On 1 January 2012 the new Work Health and Safety Act 2011 (Cth) will come into effect along with similar legislation which is expected to come into effect next year in all States and Territories, except Victoria and Western Australia, as part of the system of nationally harmonised occupational health and safety laws. Under this legislation, directors and officers will have significantly expanded obligations and liability regarding occupational health and safety.
Directors and management are no longer only deemed to be liable for the breaches of a corporation or other entity in certain circumstances. Instead, now all "officers" (as defined in the Corporations Act 2001 Cth) have a positive duty to exercise due diligence to ensure that the entity complies with the health and safety obligations under the legislation. Importantly, even in the absence of a breach by the entity, an officer may still be convicted for a breach of the officer's obligation to exercise due diligence to ensure that the entity complies with its obligations.
Anyone who falls under the definition of "officer" as defined in section 9 of the Corporations Act 2001 Cth, including:
The definition of "officer" is likely to include non-executive directors, chief executive officers, chief financial officers and in some cases, general counsel, human resources directors and others involved in decisions relating significant investments or projects.
The concept includes (but is not limited to) taking reasonable steps:
Each officer described above should be prepared to demonstrate that they have personally made enquiries about the above matters in their area of responsibility and taken steps to address any gaps arising from their enquiries. These duties are non-delegable duties. A failure to comply with these duties can result in significant penalties of up to $600,000 per officer or 5 years imprisonment. Organisations that fail to comply with their health and safety obligations face penalties of up to $3,000,000.
Organisations should identify who is an "officer" under the legislation in their business. There should then be an examination of the organisational structure, company constitution, each senior manager's role, scope of duties and degree of influence over decisions. Once those officers have been identified, steps should be taken to:
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