A prominent Perth lawyer has warned that sitting on a company board will become the ‘management of the brave’, with stricter occupational health and safety laws to be introduced into Western Australia from December.
A prominent Perth lawyer has warned that sitting on a company board will become the ‘management of the brave’, with stricter occupational health and safety laws to be introduced into Western Australia from December.
DLA Piper occupational health and safety partner Guy French said the OHS laws – introduced into federal parliament last week – would require a positive demonstration of due diligence by officers of a company and would see a significant increase in penalties for non-compliance.
“Previously under the existing law, the worst offences were those where there was a death or a serious injury, if this law goes through there doesn’t have to be (such a result) because it’s about exposing the person to a risk of that, and that is a significant change,” Mr French said.
“That means that near misses are going to come into the highest level of offence.”
Independent statutory agency Safe Work Australia developed what were called model OHS laws as part of a 2008 initiative of the Council of Australian Governments to harmonise work, health and safety laws around Australia.
That initiative, agreed at a time when all states and the federal government were ruled by Labor, committed all states and territories and the Commonwealth to the adoption of uniform OHS laws by 2011, complemented by nationally consistent approaches to compliance and enforcement.
In late 2009, a year after the conservatives took power in WA, then state minister for commerce Troy Buswell, who held responsibility for industrial relations, told the Workplace Relations Ministerial Council that while WA supported the principle of OHS harmonisation, it would retain its own settings in some areas, including the level of penalties and right of entry, power for health and safety representatives to stop work, and reverse onus of proof for discrimination issues.
At the time there was concern in the business community that the harsh NSW laws were proposed as the national model.
Mr French warned that under the proposed model legislation – from which states and territories were expected to largely mirror in their own laws – directors, company secretaries, CEOs, CFOs and COOs, all deemed officers of a company, would need to take reasonable steps to acquire and keep an up to date knowledge of work, health and safety matters.
“With this law there are too many levels of obligation that you’re required to meet and you have to have knowledge and that’s going to take a bit of work,” Mr French said.
“If this [OHS law] wasn’t top of the list as to where directors should be turning their minds, I reckon it’s getting there pretty quickly.”
Mr French’s colleague, DLA Piper workplace health and safety partner Simon Billing, said the laws would see external auditors play a much larger role in monitoring workplace practices.
“The board will be retaining these external auditors directly and saying ‘we want to know for our sake if operationally we are doing the right thing’, so they can see what’s happening and not get a filtered version,” Mr Billing said.
Mr French added: “You’re going to have to spend a lot of money as a business on audits which report directly to the board, to ensure that both internal and external audit processes are being done properly.”
The penalties for non-compliance with the model OHS laws are criminal in nature, which can involve jail time and impose heavy penalties ranging from $100,000 to $300,000 for contravention by an officer.
Mr French said the increased level of the penalties could have a damaging effect on smaller companies.
“There has been a significant jump in penalties and this is where WA has arced up and said they are going to go slightly lower with them, because of the risk that businesses could go broke,” he said.
The Work Health & Safety Act is due to start in WA on January 1, 2012.
