The Impact of The Economic Slowdown On OSH in Malaysia_ An

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The Impact of The Economic Slowdown On OSH in Malaysia_ An Powered By Docstoc
					Perception of Worker’s Representatives on
    Impact of Economic Slowdown on
Occupational Safety and Health in Malaysia

        16th National Public Health Colloquium
                 Berjaya Times Square
                    24th November




    Rozhan Shariff M Radzi, Krishna Gopal Rampal
                                                   1
“Today, as the impact of the financial and
  economic crises is felt, it is even more
   important that safe work remains a
 priority. It cannot become a casualty of
                 the crisis.”


     (Juan Somavia, Director General ILO, China
International Forum on Work Safety, November 19th
                     2008).
                                                    2
                   Outline
•   Introduction
•   Objectives
•   Methodology
•   Results
•   Discussion


                             3
                   Introduction
• The impact of the global financial crisis on
  occupational safety and health is a real and valid
  concern
• World Day for Safety and Health at Work (28 April
  2009)
   – International Labor Organization:
    “With credit barely flowing and global demand on a
     downward slide, enterprises around the world are struggling
     to cope with the global economic crisis. Meanwhile, the
     numbers of unemployed and working poor are rising. How is
     the crisis affecting working conditions? “
                                                             4
                   Reality check
• The impact of the economic slowdown in Malaysia
  perceptible since last year
• Reduction of GDP growth rate from 6.3 % (2007) to 5.3 %
  (2008)
• Retrenchment trends by Ministry of Human Resource
   – 842 employers affected (Feb.09)
   – number of workers affected > doubled
      • 14,035 workers in 2007
      • 36,243 workers in 2009 (cumulative, as per 8.6.09)
      • permanent retrenchment, voluntary retrenchment
        (VSS), lay-off and salary cut.
                                                             5
                            Issues
• How is the financial and economic crisis affecting
  occupational health and safety standards?
• Do all workers in all workplaces face the same risks? Or
  are some more at risk than others?
• Suggestions that it is better for a company and its
  workers to concentrate on its own survival, even if there
  are some reductions in OSH spending
• Impact of crisis and restructuring on the mental health
  of employees
      ILO, World Day for Safety and Health at Work 28 Apr 2009


                                                                 6
       Sickness, presenteeism and job retention
• Employers pressuring staff to carry on working when ill
• Reports of rising levels of stress, anxiety and sickness
• HR being forced to justify what it spends on workplace health.
    Absence Mgt firm FirstCare UK : Record 380,000 people calling in sick
     daily, with anxieties about jobs, family finance & economy
    Health insurer HSA (UK): job security fears prompting more employees
     to struggle into work when they are in fact ill
    Insurer AXA-PPP (UK, Sept. 08): rise in workplace presenteeism
        > 1/3 of HR professionals polled claimed their company encouraged
         employees to continue responding to e-mails & performing basic tasks
         while off sick. A further 15% admitted although they did not officially
         encourage staff to do this, it probably took place.

        3/4 also said they were aware of "extreme working", ie. employees
         continued to work through incapacity & illness rather than take a day off
         sick.
                             N Paton. Occupational health feels effects of economic
                                                                             7
                             downturn. Occupational Health 17 October 2008 , UK
 Cutbacks affecting OSH performance in
 developing countries eg. Kenya

• Fed. of Kenya Employers : Temptation for employers to
  cut spending on health and safety to tame costs in the
  wake of the global financial crisis

• Concerns of effects of cutbacks : recent work place
  disasters in Kenya
   – construction collapse, factory fires, steel mill explosions etc
     causing hundreds of deaths in past 2 years
   – Despite enactment of 5 new work-related laws, including
     setting up of Govt proposed Occupational Safety and Health
     Fund (employers pay a Sh3,000 levy annually to reduce injuries
     & death at the work place)
                                                                 8
 In crisis, there exists opportunity…….
“For companies not undertaking retrenchment or not much affected by
the global economic meltdown, I would like to suggest that they turn
this situation to their own advantage.

I …. propose that they utilize some of their workers’ time with training
or coaching on occupational safety and health (OSH).

By having OSH training during this period, it will not only increase safety
and health awareness among workers but also will be a good starting
point to help create safe and healthy work culture at the work place.

