The first Company Officer charged under WHS Legislation highlights Due Diligence Obligations
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The first Company Officer charged under WHS Legislation highlights Due Diligence Obligations

Blog - 13/06/2014

Earlier this month, following the unfortunate workplace death of a worker in the ACT, an organisation, along with a Senior Manager of the organisation, deemed an ‘Officer’ under WHS Laws was charged with failing to comply with its health and safety duties.

The charge was deemed a Category 2 offence, which means the organisation and the individual may face maximum penalties of $1.5M and $150,000 respectively.

This will be a precedent case under the revised harmonisation legislation, with the matter yet to be heard, but it’s a timely reminder to ensure that your organisation has identified all of its ‘Officers’ , they are informed, educated and clearly understand their obligations, and that your organisation reasonably and practicably meets its WHS duty of care.

In summary:

  • An ‘Officer’ means :
    • A Director or Secretary of the Corporation OR
    • A person who makes or participates in making decisions that affect the whole or a substantial part of the business. This person may be working in accordance with and is accustomed to acting under the instructions/wishes of the Directors, a receiver/manager of the property of the corporation, an Administrator of the Corporation, an Administrator of a deed of company arrangement or a liquidator of the corporation.
  • The new model WHS Laws allocates a liability on the company/organisation for breaches, and a personal liability on the ‘Officer’ to ensure that they take proactive steps to meet their corporate governance responsibilities.

Penalties

Whilst the Regulator’s commitment is to educate, for serious and repeated non-compliance, penalties are significant to encourage co-operation and adoption and management of WHS breaches. They are:

–          Category 1 Offence – $600K and 5 years jail

–          Category 2 Office – maximum $300K

–          Category 2 Office – maximum $100K

A Due Diligence Guide

To meet due diligence, an ‘Officer’ must:

  • Acquire and keep up to date knowledge of WHS matters.
  • Gain an understanding of the nature of the companies operation and the risks and hazards of the operation/s.
  • Ensure the company has adequate resources and processes in place to enable hazards to be identified, and the associated risks to be eliminated, or minimised.
  • Ensure the company has appropriate processes in place to receive and consider information in relation to incidents, hazards and risks and responds to that information in a timely and auditable fashion.
  • Has the ability to transparently verify the provision and use of the resources and processes.

A Practical Due Diligence Checklist

  • Formally identify ‘Officers’
  • Educate Officers of their responsibilities and outline the company’s processes, systems and resources.
  • Determine the company’s position on health and safety, including an audit.
  • Establish and implement objectives and targets based on audit outcomes.
  • Establish quantifiable health and safety performance indictors
  • Develop a health and safety management plan
  • Implement a risk management program
  • Commit to conducting regular reviews of the system
  • Ensure that the system is transparent, auditable and regular reviewed for improvement.

As a WHS induction specialist, WorkPro offers a free, no-obligation 20-minute on-line ‘Officers Due Diligence’ module covering the content of this blog in more detail. Contact us on 1300 975776 to gain access to the course.

For information about the case: http://www.canberratimes.com.au/act-news/kenoss-contractors-senior-manager-to-fight-charges-over-act-workplace-death-20140610-zs2kc.html

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