Public Comment Response Form Exposure Draft for Model Act and Stage 1 Model Regulations

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1 You are invited to answer any and all of the questions listed below which have been taken from the Exposure Draft Discussion Paper: Questions Part 1 Preliminary Matters Q1. What is the best title for the model Act? The Australian Institute of Architects (Institute) does not support the proposed title 'Safe Work Act', and believes it should be titled a. Occupational Health and Safety is a well understood concept (in any jurisdiction) encompassing health at workplaces, the purpose of this Act, and b. Q2. Does the definition of officer clearly capture those individuals who should have officer duties under the model Act? currently ecommendation that this be so is supported, along with the wider provisions in the Corporations Act 2001 dealing with non-corporations, and unincorporated associations which would have included the definition apparently required by the Workplace Relations Ministerial Council, However, the definition will remain deficient where the Act does not concurrently define the due diligence it requires of the officer. We and that its discussion on due diligence should be read in conjunction with the definition. While we also note, as did the Review Panel, that such a

2 definition is not currently contained in OHS legislation, that is not a reason to omit it from this Model Act, which relies on overlapping duties of multiple officers, in many circumstances from various separate businesses or undertakings (BUs). implied by a stated duty without explanatory meaning, or indication of its extent. In our view, such uncertainty is unlikely to produce improved OHS outcomes but simply contribute to wasted resources, inefficiencies and hidden costs within a BU as its officers seek to cover the unknown. Q3. There is some overlap between the definitions of plant and structure, as many types of plant have structural attributes, and vice versa. Should plant and structure be defined in a way that removes this overlap? The Institute does not consider that it will be possible to exhaustively define structure and plant without overlap unless there are counterintuitive propositions in the definitions, as there already are. For example, an item of plant is often considered to be a removable We are aware of differing opinions as to whether tanks or containers are plant or structures clearly there are examples of both containers as plant and containers such as dams, constructed lagoons etc ordinarily considered to be structures. However, the issue is not so much the distinction or not between the two as defined, as the different duties that the Model Act applies to the designer of each. There seems no logical reason why the duties are not the same in all aspects of the duty. For example, why is the designer of plant not in the same way as that of a structure (s.21(5)(c)) subject to the obligation to give current relevant information to a Q4. Are there any other types of activities or undertakings that should be specifically included or excluded from application of the model Act? For example, should residential strata title body corporates be excluded?

3 Q5. Is the scope of the suppliers duty appropriate? The exclusion of financier in the terms stated is of concern to the Institute. It is understood that the purpose of this drafting is to exclude those who only supply finance for acquisition and who necessarily become a title holder, or have another legal interest, while facilitating this transfer. However, it is of concern that because of the way a structure is defined, this exemption may also apply to financiers of buildings and infrastructure where in many instances the financier has a very significant influence and control over matters which do, or may, affect OHS outcomes. In such situations in the construction industry, the financier whether public or private has such influence through either due diligence processes, reviews, oversight of how the finance is allocated between and to various aspects of the project, any one of which can influence OHS outcomes. Such players in the industry should not be able to diminish their duties behind such an exemption where their guidelines or approval is critical to design and procurement decisions. This points to the problem with the way the specific duties are framed in the Model Act, as attaching to an entity which carries on the business of a financier, designer, manufacturer, rather than referring to the duty of any person who engages in this activity. The risk is that a person engaging in an activity which ought to encompass a duty under this Model Act will escape the duty through interpretation of what it actually takes to be a person conduct(ing) a business or undertaking that(designs/supplies/manufactures etc). For example, does a BU that manufactures concurrently have the duties of a BU that designs if the manufacturer engages in design? In our opinion, s14 which states that a person can have more than one duty by virtue of being in more than one class of duty holder is not sufficiently clear to give certainty to this. We strongly believe that the duty should apply to the activity not only when the activity is the ordinary business of a BU. Clearly, the latter will allow avoidance of the OHS duties, creating gaps in duty putting the effectiveness of this Model Act in doubt. Designers should no more manufacture or construct without a safety duty than should a manufacturer or constructor design without one.

