Date : 14th April 1999

The Hon Ronald Arculli
Bills Committee on
Factories and Industrial Undertakings(Amendment) Bill 1999
Legislative Council
The People's Republic of China
Hong Kong Special Administrative Region

Dear Sir,

Comments to the proposed Factories and Industrial Undertakings (Safety Management) Regulations

We understand that the Bills Committee is going to study the Factories and Industrial Undertakings (Amendment) Bill 1999. We would like offer our opinion in respect of the Factories and Industrial Undertakings (Safety Management) Regulations which is the major part of the amendment bill though we have not been invited to submit our views and making presentations.

We are a Society set up in 1996 comprising of Accredited Safety Auditors (ASA) and Safety Audit Assistants (SAA) under the Independent Safety Audit Scheme (ISAS) of the Works Bureau and the Housing Authority Safety Audit Scheme (HASAS) of the Housing Authority. The members are appointed to audit contractors of these two major construction arms of the Hong Kong Government to assess the safety management and performance of their contractors. The Works Bureau also base their Pay for Safety System (PFSS) on the result of these audits.

We have about 49 full and associate members at the moment representing about 80% of all the ASA and SAA under these two schemes. Our members have conducted over 1,000 safety audits in the last 2 years using a system which commensurates with the concept and approach of the proposed Factories and Industrial Undertakings (Safety Management) Regulations. Our views to the Bill are therefore founded on practical experience and we do hope that members of the Bills Committee can take them into consideration.

1. A safety audit, like a financial audit, is to carefully and systematically identify any problems and weaknesses in the company's operating system and reveal them in the report together with recommendations for improvement. Independence is therefore one of the pre-requisites of such operation. It is quite obvious that if such audit were to be conducted by an employee of the auditee company, such employee would not reveal matters which may harm his company due to conflict of interest and for fear of detrimental effect on his employment.

The Bill however allow the proprietor to appoint his own employee who is a Registered Safety Auditor or Safety Review Officer to conduct the safety audit, and only requesting them not to "carry out other work of a nature of to the extent that would prevent he efficacious conduct of the audit" (Regulation 14(b)). As such degree of involvement is difficult to prove, the restriction is practically non-existent.

We strongly request that the Bill be amended to forbid employees of the proprietor to be the appointed Registered Safety Auditor or Safety Review Officer.

2. In Schedule 1, item 3 allows a lower qualified group of persons to be registered as Safety Auditor within the first 6 months of the commencement of the Regulations. We do not see the rational behind this. There are sufficient Registered Safety Officers with adequate years of experience and training to be registered to meet the demand in Hong Kong. (In fact, a majority of our members meet the registration criteria of Registered Safety Auditors). If sufficient grace period is given before the commencement of the Regulations, there should be plenty candidates for registration.

We request that the Bill be amended to delete item 3 of the 1st Schedule.

3. There is no specific safety qualification and training requirement for Safety Review Officer and this is absurd! How can an untrained person conduct an in-depth safety review of the safety management system of a company. Though the proprietor is required to appoint a competent Safety Review Officer, without any criteria on competency, the proprietor would be at a loss and may end up appointing someone handy. Whilst there is a checkpoint for the Commissioner to request the Safety Review Officer to be replaced, it is clumsy and inefficient. Why not require them to possess safety qualification in the first instance?

We propose that Safety Review Officers should be Registered Safety Officers who have attained the same training provided by the scheme operator. However he can be one with less experience, say 2 years as a Safety Officer as opposed to 3 years managerial safety experience which is required for the Registered Safety Auditor.

4. Other minor comments:

  1. Regulation 11.(1)(a) requires half of the members of the Safety Committee to represent workers - who are workers? Definition is required. What about the other half? Should they be employer's representative? Definition is again required.

  2. Regulation 15(2) and 16(1)(d) - An auditor has to keep a copy of the report for 5 years, the proprietor who receives the report has to keep it for 5 years. Why duplicating and be so environmentally unfriendly?

  3. Regulation 16 and 17 - the Commissioner has the power to request the proprietor and also auditor to submit the report to him. One is sufficient, so why duplicating such power?

  4. Regulation 18 - Since it is the proprietor who appoints an auditor, it is therefore the duty for the proprietor to report to the Commissioner the date, time and place of audit instead requesting such information form the Auditor.

  5. Regulation 26 - This calls for a Disciplinary board panel to be a 30 person panel. Is it too many?

  6. Regulation 33(4) - The Commissioner for Labour should also inform the Auditor or the Review Officer before exercising his power to conduct a checking audit under subsection (1) and (2) of the same Regulation.

  7. Schedule 3 - The number of employees in a construction company fluctuates and for those who employ a marginal number of employees around 100, it is difficult for him to classify himself. The use of average number of employees for the past 6 months may be more reasonable.

We hope our views will be taken into consideration. If you need further explanation and elaboration, please do not hesitate to contact us.

Yours faithfully,
For and on behalf of
The Society of Accredited Safety Auditors

Y Y Wong

cc The Hon Ho Sai Chu, J.P.