environmental standards on air/water, food hygiene, health and safety and smokefree law.”
Better regulation, better benefits: Getting the balance right, BIS, October 2009.
Letter from Hazards to HSE chief executive, Geoffrey Podger
2 November 2009
Attention: Geoffrey Podger, chief executive, Health and Safety Executive
Dear Geoffrey
BP's safety disgrace and HSE's promotion of BP as an example of "director leadership"
I have written previously raising concerns about the Health and Safety Executive’s continuing use of BP as an example of “director leadership” on health and safety. Should you need a reminder of my concerns, you may wish to peruse the related Hazards article (Beyond prison?, Hazards 97, 2007).
Given yet more evidence of the inability of the company to operate in a safe or responsible manner (‘US Department of Labor’s OSHA issues record-breaking fines to BP’, 30 October 2009), I would again urge HSE to remove BP from its “director leadership” case histories.
You should be aware the safety malaise identified by OSHA goes right to the top of the London-based multinational. The failure of BP’s global structures to manage safety effectively has been exposed in a series of official and independent reports. You should also be aware that BP chief executive Tony Hayward chairs the Global Operations Risk Committee (GORC) responsible for health and safety.
BP is now the recipient of the two largest fines in OSHA’s history. It was also the recipient of what was at the time the largest UK fine for health and safety offences, relating to incidents at the Grangemouth refinery (COURT CASE AGAINST BP GRANGEMOUTH COMPLEX - HEALTH AND SAFETY EXECUTIVE STATEMENT, HSE news release, 18 January 2002). In this case, the company’s management was again admonished in an official report, this time from your agency (BP Grangemouth Scotland: 29th May - 10th June 2000 A Public Report Prepared by the HSE on Behalf of the Competent Authority).
BP is a text book example of “director leadership” gone wrong. The comments of US Secretary of Labor Hilda Solis, on the announcement of the company’s record penalty, sums up why HSE should stop providing undeserved PR to BP: “Workplace safety is more than a slogan. It's the law.”
I would once more urge you to stop providing credibility and succour to a serial safety offender which lacks either the capability or the will, or both, to remedy its woeful safety management performance. HSE should remove immediately the BP director leadership case history from its website.
As a responsible regulator, I would also expect HSE to put BP on notice that the performance of its London-based board and the operation of its not-fit-for-purpose GORC committee will be the subject an immediate probe and ongoing close scrutiny. Like it or not, BP’s global failings stem from decisions made on your patch, on your watch.
I await your early response.
Yours sincerely, Rory
Rory O'Neill
Editor, Hazards magazine www.hazards.org
Professor, Occupational and Environmental Health Research Group, University of Stirling, Scotland
Health, safety and environment officer, International Federation of Journalists
Stop press!
HSE pulls director leadership case histories
The Health and Safety Executive has removed a “directors’ leadership” case history on BP from its website, after the watchdog was criticised for providing an undeserved public relations push for “a serial safety offender.”
The criticism of BP came in a 2 November 2009 letter sent by campaigning magazine Hazards to HSE chief executive Geoffrey Podger, also published online (above) by the magazine, in the wake of a record US safety fine on BP for failing to remedy hundreds of problems at its Texas City refinery.
The plant blew up over four years ago, killing 15. The letter from Hazards notes that the “safety malaise” identified by the US safety watchdog OSHA “goes right to the top of the London-based multinational. The failure of BP’s global structures to manage safety effectively has been exposed in a series of official and independent reports. You should also be aware that BP chief executive Tony Hayward chairs the Global Operations Risk Committee (GORC) responsible for health and safety. BP is now the recipient of the two largest fines in OSHA’s history. It was also the recipient of what was at the time the largest UK fine for health and safety offences, relating to incidents at the Grangemouth refinery.”
The letter calls for HSE to stop promoting a company with a “woeful” safety management record. “HSE should remove immediately the BP director leadership case history from its website,” it says, and calls on HSE “to put BP on notice that the performance of its London-based board and the operation of its not-fit-for-purpose GORC committee will be the subject an immediate probe and ongoing close scrutiny. Like it or not, BP’s global failings stem from decisions made on your patch, on your watch.”
Within days of receiving the letter, the BP director leadership case history, as well as 40 others on the same webpage, had been removed. Only four cut down case histories survived the cull.
In a written reply to Hazards, HSE chief executive Geoffrey Podger said the case histories were “time expired” and were to be removed anyway. However, in response to press inquiries regarding the letter from the magazine, the watchdog admitted the move was prompted by “someone externally” criticising the webpages.
Letter from Hazards to HSE chief executive Geoffrey Podger. HSE director leadership case histories.
Escaping scrutiny
Contents
• Introduction
• It’s not just dumb, it’s dangerous
• Killing off the watchdog
• References
Sidebars
• Business wants inspection tip-offs
• Regulation is lifesaving
• Letter from Hazards to HSE chief executive, Geoffrey Podger
• Stop press!
Hazards webpages
Deadly business