Member Article

As you will be aware, 1 January 2012 is the go live date for OHS harmonisation. A new OHS Act, Regulation and Codes of Practice will commence in the Commonwealth and in each State and Territory at this time. The new package of OHS legislation will be based on model legislation, so will be substantially similar in each jurisdiction. For detailed information about the state of play in relation to OHS harmonisation, see our HR&IR Update of 22 June 2011.

The OHS harmonisation legislation may have important implications for officers (as defined - see below) of Universities and of any company operated by a University (University entity) as officers will have a positive obligation to exercise 'due diligence' to ensure the University or University entity complies with its OHS duties.

Significantly, the OHS harmonisation legislation sets out a non-exhaustive list of what comprises 'due diligence'. This is a welcome development, as we currently rely on case law to provide guidance about what comprises due diligence for the purpose of OHS.

The model OHS harmonisation legislation (with tweaks) has been enacted in NSW and Queensland and is currently being considered by the parliaments of SA and the ACT. Parliaments in other jurisdictions are expected to consider the legislation in coming months.

NSW has taken one step further and amended its current OHS legislation (the Occupational Health and Safety Act 2001 (NSW)) to introduce a number of the changes in the OHS harmonisation legislation - including, relevantly, the positive obligation for officers to exercise due diligence. These amendments came into effect on 7 June 2011.

 

What obligation do officers have?

Under the model OHS harmonisation legislation, officers of a University or a University entity have a positive obligation to exercise due diligence to ensure that the University or a University entity (as applicable) complies with its duties under the new OHS legislation. The University and University entity will have a range of obligations under the OHS harmonisation legislation, including:

• ensuring so far as is reasonably practicable:
  
  
  • the health and safety of workers:
    
    
    • engaged by the University/University entity;
      
      
    • caused to be engaged by the University/University entity; and
      
      
    • whose activities in carrying out work are influenced or directed by the University/University entity; and
      
      
  • that the health and safety of other persons is not put at risk from work carried out as part of the conduct of the University/University entity.
    
    
• in relation to the management or control of workplaces or fixtures, fittings or plant at workplaces; and
  
  
• in relation to the design, manufacture, import, supply, installation or construction of plant, substance or structures. 

Who is an officer?

'Officer' is defined in the OHS harmonisation legislation to include an officer under section 9 of the Corporations Act 2001 (Cth). Section 9 provides that officers include:

1. in relation to corporations (this will be relevant to University entities): a director or company secretary; a person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the corporation (eg, a senior executive); a person who has the capacity to significantly affect the corporation's financial standing; and a person who instructs the directors how to act; and
   
   
2. in relation to entities, which does not include a corporation but which does include a body corporate that is not an exempt public authority (this may be relevant to the University): a person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the business of the entity; and a person who has the capacity to significantly affect the entity's financial standing.

Relevantly, an 'entity' does not include an exempt public authority (which includes 'public authority' at common law). Whether a university is a public authority is a complex issue (and one that we don't propose to address in this article).

What is meant by due diligence?

The Explanatory Memorandum to the model OHS legislation provides that officers have a high, but attainable, standard of due diligence.

The OHS harmonisation legislation expressly provides that due diligence includes (but is not limited to) an officer taking reasonable steps to:

1. acquire and keep up-to-date knowledge of work health and safety matters;
   
   
2. understand the nature of the operations of the University/University entity and the hazards and risks associated with those operations;
   
   
3. ensure that appropriate resources and processes are available to the University/University entity to eliminate or minimise risks to health and safety (and ensure that those resources and processes are used);
   
   
4. ensure the University/University entity has appropriate processes for receiving, considering and responding to information about incidents, hazards and risks; 
   
   
5. ensure that the University/University entity has processes for compliance with its duties and obligations in the OHS harmonisation legislation in place and that they are implemented; and
   
   
6. verify the provision and use of the resources and processes referred to above.

This is a non-exhaustive list of steps that need to be taken by an officer to meet their due diligence obligations. Officers should consider whether there are any other steps they should be taking to meet their obligations.

Other changes

It is also worth noting that:

1. under the OHS harmonisation legislation, officers can be prosecuted even where there is no prosecution against the University or University entity (previously, in a number of jurisdictions, the liability of officers related to the liability of the University or University entity); and
   
   
2. the maximum penalty for breach of the obligations under the OHS harmonisation legislation for an individual is $600,000 and/or five years' imprisonment (for a category one offence).

What do you need to do?

Consider who within the University or a University entity will be an officer and will have an obligation of due diligence in relation to OHS. 

Consider whether officers of the University or any University entity will be in a position to satisfy their obligations in relation to due diligence. If not, consider how you can assist them.