S.I.A Sydney Safety Conference

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1 S.I.A Sydney Safety Conference Harmonised Work Health and Safety Laws Presenter: Bill Kritharas, Partner Date: 23 October 2012 adelaide brisbane canberra melbourne newcastle perth sydney upper hunter

2 Introduction Overview progress of harmonisation Overview of Key reforms Reforms to NSW Workers Compensation Scheme Current Insurance Market Solutions 2

3 Model Laws regime The Work Health and Safety Act commenced on 1 January 2012 in NSW, Qld, ACT, NT and Commonwealth Victoria, WA, SA and Tasmania delayed implementation Tasmania s Work Health and Safety Act received assent in April 2012 and due to commence on 1 January 2013 SA s Work Health and Safety Act to commence on 1 January 2013 but with amendments WA and Victoria not likely to commence until 2012 but WA has issues paper on likely impact of the WHS Regulations The WHS Laws will differ in the different jurisdictions and enforcement of the WHS Laws may differ in different jurisdictions 3

4 Model Laws regime SA passed the WHS bill in the Legislative Council last week with amendments:» Control section 17 amended to clarify duty holder required to comply to the extent to which they have capacity to control a risk;» Union right of entry entry permit holders will need to notify Safe Work SA before entering workplace to inquire about suspected contraventions and id inspector attends union official must comply with their directions or report findings» Right to silence abrogation of privilege against self incrimination to be abolished» Working at heights three metres instead of two;» Codes of practice must consult small business commissioner to determine affect on small business;» Strata Schemes clarify volunteer executive committee members who can not prosecuted for failure to exercise Due Diligence

5 Work Health and Safety Act Offences & penalties Health & safety duties Object & interpretation Enforcement measures Model WHS laws Duty of officers & due diligence Other important terms, application of the Act Securing compliance Consultation, representation & participation Workplace entry by WHS entry permit holder 5

6 Key reforms shift of primary duty of care Employer PCBU Qualified by reasonable practicability Likelihood of risk Consequences of risk Knowledge about risk and controls Availability of means to control risk Costs 6

7 PCBU and Employer PCBU has a duty to all workers but do not need to cover them with Workers Compensation policy unless deemed to be employees More than one PCBU can concurrently have the same duty but only employer has responsibility for its employees or deemed employees and must:» provide first aid and/or transport to medical treatment» the name of the employer s Scheme Agent or insurer» provide company name and contact details of the employer» a workers compensation claim form (if requested by the worker).» Ensure all injuries are recorded in workplace register» Notify insurer within 48 hours

8 Officers due diligence Up-to-date with health and safety matters Verify provision and use of resources and processes (legal compliance) Due Diligence Implementation of resources and processes - reporting consulting training Understand nature of the operations and risks Appropriate resources, systems and processes Timely response to incidents and information on hazards and risks 8

9 Key reforms workers EMPLOYEE VOLUNTEER CONTRACTOR STUDENT GAINING WORK EXPERIENCE SUB- CONTRACTOR WORKER APPRENTICE OR TRAINEE EMPLOYEE OF CONTRACTOR OUT- WORKER EMPLOYEE OF LABOUR HIRE COMPANY EMPLOYEE OF SUB- CONTRACTOR

10 Workplace Injury Management and Workers Compensation Act Worker means a person who has entered into or works under a contract of service or a training contract with an employer (whether by way of manual labour, clerical work or otherwise, and whether the contract is expressed or implied, and whether the contract is oral or in writing). Does not include:» a member of the NSW Police Force who is a contributor to the Police Superannuation Fund;» Certain persons whose employment is casual (that is for 1 period only of not more than 5 working days) and who is employed otherwise than for the purposes of the employer s trade or business;» an officer of a religious or other voluntary association who is employed upon duties for the association outside the officer s ordinary working hours;» a registered participant of a sporting organisation (within the meaning of the Sporting Injuries Insurance Act 1978).

