Amendments to the Work Health and Safety Act 2011 (NSW) which had been before Parliament since November 2019 were finally passed by the State Legislative Council on 4 June 2020 and commenced operation on 10 June 2020.
As was anticipated in our earlier article, the new laws contain significant amendments to the current Act with the State Government implementing a number of key recommendations from the Federal Senate Inquiry, ‘They never came home – the framework surrounding the prevention, investigation and prosecution of industrial deaths in Australia’, and also the independent review, ‘The review of the model Work Health and Safety Laws’– December 2018, undertaken by Marie Boland.
New Offence of Gross Negligence
Whilst falling short of introducing industrial manslaughter, in accordance with the recommendations of the above Inquiry, NSW now has a new offence of ‘gross negligence’ which sits alongside the other category one offence of ‘recklessness’.
The new offence requires a lesser fault element then the already existing offence of recklessness and will make it easier for regulators and prosecutors to commence and obtain convictions for proceedings commenced under the category one offence provisions. The maximum penalty for the new offence of gross negligence is $3,463,000 for companies, and $692,500, together with imprisonment of up to 5 years for individual company officers.
The new provisions also provide for a note to be inserted into the Act that there is an existing offence of criminal manslaughter contained in the Crimes Act 1900 (NSW), as a reminder that this already exists as an option for prosecutors. Whilst the offence under the Crimes Act contains penalties of up to 25 years imprisonment for individuals it is not applicable to corporations.
Ban on Insurance
Another significant amendment makes it illegal to have insurance and give indemnities for penalties in relation to offences for work health and safety breaches. From the date of commencement (10 June 2020) it is now illegal to offer and take out policies of insurance. A breach of the new provisions carries its own penalties of $50,000 for individuals and $250,000 for companies.
From this point on, a business cannot insure for this risk in standard Director and Officer, or Statutory Indemnity type policies and will have to meet any fines directly as either a company or personal liability.
Increase to Existing Penalties
Maximum penalties for all offences under the Act have also been increased significantly. The penalties have not been increased since the commencement of the current legislation 10 years ago.
The maximum penalties under the legislation are now $3,463,000 per offence for companies, and $692,500 for individuals, with all other penalties being increased by a similar level. The legislation also introduces a penalty unit system and provides for automatic increases to the value of the penalty unit based on CPI increases on an annual basis.
What do we Recommend?
Roberts Legal recommends that businesses, company directors and officers review their current work health and safety systems to ensure that they are compliant with the legislation and that they are prepared in the event of a serious incident. Companies and their senior managers should undertake training or a refresher in officer due diligence and incident management. This training can be arranged by Roberts Legal.
Click here for more information about our WHS Compliance Products & Training options.
Given the prohibition on insurance, Roberts Legal also recommends that all businesses review their insurance program to ensure that any Policies which may fall foul of the new legislation are identified and discounts on premiums for existing policies be negotiated with insurers and brokers. Roberts Legal can assist with reviewing your current policies to ensure that they are not in breach of the new legislation.
Our team of WHS legal specialists are available to provide assistance in relation to these matters. Call 1300 553 343 to arrange an appointment or click here to visit our website for more information.