The Health and Safety at Work Act 2015 (HSW Act) provides a range of options for WorkSafe when they are investigating a contravention of the HSW Act. One of those options is for the duty holder to give an enforceable undertaking.
An enforceable undertaking is a legally binding agreement between WorkSafe and the duty holder. Its purpose is to focus the duty holder on various tasks that they need to carry out to fix an alleged breach, and/or to prevent a similar breach occurring in the future.
WorkSafe will decide whether or not to accept the enforceable undertaking. The factors that WorkSafe consider include:
- the seriousness of the uncontrolled risk resulting from the breach;
- the degree of harm resulting from the breach;
- the views of any victim of the breach;
- the views of the workers and their representatives; and
- the likelihood that the enforceable undertaking will deliver real benefits to the workplace, industry or community beyond that achieved through other enforcement methods.
In practice these factors are likely to include the payment of voluntary reparation to any person injured by the breach, and the payment of costs (investigation, enforcement, and prosecution).
The undertaking will need to provide for a significant improvement to the duty holder's activities. It will not be sufficient to enter into an enforceable undertaking that only goes so far as compliance with the current legal requirements, it must improve the duty holder's practices beyond the minimum level. Additionally, the person proposing the enforceable undertaking would need to acknowledge the harm that has occurred and its impacts; however, the giving of an enforceable undertaking does not constitute an admission of guilt by the person giving it. The exact wording of any undertaking is likely to be a matter of negotiation between WorkSafe and the person making the undertaking.
All enforceable undertakings accepted by WorkSafe must be published on the internet, together with the reasons for accepting the undertaking.
While often a very agreeable alternative to prosecution by WorkSafe, a duty holder should be sure that they can comply with the undertaking before reaching an agreement. The breach of an enforceable undertaking is a stand-alone offence under the HSW Act, with fines of up to $50,000 for an individual or $250,000 for a company.
Any duty holder considering negotiating an enforceable undertaking with WorkSafe should carefully check their statutory liability insurance policy, if they have one, and discuss the policy terms with their lawyer. Some policies state that they provide cover in the event of a prosecution, which means that depending on the specific wording of the policy, there may not be any cover if a prosecution is avoided. Some insurers may agree to provide cover regardless, on the basis that a prosecution would occur if the undertaking was not made, but this is something that should be raised at the outset, rather than at the end of the process.
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.