In brief 2 min read
The Work Health and Safety Act 2011 (NSW) (the Act) has recently been amended to implement some of the recommendations of Marie Boland’s 2018 Review of the Model WHS Laws: Final Report (the Final Report). Unlike some other jurisdictions, NSW has not introduced a specific new 'industrial manslaughter' offence. However, the recent amendments to the Act should make prosecutions for the most serious WHS offences more common. The amendments also increase penalties and affect insurance availability for WHS matters.
- The Final Report highlighted a number of difficulties in prosecuting and investigating workplace deaths in NSW (and other jurisdictions). Although relatively low by historical standards, in recent years there have been on average 60 work-related fatalities in NSW annually.
- Despite these numbers, there have been relatively few prosecutions for the most serious category of WHS offence – 'Category 1' offences – which require the accused to have exposed a worker to the risk of death or serious injury. Before the most recent amendments, the prosecution also had to prove that the accused had been 'reckless' in exposing the worker to that risk.
- Recklessness is difficult to establish, particularly in the context of a criminal prosecution. To address this difficulty, the Final Report recommended that the fault element for Category 1 offences be expanded to include 'gross negligence' as an alternative to 'recklessness'. The amendments to the Act implement this recommendation.
- As a practical matter, it should be easier for prosecutors to establish 'gross negligence' because it is a lower threshold than 'recklessness'. A person (including a company) will be grossly negligent where their behaviour falls so far short of what is reasonable and involves such a high risk of death or serious injury that it deserves criminal punishment.
- In addition to this key change, the recent amendments to the Act have also specifically prohibited entering into insurance arrangements that purport to cover monetary WHS penalties. Coverage for investigation and defence costs may continue to be provided.
- Finally, the amendments to the Act have also changed how fines are set for WHS offences. Previously, fines had been set in the Act. As a result of the amendments, fines will increase automatically over time to keep pace with inflation. Following the amendments, the maximum fine for a Category 1 offence committed by a corporation will increase to $3,463,000.
- The recent amendments to the Act significantly increase the range of conduct that could constitute a Category 1 offence. Companies should ensure their systems and processes are suitably reviewed in light of these amendments.
- Company directors and other officers, in particular, should ensure that they familiarise themselves with the details of the recent amendments. Maintaining current knowledge of WHS law is a critical element of company officers fulfilling their personal due diligence obligations.
- Companies should confirm that their current directors' and officers' insurance arrangements do not breach the new restrictions on WHS penalty indemnities.