Since July 2008 the Council of Australian Governments has been developing a harmonised OHS legislation that would replace the current individual legislation in each state.
At present, each state and territory enforce their own OHS laws, however despite sharing similar regulations there are some differences in the law between Australian states and territories. To manage these differences an intergovernmental agreement was made to create a harmonised National OHS legislation.
In many cases the Act draws on existing state OHS requirements however it also introduces some new additions and clarifications across the board.
As mentioned by Prime Minister Julia Gillard, the key aspects of the model laws include:
- An unqualified obligation on employers to provide a safe workplace to employees and a broad approach to the duty of care which, given the changing nature of the workplace, needs to extend protection to persons other than traditional employees (eg extends duty to contractors)
- The capacity of regulators to share evidence across multiple jurisdictions which will significantly enhance the ability of regulators to pursue upstream duty holders.
- The increase in penalties where the new maximum will be $3,000,000 for corporations and $600,000 for individuals. The increase of penalties will allow courts a greater capacity to respond meaningfully and proportionately to serious breaches by duty holders
- A uniform cease work provision which will apply in each jurisdiction. It will also broaden the entitlement so that it applies to ‘employees’ and other kinds of workers (e.g. contractors)
- The requirement for employers to consult employees over work-related matters that affect health and safety
- The protection of the rights and roles of elected workplace health and safety representatives
- The proposed model laws allow appeals to the High Court, which is currently not available in all jurisdictions and this will ensure consistency and provide strong legal precedence
- The content and operation of the model laws will be subject to periodic review (at least once every five years) to ensure the laws remain relevant and take into account changes in workplace conditions or arrangements.
Trent Bekis, Manager of Honan Risk Services, summarised the benefits of the harmonisation “Overall, the harmonised OHS laws in Australia will impose greater standards of safety across jurisdictions and create consistency. It is also significant that the harmonisation will heighten the duty of care owed by business owners and will no longer be limited to the workplace which will present a greater liability on business.”
With this new national OHS harmonisation legislation it is important to be aware how it will affect your business and assess the impact of the new laws and whether your business is in a position to comply. The new Act will introduce significant changes to the management of safety in Australia and will impact the safety culture in your business including;
1. Greater duty of care on any person conducting a business or undertaking (PCBU) need to take all reasonable practical steps to ensure the health and safety of workers engaged in the business or undertaking and be aware that this duty extends to those workers whose activities in carrying out work are influenced or directed by the PCBU.
The challenge is to assess what your business undertaking is and what workers are carrying out at work at the direction or influence of the organisation. Further, how much control can your organisation exercise over safety in these situations? What risks can arise from work carried out as part of an undertaking? And importantly, are your current contracts and safety systems able to deal with these issues?
2. Greater duty to consult and coordinate on safety with workers, contractors and others affected by the business or undertaking.
The challenge is to assess who are the categories of people you will need to consult, the extent and level of the consultation and coordination required and what contracts and processes need to be put into place to comply with the broader consultation requirements.
3. Increased adverse publicity orders exposing your business with allegations of unsafe conduct attributed to your business.
A business could have an order made requiring the business or individual to publish their unlawful conduct and conviction as part of an ASIC or ASX announcement or on the internet. The challenge is to consider how your business will address these new adverse publicity orders.
4. Greater avenues for intervention by unions and safety regulators at your business.
New to some jurisdiction will be the appointment of Health and Safety Reps (HSR) with rights to issue provisional improvement notices and direct to cease unsafe work. The industrial impact this will have will need to be considered by the organisations in jurisdictions where HSRs do not currently hold these powers.
5. New duty on ‘Officers’ of the PCBU to exercise ‘due diligence’ to ensure that the PCBU complies with its safety obligations.
The officer must take reasonable steps to acquire and keep up to date with and have knowledge of work health and safety issues in the business and ensure that the business has appropriate procedures and resources to eliminate or mitigate risks. This imposes a greater degree of personal accountability
6. The definition of officer is broad and includes directors (including shadow and defacto directors), senior managers and operational or commercial managers who make or participate in making decisions that significantly affect the businesses financial standing.
A business will need to identify who are ‘Officers’ and ensure they are fully aware of their obligations under the new laws and what they must do to avoid personal liability.
At present each state is adopting and adapting to the harmonised law which is expected to be in full effect nationally on 1st January 2012.
In summary, the new OHS harmonisation laws provide an enhanced level of accountability for businesses. It also means a business will need to re-evaluate existing business practices and procedures to determine if they will be in compliance with these new laws and to mitigate potential exposures. The overall purpose will be to improve safety and risk management in general. Insurance is an important component in risk management and one that should not be overlooked during the review and assessment process.