On Tuesday 3rd November 2020, workplace health and safety laws in Western Australia made their biggest jump in decades. On this day, Parliament passed the Work Health and Safety Bill 2019, meaning WHS was about to change for businesses, employers and employees throughout WA.
Once the supporting regulations are finalised in March 2022, the Work Health and Safety Bill 2019 will become the WHS Act 2020.
The new legislations will be law abiding, so they may change how you do business.
We’ve broken down six key changes so you can understand what this all means for you and your organisation, and how you can prepare.
What is the WA WHS Act 2020?
The WA Work Health and Safety Act 2020 (WHS Act) is the first major overhaul of Western Australia’s WHS laws for over 30 years.
The new laws are intended to improve the protection of workers by factoring in modern employment agreements, higher penalties for companies and individuals, and introducing the term ‘person conducting a business or undertaking’ (PCBU).
For our friends outside of WA, this is familiar territory. This Act is harmonising WA with Australia’s other States and Territories (excluding Victoria) and will replace:
- the current Occupational Safety and Health Act 1984
- WHS elements of the Mines Safety and Inspection Act 1994
- WHS elements of the Petroleum and Geothermal Energy Safety Levies Act 2011
Who Will be Affected?
The short answer is everyone. Moving forwards, this single Act will cover all aspects of safety in every WA workplace.
The long answer is mainly small and medium businesses, because the penalties are high enough to bankrupt them and it will be easier to prosecute individuals. But more on this later.
What are the Major Changes of WA’s WHS Act?
In December 2020 we hosted an event with renowned WHS lawyer from Jackson McDonald (previously Wayland Legal), Greg Smith.
Greg has specialised in employment law and WHS for over 20 years. He’s also contributed to several safety publications and has worked as the Principal Safety Advisor for a major oil and gas company.
He walked us through six changes that will have the largest impact on businesses.
1. Increased Penalties
Yes, that’s right, all penalties are increasing.
But the most significant in the entire legislation is the gross negligence/industrial manslaughter penalty. The current maximum penalty for a company is $2.7 million. Under the WHS Act this jumps to $10 million.
Penalties are just as detrimental for individuals. If you’re found guilty of industrial manslaughter, you can currently face a maximum fine of $550,000 plus five years in prison. Once the WHS Act takes over, you could be hit with a $5 million fine and up to 20 years in prison.
Just in case the penalties weren’t terrifying enough, if you’re charged as an individual the funds have to come out of your own pocket, not your company’s.
Key takeaway: All penalties have increased, particularly for industrial manslaughter.
2. PCBU & Worker
PCBU is a new term to WA’s WHS laws and stands for Person Conducting a Business or Undertaking. This is a fairly broad term used throughout WHS legislation to describe all forms of modern working arrangements.
As well as an employer, a PCBU can be a:
- Sole trader
- Volunteer organisation that employs people to carry out work
- Local government council
- Independent school
- Government department and authorities
PCBUs must meet obligations to ensure the health and safety of their workers and others like visitors and volunteers.
Speaking of workers, the term “worker” is also broader under the WHS Act, and includes:
- An employee
- Subcontractors and casual workers
- Employee of a contractor or subcontractor
- Employee of a labour hire company
- Apprentice or trainee
- Student on work experience
PCBUs have the equal duty of care to a worker, even if there are multiple PCBUs involved. For example, if you employ a contractor who brings in a labour hire worker, you, the contractor and the labour hire company all share the same duty of care to that labour hire worker. So if an incident occurs, you can all be prosecuted under the WA WHS Act.
Key takeaway: Just because you don’t directly employ a person working in your business, doesn’t mean you’re safe from prosecution.
3. Industrial Manslaughter
This is the one that everyone is talking about.
As you know, penalties for industrial manslaughter are increasing under the WA WHS Act, but there’s more.
The criteria for convicting someone for industrial manslaughter under the WHS Act is the same as convicting someone under our current gross negligence law. But the WHS Act states that prosecutors no longer have to convict the company to be able to convict individual company officers – but more on that later.
The industrial manslaughter provisions came into effect in WA in 2004. Since then, there has been 421 workplace fatalities in WA and one completed gross negligence prosecution, which happened near the end of 2020.
