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Occupational

Health & Safety

Rima Newman | Partner Kristopher Cook | Senior Associate

Logie-Smith Lanyon Lawyers Logie-Smith Lanyon Lawyers

E: rnewman@logielaw.com T: 03 9628 4186 E: kcook@logielaw.com T: 03 9628 4157

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Overview

Kristopher Cook (Senior Associate)

• Overview of OHS/WHS law in Australia

• Update: The harmonisation of work health and safety laws in Australia

• Duties of directors, company officers and senior management

• Penalties

• Dealing with work safety inspectors

• Insurance

Rima Newman (Partner-in-Charge)

• Mental health and the workplace

• Bullying and sexual harassment

This presentation provides a general summary and is not intended to be comprehensive. It is not legal advice. You

should obtain legal advice specific to your circumstances before relying on any aspect of this presentation.

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OHS/WHS Law in Australia

• OHS/WHS law is criminal law.

• Penalties can include custodial sentences and significant fines (up to $3m for a body corporate and $600,000 for a company officer in some jurisdictions).

• It is contrary to public policy in Australia to enforce an indemnity

(e.g. insurance) for criminal penalties or for a company to indemnify an officer or employee for the consequences of their criminal conduct.

• Insurance is available to cover the legal costs associated with an investigation, prosecution or inquiry.

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Duty of Care

• OHS/WHS law = statutory negligence.

• Common law negligence:

– duty of care;

– breach of the duty; and

– damage.

• OHS/WHS law – damage is not necessary to incur a liability.

• The focus is on risk rather than actual injury or illness.

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Reasonable Foreseeability

"You must take reasonable care to avoid acts or

omissions which you can reasonably foresee would be

likely to injure your neighbour.”

Lord Atkin in Donoghue v Stevenson

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“Injury”

• Includes psychological injury

- PTSD, stress related illness, anxiety, depression

- musculoskeletal, headaches, migraines, skin disorders, ulcers

- behavioral indicators: absence from work, erratic behavior etc.

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Why is OHS/WHS important?

Ineffective management of OHS/WHS can lead to:

• employee health and safety issues (injury, illness, death)

• criminal liabilities

• civil litigation

• increased insurance premiums

• loss of reputation

• disruption to business

• closure of operations

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Harmonisation

• Harmonisation: Legislation based on model Work Health and Safety Act (WHS Act) has commenced in QLD, NSW, SA, TAS, ACT, NT and Commonwealth.

• Harmonisation: Council of Australian Governments (COAG) reform

agreed in 2008 – to reduce cost of regulation and enhance productivity and workforce mobility.

• Victoria and Western Australia are the only jurisdictions that have not adopted the WHS Act.

• Victoria: Occupational Health & Safety Act 2004 (Vic) (VIC OHS Act).

• WA: Occupational Health & Safety Act 1984 (WA OHS Act)

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Harmonisation

• WA – Work Health and Safety Bill 2014 (WA) is “95% compliant” with

model WHS Act.* • VIC – The new State Labor has indicated it will not implement WHS Act. • PwC report (2012) – additional costs of $3.4 billion to Victoria over 5

years, $812 million to transition to the laws and $587 million a year for the first 5 years in ongoing costs to businesses.

* Source: Ministerial Advisory Panel on Safety Legislation Reform

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WHS Act: Relationship between duties of care, activities and relevant standard

Operation of the business

or undertaking

Organisational decision

making and governance

Work activities (including

supervision)

Circumstantial attendance

at the workplace (ie visitors)

Primary Duty of Care

PCBU

Specific classes of duty

holders

Reasonably practicable

Officers’ Duty of Care Due diligence

Workers’ Duty of Care Reasonable care

Duty of Care of Others

(ie at a workplace) Reasonable care

Nature of the activity Duties associated

with the activity Relevant Standard

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Category 1

(Reckless)

Category 2

(Exposure to risk

of death or

serious injury)

