The former Newcastle United defender has 18 months remaining on his contract at Elland Road and the Whites have yet to make a decision on O'Brien's future.
"We're evaluating the situation and in the process of deciding how to go forward," said Bates in the Yorkshire Evening Post.
"Clearly Andy doesn't want to play for Leeds anymore and something has to be done.
"We're deliberating, taking all the appropriate advice and making the appropriate enquiries. It's not very illuminating for the fans, but I'm sure they appreciate that this is a delicate situation."
Earlier in the week, Bates expressed his belief that he considered O'Brien to have 'resigned' following his refusal to face Burnley.
"To my mind, that means he has resigned his position. As far as I personally am concerned, Andy O'Brien has left the club and we have moved on.
"We are looking forward without Andy O'Brien and the challenge for the other players is to come in and stake their claim. What happens in the future is what concerns me and not a player who doesn't want to play for Leeds United."