……………. the available time which may have been caused by reduction
in business is put to good use. “

       Y.B. Datuk Dr S. Subramaniam, Minister of Human Resource on “THE
       IMPORTANCE OF OSH TO BUSINESS SUSTAINABILITY “ , TNB 2nd
       Occupational Safety and Health Seminar For Top Management,
       Sheraton Subang, 25th Feb 2009
                                                                       9
                 Study Rationale
• Need to assess local scenario of economic slowdown
  impact on OSH

• Identify occupational sectors and OSH components
  which may be more sensitive to decline than others
   – Regulatory implications

• Assess response to call to improve OSH training and
  culture during economic lull

• Union representatives well placed to gauge worker
  sentiment and represent a wide selection of
  occupational sectors
                                                        10
            Study Objectives
• To determine the effects and threats of the
  economic crisis to OSH and OSH Programs
  within Malaysian industry

• To determine worker perception and support
  towards incentives for OSH that can be
  provided to industry during the economic
  crisis.

                                                11
                      Methodology
• Cross sectional study conducted in May 2009
• Interviewer guided self administered questionnaire
• 3 sections
   – A : Sociodemographic, employment & sectoral information
   – B : Items regarding employer’s current financial position and
      effect on workers’ employment status, earnings, respondent’s
      general health and mental well being as well as opinion on
      suggestions for Govt. OSH incentives
   – C : Rating scale of performance of certain OSH parameters,
      prior to and following the financial crisis
• Distributed to 41 major union representatives of different
  backgrounds, representing significant portion of the nation’s
  workforce
                                                                 12
Questionnaire




                13
                             Results
• 41 respondents, 39 included in study
  (2 excluded due to incomplete                     Ethnicity
  responses)
                                                 Other (n=1)
• All males except one
• Mean age : 43.8 ± 12.1 yrs
• Mean duration of employment:           Indian (n = 11)
  21.5± 14.9 yrs
• Company ownership:                                Malay (n= 27)

   – 27 (69.2%): Malaysian
   – 9 (23.1%): Foreign
   – 3 not stated
• Company size : all > 150 workers
                                                                    14
15
               Job position
          50



          40                            41           41


          30



          20

                        15
          10
Percent




          0
                   Administrative            Line worker / produc
                                    Supervisory                 M issing

               Job position                                                16
          Is your company                                        Has your employer                                           Due to the economic
          experiencing an                                        informed you of the                                         slowdown, have workers
          economic slowdown ?                                    company’s                                                   been reduced in number or
                                                                 economic                                                    terminated ?
          Yes 24 (61.5 %)                                        slowdown ?
          No 14 (35.9 %)                                                                                                     Yes 8 (20.5 %)
                                                                 Yes 26 (66.7 %)                                             No 31 (79.5 %)
                 Company facing slowdown
                                                                 No 13 (33.3 %)
                                                                                                                                      Company has reduced or terminated number of worke
            70
                                                                                                                                100
            60           62
            50                                                          Company has informed workers of slowdown                80
                                                                   70
                                                                                                                                                                      79
            40
                                                                                    67
            30
                                      36                           60                                                           60
                                                                   50

            20                                                     40
                                                                                                                                40
                                                                                                        33
Percent




            10                                                     30


                                                                   20
             0                                                                                                                  20
                                                                                                                                                  21



                                                                                                                   Percent
                          Yes          No   M issing
                                                       Percent




                                                                   10

                 Company facing slowdown                           0                                                             0
                                                                                     Yes                 No
                                                                                                                                                   Yes                 No
                                                                        Company has informed workers of slowdown
                                                                                                                                      Company has reduced or terminated number of workers




                                                                                                                                                                                       17
          Have salaries &                                                                   Do you feel under                                                     In your opinion, has your
          allowances                                                                        greater pressure in                                                   health deteriorated in
          deteriorated in the last                                                          the last 3 months ?                                                   the last 3 months ?
          3 months ?
                                                                                            Yes 18 (46.2 %)                                                       Yes 13 (33.3 %)
          Yes 15 (38.5 %)                                                                   No 21 (53.8 %)                                                        No 25 (64.1 %)
          No 24 (61.5 %)

                 Subject has had reduced (salary & allowances) in past 3 months feels under more pressure in past 3 months
                                                                           Subject                                                                                        subject feels health has deteriorated in past 3 month
                                                                                              60                                                                     70
            70

                                                                                              50                                        54                           60                            64
            60
                                                     62
                                                                                                                 46                                                  50
            50                                                                                40

                                                                                                                                                                     40
            40                                                                                30

                               38                                                                                                                                    30             33
            30                                                                                20
                                                                                                                                                                     20