4 Q6. Is the scope of the worker definition appropriate? Should it cover students gaining work experience? Q7. Is the definition of workplace appropriate? The Institute generally supports the Model Act definition of 'workplace'. 'Workplace' does not need further definition than being any 'place' and 'where work goes on'. However, the definition also includes any place a worker goes, or is likely to be, while at work. We suggest the meaning of while at work could be further clarified so that it is firmly related to the control the BU has over such places. For example, when a worker goes to obtain lunch or coffee from another BU during working hours is the worker still at work? The Institute also has difficulty with the use of the term 'working environment' used in the Model Act in the primary duty 18(4)(a). We consider it diminishes the primary duty, where instead the defined term 'workplace' is used in the context of the specific duties which follow that section. The Institute supports the First Report recommendation against using the term 'working environment' ( ). Section 18(4)(a) of the Model Act should read "provide and maintain a safe and healthy workplace" for all the reasons given in that Report.

5 Part 2 Safety Duties Q8. Do the principles that apply to the duties of care give clear guidance on what is expected? The general principles provide guidance, given that the Robens principle of control is largely abandoned by the Model Act and that multiple duties will arise, particularly in the construction industry. However, some clarification is required. a. The inclusion of a primary duty and then specific duties which are likely to be concurrent may deflect attention from the primary duty at least in the minds of the primary duty holder. For the construction industry, the fact of, and actual terms of engagement of, multiple specific duty holders by the primary duty holder, do limit the latter s influence and control for ensuring safety. The Model Act provides that where there are multiple duty holders, the duty to ensure (safety) is to the extent that the matter is within the person's capacity to influence and control, but gives no guidance on by what standard influence and control is to be assessed ( by the Courts). This duty applies to both entities and individual Officers. As the Second Report of the Review Panel notes in its justification for abandoning the notion of control, the Courts have variously interpreted each of control and influence, by both objective and subjective standards. The Institute calls for the Model Act to leave no doubt and to stipulate that influence and control be judged only by the objective standard of the reasonable person in the situation the duty holder is in. It should not be the case that through uncertainty, workers, or duty holders, are vulnerable during the process of determining the working of the law through the Courts. b. The Institute proposes the Act makes it clear that consultation requirements with all other duty-holders required by s.15(3)(c) applies only to those who have a concurrent duty in the same matter. This is necessary to avoid the expectation, defeatable only by application of reasonably practicable principles, that design or other consultants, having specific duties, are required to meet such obligations despite the end of their engagement or involvement. Changes by others over the life of a building (structure) may make the original design less, if at all, relevant to OHS in that workplace, yet it would not be reasonable or practicable for a continuing duty to apply to the original designer who has no further involvement. In fact, reliance on the original design may substantially increase OHS risks where the situation is now different.

6 Q9. Is the definition of reasonably practicable appropriate in this context? The Institute strongly supports the definition of reasonably practicable as a major plank of the harmonisation endeavour. Q10. Should the definition of reasonably practicable be exhaustive i.e. so only matters listed may be considered in determining compliance with the duty? The specific types of matters are appropriate, and the proposed wording of 'reasonably practicable' widens the scope of what may be considered with the addition of the words "all relevant matters including...". Providing strong guidance about the types of matters that must be taken in to account, but with the flexibility of additional factors according to the particular circumstances is the appropriate balance which the Institute strongly supports. Q11. Is the proposed scope of the primary duty appropriate? As noted at Q8 above, the Act should be constructed and expressed so that the primary duty is always paramount over specific duties which are incidental and time limited in many instances. The Institute strongly believes that the primary duty includes the duty of the person with management and control of the workplace or of fixtures, fittings or plant at a workplace, (presently also expressed as a specific duty) and should be expressed to be undiminished by the engagement of those with the remaining specific duties, those who design, manufacture, supply or install, construct or commission, plant, substances or structures. This is because the primary duty holder, the employer or contractor of the workers, and/or the person with management and control of the workplace, plant or equipment does and should have, the predominant influence on the workplace as the nexus of OHS resources.