Category 3

(Failure to

comply with duty)

Corporations: $3m

Officers: $600k / 5 years jail

Workers: $300k / 5 years jail

Corporations: $1.5m

Officers: $300k

Workers: $150k

Corporations: $500k

Officers: $100k

Workers: $50k

WHS Act - Penalties

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VIC OHS Act

• Duty of employers to employees (reasonably practicable)

- plant and systems of work that are safe and without risk to health

- safe workplaces

- adequate facilities

- information, instruction, training

• Duty of employers to monitor health and conditions (reasonably practicable)

• Duty of employers to other persons (reasonably practicable)

• Duty of employees to themselves and others (s25) (reasonable care)

• Officer duty – must relate to a contravention by the company of one of its general duties (s144).

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Penalties

VIC OHS Act (max. penalties)

- $1,328,490 for corporation

- $265,698.00 for individual

WA OHS Act (max. penalties)

- $625,000.00 for corporation

- $312,000 / 2 years for individual

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Are you a company officer?

• OHS Acts and WHS Acts adopt the meaning of ‘company officer’ in s9 Corporations Act 2001 (Cth).

• Director, Secretary, CFO, COO and General Counsel

• Possible candidates include:

- Human Resource Manager

- Health and Safety Manager

- Chief Information Officer

- Compliance Manager

- General Managers

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Makes or participates in making decisions

that affect the whole or a substantial part,

of the business.

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Company Officers – WHS Act • A POSITIVE duty on officers to exercise due diligence to ensure the

organisation complies with the WHS Act.

• Due diligence is defined under the WHS Act— similar to definition

found in case law re: duty of officers under Corporations Act and at

common law.

• Due diligence is a personal duty – it can not be delegated, modified

or transferred.

• Due diligence = corporate governance applied to health and safety.

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WHS Act - investigation and questioning

powers of workplace inspectors

• Removal of the right to silence (but note the amendments to the WHS Act in SA).

• Cannot refuse based on privilege against self-incrimination

• Use immunity if assert the privilege

• Requirement for warning

• Need to rely on the courts and Evidence Acts – complex.

• Legal professional privilege enshrined

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Critical incident management

• Develop a documented critical incident management protocol that

considers:

- OHS/WHS jurisdictional interface

- Dealing with investigators, regulators and the police

- Rights and obligations of individuals

- Union right entry and H&S representatives

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Insurance

• Directors and officers liability insurance.

• Insurance policies that purport to cover criminal liability are void

against public policy: see s272 WHS Act (no contracting out).

• Can insure for legal costs and other expenses associated with

defending a prosecution.

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Insurance

• Note: a prosecution can take place after a company officer or

worker has left the company.

• What do your employment contracts and/or deeds of indemnity say

re: assistance and access to information AND indemnity for legal

costs associated with a regulatory investigation?

• Review company insurance policies for coverage and exclusions re:

breach of statutory provisions (including re: admissions made in the

course of an investigation)

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Mental health at work

• Work environment

– work location and environment

– travelling and expatriate employees

– unreasonable work expectations and other stressors

– inherent requirements of position

• Bullying and harassment

• Managing and responding to workplace risk

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Work environment

• Physical environment (e.g. sedentary lifestyles)

• Workplace culture

• Unreasonable work hours or expectations

• Stressful occupations

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Stressful occupations?

• Telstra call center operator committed suicide in 2007 after

complaining that work targets were set too high.

• UK lawyer committed suicide. Sleepless nights and inconsolable

with worry over outcome of big case.

• 10 employees of Orange France have killed themselves since

beginning of 2014.

• BBC journalist committed suicide. Stressed and overworked (also

alleged poor handling of harassment allegations).

