Workplace Health & Safety Reforms

5/11/2013

They’re Big And They’re Coming Soon. Are You Up On The Play?

In August, the Government announced the largest changes to NZ’s workplace health & safety regime in 20 years. ‘Working Safer: a blueprint for health and safety at work’ is the Government’s response to the recommendations of the Independent Taskforce on Workplace Health and Safety set up last year - partially in response to the Pike River coal mine disaster. The reforms aim to reduce NZ’s workplace injury and death toll by 25% by 2020.The new law and key supporting regulations are expected to start coming into force in 2014.

The Government has also said that risk areas will be the target of the regulator, WorkSafe New Zealand - expected to be operational from December this year.

There’s plenty to understand. Take the issue of responsibility. The new law allocates duties to people in the best position to control risks to health & safety. The primary duty-holder under the new law will be a ‘person conducting a business or undertaking’ or PCBU. It’s no small concept. It reaches through all the relationships between people in control and people affected by that control.

Duties extend to contractors, subcontractors and employees. And they’re rigorous. Each PCBU will be required to supervise and monitor the health & safety performance of those under them in the chain. The PCBU will also owe a duty to other people affected by the work being done.

Sounds complex? It is. There may be many businesses and numerous PCBUs working at the same location. And the duties run upwards from the work location too, to include others in the supply chain, such as manufacturers, importers and suppliers.

Personal responsibility? It’s really personal.

Right now, under the current Health & Safety in Employment Act, if you are a director, officer or agent, you’re only exposed to potential secondary liability if you have participated in, contributed to, or acquiesced in any failure of the company to comply with the HSE Act.

That’s going to change. Under the proposed new law the due diligence duty will be individual to the officer. And the potential penalties are significant:

for category 1 offences (reckless conduct), the maximum penalty for an individual is $600,000 or five years' imprisonment, or both. For a body corporate, it is $3 million;
for category 2 offences (failure to comply with health and safety duties exposing an individual to serious risk), the maximum fine for an individual is $300,000 and for a body corporate is $1.5 million; and
for category 3 offences (general failure to comply with health and safety duties), the maximum fine for an individual is $100,000 and for a body corporate is $500,000.

Get to know the coming due diligence duty

The proposed new law introduces a new due diligence duty. Broadly, it means that if you are in any governance role, it’ll be your duty to proactively manage workplace health & safety.

It’s a duty that will fall on all directors, chief executives and others in governance roles (excluding volunteers), and it’ll be defined to match your role. For example, it will require you to take reasonable steps to:

gain an understanding of the nature of the operations of the PCBU (‘person conducting a business or undertaking’) and the hazards and risks associated with those operations; and
ensure the PCBU has, and implements, processes for complying with its duties.