11 Workers While at work, a worker must:» Take reasonable care for his or her own health and safety;» Take reasonable care that his or her acts or omissions do not adversely affect the health and safety of other persons;» Comply, so far as the worker is reasonably able, with any reasonable instruction that is given by the PCBU to allow the person to comply with this Act; and» Co-operate with any reasonable policy or procedure of the PCBU relating to health or safety at the workplace that has been notified to workers. Volunteers and work experience students are not workers under Workers Compensation Act 1987 and employers do not need to cover them with Workers Compensation policy Employers still owe a duty of care and may be prosecuted under WHS Laws 11

12 NSW Workers Compensation Scheme NSW Government introduced changes in June 2012 transitional arrangements for claims prior to changes Lump sums new arrangements mean only available to workers assessed at greater than 10% total impairment Medical expenses payable for 12 months after date of injury (or 12 months from last payment of weekly benefits) but does not apply to seriously injured workers (WPI greater than 30%) Weekly benefits are linked to return to work with more benefits during first 13 weeks and then if you work 15 hours per week

13 NSW Workers Compensation Scheme Heart Attack and Stroke, Disease and Journey Claims new arrangements and no compensation» Disease work was main contributing factor» Journey Claims real and substantial connection between employment and injury received» Heart attack employment gave rise to a significantly greater risk

14 Workers Compensation Scheme and WHS Changes to Workers Compensation will not impact on enforcement of contraventions of WHS Laws by WorkCover Worker s Compensation insurer will now assess work capacity (medical, functional and vocational) to inform on decisions to return to work in suitable employment which affects entitlements to weekly payments Work capacity assessment can occur any time (within 130 weeks) If worker disagrees with decision may apply to insurer for a review or thereafter apply for a review by WorkCover or WorkCover Independent Review officer

15 Workers Compensation Scheme and WHS WorkCover NSW inspectors have additional powers to enforce employer s obligations to provide suitable duties to employee to return to work Notification Must notify WorkCover of notifiable incidents arising out of work carried out by business or undertaking or at a workplace:» Death of a person;» Serious injury or illness;» Dangerous incident. Incident site must be preserved until Inspector arrives Must notify Scheme agent or insurer within 48 Hours Develop a notification policy that covers WorkCover/Insurer

16 Current Insurance Market Solutions Directors & Officers Liability Insurance In a WHS setting, there is only cover for the directors and officers NOT the organisation itself Therefore there is no cover for the fines and penalties or legal / investigations costs incurred by the organisation Claims trigger under a D&O policy is the notification of a third party claim and in the case of WHS, an official investigation by the regulator e.g. Work Cover Time lag between an WHS incident occurring and a formal claim or commencement of a formal investigation Aon Professions & Financial Services Group April

17 Current Insurance Market Solutions (cont) Statutory Liability Insurance Typical policies require there to be a defence to the claim However, typical policies also enable the insurer to retain full discretion as to whether a claim can be defended against Senior Counsel clauses dealing with disputes delay Key point is that WHS infringements are notoriously difficult to defend, and organisations will wish to (criminal / civil liability and reputational damage) Like D&O, Statutory Liability requires a third party claim or the commencement of a formal inquiry by a statutory body

18 Current Insurance Market Solutions General Liability Generally speaking, General Liability policies are occurrence based and provide cover for claims brought by third parties (not employees) Generally, there is no cover for fines and penalties Defence and investigation costs from actions brought by a statutory body such as Work Cover may be excluded Workers Compensation Cover to an organisation for civil liability that can flow from employees being injured - compensatory claims Cover for investigation and defence costs limited to a Work Cover action Does not provide cover for fines and penalties associated with a WHS breach Aon Professions & Financial Services Group April

19 Conventional Insurance Policy performance: sample Gap Analysis Aon Professions & Financial Services Group April

20 Questions adelaide brisbane canberra melbourne newcastle perth sydney upper hunter

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