The much anticipated Health and Safety at Work Act (Act) was passed by Parliament yesterday following a fortnight of debate and last minute “tweaks” to further clarify the new requirements. The Act represents the most significant reform to New Zealand’s health and safety laws in the past 25 years, with the majority of changes due to come into force on 4 April 2016.
The key aspects of the Act are set out below.
New concept of PCBU
As signalled in previous drafts of the bill, the primary duty-holder under the Act is a person conducting a business or undertaking (PCBU). The definition of “PCBU” is broad enough to include all types of modern working arrangements such as joint ventures, principal-contractor, employer-employee, and franchise arrangements.
There are some exclusions to the definition, including:
people who work in, or are officers of, a PCBU;
volunteer associations; and
occupiers of homes who engage people solely to do residential work.
New “horizontal consultation” obligation
If more than one PCBU has a duty under the Act in relation to the same matter, then each duty-holder must, so far as is reasonably practicable, consult, co-operate with and co-ordinate activities with all other PCBUs who have a duty in relation to the same matter. This is a separate duty known as the duty of “horizontal consultation”. Failure to consult is an offence under the Act, and may result in a fine of up to $20,000 for an individual or $100,000 for any other person.
New “due diligence” duties for officers
Officers of PCBUs now have a personal “due diligence” duty to ensure that the PCBU complies with its duties and obligations. However, a new reasonableness standard has been introduced. This duty of due diligence requires the officer to exercise the care, diligence and skill that a reasonable officer would exercise in the same circumstances, taking into account the nature of the business, the position of the officer, and the nature of the responsibilities undertaken by the officer.
The definition of “officer” includes:
directors (where the PCBU is a company);
partners in a partnership;
any general partner in a limited partnership;
any person occupying a role that is comparable to that of a company director; and
any person occupying a position in relation to the business or undertaking that allows the person to exercise “significant influence” over the management of the business or undertaking (such as the CEO).
However, the definition excludes a person who merely advises or makes recommendations to an officer.
The elements of the due diligence duty are summarised in our 11 March 2014
newsletter, and have not changed since the Bill was first introduced.
The proposed penalties haven’t changed since the Bill was introduced. The Act introduces three tiers of offences with maximum penalties that are substantially higher than the penalties available under the current Health and Safety in Employment Act 1992. A PCBU which is a body corporate that commits an offence under the new regime may be liable to a penalty of up to $500,000, $1.5 million or $3 million, depending on the seriousness of the offence.
More detail regarding the increased penalties is set out in our 11 March 2014
Last minute changes
A number of minor amendments were made to the Act by supplementary order paper in the last few weeks.
Dates on which Act comes into force: the majority of the Act will come into force on 4 April 2016 (the section relating to the issuing of regulations and approved codes of practice will come into force earlier, on the day after the Act receives the Royal assent).
Management of risks: The Act now qualifies a duty-holder’s obligation to eliminate or minimise health and safety risks to the extent it has the “ability to influence or control” the matter.
Worker participation in “high risk” industries: all high risk sectors or industries, regardless of the number of employees, will be required to elect health and safety representatives. “High risk” sectors or industries will be defined in regulations, and will include any industry that carries the risk of a catastrophic event, any industry that has a fatality rate greater than 25 per 100,000 workers since 2008, and any industry that has had a serious injury rate of more than 25 per 1,000 workers since 2008. The categorisation of ‘high risk’ industries has been well publicised in recent weeks, but these have yet to be finalised.
Worker participation in small, low risk businesses: a PCBU must notify its workers if it seeks to rely on the exclusion relating to businesses or undertakings with fewer than 20 workers that are not within the scope of any high-risk sector or industry.
Where to from here?
WorkSafe New Zealand has confirmed that there will be an education and information campaign to support people to prepare for the new legislation before it comes into force. In addition, consultation continues regarding new regulations to be imposed under the Act. We also expect to see WorkSafe issue approved codes of practice, best practice guidelines, and other guidance materials in the coming months.
Presenting on health and safety
Our team regularly presents on health and safety at industry related conferences and seminars. We have also provided training on the changing landscape of health and safety legislation to numerous corporate clients and their boards. Please contact your usual Bell Gully contact for more information.
This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.