OHS harmonsation: the big nine changes

The first draft of regulations (with some omissions and half of the Codes of Practice to sit beneath the regulations) have now been released for the Model Harmonised OHS Act. The purpose for releasing the regulations now is for public comment in the hope that it will iron out any problems before it becomes law.

The new regulations will usher in a new world of OHS compliance in Australia.

The big nine changes

There are nine things you need to know:

1. The regulations are meant to be all encompassing (the mining regulations have not been included as yet) spreading for 600-plus pages a further 12 draft Codes of Practice have been released, adding hundreds of more pages. There are 16 Codes of Practice which are yet to be released and will probably be released later this year. There will be a policy released to assist all people to understand how the regulations, Codes of Practice and Act apply uniformly across Australia. Sadly, that has not been released.

2. The regulations are designed to complement and expand upon the duties imposed by the Model Act and flesh out details so compliance is easier. You will see from our criticism below that although there is some general improvement, and at least unanimity between the various states, in some parts the regulations are inconsistent, reduce the levels of protections and practice that presently exist in a number of states and in other parts fail to address key issues.

3. There is a sizable increase in paperwork compliance required, and as a result the “due diligence” duties to be imposed on company officers, there will need to be a significant improvement in both practice and paperwork reporting to the board and relevant officers of the business.

4. OH&S committees will become work groups with a stronger role for the HSR. The HSR will have an entitlement to intrude upon management prerogative and decision-making about risk and can require review.

5. There is more detail around general and specific hazard management within the regulations and the Codes of Practice have been drafted in a way (supported by pictures and drawings), which will assist business in understanding how to comply with the regulations.

6. There is a centralising of general licensing requirements under the Act but interestingly there is no attempt to include electrical licensing responsibilities. The Code of Practice and regulations surrounding electricity do not appear to exclude, in any major way, the state legislation governing electrical practice.

7. The regulations relating to building impose duties on principal contractors for works over $200,000 moving away from the current thresholds based upon the number of people employed or the variety of different financial thresholds before a person becomes a principal contractor under present state and territory legislation. The construction industry white card rules will be incorporated.

8. The Codes of Practice are admissible as evidence in court as to what is reasonably practicable behaviour and businesses can only vary their compliance regime where it is equal to or better than that within the code. Therefore, businesses will have to be familiar with the Act, regulations and Codes of Practice which now represent thousands of pages of legislation and supporting documentation.

9. A new penalty regime will be imposed which emphasises risk management. Under the regulations, any breach which is referrable to a duties breach under the Act will fall under the penalties regime of the Act. Where a breach of risk assessment processes occurs, fines will be between $30,000 to $60,000 (all fines being one fifth for a person), signage and instruction carry fine of $18,000 to $36,000 and record keeping a top fine of $6,000.00. So depending on the circumstances, there is a gradation of penalties that can be applied. The clear thrust of the three level regulation penalty breaches is to empower inspectors upon entering the site to look at the substance of compliance by a business and exercise both notification and penalty based processes to ensure systems compliance.

What they don’t tell you

1. The regulations, codes and relevant guidelines and policy processes to be developed represent a significant expansion for a small business on what they must comply with. It will be a massive increase in bureaucracy which will only benefit businesses that work across states.

2. Despite the Act potentially making the test of reasonable practicability for employers harder because the object of the Model Act is to provide the highest possible standards, the regulations, importantly in the hierarchy of control, reduce the standards of safety practice that all of us would feel are reasonable. The hierarchy of control is only incorporated into the regulations in respect of high-risk activities. In nearly all jurisdictions the hierarchy of control is inserted in regulations to eliminate or minimise the risk of health and safety following hazard identification and risk assessment. This anomaly comes without explanation or reason.

3. Although there will be Codes of Practice around bullying and fatigue, there is an absence of any coherent discussion within the regulations or Act in these important and emerging parts of OHS.

4. Finally, it is disturbing to see the lack of meat to the bone on the positive duties that will be imposed under the Model Act on officers (directors, CEOs and the like) which requires officers to exercise due diligence in safety management. The failure to provide any helpful advice will mean the only certainty for employers will come from reliance upon the codes when developed and eventually prosecution and litigation. Again, a disappointing oversight.

The wrap up

Perhaps the overriding benefit of new regulations and Codes of Practice is there will be some uniformity of law applying across Australia which will permit better education and training. Unquestionably the Model Act, the regulations and documents that flow from it will dramatically increase state-based businesses legislative compliance, will massively increase the paperwork proving compliance and will inevitably lead to a substantial increase in costs to business in managing safety and OHS.

Businesses now have a little over 10 months to fully review their OHS safety systems, documentation, training and education to be compliant on January 1, 2012.

Andrew Douglas is the Managing Director of Douglas LPT, an integrated legal, HR, recruiting and training business. He is the Editor-in-Chief of the loose leaf publication, The OHS Handbook, and writes on workplace law issues such as Industrial Relations, Employment law, OHS, Equal Opportunity, Privacy, Surveillance and Workers Compensation. He is the principal of the legal division of Douglas LPT and appears in courts, tribunals and Commissions throughout Australia.