Australia: New OHS Law Changes Coming Sooner Than Expected In New South Wales

Client Bulletin

Most employers in New South Wales are at least to some extent aware already that very significant changes to existing Occupational Health and Safety Laws are scheduled to come into effect on 1 January 2012 when the National "harmonized" system on this subject is due to commence. When the NSW Liberal/National Coalition parties made it clear in the election campaign for the 24 March 2011 State election that they would legislate to implement the harmonized model, the general understanding was that such system would commence in New South Wales on the nationally agreed date of 1 January 2012.

On 5 May 2011 the new O'Farrell Coalition Government introduced into the NSW Parliament the "Work Health and Safety Bill 2011" which will, when enacted, replace the Occupational Health and Safety Act 2000 (NSW) from 1 January 2012. The Bill appears to be in the form and the terms that all Governments in Australia (apart from Western Australia) have agreed as being the basis of the new "harmonised" model.

Just to recap, the new system is a "harmonised" one rather than a national one because the approach is that each jurisdiction enacts its own piece of legislation in terms that are the same as the agreed model legislation, except for listed areas where local variations of a limited nature can be adopted by individual governments.

However, in what seems to be a surprise to most people, the new State Government has also introduced a Bill to amend the current Occupational Health and Safety Act 2000 so as to graft onto that Act, pending the commencement of the proposed Work Health and Safety Act 2011, what are considered to be the "core" changes to the current system that are contained in the model legislation. Those "core" changes are:

  • Modifying the primary duties from ones that require the duty holder (mostly employers) to "ensure" the safety, health and welfare of their workforce and others affected by their operations to duties that require safety etc etc to be ensured "so far as is reasonably practicable"; 
  • Modifying the duty of officers of corporations in relation to the corporation's safety obligations from one equal to that of the corporation unless certain exceptions are established by the director in question (most particularly, demonstrating that "all due diligence" had been exercised) to one of exercising "due diligence" as particularized in the legislation;
  • "Reversing the reverse onus of proof" -- ie casting the burden of proof of breach of a duty on the prosecution, rather than requiring an employer to establish, on the balance of probabilities, certain defences in order to escape conviction; and
  • Eliminating the right of unions to prosecute for offences under the legislation.

The Government's intention is that the first three of these changes will take effect from the date that the amending Act is enacted (which clearly is intended to be this year well before 1 January 2012) and that the elimination of the union right to prosecute will come into effect on the day the Bill was introduced, namely 5 May 2011 (which is in effect retrospective legislating).

So, all employers, employees and other stakeholders in the area of work health and safety in New South Wales should be aware that probably very soon these core aspects of the new "harmonized" system will be operative – far sooner than anticipated.

This will mean most particularly that from their commencement any investigation into an incident involving a hazard or risk to safety at a workplace (whether it results in an actual injury to someone or not) has to focus on not only the fact that a risk actually existed and what the employer did to avoid it but a range of "reasonable practicability" factors, the most important of which are:

  • The likelihood of the hazard or risk occurring;
  • The degree of harm that might result from the hazard or risk;
  • What the duty holder knew or ought to have known about the existence of the risk and ways of eliminating it;
  • The availability and suitability of ways of eliminating or minimizing the risk; and
  • The cost associated with eliminating or minimising the risk, including whether the cost is grossly disproportionate to the risk.

It is also important to bear in mind that the new duty does not focus exclusively on elimination of risks, it also specifically decrees that if it is not reasonably practicable to eliminate a risk, then the duty is to minimize the risk so far as that is reasonably practicable.

Some say that the effect of these changes in the harmonized model is to reduce the standards required of employers in relation to safety matters at the workplace. Only time will tell whether these changes result in any significant reduction in safety standards in workplaces. But there is no real doubt now that these changes will come into law and the initiatives of the new State Government in New South Wales will, by legislating the new core principles early, make the changes inevitable at the national level. Employers certainly believe that the new core principles are more reasonable than those previously in place. The real question (and this is obviously a controversial and political issue) is whether the current standards in NSW have been too high.

All that having been said, the initiatives by the new State Government give rise to legitimate concerns, which include the following:

  • While the Liberal/National Coalition parties made it very clear prior to the election that they would legislate for the harmonized Model Bill, it was certainly not clearly flagged that they would in effect "pick the eyes" out of the Bill and rush those into effect prior to the well known and nationally agreed start date of 1 January 2012.
  • The Model Bill is a very large and comprehensive package of measures, which was the subject of extensive debate, dialogue and submissions over some years prior to its acceptance in late 2010: to take some of the measures out of that package and give them a life of their own, departs substantially from the painstaking consensus process from which the whole package emerged. Such an initiative is arguably a bad precedent that taints the outcome of the "co-operative Federalism" process involved, thus possibly inhibiting its use in future.
  • Further to the preceding point, the Government's initiative undermines the process by departing from the bipartisan nature of it – that is, the Government has picked out those parts of the package that generally speaking appear to assist employers, while leaving for the commencement of the full legislative package those parts which are additional safeguards for employees, such as the enhanced role and powers of workplace safety representatives. 
  • Another similar concern is that the Government is moving to bring certain parts of the new system into early effect when the entire package of supporting regulatory documents, such regulations and codes of practice, have not been finalized (and even if very close to finalized, there has been no chance for stakeholders to become fully familiar with them – they have been expecting to have another 6 months at least to do so, but that acclimatization period seems to be evaporating).

The Government believes that the core provisions of the new system are clearly accepted nationally and the Government's election gives it an implied mandate to fast track those provisions, and that may be so. There is also a reasonable argument that it would be better to make this change now to reduce the "phase in" or transitional period to the new system, so that the old standards will not overhang so long after 1 January 2012 (as breaches that occurred prior to that date will continue to be dealt with under the repealed law). But the concerns expressed above are legitimate ones, it is suggested, and legislators should be reminded that one should always "make haste slowly".

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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