After nearly a decade of gradual progress, WA is close to implementing new harmonised Work Health and Safety (WHS) laws which will replace existing Occupational Safety and Health (OSH) legislation.
The WHS Bill 2019 (WA) (WHS Bill) was introduced into WA parliament on 27 November 2019 and is nearing the final stages of implementation, potentially coming into effect early 2021. Its purpose is to address deficiencies in, and unify, the current legislation.
Below we look at the key changes that the WHS Bill will introduce as well as the protection it will offer above and beyond the ‘model’ provisions. Keep in mind these changes have not yet fully passed parliament and are subject to change.
EMPLOYERS –> PCBU’s
The term ‘employer’ will be replaced with the broader ‘person carrying on a business or undertaking’ (PCBU), capturing all types of organisations including those without employees.
A PCBU could be an individual, partnership, corporation, charity, government, or other similar entity. They will owe a ‘primary duty of care’ to ensure, so far as reasonably practicable, the health and safety of workers and others who are influenced or directed by the PCBU.
As to what is ‘reasonably practicable’, the WHS Bill provides some guiding factors. These remain essentially unchanged and include:
- The likelihood of the hazard/risk occurring;
- The degree of possible harm;
- What the person knows (or ought to know) about the hazard/risk; and
- The availability/suitability of ways to eliminate/minimise the risk.
- Note: costs will not be a highly persuasive factor
Question: Could a parent company be considered the responsible PCBU for the workers of its wholly-owned subsidiary, even across State borders?
Answer: YES! However, the parent company must ‘control’ the operation of the subsidiary in practice, not just in law. (Inspector Orr v Perilya Limited [2018] NSWDC 29)
OFFICER DUE DILIGENCE
The Bill imposes greater due diligence duties upon PCBU decision-makers. These new duties require officers to personally understand their WHS obligations and how they are implemented. They represent a shift away from the ‘fault-based’ duties in existing legislation and are intended to increase decision-making accountability.
‘Officers’ includes directors, board members, and senior management, but excludes middle management. The nature and extent of a person’s duty will depend on the circumstances of their position and their level (or expected level) of WHS decision-making involvement. For greater clarity, see our previous article looking at the definition of company officers.
Due Diligence requires officers to:
- Acquire and keep up to date knowledge on WHS matters;
- Understand the business operations and the hazards and risks;
- Ensure there are available resources to eliminate/minimise WHS risks;
- Ensure appropriate processes to consider and respond to incident, hazard and risk data; and
- Verify the use of resources and processes as per above.
Cases show that responsibility for ensuring a safe workplace lies entirely with the PCBU and its officers – There is no allowance for the ‘common sense’ of workers.
Consider – Are you an officer of a PCBU? If so:
- How often do you physically attend the worksite?
- Has proposed expenditure on safety improvements ever been rejected?
- Do you participate in safety interactions or ‘hazard hunts’ (etc.) with workers on site?
- Do you discuss safety reports/statistics with Managers?
OTHER ADDITIONS
Duty to all ‘workers’:
The Bill broadens the type of person owed a duty, from ‘employees’ to ‘workers’. This encompasses all directly employed and indirectly engaged workers, such as contractors, sub-contractors, and volunteers who previously were not afforded the same level of protection.
Increased Consultation:
Increased obligations require all PCBU’s, officers, and other duty-holders with common duties, to ‘consult, cooperate and coordinate’ in relation to WHS matters. In conjunction with the wider definition of ‘worker’ above, this requires PCBU’s to consult with a broad range of people.
Shorter Limitation Period:
There will be a 2-year limitation period for prosecution under the WHS Laws. Serious offences could be prosecuted beyond this time limit where fresh evidence is available. The current limitation period is 3 years.
Enforceable Undertakings:
Enforceable Undertakings may be accepted in lieu of prosecution or criminal conviction for all but the most serious of WHS offences. This may include commitments to develop, implement or support an approved workplace or public WHS initiative.
Broader Definition of ‘Health’:
The Bill specifies that the term ‘health’ is to be understood in its broadest sense, capturing both physical and mental health. Risks such as stress, fatigue, and bullying will be subject to the same general obligations as physical health and safety risks.
PENALTIES
In October 2018 WA increased penalties under existing OSH and Mining Safety laws to be consistent with the ‘model’ WHS legislation.
Penalties in the WHS Bill include further increases, ranging from to $570,000 to $3.5 million for a corporation or $120,000 to $680,000 and imprisonment for 5 years for an individual.
Penalties under the industrial manslaughter offences in the Bill (see below) are significantly higher yet again.
INDUSTRIAL MANSLAUGHTER OFFENCES
‘Simple’ offence:
Where a person fails to comply with a WHS duty causing the death of a person. Most workplace fatalities will meet this definition in circumstances where a duty was breached causing the death of the person.
‘Crime’ offence:
A criminal offence. Where a person has a WHS duty and engages in conduct that causes a workplace death, knowing that the conduct was likely to cause the death of an individual, and the person acted in disregard of that likelihood.
Both PCBU’s and its officers personally can be charged with industrial manslaughter offences. For officers, the prosecution must additionally prove that the PCBU’s conduct was attributable to neglect by the officer or was engaged in with the officer’s consent or connivance.
Penalties:
- The ‘Simple’ offence attracts a maximum penalty for an individual of 10 years imprisonment and a fine of $2.5 million, and for a corporation $5 million.
- The ‘Crime’ offence attracts a maximum penalty for an individual of 20 years imprisonment and a fine of $5 million, and for a corporation $10 million.
ABOVE AND BEYOND MODEL LAWS
New duty of care for WHS service providers:
WHS Service providers (who are also a PCBU) have a duty to ensure that their provision of WHS Services (such as advice, recommendations, training/education, and testing/analysis) does not put at risk the health and safety of persons at the workplace. Exemptions apply for services provided by a WHS authority, emergency services personnel in emergency situations, and legal professional privilege.
WHS Committee decision maker:
Where a PCBU forms a WHS Committee, at least one member of that Committee must have sufficient authority to implement its decisions.
WHS Inspectors involvement in WHS disputes:
Where parties cannot resolve WHS issues with reasonable efforts in a timely manner, a party may request a WHS Inspector to assist in resolving the dispute. A WHS Inspector must decide the issue within two days or seek an extension of time from the WHS Tribunal.
Prohibition on insurance and other indemnities:
Insurance policies indemnifying a person’s liability to pay a fine for a WHS offence, or contractual obligations/promises to pay a WHS fine for another person will be prohibited. The penalty for breaching the prohibition will be $285,000 for corporations and $55,000 for individuals.
WHAT DOES IT MEAN?
This Bill represents a significant change for all employers and businesses in WA. It is critical that employers (and others likely to be impacted) consider their duties and practices in light of the proposed changes and prepare for their introduction.
Senior management should ensure they are familiar with their expanded personal obligations. They should seek the necessary support from the business to ensure that adequate plans and procedures are considered in preparation for the changes. Further, managers should critically consider whether they could fall under the definition of ‘officer’ and become subject to these WHS duties.
Marshall Lawyers has been working closely with businesses both in Eastern States (where the harmonised legislation is already in effect) and in WA to assist with the transition. We have helped businesses identify the changes in their obligations and prepare compliant practices and procedures. Contact us for a discussion on how we can assist you.