Director and manager occupational health and safety (OHS)
liability from 1 January 2012
OHS harmonisation remains on track to occur by 31 December 2011,
with State and Territory OHS legislation to be replaced by a model
Work, Health and Safety Act. The States/Territories other than
Western Australia have agreed to pass laws that mirror the Work,
Health and Safety Bill. Workplace Relations Ministers will also be
asked to agree on model Regulations in June 2011.
There are a number of important proposed changes.
Under the Bill, an officer of a body (eg company, partnership,
government department) must exercise due diligence to ensure that
the body complies with its OHS duties. Significantly, the term
'due diligence' is now defined and provides an important
sign-post for employers. The definition provides guidance on what
you can be doing to manage the OHS risk within your organisation.
The Bill proposes that 'due diligence' will mean that an
officer is to:
Acquire and have up to date knowledge of work OHS matters.
Understand the nature of the operations of the business and the
hazards and risks associated with it.
Ensure that the business uses appropriate resources and
processes to identify and control or eliminate hazards associated
with the operations of the business.
Ensure that the business has appropriate processes for
receiving and considering information on incidents, hazards and
risks and responding in a timely way to that information.
Ensure that the body has, and implements, processes for
complying with any duty or obligation of the body under the Act
(this might include the obligation to notify incidents, consult
with workers, etc).
Have in place a system for verifying compliance with the
business' safety obligations.
An 'officer' is defined to include an officer within the
meaning of section 9 of the Corporations Act 2001 (Cth), which, for
corporations means any of the following:
Director or secretary.
Person who makes, or participates in making, decisions that
affect the whole, or a substantial part, of the business or
undertaking of the body.
Person who has the capacity to affect significantly the
body's financial standing.
In the case of the Crown, a public authority or local authority,
'officer' means a person who makes, or participates in
making decisions that affect the whole, or a substantial part, of
the business or undertaking of the relevant government department
or that authority, excluding Ministers.
Among the most significant issues for directors and managers
under the Bill are:
The substantial increase in penalties.
The restriction of imprisonment to offences involving
recklessness on the part of the officer.
An officer is not deemed to commit an offence simply because
his or her company commits an offence (which compares favourably to
deeming provisions in the NSW OHS Act).
Decision makers within government departments and authorities
are on equal footing in terms of exposure to prosecution as
directors and managers in the private sector.
The Bill signals that, in the move to a national OHS system,
directors and managers need to be as vigilant as ever in
establishing and maintaining safe systems of work. Although the
deadline for harmonisation is 31 December 2011, the laws could be
enacted earlier. We recommend that you consider reviewing existing
systems and procedures to determine whether changes are required
with the introduction of the new laws. This is also a useful task
so that commercial arrangements entered into now will not be
inconsistent with the new laws when they are introduced.
DLA Phillips Fox is one of the largest legal firms in
Australasia and a member of DLA Piper Group, an alliance of
independent legal practices. It is a separate and distinct legal
entity. For more information visit
This publication is intended as a first point of reference and
should not be relied on as a substitute for professional advice.
Specialist legal advice should always be sought in relation to any
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