LC36: Control of organisational change
Site Inspection Planning
T/INS/036 - Issue 1
1. Purpose and scope
1.1 The purpose of this guidance is to facilitate a consistent approach to LC 36 compliance inspection and to provide assistance to inspectors while carrying out their duties in this area. The guidance should not be regarded as either comprehensive or mandatory. Although every attempt has been made to deal with all the key features that are likely to arise in inspecting for compliance with this licence condition, additional aspects may need to be examined to ensure a comprehensive and complete inspection. Comments on this guide, and suggestions for future revisions, should be recorded on a Process Improvement Feedback Form (PIFF1) in accordance with DBP 003.
1.2 The guidance does not indicate when or to what extent these compliance inspections should be made as these matters are covered in individual inspector's inspection programmes.
1.3 The guidance provided is split into four main elements:
1) Purpose of the Licence Condition
2) Guidance on arrangements for LC 36.
3) Guidance on inspection of arrangements.
4) Guidance on inspection of implementation of arrangements.
2. Licence Condition
Licence Condition 36 - Control of organisational change
36 (1) The licensee shall make and implement adequate arrangements to control any change to its organisational structure or resources which may affect safety.
36 (2) The licensee shall submit to the Executive for approval such part or parts of the aforesaid arrangements as the Executive may specify.
36 (3) The licensee shall ensure that once approved no alteration or amendment is made to the approved arrangements unless the Executive has approved such alteration or amendment.
36 (4) The aforesaid arrangements shall provide for the classification of changes to the organisational structure or resources according to their safety significance. The arrangements shall include a requirement for the provision of adequate documentation to justify the safety of any proposed change and shall where appropriate provide for the submission of such documentation to the Executive.
36 (5) The licensee shall if so directed by the Executive halt the change to its organisational structure or resources and the licensee shall not recommence such change without the consent of the Executive.
3. Purpose of Licence Condition 36
3.1 This Licence Condition is designed to provide a system of rigorous and appropriate regulatory control of changes to the licensee's organisational structure and resources, wherever they are located, and for whatever purpose, if they are pertinent to the safety of a licensed site. LC 36's specific purpose is to ensure that adequate arrangements exist, and are implemented, for the control of organisational change which may affect safety.
3.2 A particular feature of the regulation of LC36 is that it is recommended that inspection of licence compliance needs to focus on the application of the arrangements as a comprehensive quality management system for managing change - i.e. whether licensees are applying their process appropriately . A licensee's arrangements should cover all stages of a plant's lifetime, all parts of a licensee's organisation (whether on- or off-site) and the effect of changes to other organisations (or in the relationship with other organisations) upon whose support a licensee relies for compliance with safety legislation.
3.3 Specialist Inspectors should be consulted on the deeper assessment of the adequacy of the whole arrangements and on such topics as task analysis which might be needed to judge on specific aspects of the arrangements (such as the adequacy of a baseline - see paragraph 5.4(2) for further details).
3.4 The safety of an installation is dependant on the adequacy of the organisation and management of the individuals who design, give engineering support to, give health and safety support to, procure for, construct, operate, maintain, modify etc. the plant. The Licensee is therefore required to make and implement arrangements to ensure that changes to its organisation as a whole are properly controlled. By these means it maintains its capability to sustain the activities which affect the safety of a nuclear licensed site and meet the licensee's legal duties under the NI Act, including the retention and use by the licensee of an adequate range and depth of technical competence (the "Intelligent Customer" capability).
3.5 Other, related licence conditions (LCs 10, 12, 26) deal with ensuring that persons with safety duties have competencies appropriate to those duties. Note that a Licensee may deal with like-for-like changes in staff under LCs 10 and 12.
3.6 LC36(1) provides for the making and implementing of adequate arrangements.
LC36(2) gives the power to the Executive to specify the arrangements or parts of arrangements for approval . This power would be used when first these arrangements were made, not for subsequent alterations. It is generally the intention of NII that the "top tiers" of each licensee's arrangements made under LC 36 will be approved. Inspectors may wish to make an exception to this for very small licensees (such as research reactors) where the arrangements are minor and very straightforward. When licensee's arrangements are submitted for approval under this or the next clause, they should be assessed for adequacy against T/AST/048 (Technical Assessment Guide - Licence Condition 36 Arrangements), and subsidary documents (see also section 3.3 , above).
LC36(3) ensures that where the Executive has approved arrangements the Licensee must apply for approval to amend or alter those arrangements.
LC36(4) requires the Licensee to apply a change classification system so as to segregate proposed changes according to their significance to safety and hence to treat those proposals in a proportionate way; taking due account of the consequences of inadequate conception or implementation. It also includes a requirement for the licensee to produce adequate documentation to substantiate the safety of a proposed change and to submit such documentation to NII in appropriate cases.
