Efficiency cycle: keeping the house in order with regular workplace audits

January 1, 2016
FCB HR Services

Like most things in life, a systematic and structured approach to managing key responsibilities (albeit a little tedious at times) frees you up to focus on the stuff that keeps the blood pumping. Whether it’s the regular dental check-up, servicing the car or keeping records for your tax return, life’s that bit easier when you do the small stuff consistently.

Unlike personal responsibilities, where the consequence of an unstructured life is often limited to embarrassment and budget blow-outs, when it comes to risk management in the workplace, the impact of non-compliance is a little more compelling and increasingly personal. The “ripping down” of the corporate veil, which had historically provided personal protection for company officers, means accountability is now falling squarely on individual managers and key decision-makers. Moreover, fines and penalties have increased significantly for those who fail to comply with the multitude of applicable workplace regulations and the consequences for a company’s brand reputation can be devastating.

Against this backdrop, regular auditing, historically the domain of safety and quality, has become an essential corporate behaviour across a broader range of disciplines. Increasingly we are seeing courts and regulators expecting a structured auditing program in award compliance, prevention of discrimination, contractor compliance and workforce diversity, just to name a few. Therefore, it’s time to take a look in the mirror, identify your own “auditing personality” and ask: “does it inspire more than a tick of the box?”

When done well, comprehensive regular auditing is a way of attracting and retaining staff and helping an entire workforce (including third party contractors) perform at their peak. But it needn’t be a chore. Increasingly, smart operators are finding more efficient ways to maintain their systems of work and demonstrate compliance, taking the load off managers and supporting them as they focus on other leadership priorities.

Accessorial liability: it’s not my responsibility, is it?

Recent cases have demonstrated how responsibilities are extending more broadly than ever. The Fair Work Ombudsman recently took on Coles in relation to the management of contractors engaged to collect shopping trolleys at suburban supermarkets. Previously, contractor management was understood to be limited to work health and safety and specific construction code compliance. However, under the Fair Work Act the Fair Work Ombudsman is promoting a far wider field of responsibility for principals who engage contractors. The Fair Work Act provides the regulator with power to create accountability within organisations that are not the employer, which are involved in a breach. Known as accessorial liability, this legal concept is being increasingly relied upon to expand the responsibility and liability of third parties. In fact last August the Fair Work Ombudsman, Natalie James, stated: “We are using  more and more, so that we can hold individuals involved in contraventions to account.”

Accessorial liability, combined with changing societal expectation and increasingly targeted legislation mean that ongoing proof of compliance and regular monitoring are essential features of the modern corporate profile. And it is regular auditing which gives that corporation and its officers the confidence to focus on sustainable growth strategies. It is equally important to remember that due diligence is an expanding social expectation which will continue to grow on the back of online social movements.

Lightening the auditing load

One thing we’ve observed in our practice is that businesses who engage in regular and systematic auditing don’t get bogged down in the process – instead, they relish the freedom it provides them to focus on other critical aspects of the business. These organisations also use the auditing process to challenge traditional thinking and approaches. Within FCB we believe that the freedom auditing provides should be the focus of the corporation, rather than the ‘red tape’ perception it is often aligned with.

Consulting with workforce managers on the scope, method and feedback associated with regular risk management auditing is another way to promote ownership of the task. Just as work safety consultation is a key ingredient in effective WHS management, it is equally important to promote a wider awareness of inconsistent workplace behaviours across equality, tolerance, award compliance and quality of output. Engaging a larger section of the workforce in the auditing design and roll-out process can be a great way of broadening responsibility.

Audit your auditing personality

With the regulator’s growing expectations of thorough and regular auditing, it may be time to take a look at your “auditing personality” and ask your corporation a few probing questions! Ideally you will question how workplace auditing processes can become part of your business culture, rather than an external examination alone. Sure, there are times where auditing by an external body is essential however, if you work with a regular external auditor you can partner with them to identify ways to collect the data and information in a way which challenges and informs management and staff at the same time.

Here are just a few questions you may wish to consider asking yourself to determine whether you are making the most of your auditing opportunities:

  • How can you communicate the auditing processes and responsibilities within your organisation to promote them as opportunities rather than simply tasks?
  • Is regular auditing demonstrating a proactive approach to corporate governance which enhances a perception of learning and owning rather than ticking a box?
  • Does your entire workforce understand that regular auditing provides protection to officers and managers from prosecution through a demonstration of a living and breathing system of governance?
  • Is auditing being conducted within your business with a view to identifying it as a marketing opportunity, not just a compliance tool, with the capacity to promote a progressive corporate brand?
  • Does your business promote auditing as a brand protection and talent sourcing tool with improved market attraction to aid candidate attraction and retention, or is it still promoting it as simply a tick the box exercise?

You need more than a checklist

FCB understands how contemporary workforce risk management auditing helps form a corporate profile both for an internal and external audience. We work with our clients to examine how we can use the auditing process as a means of challenging and educating those that own the business structures and influence the people.

FCB is increasingly working with clients to ensure due diligence is maintained, rather than simply achieved at the front end. This requires an auditing partnership over an extended period to identify and promote people development and capitalise on the opportunities an audit can present. Would you like to discuss your business needs with us? Please call us on (02) 9922 5188 or email us at info@fcbgroup.com.au.