Engineers Court Peril by Confusing Risk Approaches 2

Thursday, October 17th, 2013
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Engineering firms could be exposing themselves to greater peril, both legal and actual, than they realize by adopting the wrong risk approach when conducting due diligence.

It has become increasingly common for engineers to confound two disparate approaches towards risk minimization when performing due diligence with regards to safety –  those of risk minimization so far as is reasonably practicable (SFAIRP) and risk minimization as low as is reasonably practicable (ALARP).

While both approaches share the same objectives with respect to the demonstration of safety, they are characterized by certain differences in their concrete processes, as well as the legal and practical implications of their adoption.

ALARP is a process for assessing whether further precautions should be adopted with respect to a hazard, stating clearly that a risk is only acceptable when further mitigation is not practicable. SFAIRP focuses more on available and practicable precautions before assessing which are reasonable based on the comparison required by common law of the significance of the risk versus the effort its reduction entails.


risk management diagram

Produced by: R2A Due Diligence Engineers

The diagram above depicts the differences between the two approaches. The ALARP approach is characterized by a number of core flaws, including the inherently unrepeatable nature of hazard analysis and risk calculation, and the subjective nature of the risk criteria selected.

Most importantly from a legal perspective, some ALARP guidance suggests that no further action is required once a hazard is deemed to be beneath an acceptable or tolerable risk threshold.

Australian common law deems, however, that even if a risk is only slight, the failure to adopt available precautionary measures which entail modest difficulty or expense is considered negligent in the event of contingency. The courts of Australia instead favour the SFAIRP approach, and its emphasis on the assessment of the level of precaution as opposed to the level of risk.

It is for these reasons that the attitude frequently encountered amongst engineers that ALARP and SFAIRP are equivalent in practice, or even worse, the misconception that ALARP is a target risk approach, should be a source of deep concern.

Not only does misunderstanding or misapplication of ALARP fail to safeguard firms from a legal perspective, it also fails to account for the safety and well-being of others by omitting precautionary measures for black swan events which, though rare, often appear to be just short of inevitable in the real world.


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  1. Mervyn Sher

    Good article, you had my attention right up to the last paragraph, which is when you lost me.

  2. Andrew Rae

    This article creates a false distinction between ALARP and SFAIRP by misrepresenting ALARP – both its common law basis and its practical implementation. ALARP is, and has always been, a process for testing whether further mitigations should be applied to a hazard, and not a target risk approach. It arose directly from Edwards v. National Coal Board, as a process for meeting the common law test for safety.

    ALARP states clearly that a risk is only acceptable when further mitigation is not practicable.

    Necessarily this requires an element of risk assessment – SFAIRP is no different in this regard – because you can’t measure the benefit of a mitigation without understanding the risk it is trying to mitigate.

    The only way in which ALARP could be compared to a target risk approach is that some ALARP guidance has suggested that there is a line below which the risk is so low that further consideration of mitigations is unnecessary. This line is not an inherent part of ALARP, and is removed in most current descriptions of ALARP processes.

    There has been a lot of confusion generated by trying to talk up the new OH&S regulation as a fundamental change. Ultimately _if_ you were applying ALARP correctly previously, SFAIRP is not a change in principle or application.

    Admitedly ALARP was _not_ consistently applyed correctly, and many engineers _did_ misunderstand it as a target risk approach. This was evident in hazard logs that labelled hazards as “ALARP” based on the amount of riks, not on considerations about available mitigations.

    However, trying to fix this misunderstanding by explaining the “difference” between ALARP and SFAIRP is not helpful. A lot of existing guidance and non-localised regulation still uses ALARP, and mischaracterising it in this way just encourages bad practice.