LC36(5) gives the power to the Executive to direct the Licensee to halt a change to its organisational structure or resources and prevent the licensee from recommencing such change without NII's consent .
4. Guidance on arrangements for LC 36
4.1 The following list of elements of arrangements provide NSD's views on what the Licensee's arrangements might be expected to contain to comply with LC36. The list is neither exclusive nor exhaustive and will be subject to review and revision in light of operational experience. If licensees have generic model(s) for arrangements then it is for the site to justify any deviation from the model(s). [note: not all licensees use generic models] .
4.2 Arrangements should be adequate to satisfy the specific licence condition requirements which are:
1) A clear requirement that the arrangements provide for the control of any change to organisational structure or resources which may affect safety. LC36(1)
2) The requirement to submit for approval to the Executive (NSD) those parts of the arrangements the Executive may specify . LC36(2)
3) The requirement that once approved by the Executive arrangements can't be altered without the approval of the Executive. LC36(3)
4) A system for classification of modifications by safety significance which takes due account of the consequences of it being incorrectly conceived or executed. LC36(4)
5) The requirement to include arrangements for the provision of adequate documentation to justify the safety of any proposed change and to where appropriate submit such documentation to the Executive. LC36(4)
6) The requirement to halt the modification if so directed by the Executive and not to recommence without the consent of the Executive. LC36(5)
4.3 The arrangements can be defined in a single document or a suite of linked documents which have a hierarchical structure, a well defined part of which is suitable for approval, and provide the means by which the licensee controls changes to its organisational structure or resources.
4.4 The arrangements should include a policy for dealing with organisational change.
4.5 The arrangements should comprise a comprehensive quality management system for management of change: they should not consist only of a procedure for individual changes. Of particular interest to NII should be the review and audit functions to oversee the synergistic effects of numbers of changes and to lead to the continuous improvement of its process.
4.6 Classification of changes should be clearly and objectively defined and corresponding arrangements for control and implementation specified.
4.7 Arrangements should allow NSD flexibility to specify, agree or acknowledge and opt in or out of regulatory hold points as appropriate.
4.8 In inspecting and judging a licensee's arrangements for LC36, inspectors can consider the activities which affect the safety of a nuclear licensed site and meet the licensee's legal duties under the NI Act, including the retention and use by the licensee of an adequate range and depth of technical competence (the "Intelligent Customer" capability). Currently, NII is concentrating on organisational structure, staffing levels (including the use of contractors) and ways of working, unless there are significant problems with changing resources, material assets or funding (of, for example, safety features, improvement programmes, research or decommissioning), in which case Unit 4b will provide advice on the appropriateness of using LC36 to regulate such changes to resources.
4.9 The arrangements should state that suitable records should be made and kept under condition 6.
4.10 They should identify the person who has responsibility for reporting non-compliance to the Executive.
4.11 They should also enable the licensee to respond to any Specification from the Executive. Such arrangements should identify the person responsible for responding to the Specification and should identify the system whereby constraints, caveats or conditions imposed by the Executive are implemented.
4.12 They should ensure that if they or any part of them are approved under this condition by the Executive they can only be changed or amended with the approval of the Executive. Persons responsible for ensuring compliance with this requirement should be identified in the procedures.
5. Guidance on inspection of arrangements for LC 36
5.1 Part 5 of this guidance is to assist inspectors in judging the adequacy of the licensee's arrangements. The following list is neither exclusive or exhaustive and will be subject to review and revision in light of operational experience. It does however, provide a hit list of aspects of LC 36 that can be examined during routine inspections.
5.2 Technical Assessment Guide T/AST/048 gives more comprehensive guidance on the assessment of a licensees general LC36 arrangements, Technical Assessment Guide T/AST/049 gives more comprehensive guidance on the assessment of a licensees "Intelligent Customer" capability, Technical Assessment Guide T/AST/052 gives more comprehensive guidance on the assessment of contractorisation and a Technical Assessment Guide is to be written to give more comprehensive guidance on the assessment of a licensee's baseline.
5.3 Examine the arrangement's documentation layout and check that it is consistent. Review the arrangements to establish validity, whether any changes have been made since the last review and whether the identified responsible persons are correct. Note whether instructions, methods and quality assurance rules claimed in procedures have been followed and whether any changes have been correctly incorporated and validated.
5.4 Examine the arrangements and check that arrangements have a hierarchical structure, a well defined part of which is suitable for approval. Check that they cover:
1) A policy for dealing with organisational change.
