It is now easier than ever for SafeWork to prosecute Category 1 offences.
On 10 June 2020, amendments to the Work Health and Safety Act (NSW) (WHS Act) came into effect, which create a new offence for duty holders that demonstrate gross-negligence by exposing workers to the risk of death, serious injury or illness regardless of whether or not a worker is killed or seriously injured.
In this insight article, our work health and safety lawyers provide a breakdown of the key changes to the WHS Act, so you have a better understanding of how they will impact upon your business and its people.
Overview
Preliminary figures indicate that there were 59 work-related deaths in 2019 alone.
NSW Parliament has taken the position that workplace deaths in NSW are still too common so has implemented reforms to:
- address the ongoing issue of workplace deaths by strengthening the deterrent powers and enforcement measures for breaches of the WHS Act;
- make it easier for regulators to prosecute the most serious offences;
- increasing penalties for breaches;
- strengthen support for families of workplace victims; and
- provide workers and business with greater clarity on aspects of the WHS Act.
Let’s take a closer look at some of the key reforms to the WHS Act now in effect.
Workplace deaths can be prosecuted as Manslaughter
It has long been the case that any duty holder – whether employer, business owner or worker – that causes the death of a worker through negligence, could face a prosecution for manslaughter by criminal negligence under the Crimes Act 1900. An offence punishable by 25 years imprisonment.
However this fact was not well known or understood by people.
It is now made clear within the WHS Act (Note to Division 5 of Part 2) that such prosecutions are available to SafeWork NSW and other law enforcement agencies.
An enhanced Category 1 Offence for breach of a health and safety duty – The introduction of “gross negligence”
Section 31 of the WHS Act has now been broadened to include a “gross negligence” offence, making it easier to prosecute the most serious work health and safety offences (category 1), that carry the harshest penalty under the Act.
Prior to the reforms, Category 1 offences were rarely prosecuted because regulators had been hampered by the requirement that they prove “recklessness” on the part of the duty holder.
This fault element usually meant having to prove, beyond a reasonable doubt, that the defendant made a conscious decision to take an unjustified risk.
With the introduction of “gross negligence” as a fault element, it will now be much easier for regulators to prove a Category 1 offence against negligent duty holders.
Gross negligence has been interpreted by the courts as behaviour that
“falls so far short of what is reasonable and involves such a high risk of death or serious injury that it deserves criminal punishment”.
The ability to prosecute a duty holder for gross negligence will arise if they expose a worker to a risk of death, serious injury or illness, regardless of whether or not a worker is killed.
Given that barriers which reportedly constrained safety regulators from prosecuting category 1 offences have been removed, it is reasonable to expect an increase in number of these prosecutions in the future.
The most serious under the WHS Act that include terms of imprisonment of up to 5 years, and cannot be dealt with by enforceable undertakings.
Prohibition on insurance and indemnity against WHS Penalties. Insurers and insured beware
Sections 272A and 272B of the WHS Act now make it an offence to either enter into or provide a contract of insurance, or indemnity against liability, for a penalty imposed under the Act.
This means that both insurers and the insured can be prosecuted, effectively bringing a stop to these types of insurance policies or indemnifications. The reforms also extend liability to officers of a company for their involvement in assisting or being knowingly concerned in the commission of such an offence.
The reforms come after strong condemnation that those businesses and officers who breached work health and safety laws were able to escape financial penalties, and so would take their duties less seriously because they felt somewhat insulated against any real loss.
The maximum penalties include fines of $27,500 for individuals and $137,500 for a company.
Substantial increase to financial penalties under the WHS Act. And they will only continue to increase
The changes to the WHS Act see an increase in financial penalties which will increase year on year in accordance with the Consumer Price Index (CPI).
At present in NSW, one penalty unit is equal to $110. So for a Category 1 offence which carries a maximum financial penalty of 34,630 penalty units in the case of a body corporate, that equates to a potential fine of $3,809,400.00.
The reforms see a significant increase in the penalties for Category 1, 2 and 3 offences under the Act.
We have set them out for you in the table below.
Maximum Financial Penalty
| Offence under WHS Act | For an individual | For an individual as a PCBU or officer of a PCBU | For a body corporate |
| Category 1 Offence (s.31) | $381,150 | $761,750 | $3,809,300 |
| Category 2 Offence (s.32) | $190,300 | $381,150 | $1,904,650 |
| Category 3 Offence (s.33) | $63,250 | $127,050 | $634,700 |
Extension of time for persons to request the safety regulator to prosecute. Plus increased communication with the person that has made the request, such as a victim or their family
Section 231 of the WHS Act has been amended to extend the time within which a person can ask the WHS regulator to start a prosecution for a category 1 or 2 offence to 18 months.
This provides an extended window, recognising that it can often take SafeWork NSW over 12 months to conduct a complex investigation into a serious workplace incident.
The reforms also aim to reduce the trauma to victims and their families by requiring investigators to regularly report back to them on the progress of the investigation.
The Road Ahead
Whilst there are other amendments to the WHS Act that have not been discussed here, the key changes that have demonstrate an even tougher stance on ensuring that businesses and individuals start to take their health and safety duties extremely seriously.
The changes should signify that it is time for every company, its officers and its workforce to review workplace safety and risk management practices. The risks of not doing so are now as severe as they have ever been.
It falls on your company’s Officers and Senior Managers to ensure that they are all exercising due diligence in ensuring that the company is fulfilling its duties under the WHS Act.
If you would like expert guidance and advice on your organisation’s health and safety duties, and how to comply with them, please get in touch with our work health and safety team at Obsequium.
Disclaimer
The information contained in this publication is of a general nature and is for informational purposes only. It not intended or to be regarded as providing legal or technical advice of any kind, nor as expressing opinions on the specific circumstances of any particular case, individual or entity.
Whilst Obsequium endeavours to provide accurate and timely information, we do not guarantee the accuracy of information contained in this publication, or that it will continue to be accurate in the future.
You should obtain legal or technical advice before taking action on an issue dealt with in this publication.
