FACTORIES (AMENDMENT) BILL

Order for Second Reading read. 2.43 pm

The Minister for Manpower (Dr Lee Boon Yang): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

Sir, this Bill before the House seeks to amend the Factories Act to introduce provisions to enhance the framework for self-regulation and to improve safety and health standards at factories and other workplaces. The Bill also seeks to extend the scope of the Act to cover more workplaces.

Mr Speaker, Sir, over the past 10 years, the industrial accident situation has improved. In 1990, the accident frequency rate was 4.0 accidents for every million man-hours worked. It fell to 2.5 accidents per million man-hours worked in 1998, which is a reduction of about 40%. I cannot use the more recent figure for 1999 because the statistics have not been finalised yet. So I am comparing it to the 1998 figure.

Sir, the improvement was seen across the board even in industries, such as shipbuilding, ship repairing and construction. The marine industry, for example, suffered 12.2 accidents per million man-hours worked in 1990. In 1998, there were only 6.1 accidents per million man-hours worked, which is an improvement of 50%.

In the case of the construction industry, the accident frequency rate also fell from 3.7 in 1990 to 2.7 in 1998, an improvement of about 30%. These improvements could be attributed to the implementation of safety regulations and improved self-regulation by the industries. Despite these improvements, we must continue with our efforts to make workplaces safer for all workers. We must bear in mind that current safety performance is still below that of the developed countries. For example, the accident frequency rate for Japan in 1997 was only 2.08 accidents per million man-hours worked compared to Singapore's 2.6 accidents per million man-hours worked for the same year. One area of particular concern is that we still see many fatal accidents in the construction industry. The number of fatalities in the construction industry had increased to 73 in 1998 from 36 in 1990.

Sir, I would like to emphasize, right from the onset, that legislation alone will not resolve the problems of safety and health at the workplace. The efforts of the Government must be complemented by the employers' strong commitment to the safety and health of their employees. Employers and management must, therefore, take ownership and set their agenda to improve safety and health conditions at the workplace. Supervisors and workers must also be alert to workplace hazards and learn to work safely.

The basic framework to get the industries to self-regulate has been put in place for some time. Since then, my Ministry has been actively promoting self-regulation in industry and implementing programmes to help factory occupiers and employers towards this objective.

The proposed amendments to the Act will further enhance this framework by introducing provisions to require factory occupiers to take a more pro-active role to protect the safety and health of workers.

I shall now highlight the key amendments in the Bill.

Clause 2 of the Bill amends the Factories Act to expand the interpretation of "factories" to include any premises in which mechanical power is used in sorting, packing, handling, or storing of articles which is carried out by way of trade or incidental to other businesses. Currently, the Act contains a provision to cover workers involved in this kind of work, that is, the sorting, packing or handling of articles in a warehouse only where such work is carried out as a business or by way of trade. In other words, the warehouse must be a commercial warehouse taking in the goods for storage for and on behalf of customers. However, whether the warehouses where such activities are being carried out are in the warehousing business or just a company's own warehouse to store its own products or materials, workers are actually exposed to the same kind of hazards. The Ministry, therefore, proposes to expand the scope of the Act to include warehouses or open yards where such activities are carried out and where mechanical power is used. Warehouses where no mechanical power is used are obviously less hazardous to the workers. Hence, the amendment excludes premises which are essentially stores where articles are kept incidental to business activities and no mechanical power is used at all. The extension of the Act will ensure that workers who are exposed to occupational hazards in all warehouses and open storage areas where mechanical devices are in use would be adequately protected.

Workers engaged in the maintenance work on the MRT and LRT tracks, ie, for repair or maintenance of the railway tracks, including viaducts and tunnels, are exposed to various hazards such as falling from the place of work, or hazards posed by electrical equipment and also moving vehicles on the tracks. Such workers should also be accorded protection under the Act. Clause 2 of the Bill will amend the Act to cover maintenance work on the MRT and LRT.

Clause 5 creates a new section 24A to require occupiers of factories to establish and implement a "Lock-out" system to prevent accidental activation of machinery or equipment. This consists of a device to lock-out the power source such as an electricity supply, and a related set of procedures using special tags or additional locks to indicate that workers are still engaged in the work. Such a system is designed to ensure that any plant, machinery or equipment that is under inspection, cleaning, repair or other maintenance work would not be inadvertently switched on, or activated in any way that might endanger the workers involved in the repair or the maintenance work.