            20
                                                                                              10




                                                                                                                                                        Percent
                                                                                                                                                                     10
                                                                                  Percent




            10
Percent




                                                                                               0                                                                     0
                                                                                                                  Yes                    No                                         Yes             No           Missing
             0
                               Yes                    No
                                                                                                   Subject feels under more pressure in past 3 months                     subject feels health has deteriorated in past 3 months

                 Subject has had reduced (salary & allowances) in past 3 months




                                                                                                                                                                                                                             18
          As a result of the economic                                            Has your attendance at work
          slowdown, have work days or                                            improved since the economic
          work hours at your workplace                                           slowdown ?
          been reduced ?
                                                                                 Yes 18 (46.2 %)
          Yes 12 (30.8 %)                                                        No 20 (51.2 %)
          No 27 (69.2 %)                                                         Unstated 1

                   Company has reduced working days or working hours Subject feels work attendance has imp roved in past 3
              80                                                                     60


                                                    69
              60
                                                                                     50
                                                                                                                   51
                                                                                                    46
                                                                                     40
              40

                                                                                     30
                               31
              20
                                                                                     20
Percent




              0
                                Yes                 No                               10
                                                                       Percent




                   Company has reduced working days or working hours
                                                                                      0
                                                                                                    Yes            No           Missing


                                                                                          Subject feels work attendance has improved in past 3 months




                                                                                                                                                    19
           Support for Suggestions on OSH Incentives
          Govt should provide tax                                     Govt should relax compliance
          exemption for purchase of PPE                               towards OSH laws & regulations
                                                                      during economic slowdown ?
          Yes 33 (84.6 %)
          No 6 (15.4 %)                                               Yes 18 (46.2 %)
                                                                      No 21 (53.8 %)
                   Govt should exempt PPE from tax
             100
                                                                              Govt should relax compliance to OSH laws during slow
                                                                         60
              80                85
                                                                         50                                    54
              60
                                                                         40
                                                                                           46
              40                                                         30



              20                                                         20

                                                       15
Percent




                                                                         10
               0
                                                            Percent




                                 Yes                   No
                                                                          0
                                                                                           Yes                   No
                   Govt should exempt P P E from tax

                                                                              Govt should relax compliance to OSH laws during slo wdown



                                                                                                                                     20
          Employers should be given                                                      Technical assistance on OSH should
          interest free loans for OSH                                                    be provided at minimal / no cost to
          infrastructure related                                                         employers by Govt agencies
          expenditure
                                                                                         Yes 31 (79.5 %)
          Yes 33 (84.6 %)                                                                No 8 (20.5 %)
          No 6 (15.4 %)

                                                                          Free/low cos
                    Interest-free loans to employers for OSH infrastructure expendit uret OSH technical assistanc e to employers by
              100                                                                           100



               80                85                                                          80
                                                                                                               79
               60                                                                            60



               40
                                                                                             40



               20
                                                                                             20
                                                        15                                                                          21
Percent




                                                                               Percent




                0
                                  Yes                    No                                   0
                                                                                                               Yes                   No

                    Interest-free loans to employers for OSH infrastructure expenditure
                                                                                                  Free/low cost OSH technical assistance to employers by Govt agencies




                                                                                                                                                               21
Perceived changes in key OSH areas before &
         since economic slowdown
• Rating scores for company performance in key OSH
  areas prior to and ever since the advent of the
  financial turmoil were submitted by respondents &
  analyzed as related samples

• Virtually all aspects rated were perceived by
  respondents as having declined in performance (to
  varying degrees)
• Statistically significant results are highlighted


                                                      22
Aspects of OSH                                            P value *
Compliance toward requirements under OSH Laws,
                                                              0.180
Regulations & COP
Compliance toward safe operating procedures                   0.180
OSH training                                                  0.146
Provision of PPE                                              0.006
Machinery & equipment maintenance                             0.065
Ventilation                                                   0.508
Lighting / illumination                                       0.180
Control of physical hazards                                   0.219
Chemical handling & exposure (if present)                     0.063
* Wilcoxon’s Signed Rank test; result is significant if p ≤ 0.05
                                                                      23
Aspects of OSH (continued)                                P value *
Physical work conditions (ergonomics)                         0.070
Employer – employee communication and
                                                              0.039
relationship
Adequacy of manpower                                          0.007
Rate of workplace accidents & injury                          1.000
Priority to OSH compared to quality and productivity          0.219
Adequacy of financial allocation for OSH activities           0.021
Outpatient/inpatient /dental benefits                         0.375
Meal &travelling benefits                                     0.021
Worker absenteeism at your workplace                          0.039
* Wilcoxon’s Signed Rank test; result is significant if p ≤ 0.05
                                                                      24
Logistic regression modeling was conducted to
determine possible predictors of significant
changes in OSH aspects pre & post financial crisis
• Subjects who perceived deterioration in PPE provision were
  more 15 times more likely to support reduced compliance
  towards OSH laws, regulations and COPs (OR 15.45, p =
  0.014, 95% CI 1.73 – 138.24)