7 This is not assisted by the apparent anomaly, where the primary duty holder is not obliged, as are specific duty holders, to calculate, analyse, test and examine the workplace and pass on this information to subsequent primary duty holders, for example, or to the specific duty holder responsible for management and control of the workplace, or fixtures, fittings or plant. Accordingly, the Institute strongly recommends that the equivalent duties of 21(3), (4) and (5) be placed on the duty-holders of s.19 and 20, as well as expressing the latter duties as primary. Q12. The model Act requires the provision of, so far as is reasonably practicable, any information, training and instruction or supervision that is necessary to protect all persons from risks to their health and safety arising from work (Clause 18(4)(f)). Should this requirement expressly require that the information etc. be provided in an appropriate language or languages, or provided at a level that can be understood by the workers? The Institute believes this issue should be dealt with on an industry specific basis. Q13. The model Act requires, so far as is reasonably practicable, the provision of adequate facilities for the welfare of workers at work (Clause 18(4)(e)). Should this provision be drafted to require access to such facilities (e.g. to take account of requirements for mobile workplaces)? Design consultants are one of the examples of a BU that cannot provide facilities to their workers when sending them off-site and the Institute supports the clarification of access to. Similarly, S.18(4)(g) needs to be expressed to allow a broad interpretation for the duty to ensure conditions at the workplace are monitored, else it will be problematic for leased workplaces where the BU is not in a position to do this itself. Q14. Is the scope of the duties related to specific activities appropriate? a. As noted at Q11 above, the Institute strongly recommends that the equivalent duties of 21(3), (4) and (5) are placed on the significant duty-holders of s.19 and 20, those Persons with management control of workplace, and those Persons with management or control of fixtures, fittings or plant at a workplace. b. The Institute does not support extending the designer duties for a structure (to be used as a workplace) to apply to the workplace of the

8 construction site that preceded it. sequence of a building (structure) construction site betrays a continuing lack of understanding of the building construction process and the roles and responsibilities of its participants. Designers of buildings are not trained to design the workplace of a building site and the industry does not expect this of the building designer. Designers design buildings (structures), but not the organisation of construction sites, or the methods and/or sequences of carrying out construction work. Construction sites different in nature, and the construction industry clearly understands, where the Model Act does not, that the constructor has control of the site and the work methods. The workplace that results from completion of the construction process is a different workplace than c. However, the Institute does support the duty of designers to those who will work in and around the ultimate workplace arising from the design, once that workplace is completed as designed, and when used for the purpose for which it was designed. d. The Institute considers there are two possible interpretations of the drafting of s.21(1) (and similarly ss.22(1) -- 25(1) inclusive). For the undertakes the As noted in Q5, the Institute strongly believes it is the latter which must be the only interpretation of this specific duty, and urges adoption of legislative drafting that makes this abundantly clear. To achieve good OHS outcomes it cannot be open to a BU whose core or primary activity is construction, for example, to avoid the duties and responsibilities attaching to design, if it undertakes design. It would be equally illogical if a design business could undertake construction activities without attracting the duties of a constructor. The reality is that primary duty holders undertake design activity in instructing design consultants they have engaged and in adopting or rejecting alternatives proposed by them. e. Constructors and/or primary duty holders also undertake design when in construction of the workplace they depart from design i.e., in accordance with the design. For this reason there is a self- construction, (proper) use or (proper) demolition and the logical express duty on constructors and owners to similarly do so if the construction, use or demolition is not owners and constructors? Clearly OHS risks

