Australia: Heavy Vehicle National Law changes: what you need to know

Why is the law being amended and how are these changes being made?

The Heavy Vehicle National Law (HVNL) regulates the use of heavy vehicles (vehicles with a GVM or ATM of more than 4.5 tonnes) on roads in all states of Australia except Western Australia.

As a result of concerns expressed by industry participants and regulators, and after extensive consultation, Australia's transport ministers recently resolved that the HVNL should be reformed to better align with other national safety legislation such as the Model Work Health and Safety Act and the Rail Safety National Law. The ministers considered that safety outcomes will be improved and enforcement simplified if all parties in the 'chain of responsibility' are subject to a primary duty to ensure, 'so far as is reasonably practicable', the safety of transport services.

The Heavy Vehicle National Law and Other Legislation Amendment Bill 2016 has now been introduced in the Queensland Parliament (as the host jurisdiction). The Bill is currently being considered by the Transportation and Utilities Committee with that committee to report back to Parliament by 1 November 2016.

When will the changes commence?

Once the amendments are passed, it is proposed that the changes will not commence for one year to allow regulators and industry participants to educate themselves and their staff and to put in place systems to ensure compliance.

What are primary duties?

Under the reforms, everyone in the chain of responsibility for a heavy vehicle will have a non transferable duty to ensure, so far as is reasonably practicable, the safety of their transport activities related to the vehicle. This duty extends to eliminating or, where elimination is not possible, minimising safety risks and the risk of damage to road infrastructure, so far as is reasonably practicable.

All parties in the chain are also required to ensure that, as far as reasonably practicable, their conduct does not directly or indirectly cause or encourage a driver or another party in the chain to contravene the HVNL.

Current chain of responsibility provisions deem parties in the chain to be responsible for a series of on-road offences such as breaches of a vehicle's mass, dimension and loading requirements and breach by drivers of speed and fatigue requirements. The new provisions go further – it will no longer be necessary for a road offence to be committed before a party in the chain is liable under the HVNL. Instead, a party may be prosecuted because it does not have in place practices and procedures that ensure the safe operation of its transport activities.

The level and nature of each party's obligations under the new provisions depends on the nature of the public risk created by their activities and their capacity to control, eliminate or minimise any risks.

Who are the parties in the 'chain of responsibility' to whom the primary duties apply?

The amendments do not significantly enlarge the current list of parties in the chain of responsibility. All of the following parties are part of 'the chain' and will be subject to the new primary duties:

  1. a driver's employer;
  2. a prime contractor, if a driver is self-employed;
  3. a vehicle operator;
  4. a scheduler of a vehicle;
  5. a consignor and consignee of goods in a vehicle;
  6. a packer of goods in a vehicle;
  7. a loading manager;
  8. a loader; and
  9. an unloader.

All Australian businesses that make use of heavy vehicles to transport goods, whether directly or indirectly, are potentially consignors and consignees and therefore part of the chain. The reach of this legislation is therefore significant and goes far beyond those parties directly involved in providing transport services.

The Bill amends the HVNL to clarify that it is the performance of any of the functions of any of the chain of responsibility parties, whether exclusively or occasionally, that determines whether a person falls within the definitions, rather than the person's job title or contractual description. A person may also have more than one duty, and a duty may be shared between one or more persons.

The primary duty requires a party to ensure safety 'so far as is reasonably practicable'. What does this mean?

The Bill uses the same terminology and definition of 'reasonably practicable' that appears in other national safety laws and defines 'reasonably practicable' as follows:

  1. 'reasonably practicable', in relation to a duty, means that which is, or was at a particular time, reasonably able to be done in relation to the duty, weighing up all relevant matters, including –

  2. the likelihood of a safety risk, or damage to road infrastructure, happening; and
  3. the harm that could result from the risk or damage; and
  4. what the person knows, or ought reasonably to know, about the risk or damage; and
  5. what the person knows, or ought reasonably to know, about the ways of –
    1. removing or minimising the risk; or
    2. preventing or minimising the damage; and
  1. the availability and suitability of those ways; and
  2. the cost associated with the available ways, including whether the cost is grossly disproportionate to the likelihood of the risk or damage.

Such a definition is unlikely to produce a different result in practice than applying the 'all reasonable steps' requirement that currently applies under the HVNL.

Do the duties apply to managers as well as to the businesses they manage?

The primary duties are relevant to directors and managers, not just the businesses they are involved in managing. The Bill imposes a positive due diligence obligation on all 'executives' to exercise due diligence to ensure the business complies with its primary duty. In addition, in relation to certain prescribed offences, if a corporation commits an offence, the executive officer will also be found to have committed the same offence if the officer did not 'exercise reasonable diligence' to ensure the corporation did not engage in the relevant offending conduct. The prescribed offences include tampering with speed limiters and contravening a mass or dimension exemption.

