The legal regulation of OHS

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1 The legal regulation of OHS Introduction This session will explore how the law is used to regulate occupational health and safety. The entire course is intended to assist you to implement the Occupational Health and Safety Act 1993 and soon, the Act of 2000 so I wont take you through those acts in detail. My aim today is to identify other areas of law that impact on occupational health and safety and explain how these laws interact. The areas I will talk about are: The common law and in particular, the law of negligence Workers Compensation The Occupational Health and Safety Act and Regulations and Industry Codes of practice and Australian Standards. The common law The common law has come to us over time from the decisions of the courts. Once upon a time most law came from the judges who were asked to apply old principles to new cases. Their decisions were, and are, reported and used as precedents to show what the law in a particular area is. An area of law that gets a lot of attention is the law of negligence, and this was one of the first areas of law that could be used to impact on Occupational Health and Safety. The law of negligence says that we all owe a legal duty to avoid hurting our neighbours. A neighbour for this purpose is anyone who is likely to be affected by what we do, or fail to do. This means that if you drive a car you owe a duty to other road users to take care to avoid hurting them, and if you don t then you are expected 1

2 (or more likely your insurance company) is expected to pay them money to compensate them for any damage that you do. In the area of OHS that was, at least some time ago, the relevant law. Employers had to take care to avoid their employees (subject to some exceptions that are no longer relevant). At least some time, negligence law had the biggest impact on OHS because an employer knew that if they injured an employee they could be sued and that could be expensive. The common law is still relevant where the person injured is not an employee. To put that in the context of the UNE Union, if a visitor to the Union is injured because of a lack of care by the Union staff or management, then they would be entitled to sue for compensation if they could prove negligence, so the common law still has some power to persuade workers and managers to take care to ensure that the workplace is safe, but that power is probably somewhat less than it may have been in the past. The aim of the common law is to compensate an injured person, not punish the person who caused the injury. The amount you have to pay depends on the injuries suffered, not the degree of neglect. The focus is on the injury to the person not the fault of the person or organization that caused the injury (though it may not feel like that if you are the one being sued). Workers Compensation Workers Compensation law has grown out of dissatisfaction with the common law. The biggest problem with the common law is the need to prove that someone else was negligent, that is they failed to take reasonable care in the circumstances. To succeed at common law one has to sue a defendant (usually your employer) and prove that the management or other staff did something wrong. Common law compensation is paid as a lump sum that is a single amount that is meant to last a lifetime, particularly if there are serious injuries that require on-going support or if the person will never work again and is being given money to replace their wages. Workers Compensation legislation introduces a no-fault compensation scheme. There is no need to prove that anyone was at fault, only that the injury occurred in the course of the person s employment. Once that is established, there is an obligation to pay 2

3 compensation in the form of weekly benefits, lump sums for significant injuries, ongoing medical expenses etc. There is also obligations built into the Workers Compensation legislation to try and ensure that employers who injure their workers, accept their workers back where that can be arranged with rehabilitation and redesign of the person s job. The amount one gets paid under Workers Comp is likely to be less than at common law, but it is quicker and the focus is, if possible, to get the worker back to work. Insurance Insurance is a scheme whereby the insured enters into a gamble with the insurance company. You pay a premium to get insurance against a risk. If the risk arises and the insurance company pays out more than the premium, you win. If the risk doesn t arise so they get your premium and don t have to pay out, they win. The reason it works (HIH excepted) is that usually they win more often than you do, but when you win, it is nice to know that someone else is paying the bill. Insurance does not affect one s legal obligations; it simply shifts the risk of those obligations. At the UNE OHS committee people constantly want to discuss insurance and what we are covered for, as if the presence, or absence, of insurance somehow determines the scope of one s legal liability. People seem to think that if we are covered for some risk, and that arises, then an injured person will be compensated, but if we are not covered, then they wont and that is not correct. If the employer has a legal obligation to pay compensation and they are insured, then the insurance company pays. If there is no insurance then the employer has to pay, it is not the case (assuming that the employer is not insolvent) that the injured persons rights depend on insurance. Nowadays it is compulsory for an employer to have Workers Compensation insurance that ensures that an injured worker will receive their compensation entitlements under both the Workers Compensation Act and common law. With this, the risk of liability if a worker or other person is injured has less dramatic implications for an employer, as it will be insurer that meets the legal obligation to pay compensation. An obligation to pay compensation does have some impact on OHS because if an 3

4 employer takes more care to ensure the workplace is safe, then less people are likely to be injured, the less injuries the less the insurers have to pay out and the less they have to pay, the lower the insurance premiums will be. That may be considered the carrot, the less injuries, the less it costs the employer, but it is an indirect way to try and ensure that workplaces are safe. A more direct stick is contained in the Occupational Health and Safety legislation. Occupational Health and Safety Legislation Occupational Health and Safety legislation uses language similar to the common law, but the way OHS law aims to ensure people make the workplace safe is quite different. The OHS legislation says that every employer has a duty to ensure the health and safety of people at the place of work, whether they are employees or visitors. In that way it sounds like the common law, imposing a duty to take care. The consequences of a breach of that duty are, however, quite different. A breach of the duty under the OHS Act does not lead to an obligation to pay compensation. A worker may be able to say the fact that you did not comply with the OHS Act shows negligence, but a breach of the Act, by itself, does not lead to an obligation to pay compensation. What the OHS Act does is create criminal offences. A person or a company who fails to comply with the OHS Act, who fails to ensure the safety of people at work, can be prosecuted in the same way that you can be prosecuted for accidentally killing someone with your vehicle. The court, when hearing a case under the OHS Act is not concerned with compensating an injured person but with punishing the person or organization that failed to comply with the law. Punishment may take the form of fines or, for individuals, gaol. And the fines are high, a maximum of $ for corporations and $ and/or 2 years goal for individuals. A major difference between criminal and civil law is that one cannot insure to avoid liability in criminal law. If a worker is injured and wants compensation, you can have insurance to make sure the insurer pays out, but when its criminal law, as with the OHS Act, then either the individual or the company has to pay out of their own funds. The OHS Act imposes an obligation upon employers to ensure that a workplace is 4

