September 2011

Work health and safety reforms: NSW employers must prepare for the new Act

Key takeaways

  • Businesses should review work safety systems to align with the new laws.

  • Officers should understand the new laws and their positive duty of due diligence to avoid penalties.

On 1 January 2012 the Work Health and Safety Act 2011 (WHS Act) commences operation replacing the existing NSW Occupational Health and Safety Act 2000 (OHS 2000). For NSW employers, the changes are significant.

However, on 7 June 2011, the Occupational Health and Safety Amendment Act 2011 amended a number of provisions in OHS 2000 to fast-track some of the reforms, such as the duty of due diligence.

The major changes in the WHS Act for NSW employers include:

  • a broader focus than "employer" and "employee" to cover all "persons conducting a business or undertaking" to secure the safety of all "workers";

  • "workers" is broadly defined to include employees, contractors and others;

  • the absolute duty to guarantee safety is modified to include the concept of reasonable practicability;

  • a positive duty on "officers" to exercise due diligence;

  • broader consultation obligations, including a duty to "consult, co-operate and co-ordinate" with other duty holders; and

  • significantly increased penalties for a contravention of the WHS Act.

For NSW employers there is a welcome shift from the previous absolute duty to ensure safety to a duty to ensure safety so far as is reasonably practicable with the onus being on the prosecutor to prove all material facts.

However, the new regime requires a proactive, smarter and considered approach to safety. Safety is dealt with more holistically and, as a result, obligations can be more encompassing.

The primary duty

Section 19(1) of the WHS Act provides that persons conducting a business or undertaking must, so far as is reasonably practicable, ensure the health and safety of workers at work in the business.

Ensuring safety "so far as is reasonably practicable" may operate in a number of ways:

  • The obligation is "heightened" and greater than the common law duty to take reasonable care.

  • The first step will be to eliminate risks before any lesser control standard can be adopted.

  • What is "reasonably practicable" depends largely on a consideration of whether the time, trouble and expense of the steps to eliminate or reduce the risk are grossly disproportionate to the nature of the risk involved.

  • WorkCover bears the onus of proof in any charge. It must prove, to the criminal standard, that the business failed to ensure, so far as is reasonably practicable, the health, safety and welfare of the workers.

  • It is likely that once simple and relatively inexpensive measures which could have been taken at the time to avoid the accident are identified, the prosecutor's onus will be discharged.

Due diligence

Section 27(1) of WHS Act requires an officer of the person conducting the business or undertaking to exercise due diligence to ensure that the person conducting the business complies with its duty or obligation.

An "officer" includes directors and the secretary of a corporation as well as persons who make, or participate in the making of decisions that affect the business, or a substantial part of the business.

The duty to exercise due diligence is positive. Being passive or disinterested can be a contravention; due diligence requires officers to be proactive about safety and have an ongoing demonstrable interest in safety matters.

Due diligence is usefully defined in section 27(5) of the WHS Act as:

... "due diligence" includes taking reasonable steps:

(a) to acquire and keep up-to-date knowledge of work health and safety matters, and

(b) to gain an understanding of the nature of the operations of the business ... and generally of the hazards and risks associated with those operations, and

(c) to ensure that the person conducting the business ... has available for use, and uses, appropriate resources and processes to eliminate or minimise risks to health and safety from work carried out ..., and

(d) to ensure that the person conducting the business ... has appropriate processes for receiving and considering information regarding incidents, hazards and risks and responding in a timely way to that information, and

(e) to ensure that the person conducting the business ... has, and implements, processes for complying with any duty or obligation of the person ... under this Act, and

(f) to verify the provision and use of the resources and processes referred to in paragraphs (c)-(e).

Conclusion

Businesses and their officers should understand the new laws, the duties and obligations and take active steps to ensure compliance with the new obligations, including exercising due diligence.

Bartier Perry can conduct tailored seminars for businesses and its officers on the new laws, as well as undertake a review of systems and practices against the due diligence obligation. Please contact us to discuss this service.

Author: James Mattson