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Travelling and expatriate

employees

• Increased risk of physical and psychological

injury:

- unfamiliar environment, culture and language

- unfamiliar legal jurisdiction

- increased risk of physical attack or kidnapping

- isolation from family and friends

- extended periods of travel

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FIFO workers

• Social isolation from family and friends

• Stress, fatigue management and ‘high-

compression’ rosters

• Disruption to sleep patterns

• WA Parliamentary Inquiry into mental health

impacts of FIFO work arrangements

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Workplace environment –

Legal risks

• Failure to identify and manage potential risks

associated with mental health and psychological

injury in the workplace, could be a breach of

OHS/WHS laws.

• Also: civil litigation and insurance claims.

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Workplace bullying – legislative

framework

• Fair Work Act 2009 (Cth) (FW Act)

• OHS/WHS Acts

• Workers’ compensation legislation

• Crimes Act 1958 (Vic) (Brodie’s law)

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Bullying- defined

• Repeated and unreasonable behaviour

directed towards a worker or group of workers

(by an individual or group) that creates a risk to

health and safety.

– Draft Code of Practice on Preventing and Responding to

Workplace Bullying

– Fair Work Amendment Act 2013

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Examples • Abusive, insulting or offensive language or comments

• Withholding information vital for effective work

performance

• Excessive or unreasonable scrutiny of work

• Setting unreasonable timelines or constantly changing

deadlines

• Setting tasks that are unreasonably below or beyond a

person’s skill level

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Examples (cont.)

• Denying access to information, supervision, consultation

or resources to the detriment of the worker

• Spreading misinformation or malicious rumours

– Draft Code of Practice on Preventing and Responding

to Workplace Bullying

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What is not bullying?

• Reasonable management action carried out in

a reasonable manner

– Draft Code of Practice on Preventing and Responding to

Workplace Bullying

– Fair Work Amendment Act 2013

– Note also similar exclusion in workers’ compensation legislation

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Non-legal Risks

– Effect on morale

– Lack of efficiency/productivity

– Drain on company resources: management/HR

– Impact on premiums

– Floodgates?

– Risk of employee departures

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Risk minimisation / management

• Anti-bullying policies / workplace conduct – Standards of expected behaviour

– Definition of workplace bullying

– Process for reporting and responding

– Details of contact officers / resolution offices

– Consequences

• Social Media policies

• Grievance processes / complaints procedures

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Risk minimisation / management

(cont.)

Training

– Induction at point of commencement

– Ongoing training/refreshers

– Record keeping of training

– Acceptable workplace behaviours - workplace bullying policies and

procedures

– When, how and to whom to make a complaint

– Complaints process

– Where to go for more information and assistance

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Use by employees (cont)

• Risk minimisation (cont)

– Employee education/training

– Investigate allegations (grievance process)

– Take disciplinary action where appropriate

– Consider blocking access

– Support services

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Risks (cont.)

• Non-legal risks:

– effect on morale;

– lack of efficiency/productivity;

– drain on company resources: management/HR;

– impact on premiums;

– floodgates;

– employee turnover; and

– financial costs.

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Complaint handling

• Informal/formal resolution process.

• Characteristics of a sound investigation process:

– complies with relevant internal policy/process;

– impartial investigator;

– confidential; and

– consistent with natural justice:

• all parties and witnesses interviewed and given opportunity to

respond; and

• timely.

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Questions?

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Logie-Smith Lanyon Lawyers

Australian Defence Procurement

Employment & Industrial Relations

Family Law

Intellectual Property

Insolvency, Corporate Investigation

Insurance

Litigation, Dispute Resolution

Mergers & Acquisitions

Private Client Services

Property & Construction

Taxation (Direct & Indirect)

Rima Newman

Partner

Employment & Industrial Relations Law

E rnewman@logielaw.com T 03 9628 4143

Logie-Smith Lanyon

Level 12 575 Bourke Street

Melbourne VIC 3000

AUSTRALIA

T 03 9628 4100 F 03 9620 0711

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This presentation provides a general summary and is not intended to be comprehensive. It is not legal advice. You

should obtain legal advice specific to your circumstances before relying on any aspect of this presentation.