An executive is not just a partner or director but, in the case of a corporation, extends to 'a person who is concerned or takes part in the management of the corporation'.

For the purposes of the primary duty, 'due diligence' is defined as including:
taking reasonable steps –

  1. to acquire, and keep up to date, knowledge about the safe conduct of transport activities; and
  2. to gain an understanding of –
    1. the nature of the legal entity's transport activities; and
    2. the hazards and risks, including the public risk, associated with those activities; and
  1. to ensure the legal entity has, and uses, appropriate resources to eliminate or minimise those hazards and risks; and
  2. to ensure the legal entity has, and implements, processes –
    1. to eliminate or minimise those hazards and risks; and
    2. for receiving, considering, and responding in a timely way to, information about those hazards and risks and any incidents; and
    3. (v) for complying with the legal entity's duty under section 26C; and
  1. to verify the resources and processes mentioned in paragraphs (c) and (d) are being provided, used and implemented.

A failure to exercise due diligence may result in the executive being fined or jailed with the maximum penalty that applies being the same as the maximum penalty that would apply if the breach of duty had been committed by an individual (see penalty table below).

What are the proposed penalties for a breach of the 'primary duty'?

The failure to discharge a primary duty of care is an offence that can attract significant penalties, comparable to those in other national safety laws. Breach may result in a jail sentence, as set out in the table below. The hierarchy of penalties is based on the nature of each risk and the actual harm or damage caused.

What will happen to the existing 'extended liability' offences in the HVNL in relation to fatigue, mass, dimension, loading and speeding breaches?

Many of the previous offences that deemed parties in the chain to be liable in the event of mass, dimension, speed and fatigue offences (unless they could show they took 'all reasonable steps') will be omitted from the HVNL.

However, the Bill includes new offences that apply to a person who, without reasonable excuse, 'permits' another person to drive a vehicle in circumstances where the vehicle is does not comply with the HVNL, such as where the vehicle is overloaded or does not comply with loading or dimensional requirements. These sections will presumably apply to employers and operators and may extend to prime contractors.

Will my business be protected if I comply with a code of practice?

A registered industry code of practice will be admissible in any proceedings as evidence as to whether or not a duty under the HVNL has been complied with. A court may also have regard to the code for evidence as to what is known about a hazard and what is 'reasonably practicable' in relation to a party's activities.

Are the any proposed changes to enforcement practices?

The proposed amendments will allow enforcement authorities to require a person to provide information to allow monitoring of or enforcement of a primary duty imposed by the HVNL. The person must provide that information, even if doing so might tend to incriminate the person, or expose them to a penalty. The information a person provides under this section is not admissible against that person in any civil or criminal proceeding. The information provided may, however, still be used against a corporation or another person.

The proposed changes also enable the use of voluntary enforceable undertakings as an alternative to prosecution for parties who agree to be bound to take specified steps to ensure compliance with the HVNL. A person or corporation cannot make use of an enforceable undertaking if they have committed a Category 1 (reckless) breach of a primary duty. Non-compliance with an enforceable undertaking will attract a maximum penalty of $10,000. Where the undertaking is not complied with, an enforcement agency can apply to a court or tribunal for an order to direct the person to comply with the undertaking or to have the undertaking discharged.

What should parties in the chain of responsibility do to prepare for the changes?

The extensive changes to the HVNL mean that all parties need to:

  1. consider and familiarise themselves with the new legislative regime of primary duties;
  2. educate management and staff as to the new primary duties and the severe penalties associated with non-compliance; and
  3. consider the risks associated with their transport services, what policies and practices are currently in place to manage those risks and what further steps could and should be taken to manage the risks and to document the steps taken to manage those risks.

In considering how to discharge any primary duty and to meet due diligence obligations, parties should have particular regard to the definitions of 'business practices' and of 'due diligence' in the Bill. Business practices include 'operating policies and procedures' and, as discussed above, 'due diligence' includes taking steps to keep up to date with knowledge about safe practices and ensuring that resources are available and processes are in place to manage risk, respond to incidents and to verify that any processes are followed.

To discharge the duties imposed, ad hoc unwritten and informal policies and activities than are not audited or supervised are highly unlikely to be adequate. Parties in the chain, including all Australian businesses that make use of heavy road transport services, should use the time between now and the commencement of the changes to properly document policies and procedures and contractual responsibilities with other parties in the chain.

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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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