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Establishing due diligence

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Section 26 of the OH&S Act 2000 in NSW offers senior managers and directors of businesses a number of potential ‘escapes’ from liability for a contravention of the Health and Safety Law.

One of these is where the executive “used all due diligence to prevent the contravention by the corporation”. The best way to evidence the due diligence is with a set of records.

In Victoria, Section 4 of the OH&S Act 2004 sets out the compliance requirement of “eliminating or reducing ….risks to health or safety ….so far as is reasonably practicable”.

It therefore follows that if the controllers or managers can use records to show they used all due diligence to eliminate or reduce those risks then they have grounds to defend against a criminal negligence prosecution by a Workcover or Worksafe Inspector.

The Victorian Act takes the definition further in Section 20 through a statement clarifying the “concept of ensuring health and safety”.

The law recognises that the principle of a risk management approach to OH&S compliance will provide senior management with an opportunity to demonstrate that they have taken all reasonable and practical steps to avoid negligence.

It is up to the business and senior management to know what all of the hazards and risks are in the processes carried out by the company’s employees.

Whereas the 1983 Act in NSW actually set down limits like the maximum weight that could be lifted by a female worker , the 2000 OH&S Act lays down that management surely knows the business better than any Workcover inspector can and thus it is up to management to identify these risks, assess them and to record these findings.

Different methods

One method of doing this is to systematically identify ‘foreseeable’ hazards using a matrix, where the different processes from goods inward all the way through to goods out are listed down the vertical axis.

The horizontal axis would include risks like fire, explosions, electric shocks, manual handling, dangerous goods handling, chemicals safe management, civil disturbance and natural disaster.

Once these risks have been listed comprehensively, the records must then show the controls that have been put in place.

These records will constitute evidence of due diligene and could be used to defend against a criminal negligence prosecution.

Another essential set of records to establish are those relating to consultation. Section 13 of the OH&S Act NSW 2000 and Section 35 of the Victorian Act require the employer to consult with employees regarding OH&S issues. Again a risk management approach is adopted. Employees must be given a mechanism to voice their concerns about OH&S hazards and risks.

The NSW Act’s requirement is further clarified in the OH&S Regulations 2001 NSW.

The consulting process must be recorded to be used as evidence, and might include documentation giving notice to safety reps to meet and to consult, a record of an agenda, as well as the record of the substance of the meeting and the corrective action required to be taken. The records should also include what action was taken and by whom.

Managers should be warned that the courts have held that a safety management system (SMS) that exists on paper but not on the shopfloor will not be viewed as evidence of due diligence. The records must be corroborated by operators with knowledge on the shop floor.

Inspectors are known to wander on to the floor and to question operators about what consultation has taken place. Records that cannot be supported by operator corroboration may get you in to dire trouble.

Another example of records that the business must be able to produce relates to the carrying out of risk assessments required under section 15 of the NSW Act for all of the business’ “significant” risks to health and safety. The operators’ input must be sought and recorded as part of the risk assessment process.

Slowly, actually very slowly, businesses are becoming aware that they often have more contractors coming onto their premises than they realise. Every one of these tradespersons and couriers, what ever the reason for their being on site presents a threat to the business insofar as they may suffer an injury while working on-site. Very often this is completely uncontrolled and certainly goes unrecorded. This can constitute a gaping lacuna in any small business’ OH&S- SMS.

It is essential that these persons coming on site be formally inducted and made aware that they in effect come on Site under the same SMS “controls” as those governing employees of the business. Hence the OH&S Policy, the safety procedures, the safe work methods, the induction program, the use of PPE and a host of other procedures that govern workers of the business also apply to contractors.

But, clearly these rules must be brought to the attention of the contractors and more over they must be supervised and understand they fall under the control of the business’ management.

All of this must be recorded, preferably according to a formal system not fully documented here. A Workcover inspector called to a site (perhaps, as a result of an anonymous tip off) will in the first instance, conduct a visual inspection and then the written records will be called for.

If you do not have these to produce you may find yourself at the receiving end of an infringement notice, even a more serious penalty notice and the time-consuming exercise of preparing ‘urgently’ a set of risk assessments that could cost you ‘big biscuits’ or even inflict on you a magistrates court appearance.

The above few and very incomplete examples should alert businesses to the need for the keeping of records. In some instances these are mandatory. A proper set of OH&S records would save you a tonne of pain and hassle.

* Ray Schaffer is the principal consultant with Schaffer and Co , health, safety and environment consultants 02 9878 0613. Visit www.environmentdiy.com.au, pose a question and receive an answer at no cost.

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