9 f. is a curious extension relation to the construction industry. Such an obligation may extend indefinitely, and provides no certainty where methods of demolition are likely to change, the inherent structural systems and of even the type of construction may change with differing use, neglect, and subsequent s the removal of the reference to demolition. A less acceptable alternative is that the obligation about demolition is qualified so that it only applies to a designer currently engaged at the time of/ or for the purposes of the demolition in relation to the structure. Q15. In determining whether a worker failed to take reasonable care, should regard be had to what the worker knew about the relevant circumstances? Q16. Is the treatment of volunteers under the model Act appropriate? Q17. Are the range and levels of penalties proposed above appropriate, taking account of the levels set for breaches of duties of care by the WRMC? The level of penalties in general will have a significant effect on the insurance burden to be met by business, and this needs to be recognised please refer to other comments, following. Q18. What should the maximum penalty be for a contravention of the model regulations? Q19. The intention is that all contraventions of the model Act be criminal offences. Is this appropriate or should some non-duty of care offences be subject to civil sanctions e.g. failure to display a list of HSRs at the workplace, offences relating to right of entry? The Institute believes that technical or compliance breaches not directly related to safety issues ought not be criminal offences. Part 3 Other Obligations Q20. Is the list of notifiable incidents sufficiently clear and objective, so duty holders easily understand their obligations?

10 Part 4 Consultation, participation and representation Q21. Is the proposed scope of duty to consult workers appropriate? Q22. Should the model Act include a procedure to follow if agreement on a consultation procedure cannot be reached? Q23. Clause 49 allows work groups to be determined for workers engaged in 2 or more businesses or undertakings. Should such arrangements be by agreement only, i.e.with no prescribed procedure if negotiations fail? Q24. Negotiations for work groups must be commenced within a reasonable time. Should a time limit be prescribed e.g. 14, 21 or 28 days? Q25. Elections for HSRs and possibly deputy HSRs must be conducted as soon as reasonably practicable after the relevant work groups are established, or after a request for an election is received if work groups are already established. Should a time limit be prescribed? Q26. The model Act requires that the HSR training must take place within a reasonable time, to accommodate a range of circumstances. For example, it may take longer for HSRs working in rural or remote regions to attend an approved course that may not be available in their area. Should a time limit be specified within which the training must be provided? Q27. The model Act requires that a health and safety committee be established within 2 months of the request being made. Six of the current OHS Acts include such a timeframe, which varies across jurisdictions from 3 weeks to 3 months. Is the proposed time limit of 2 months appropriate? Q28. The Fair Work Act 2009 (Cth) (Fair Work Act) refers to ceasing work on the basis of a reasonable concern of the employee about an imminent risk to his or her health and safety, while the model Act refers to reasonable grounds. Should the terminology in clauses 75 and 76 be aligned with the Fair Work Act?

11 Q29. Should a health and safety representative be required to complete approved training before being able to direct that work cease under these provisions? Q30. Should a health and safety representative be required to complete approved training before being able to issue a PIN under these provisions? Q31. A PIN cannot require compliance before 7 days from the date the PIN was issued. Is this time frame appropriate? Part 5 Protection from Discrimination Q32. Should the model Act expressly protect persons from being coerced or induced to exercise their powers in a particular way? Part 6 Workplace entry by OHS entry permit holders Q33. Are the notification requirements appropriate? Q34. Should the model Act contain a specific authorisation process for an OHS entry permit or can it rely on authorisation obtained under other Acts such as the Fair Work Act? Q35. Should contraventions of this Part attract criminal or civil sanctions? If civil sanctions are considered appropriate, should penalty levels reflect those that apply under the Fair Work Act? Q36. The right of entry provisions have been drafted to be generally consistent with the Fair Work Act. Do these provisions appropriately apply to the role of a union representative when entering the workplace in relation to OHS, rather than in relation to workplace relations?

