Quite a few months after the ‘Exposure Draft’ was introduced in October 2013, the government has now introduced the Health and Safety Reform Bill into parliament. The sales pitch is that this is the biggest health and safety reform in 20 years. So what will it mean for you?
If you are a Person Conducting a Business or Undertaking
Various duties are imposed on “PCBU”s, that is, Persons Conducting a Business or Undertaking. PCBUs can be natural persons, companies, partnerships or other entities, and can be for profit or not. Specifically excluded are volunteer associations in which no-one is employed, and occupiers of a home in respect of residential work done to that home. PCBUs are the primary duty-holders and are a much wider category than the current Act’s focus on employers.
PCBUs have a general and primary duty of care to ensure, (“so far as is reasonably practicable”), the health and safety of workers employed, engaged, influenced or directed by the PCBU, and the safety of any other persons who may be put at risk by work done by the PCBU. (“Reasonably practicable”) is a slightly different test than (“all practicable steps”) – although duty holders still need to consider the risk, likelihood of it occurring, and ways of managing the hazard. Having done that, the duty holder must then assess whether the costs associated, and whether they are (“grossly disproportionate”) to the risk.
There are also specific duties on PCBUs in respect of certain activities – managing or controlling a workplace, managing plant or fittings at a workplace, designing, manufacturing, importing or supplying, plant, substances or structures, and installing, constructing or commissioning plant, substances or structures.
If you are an Officer
One of the most widely publicised aspect of the Reform Bill is the extension of health and safety ‘due diligence’ obligations to “officers” of a PCBU. “Officers” are widely defined as including:
- Directors of a company, by whatever name called
- Any partner in a partnership, and a general partner in a limited partnership
- Any person occupying a position comparable to a director in a body corporate or an unincorporated body
- Any other person who makes decisions that affect the whole or substantial part of the business of the PCBU (for example, the chief executive).
We note that the fourth category of decision-makers is likely to be the most controversial and challenging to interpret – how far down the management tree will the duties extend? In the Bill, the words “participate in decisions” (which appeared in the Exposure Draft) have been removed, but there is still no real indication of how this definition will be interpreted. Would it include a dominant shareholder that involves itself in decisions? Will it be interpreted to include an HR Manager or a Health and Safety Manager? These are issues the Australians are still wrestling with, under their (very similar) legislation.
We also note that there have been a few changes from the Exposure Draft – certain office holders (including a member of a governing body of a local authority and trustees of school boards) will still be deemed “officers” but will not be subject to prosecution.
Officers are required to exercise due diligence to ensure that the PCBU complies with any duty or obligation under the Bill. Due diligence is defined to include, at least, acquiring and keeping up-to-date knowledge of work health and safety matters and ensuring the PCBU has, and implements, processes for complying with any duty or obligation the PCBU has under the Bill.
It will be no excuse for an Officer to say that he or she ‘had no knowledge’ of health and safety matters, or did not play an active role in the management of the company; all officers will be required to exercise due diligence.
If you are a Worker
Under the Bill, a “Worker” is defined as a person who carries out work in any capacity for a PCBU, including as an employee, contractor, subcontractor, apprentice, outworker, employee of a labour hire company, person on work experience, or volunteer. Again this is a far wider category. Workers will continue to have obligations to ensure their own safety, and the safety of those who may be impacted by their work.
Workers will also have greater protection from “adverse, coercive or misleading conduct” by a PCBU, (including dismissal, detrimental treatment or terminating a commercial arrangement) if the worker is acting under a provision of the Bill (e.g. if the worker refuses to do unsafe work, or is performing functions as a health and safety representative). The Bill also provides (according to the government) more opportunities for worker participation in health and safety. Workers can (as under the present Act) refuse to carry out unsafe work.
If you breach your obligations
The Bill provides a three tier system of offences, depending on the level of ‘culpability’ – as per the table below. The penalties are increased significantly from the current legislation.
|Reckless conduct (where a duty-holder engages in conduct that exposes any individual to a risk of death or serious injury or illness, and is reckless as to that risk):||Failing to comply with duties and exposing individual to risk of death or serious illness or injury:||Failing to comply with any duty (including the due diligence requirements for Officers):|
|Individual but not a PCBU or Officer||Up to $300,000 fine and/or up to 5 years’ imprisonment||Up to $150,000 fine||Up to $50,000 fine|
|Individual who is a PCBU or Officer||Up to $600,000 fine and/or up to 5 years’ imprisonment||Up to $300,000 fine||Up to $100,000 fine|
|Body Corporate||Up to $3m fine||Up to $1.5m fine||Up to $500,000 fine|
It is expected that the Bill will be passed into law by the end of this year and be in force by midway through next. However, we are of course in an election year, so there is always the possibility of attention being diverted. As it currently stands, the Bill had its first reading on 13 March, where it was referred to Select Committee. Any party wishing to make submissions on the Bill must do so by 11 April. Following that, a report is due by 13 September.
In the meantime, if you would like further detail on the contents of the Bill, the process for making submissions, or the impact on you, please give us a call.