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June 30, 2010

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Union renounces flawed study on directors duties

Construction union UCATT has rejected a new report into the effectiveness of the voluntary HSE/IoD code on directors’ duties, describing the evaluation approach as flawed.

The union sat on the steering group that examined the evidence on whether directors are taking their health and safety responsibilities seriously, but its representative, Jim Kennedy, felt unable to approve the content of the final report.

Said Alan Ritchie, UCATT general secretary: “The report is not a true reflection of the overwhelming need for statutory director’s duties. Despite the report going out of its way to present the voluntary code in the best possible light, it is obvious that it has been a complete failure.”

The report does not make any recommendations regarding directors’ duties, and its content was approved by all other members of the steering group, which included representatives from the Unite and Unison trades unions, as well as the CBI, the Federation of Small Businesses, and the Local Government Association.

To inform its research on the impact of the joint HSE/IoD guidance, the steering group considered five new items of evidence – the most significant being two surveys of directors: one between July and September 2008, and a follow-up between September and November last year.

The voluntary code is aimed at organisations with five or more employees, so the surveys excluded organisations with fewer staff. This was a bone of contention with UCATT, which repeatedly pointed out that the vast majority of companies in the construction industry have fewer than five employees.

According to the report, the evidence reviewed by the steering group suggested that:
• the number of organisations in which directors were aware of the guidance, had read it, and had subsequently taken action, was significantly higher in autumn 2009 than in autumn 2008;
• the transition from awareness to readership, and subsequent action, was broadly the same in the two surveys, but it is not possible to ascertain a causal relationship between reading the guidance and taking action; and
• given that the interval between the two surveys coincided with publicity and media coverage of other issues relevant to directors’ responsibilities for health and safety, it is not possible to link any of the changes observed to the issuing of the guidance specifically.

UCATT, however, emphasised the report’s finding that just 19 per cent of directors had claimed to read the voluntary code. Added Ritchie: “This report demonstrates that self-regulation simply doesn’t work. If companies are not compelled to do something, they won’t.”

His comments were echoed by Unite’s Bud Hudspith, who also sat on the steering group. Although supporting the report, he stressed that any apparent differences of opinion among TUC representatives are “merely of style and definitely not of substance”, and pointed out that press coverage at the time of the development of the Corporate Manslaughter and Corporate Homicide Act outweighed the coverage devoted to the IoD/HSE guidance.

Hudspith told SHP: “It has always been the TUC position that employers acted on the basis of laws and not guidance, and that all of our experience told us that any action on health and safety at director level was much more likely to be a result of the law than guidance. The fact that these two things were happening at the same time made it impossible for the research to separate them. This is why the report ended up as neutral.”

He added: “The disappointing thing for everyone concerned must be the finding that the IoD/HSE guidance appeared to have very little effect at all on the behaviour of directors, despite the fact that is probably one of the most promoted pieces of guidance ever issued by the HSE.”

Asked if it mattered whether directors’ action on health and safety was as a result of the voluntary code or the Corporate Manslaughter Act, a UCATT spokesperson insisted that it doesn’t believe that directors are taking their health and safety responsibilities seriously. He said: “UCATT believes that if safety laws could lead to directors going to prison, it could fundamentally change the safety culture in industries such as construction.”

Commenting on the publication of the report, an HSE spokesperson said: “HSE welcomes the research and the contribution of key stakeholders in studying the topic. The Executive board will consider the matter further in due course, in line with the leadership theme in the HSE strategy.”

‘The report of the Steering Group overseeing an independent evaluation of measures taken to strengthen director leadership of health and safety’ is available at www.hse.gov.uk/leadership/steering-group-report.pdf

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