12 Part 7 The Regulator Q37. Should guidelines have any other particular legal status under the Act? While guidelines should be just that, guidelines without legal status, it is of serious concern to the Institute that the Model Act does not provide for fixed legal status of a Code of Practice adopted by the Minister (ss.248, 249). We interpret the effect of s.249 to be that a duty holder cannot rely on compliance with a Code of Practice as an effective defence in a proceeding. While s.249(c) reflects an important principle, that a person may adduce evidence other than their compliance with a Code to demonstrate the performance of their duty was as reasonably practicable, the equally important parallel principle does not appear to be incorporated. Conversely, by s.249(2)(b) a Court tandard. The Institute urges clarification of the drafting of the section to ensure that the principles outlined above apply to give certainty to those required to perform obligations. As noted at Q27 above, with the abandonment of the Robens principle of control in favour of multiple duty holders with overlapping responsibilities, there is a real danger that OHS outcomes may suffer as a result of confused responsibilities rather than positive actions. When neither control or due diligence are defined, it is likely to be a relatively slow process of court precedent to resolve what the Act actually means. The Institute believes OHS outcomes will not ultimately be assisted by this Act duties on those who but for this Act have no role or legal authority, contractual or otherwise. Designers are a prime example of such duty holders who are employed by owners (who have a primary duty) to advise them as to a design proposal and the detail of a design. Designers, rather, they. As noted above, t It is imperative that meaningful and targeted Codes of Practice that are narrowly, not broadly, industry specific, drafted by real and considered consultation with all the stakeholders, are adopted promptly, with, as noted above, that gives certainty to the duty holders.

13 Part 10 Review of Decisions Q38. Is the list of reviewable decisions appropriate? Q39. Are the processes and timeframes prescribed for the internal review of decisions appropriate? Q40. Are stay arrangements appropriate in relation to the issue of a prohibition or nondisturbance notices, having regard to the purposes of those notices? Exposure Draft of Key Administrative Regulations Q41. Should the list of matters to be considered in negotiations for work groups be provided for in a Code of Practice rather than prescribed in regulation? Do you have any other comments? Impost on small and medium design businesses. The imposition of duties on designers which are largely inappropriate, for the reasons stated above, is likely to significantly increase the costs of doing business, particularly for small and medium practitioners, whether as consultants/subcontractors, or business owners. With universal and overlapping duties, limited by the extent of influence and control, the apportionment of liability for an incident can only be ultimately decided by a court process. The Institute is concerned that with the imposition of specific duties on designers, a designer will find itself implicated in any prosecution of an incident, by default, whether the ultimate apportionment of liability is minimal or otherwise. Such involvement for small and medium design consultant businesses in particular, is likely to be a significant impost on their operations -existent.

14 This increases the risk exposure of small and medium businesses, and aside from potential gaol terms for individuals, the magnitude of potential fines is crippling for such businesses. Proper risk assessment virtually guarantees the need for statutory penalty insurance. This cannot be provided by professional liability insurance (PII) and needs separate cover. Information we have so far reflects a significant cost impost on virtually every small and medium business. The cost of cover for statutory liability and defence costs varies according to factors such as number of staff, gross fees, claims history, limit of indemnity, and area of operation. The cost of statutory liability cover is a disproportionate burden on smaller practices. The following table expresses the cost of statutory liability cover as a percentage of the professional indemnity insurance premium paid by a particular practice: Practice size (number of staff) Cost of statutory liability cover as a percentage of PII insurance premium % % 50+ 3% Current premiums for statutory liability cover are relatively low, on the basis that, to date, there have been very few prosecutions of designers of buildings under safe design laws. The Model Act is likely to increase the level of premium. To illustrate the effect of historical claims, statutory liability premiums in NSW (which has a record of imposing high fines for OHS breaches) can be in the vicinity of 25% higher than other states. If the Model Act results in more prosecutions, we would expect the premiums quoted above to rise very significantly across all states and territories. In the past, namely 2003/2004, COAG has seen fit to agree to significantly amend tort and trade practices legislation to minimize the effect of insurance market fluctuation on small and medium business. Based on the present scenario alone, the adoption of the Model Act with its significant penalties is likely to have a substantially negative effect on the capacity of small and medium entities to remain in business.