2) A baseline analysis and a process for producing and reviewing the baseline (see T/AST/0xx) . A baseline organisational analysis should (as for a safety case) form the substantiation of the existing state before a change in order to support the substantiation of the change itself. Such baseline substantiation should be peer reviewed and in appropriate cases referred to a Nuclear Safety Committee (NSC) or equivalent body set up for the purpose, before implementation of either the project or its stages. The licensee should have a process to establish and maintain its baseline. A range of different techniques are available to licensees to develop a baseline and the depth of the process can vary. Licensees should adopt appropriate regimes of analysis for different parts of their baseline depending on the importance to safety. Licensees should also show how they intend to improve the rigor of the baseline analysis with experience. The acceptance of an initial baseline provided by a licensee will not indicate that NII is content either with the methodology used or with the adequacy of the levels or configuration of resource used.
3) A consistent approach to the assessment of the safety implications of a proposed change and, where it is confirmed that a change can be made, the provision of a written substantiation which is capable of audit and review. The substantiation should also contain a demonstration by the licensee on the retention of its intelligent customer capability (see T/AST/049). Such assessment of the safety implications of a proposed change should be applied to every change, allowing for a safety significance analysis to determine the classification and hence the degree of decision-making detail that needs to be documented.
4) A register of change proposals for each site which lists all organisational changes, the assigned category and other appropriate attributes for each change and is updated more than 28 days before the implementation of the change is due to be commenced (so as to allow NII time for regulatory intervention if necessary).
5) A process by which NII is informed of the details of all proposed changes of the highest category, after the approval of the change by the licensee and more than 28 days before the implementation of the change is due to be commenced (so as to allow NII time for regulatory intervention if necessary).
6) All organisational changes should be subjected to the licensee's management of change process, categorised for importance to safety. The scope of the arrangements should also cover: Site, HQ and other parts of the licensee's organisation; unplanned changes; and should not be restricted to the safety duties imposed by the LCs but cover all safety duties imposed by all legislation.
7) A classification process which requires changes to be dealt with proportionately by the licensee in accordance with the significance to safety, by which the effects of proposed changes are considered, sanctioned and reviewed at an appropriate managerial level for implementation and provides for appropriate regulatory intervention by NII. To assist the regulatory interface, the top category should be defined in licensees' arrangements in a way which limits the changes to those small number which constitute wholesale organisational change or which potentially challenge the basis upon which the licence was granted (see Annex for examples). The arrangements should also include requirements for the licensee's regular (recommend: annual or more frequently) review of the classification that has been assigned to modifications during the period being reviewed and that the classification process is subject to the making of adequate records.
8) A recognition that the various stages in the process (e.g. classification, analysis, performance measures, contingency plans etc.) should be tested against the principle of "inadequate conception and implementation".
9) A process (see also T/AST/048) for planning and making changes:
roles and responsibilities for carrying out the process and each stage of the plan, with clearly assigned duties for originating proposals, for peer review and management approval, and for seeking advice from the NSC or identified equivalent status body (where appropriate);
"staging" of changes when appropriate;
the identification and management of "enablers" or precursors to a particular stage of the plan ( see also T/AST/048);
the identification and management of "performance measures" by which to monitor for unexpected or undesirable outcomes of the change;
the identification of "contingencies" which may be put in place in the event of such outcomes;
that the planning and implementation process is subject to the making of adequate records.
10) Appropriate review and audit process (including safety reviews) at appropriate times covering:
regular (recommend: annual or more frequently) review of the planning and implementation of changes;
periodic review of the baseline;
performance reviews during implementation;
reviews of the levels of categorisation;
regular departmental reviews of all changes for synergistic effects;
independent safety reviews when the classification requires;
overall review of process and implementation;
and the implementation of plans for improvement;
that the review process is subject to the making of adequate records.
11) The use of appropriate QA processes which ensure that each element is transparent, recorded and capable of audit and review.
12) Arrangements should require that there is appropriate and clear linkage to other supporting arrangements such as LC10 training, LC12 SQEPs, and LC26 Control and supervision of operations.
6. Guidance on inspection of implementation of arrangements for LC 36
6.1 Part 6 of this guidance is to assist inspectors in judging the adequacy of the Licensee's implementation of their arrangements i.e. is the licensee doing what their arrangements say they should be and with the effect intended. Assessment Inspectors, when making inspections on the technical aspects of safety cases, may also widen their remit to contribute to the inspection process for LC36.
6.2 It is for Inspectors to apply their experience and discretion to determine the extent and depth of a particular inspection taking due account of a number of factors such as safety significance, complexity, importance and technical specialism of the area. In some cases it may be possible for the inspector to reallocate progress of specific regulatory matters on a topic within his unit or division. Additionally, themed inspections are planned for LC36.
6.3 The following list is neither exclusive or exhaustive and will be subject to review and revision in light of operational experience. It does however, provide a list of aspects of LC 36 that can be examined during routine inspections.
6.4 This section of the guidance is presented in two parts dealing firstly, with inspection of the process for dealing with organisational change and secondly with the inspection of individual changes by which a judgement on the veracity of the process is obtained. Technical Assessment Guide T/AST/048 gives more comprehensive guidance on the what is appropriate in various aspects of LC36 arrangements
Inspection by checks on Process
6.5 Examine records of training and establish that staff responsible for ensuring compliance with this licence condition are at a suitable and sufficient level of authority within the licensee's organisation.
