Safety regulators have been noticeably more active in terms of commencing prosecutions and other enforcement action (particularly in issuing improvement notices). It is also clear that there is a real focus on the steps that Officers of organisations should be taking to ensure that a business complies with the Act – and Officers are being held accountable.
In Victoria in January 2019, a director of a scrap metal business was sentenced to six months’ imprisonment by the Latrobe Valley Magistrates Court following a 2017 workplace fatality.
Following this, last week a Brisbane director was sentenced to 12 months' imprisonment (suspended after four months) and the company fined $1 million in relation to a workplace fatality. The Maroochydore District Court found the director guilty of reckless conduct in relation to the operation of a roofing business. This will be the first time a director in Queensland will serve time (as opposed to a suspended sentence) for a breach of the WHS regime (pending any appeal).
While imprisonment and significant fines have long been available, a sentence involving jail time demonstrates a significant change in approach from the regulator and the Court.
What is the obligation on a director or other officer?
More than ever, those in Officer roles must have the systems set up to be in a position to positively demonstrate that they have discharged their personal duty to ensure the business complies with its obligations under the Act relevant Act depending on the state or territory in which it operares. The regulator will look for documentary proof of this compliance by Officers.
The various pieces of work health and safety legislation nationally adopt the definition of Officer in the Corporations Act 2001 (Cth) which includes directors but also extends further including to those who make or participate in making decisions that affect the whole, or a substantial part of the business. In some circumstances this may extend beyond the Board and executive leadership team.
Officers (particularly in the harmonised regimes where this is required under the legislation) should consider taking reasonable steps to:
- acquire and keep up-to-date knowledge of safety matters;
- gain an understanding of the nature of the corporation's operations and the hazards and risks associated with those operations;
- ensure that appropriate resources and processes are available to the corporation to eliminate or minimise risks to health and safety (and ensure that those resources and processes are used);
- ensure that the corporation has appropriate processes for receiving, considering and responding (in a timely manner) to information about incidents, hazards and risks;
- ensure that the corporation has appropriate processes for compliance with its duties and obligations under the Act and that the processes are implemented; and
- verify the above.
What steps should an Officer be taking now?
In practice, Officers should make an active inquiry into the organisation's safety systems and performance, ensuring that the following systems are in place:
- attend and participate in regular safety briefings where legislation, case updates and the organisation's key risks, hazards, and performance are discussed;
- understand key risks and hazards in the organisation and broader industry through site visits and training in the organisation's operations and systems;
- regularly make time for strategic discussion on emerging safety issues at Board or other management meetings;
- ensure that work health and safety issues and safety compliance are raised at the executive level (and higher if necessary). Safety should be on the Board agenda at all times;
- understand where concurrent duties apply with third parties (e.g. suppliers and distributors) and what risks are associated with the corporation's interaction with those third parties;
- ensure that the organisation's safety management system is audited annually against the applicable laws;
- ensure the safety management system addresses each identified risk and reporting is occurring in a timely way. This will involve reviewing the organisation's risk and incident registers;
- ensure any reportable incident is reported directly to Officers immediately on the organisation becoming aware of the event;
- consider incident, hazard and risk data and audit reports and actively question any data that does not look right;
- ensure that the organisation has a safety team and that the team is appropriately resourced. Consider the impact of budget cuts on this function;
- appoint a staff member who takes key responsibility for health and safety reporting and verify that any actions raised by Officers are followed up and covered off in subsequent reports; and
- be alert to trends or recurring safety issues as this may indicate a problem and actively question those matters.
Taking the above steps can assist Officers (particularly those in non-executive director roles who can face additional challenges by virtue of being somewhat removed from the organisation's risks and hazards) to discharge their due diligence obligations without having to have day-to-day operational involvement in an organisation's activities. The Act recognises that the role of officer is a strategic position, not operational.
While these decisions and apparent trends toward imprisonment are concerning, avoiding liability does not require an Officer to be an expert in health and safety. An Officer may rely on information from others to help them meet their obligations, including senior managers, subject matter experts, line managers and supervisors. The key to relying on others to assist in discharging the duty is to be able to demonstrate that the reliance is reasonable.