• Subjects who perceived deterioration in employer-employee
  communications were more likely to be
   – older (OR 1.48, p = 0.021, 95% CI 1.06 – 2.07)
   – at less risk (protected) from termination (OR 0.16, p =
     0.009, 95% CI 0.01 – 0.36)
   – supportive of free/low cost technical OSH assistance from
     Govt (OR 490.73 p = 0.027, 95% CI 2.02 – 119379.4)
                                                          25
                            Discussion
• 6 significant key areas of perceived deterioration in OSH, since
  economy slowed down
   – Supply of PPE
   – Employer – employee communication & relationship
   – Adequacy of manpower
   – Adequacy of funding for OSH at workplace
   – Basic daily needs/welfare ie. meal & travelling financial
     support
   – Worsening of absenteeism
• “presenteeism” does not appear to be an issue yet
• No increase in OSH training to fill production gaps
• Where do our OSH priorities and plight in Malaysia stand, in
  comparison to others ?
                                                                     26
• Pan European poll by European Agency for Safety and
  Health at Work (EU-OSHA)
   – 27,000 respondents interviewed in 27 EU member countries
   – Safe & healthy work conditions ranked 3rd in respondents’ priority, behind job
     security and salary level

• Taiwan : Institute of Occup. Safety & Health (IOSH)
    SMEs ~ 97.8% of all companies in Taiwan, 68% workforce
    Dismal record on non-production safety and health equipment,
     > 20,000 fatal accidents / year (?) (25.10.09)
    current financial crisis exacerbating SME difficulties
    Govt resources too limited to assist all businesses covered by OSH Act
    IOSH developed “Industrial Safety Investment Model for Enterprises”
   – aids SMEs in sourcing of funding to improve & investment in industrial safety,
     reduce factory bankruptcies & employee layoffs while preventing occurrence of
     occupational accidents & creating a winning situation for corporate proprietors,
     workers & Govt alike”

                                                                              27
       Study Implications & suggestions
• Challenge to encourage employers to take long term view of
  (OSH) when other pressing current needs unmet
• Some thorny issues, no clear solutions
    – Work burden vs. manpower constraints, culture of communication
    – Reliance on cheap migrant labor ? lack of viable alternative
• OSH funding, PPE
    – ? Pooling of resources : ? Risk rated OSH sinking fund
    – aggressive overtures eg.tax breaks & incentives to discourage neglect of
      OSH; Govt political will required
    – compensate via other “sin” taxes eg. tobacco, alcohol etc (refer
      Recommendation #10, WHO European Ministerial Conference on Health
      Systems, Oslo, Feb.2009)
• No relaxation of compliance; targeted OSH inspectorate visits
  involving “at risk” sectors (SME)
• Strengthening public sector healthcare to fill pvt employer spending
  gaps; easing worker anxieties by improving intangibles eg. social
  support infrastructure (childcare, public transport)                 28
                Study Limitations
• Need to also address employers’ viewpoints
• Causality between variables cannot be ascertained
   – Eg. perception of ↓ availability of PPE & significant
     association with support of relaxed compliance
• Small sample size, absurdly wide confidence intervals –
   – ? Value of findings
   – ? meaningfulness of associations
• Information obtained only represents point / period
  prevalence of sentiment/perception;
   – economy is dynamic thus impact may improve / worsen
     over time


                                                             29
                   Conclusion
ILO’s message regarding occupational safety and
health in times of crisis

“Everyone has the right to a safe and healthy working
environment …. This is especially true in a time of
crisis.

It should not be an excuse to lessen decent working
conditions, including occupational safety and health
standards, but an opportunity to promote them.”
          Dr. Sameera Al-Tuwaijri, Director, Safe Work
          Programme, ILO
          “Implementing Occupational Safety and Health
          Standards Globally” Conference, Dusseldorf,
          November 5 2009
                                                         30
Thank You




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