6.6 Establish that the licensee's policy for dealing with organisational change has been promulgated to all staff. Establish that the licensee's processes for LC36 are parts of its quality assurance system and subject to the normal processes of independent review and audits operated by the licensee.
6.7 Check regularly (i.e. if practicable, every visit) the register of change proposals. Check that it is up to date and fully filled in, that changes have been updated in time to provide 28 days for NII to be aware of changes, prior to implementation. Sample-check the classification of some change proposals known to you, drawing a judgement on the accuracy of classification and ensuring that any top category changes have been notified to NII for approval.
6.8 Check that the licensee is carrying out a regular review of classification levels and check its adequacy. Check the adequacy and completeness of records.
6.9 Check the baseline analysis contains a substantiation of the "right size and structure" (and not just a statement of size and structure). Check that there is no presumption that the existing structure is adequate.
6.10 Interview some of the managers proposing changes and others such as reviewers to examine their knowledge of:
- roles and responsibilities;
- "staging" of changes when appropriate;
- "enablers" properly identified and managed;
- "performance measures" and "contingencies" properly identified and managed;
- reviews ((including safety reviews) at appropriate times during implementation;
records.
6.11 From discussions with staff at various levels, confirm that the licensee's arrangements are being adhered to: in particular that no unauthorised changes have been made or are intended to be made.
6.12 Sample and check the licensee's change substantiations to ensure that they comply with the arrangements. In particular that safety reviews and authorisation is at a level appropriate to the classification.
6.13 Sample and check the QA records for change to examine: records; register of change proposals; review and audit.
6.14 Sample and check the licensee's implementation of the review and audit processes, examining:
the periodic review of the zero base (this may take place as part of the PSR);
reviews of performance indicators during and after implementation;
categorisation reviews;
regular reviews of all changes to ensure there are no synergistic effects or "salami slicing";
independent safety reviews (such as those by the HSD organisation or NSC);
overall review of process and implementation and the implementation of plans for improvement.
Inspection by checks on individual change proposals
6.15 Sample individual changes for checking. The sample should include top category changes, if there have been any, and lower category changes, throughout the range of significance. The sample should ideally include changes at the centre which may affect safety at the site. Consider "calling in" changes (at any or all category levels) for specialist assessment.
6.16 Check the QA records for each change sampled.
6.17 Check the register of change proposals to ensure that the change was updated in time to provide 28 days for NII to be aware, prior to implementation. In the case of a top category change, ensure that it was submitted to NII 28 days before implementation was planned.
6.18 Draw a judgement on the accuracy of the classification of the change.
6.19 Check the substantiation for the change give rise to:
a detailed implementation plan with timescales;
enablers or prerequisites;
contingency plans; and
where appropriate, allow for shadow working to confirm planned arrangements.
6.20 Check that all enablers and prerequisites were met before the appropriate parts of the change were implemented (examples of enablers are: reduction in workload, training and etc).
6.21 Check that attention has been given to, and dealt with, the knock-on effect of the proposed change on other procedures, instructions and management processes within the licensee's organisation.
6.22 Establish that the licensee addressed the implications of the proposed change for staff capabilities and working practices, e.g. increased travel, higher workloads and communications and reviewed the implications of a change if it results in a single person in a particular technical expertise.
6.23 Examine the way in which the licensee has dealt with employee consultation.
6.24 Check the LC36 records for the change and judge whether appropriate levels of approval have been applied; and check the adequacy and completeness of records.
6.25 Ensure that the principle of " inadequate conception and implementation" has been applied to:
- classification;
- substantiation;
- enabler identification;
- performance indicators; and
- contingency identification.
6.26 Examine:
the safety reviews for the proposed changes (as part of the licensee's sanctioning process);
the independent review process at each stage of the implementation plan to monitor through the use of appropriate indicators, for example, the meeting of prerequisites and the operation of countermeasures and contingency plans;
the reversibility of changes or the application of contingency plans, should subsequent performance monitoring indicate that the change has been inappropriately conceived or inadequately carried out.
Annex: Examples of recent changes or proposals which might be classified in a licensee's top category
It is felt that the provision of examples will aid in guidance. NII's view is that the following examples, from recent proposals or changes made by licensees, should be classified as "major" (or in the top category):
- outsourcing all technical support to a divested engineering agency;
- wholesale restructuring a company e.g. de-merger prior to privatisation;
- taking on contractors in managerial roles so as to challenge who is the "user" of the site;
- Vision 2000 in BE;
- downgrading the head of safety in a company so that he/she is no longer a director;
- the acquisition of another company by a licensee and the placement of that company to operate and control activities on one of its sites.
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