Health and Safety Reform: A Review of Four Different Approaches

Abstract

New Zealand reformed its approach to occupational health and safety in 1992, with the passage of the Health and Safety in Employment Act and the Accident, Rehabilitation, Compensation, and Insurance Act. These legislative changes were not, for the most part, informed by a thorough review of the variaus policy options. This paper provides part of such a review by assessing the effectiveness of four different approaches to occupational health and safety. The first three approaches examined are found to have major deficiencies. The market approach of compen sating dangerous work with wage premiums is criticized, because workers nor mally lack the bargaining power to secure pay concessions or hazard prevention measures. The regulatory approach of setting startdards to limit hazard levels or to prescribe safe production methods is faulted for being difficult to errforce and difficult to apply to most hazards. The accident compensation approach of experi ence-rating employer levies to employee claims is also faulted for failing to tightly link employer costs to unsafe conditions. In contrast, the fourth approach of giving workers the right to refuse unsafe work is lauded for its advantages in both detecting hazards and providing incentives for their prevention and rectification. However, improvements on the North American variants of the right to refuse unsafe work are suggested to allow workers to refuse to work in a greater variety of unsafe circumstances without fear of being disciplined.