In a recent case, we had two mechanics trying to clear a choke in a machine. They had actually deactivated the machine by turning off the isolation switch to the machine. One of them had to leave the job to attend to a related matter. When he returned, he assumed the choke had been cleared and switched on the power supply to the machine. This resulted in the amputation of a finger of the other mechanic who was still working on the machine. With the "Lock-out" system envisaged in this amendment, a lock or some other suitable device would have been used to indicate that someone is still working on the machine and therefore power to the machine should not be turned on. We would then have prevented the accident. Hence, we are moving towards this direction of requiring "Lock-out" mechanisms to be used.

Clause 6 creates a new section 27A to require occupiers of factories to ensure that certain categories of persons employed in a factory are given safety training. The Chief Inspector is empowered to specify the training courses and the categories of persons, such as managers of construction projects or wafer fabrication plants, supervisors of processes that pose specific risks, and workers who have to work in tunnels and other confined spaces. Such training for employees or workers is fundamental to workplace safety and health.

Clause 11 creates a new section 47A that prohibits the commencement of any hazardous work specified in a new Twelfth Schedule, unless certain specified precautions had been taken. These include identifying the hazards to which persons at the workplace could be exposed, setting out safe work procedures, and implementing safety measures in the course of work and during an emergency. For example, if work is to be done in a confined space where there is risk of suffocation or fire or explosion, then procedures such as carrying out the necessary tests on the air quality, briefing workers on the nearest emergency exit, and measures such as providing adequate ventilation and continuous monitoring should be undertaken before commencement of the work itself.

Clause 13 re-enacts section 49 to provide additional powers and penalties -

(a) to reinstate the power of the Chief Inspector under the repealed section 48 to stop the use of machinery or plant in a factory;

(b) to raise the maximum penalty for failure to comply with an order under the section, that is, a "stop work" order, which requires the occupier to remedy the danger to persons or to stop any process or work in the factory. The maximum penalty will be an increase in the current fine of $10,000 to $200,000; or to imprisonment of a term not exceeding one year instead of the current term of 6 months or to both. In the case of a continued offence, that is, a "stop work" order has been issued but the occupier disregards the "stop work" order and carries on with the work, the penalty would then be increased from a fine not exceeding $1,000 per day to a fine not exceeding $20,000 per day. To put this in perspective, the maximum fine under the Act for a contravention that results in two or more fatalities is $200,000. Therefore, the proposed fine is in keeping with the severity of the offence and will deter any factory occupier from deliberately violating such a "stop work" order and knowingly putting workers at risk because in many instances, the liquidated damages for any delay in a project, or the losses due to suspended production are far more costly than the existing fine of just $10,000;

(c) to empower the Chief Inspector of Factories to take appropriate measures to prevent unauthorised entry to any area, or unauthorised access to any machinery affected by the order;

(d) to empower a police officer or an inspector authorised in writing by the Chief Inspector to arrest without warrant any person who contravenes the section by entering areas, or gaining access to machinery affected by the order, without the authorisation of the Chief Inspector.

Clause 20 creates three new sections, 70A, 71B and 71C. These will empower the Minister to require occupiers of certain factories -

(a) to appoint a safety co-ordinator, with suitable qualifications and training, to promote the safe conduct of work generally within a factory, under the new section 71A;

(b) to implement a safety management system to ensure the safety, and to protect the health and welfare of persons employed, under the new section 71B; and

(c) to appoint a competent person (who must be approved by the Chief Inspector of Factories) to conduct periodic safety inspections, carry out the recommendations resulting from the inspections and to submit the report of the competent person to the Chief Inspector when required, under the new section 71C.

Clause 24 creates a new section 78A to empower the Minister to require occupiers of factories to comply with prescribed Singapore Standards and Codes of Practice published by the Singapore Productivity and Standards Board.

Clause 25 amends section 85 to increase the maximum penalty for obstructing an inspector in the execution of his duties under the Act from a fine not exceeding $2,000 to not exceeding $5,000 or imprisonment for a term not exceeding 3 months to a term not exceeding 6 months.

Clause 26 amends section 88 -

(a) to provide under subsection (2) that any person who contravenes any provision of the Act or subsidiary legislation made under the Act is guilty of an offence;

(b) to empower the Chief Inspector, under subsection (3), instead of the Commissioner, to authorise an inspector to arrest without warrant, any employed person who wilfully interferes or misuses any means or appliances for securing the health and safety of workers;

(c) to extend the provision relating to corporate offences under subsection (13) to cover offences under both the parent Act as well as offences under the subsidiary legislation made under the Act, instead of covering only offences under the Act; and

(d) introduce a new subsection (14) to make every partner in a partnership liable for any offences committed by the partnership.