5 safe and that duty is backed up with punishment, not just an obligation to compensate, if it is not met. The relationship between the Act, the Regulations and Codes of Practice. The form of the OHS Act 1993, and even more in the 2000 Act is to impose an obligation but to leave it to employers to determine how that obligation is to be met. Early workplace safety legislation was prescriptive, setting out what had to be done in particular circumstances. The 1993 moved away from that imposing a general duty to ensure health and safety but it kept some associated legislation that remained prescriptive. The 2000 Act, when it comes into force, will move even further from the early model, requiring employers to undertake a risk analysis and adopt procedures that are suited to their own environment and workplace. The government and WorkCover will still have some say in guiding employers and assisting them to comply with their legal duties. This can, and will, be done in two ways, through regulation and Codes of Practice. An Act, such as the OHS Act is law made by the Parliament. The Parliament does not however, want to revisit the matter to work out the fine detail so they give someone the power to make regulations. Regulations are made where the Act says that they can be made and they are law and you can be prosecuted for failing to comply with them. Some examples of regulations under the 1993 Act are: Occupational Health And Safety (Asbestos Removal Work) Regulation 1996 Occupational Health And Safety (Certificates Of Competency) Regulation 1996 Occupational Health And Safety (Committees In Workplaces) Regulation 1999 Occupational Health And Safety (Hazardous Substances) Regulation 1996 Occupational Health And Safety (Manual Handling) Regulation 1991; and Occupational Health And Safety (Noise) Regulation

6 It is proposed, when the 2000 Act comes into force, to abolish all these regulations and replace them with a single regulation that will contain all the relevant provisions in one place. The key point to note with a regulation is that it is law as much as the Act is and again, you can be prosecuted for failing to comply with them. Industry Codes of Practice The 2000 Act will provide for Industry Codes of Practice. These are intended to provide practical guidance to employers and others who have duties with respect to occupational health, safety and welfare. An Industry Code of Practice is prepared by WorkCover and after consultation, approved by the Minister. Once approved and published, the Code of Practice can be used, as evidence to show how the matter covered by the Code should have been dealt with, and as evidence to show that a person or company being prosecuted did not take appropriate care. Failure to comply with the code does not of itself, represent a breach of the law, it is only evidence that can be used to argue that the defendant breached the law. An Industry Code of Practice can adopt other documents, so if there is a standard produced by, say the Australian Standards Association or some other body, that WorkCover thinks should be adopted as an Industry Code, then they can do that. Australian Standards Australian Standards, unless they are incorporated into an Industry Code of Practice, are not a legally binding document, but of course if there is a standard in place, and a person wants to argue that an employer failed to take reasonable care to ensure the safety of another (in simple terms, was negligent) then failure to comply with a standard will be useful evidence to support that claim. The same will be true if it is WorkCover alleging that an employer has failed to meet its duty under the Occupational Health and Safety Act. Summary In summary then, we can identify a number of laws that are used to regulate the workplace to try and make employers (and others) ensure that the workplace is safe. These are listed, and compared, in the table below. 6

7 Aim Employer s Obligation What happens if breached Common law, To compensate injured To take reasonable care in the Order to pay compensation (money) negligence worker circumstances. Workers To compensate the injured To provide compensation for any Criminal offence not to have Workers Compensation worker and facilitate a worker injured in the course of their Compensation insurance. Worker is return to work employment. compensated by WorkCover scheme. Occupational To impose obligation to To ensure health safety and welfare Criminal prosecution and punishment Health and Safety ensure workplace safety of persons at the place of work. law Industry Code of To provide guidance to May be used as evidence in subsequent Practice those who have duties prosecution. under the OHS Act 7

8 Conclusion At the end of the day, everyone s objective should be to try and ensure a safe workplace. We can worry about who is going to pay, and who is going to be liable, but the better approach is to try and ensure that people do not get injured in the first place. The reason an employer should take steps to have good OHS management in place is not simply to meet a legal obligation but to actually try to ensure that coming to work is safe. As OHS Committee members it is important to have some understanding of this legal framework but remember the primary objective of a safe workplace is not to avoid paying out money, but to avoid seeing one of your colleagues being taken away on a stretcher, or worse, in a body bag. The Act is clear, as OHS Committee members you are not liable if a person is injured, and you are not liable for performing your functions under the law. The law is important and you need to understand, in basic terms, the issues we have discussed, but please don t be overwhelmed by it, but rather focus on making the workplace safe because that is the right thing to do. Michael Eburn BCom, LLB, BA(Hons), LLM, GradCertUnivTeach&Learn Barrister (NSW) Lecturer, School of Law Convener, UNE OHS Committee 8

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