“I’m not sure what the compelling need is to shift to $10 million fines, because we haven’t actually tested the fines we currently have,” says Greg.
Key takeaway: Prosecutors no longer have to convict the company to prosecute a company officer.
4. Positive due diligence
“There is absolutely no doubt that health and safety legislation is substantially prejudice against small businesses,” says Greg.
“Every single company officer who has ever been prosecuted under health and safety legislation in Australia – ever – has been a small business owner, a working director with day-to-day involvement in the business.”
This new legislation has made it administratively easier to prosecute company officers. Most companies go into liquidation when faced with a WHS prosecution. Under our current laws, if your company goes into liquidation it can’t be prosecuted. This means the WA Supreme Court has to get your company reinstated in order to prosecute the company officer.
However, under the WHS Act the company doesn’t have to be convicted of an offence to be prosecuted. There doesn’t even have to be an accident or an incident. If you as a company officer have shown you have not met your obligations of due diligence, you can be prosecuted.
Key takeaway: If a company officer shows they have not met their obligations of due diligence, they can be prosecuted – even if an accident hasn’t occurred.
If you’re prosecuted under the current OHS Act, your insurance can pay for your legal fees and your penalties.
Once the WHS Act comes into effect, your insurance can still pay for your legal fees, but when it comes to paying the penalty, company officers and PCBUs cannot take out insurance to cover fines for breaches. Companies cannot indemnify employees, so if you’re handed a penalty, you’re on your own.
Key takeaway: You can still get insurance to pay for your legal fees, but if you’re personally prosecuted the dollar figure has to come from your own pocket.
6. WHS Advisors
There is a new section in the WHS Act specifically for external WHS advisors (like us). If an external WHS advisor gives advice about health and safety in your business, we have to ensure that our advice doesn’t create hazards in your business.
If hazards are created as a result of poor advice, advisors can be sued for negligence, sued under public liability insurance and prosecuted.
“But it is not a defence to say: I got bad advice,” says Greg. As an employee or business owner, you cannot simply point the finger at your safety advisor and get off with a slap on the wrist if an incident occurs.
Key takeaway: External WHS advisors can be prosecuted in the same way as a business owner.
How to Prepare for the WA WHS Act 2020 – 3 Steps
These changes are coming at us like an overhyped storm. People are closing the shutters, bringing everything inside and bracing themselves for the impact.
But when the clouds break, the sun comes out and you peek through the blinds, you’ll find things look pretty much the same apart from a few fallen branches.
So here’s how to prevent those branches from falling, so you can maintain business as usual.
1. Communicate the WHS Act changes to key stakeholders
Now that you know what’s in store, it’s imperative you get key stakeholders up to speed with the changes. These key stakeholders can be your boots on the ground or your leadership team.
If you need help communicating them, Greg can assist here and answer any questions you or your team may have.
Once everyone understands how the changes are going to affect processes, it’s time to get to work.
2. Conduct an audit of your business against the new legislation
‘I didn’t know’ won’t save you in court, so make sure your workplace health and safety is up to scratch by conducting an internal audit.
“The biggest source of legal liability for most organisations when it comes to health and safety prosecution are your own documents; because you have all this paperwork that says you’re going to do all this stuff and it’s not what you do in practice,” says Greg. “And if you don’t do it in practice you will be convicted on the basis of your documents.”
Audit your business against the current requirements and the new. Update your outdated documents, interview staff about current processes, assess your equipment, and – most importantly – document the results.
If you need a hand with an audit, here’s How to Conduct a WHS Audit in 6 Steps (with a free template). If you don’t have time to conduct an audit yourself, get in touch today to have a chat with our safety audit experts.
3. Create an action plan
Conducting an audit, writing a report and filing it away won’t do yourself, your business or your team mates any good unless actions come from it.
Once you’ve identified the positives, negatives and any gaps in your processes, communicate your findings with key stakeholders. Then create 90-day action plans to get the wheels in motion.
Don’t forget that help is at hand. Contact us if you need any help, or sign up to our newsletter via the footer if you’d like to hear about our future events. For WHS legal advice, reach out to Greg at Jackson McDonald, he’ll be happy to help.
Finally, try not to be overwhelmed by a shift in legislation. Yes, there are some daunting changes, but now is the perfect time to dust off your documents, refresh your processes, and get your ducks in a line.