Most of the other provisions on penalties were introduced more than 20 years ago, that is, the penalties stipulated in the existing Act were nearly two decades old. Besides the penalties which I have mentioned earlier, we have also reviewed other provisions to ensure that penalties remain effective deterrents and help to better ensure the safety of workers at the workplace.

Clause 27 amends section 89 -

(a) to increase the maximum penalty for offences under subsection (1) from $1,000 to $2,000 and from $2,000 to $5,000;

(b) for contravention which is likely to cause death or bodily injury to any person, to increase the maximum fine from $10,000 to $20,000;

(c) for contravention which results in a dangerous occurrence or serious bodily injury to any person, to increase the maximum fine from $25,000 to $35,000; and

(d) to provide for an enhanced penalty of up to twice that provided under the Act if the offender is convicted of committing an offence in the same designated categories listed in the Fourteenth Schedule for a second or subsequent time. These include offences arising from persons falling from height as a result of failure to provide barricades, a safe work platform or workplace; falling objects injuring workers; electrocution, just to name a few. Investigations carried out by my Ministry indicated that the majority of the fatal accidents could be attributed to these examples which I have just mentioned. We have recorded instances where such accidents recurred because the occupier of a factory or a worksite did not seem to learn the lesson from past accidents. They continued to allow unsafe conditions to remain and suffer a second accident as a result. My Ministry therefore proposes that the fines for such offenders be doubled as an added deterrent. There is no reason why an occupier should allow an unsafe situation which had already resulted in an accident to be continued and for another accident to be repeated. We hope that the enhanced penalty for those situations listed in the new Fourteenth Schedule will deter employers/occupiers from allowing unsafe situation at the workplace to continue, and to take immediate action to rectify and to prevent the recurrence of such unsafe situation.

Clause 28 amends section 90 to increase the maximum fine from $300 to $1,000 per day for non-compliance of an order of the Court to remedy a contravention under the Act.

Clause 29 amends section 91 to increase the maximum penalty for any forgery of certificate, false entries and false declarations from $2,000 to $5,000.

Sir, presently, the Chief Inspector may compound any offence under the Act for an amount not exceeding $1,000. Composition has proven to be an effective and efficient means of persuading occupiers to take prompt action to rectify unsafe conditions. To further enhance the effectiveness of this enforcement option, the Ministry proposes to increase the maximum compound fine to $2,000. This amendment is in clause 31.

Clause 32 amends section 102 to include radiant heat amongst the list of factors for which the Minister may make regulations for its control in factories, and to make minor drafting amendments. Radiant heat is generated by furnaces or similar processes. Similar to lighting or humidity, it is one of the factors that may affect workers' health.

Clause 33 amends section 104 to limit the circumstances in which the Minister may amend the Fourteenth Schedule. This is the Schedule listing out all the offences or infringements under which a repeat offence can result in a double penalty. This Schedule, as I said, sets out the classes of offences for which a second or subsequent conviction carries an enhanced fine under the new section 89(6). The new subsection (2) provides that the Fourteenth Schedule cannot be amended to include new offences or classes of offences, or to change the classification of offences. However, the new subsection (3) makes it clear that the Fourteenth Schedule may be amended for the purposes of correcting cross-references, re-numbering or other consequential changes. In other words, the list of offences which will attach a heavier penalty for a repeat offence is fixed, as it is now in the Bill and it cannot be just added on without coming back to Parliament.

Clause 34 amends the Fourth Schedule by adding three other classes of dangerous occurrences: in other words, incidents that must be reported to the Chief Inspector. These are:

(a) Failure or collapse of form-work or its supports;

(b) Collapse in part or in whole of a scaffold exceeding 15 metres in height or of a suspended scaffold or hanging scaffold from which a person may fall a distance of more than 3 metres;

(c) Accidental seepage or entry of seawater into dry or floating docks resulting in flooding of the dry dock or floating dock.

Sir, the Bill also contains other amendments that are made for the purpose of bringing the Act up-to-date. They are mostly of a technical nature. Explanations for these amendments can be found in the Explanatory Statement of the Bill.

Sir, I beg to move.

Question proposed.

Mr Speaker: Order. I suspend the Sitting and will take the Chair again at 3.30 pm.

Sitting accordingly suspended at 3.06 pm until 3.30 pm. Sitting resumed at 3.30 pm