Employers Take Care: OHS Penalties Increased

By Gerard Lethbridge

For over twenty years now, modern occupational, health and safety (OHS) laws have played an important role in the workplace. Recently, however, Victoria has proposed controversial new changes to the legislation.

Prior to the 1980s, the dominant safety legislation set out quantifiable standards that needed to be met in factories and other workplaces. In the 1980s, most states and territories in Australia introduced a general risk management approach to occupational health and safety. That is, employers were given a general duty to ensure the health, safety and welfare of their employees. Breaches of this duty could result in substantial monetary penalties being levied on a company or its senior employees.

At present, under the Occupational Health and Safety Act 1985 (Vic), maximum penalties for most breaches of the Act are generally 2500 penalty units ($255,625) for corporations and 500 penalty units ($51,125) for individuals. For subsequent offences, the penalty can be increased by an additional 2500 penalty units for corporations. For subsequent offences, individuals can face an additional 500 penalty units and/or five years imprisonment.

Despite the presence of significant penalties, serious injuries, illnesses and fatalities in the workplace continue to be an issue. This is particularly so on construction sites, in factories using antiquated machinery and when dealing with strong electrical currents.

These problems have led to a number of states and territories increasing their penalties for breaches of OHS legislation and, in some cases, introducing a criminal offence of industrial manslaughter. Such an offence commenced in the ACT on 1 March 2004. In order to satisfy the elements of this offence, an employer or senior officer of the company must have recklessly or negligently caused a worker’s death. Breaches of this offence are punishable by a maximum fine of $1 million for companies. Individuals face a maximum fine of $200,000 and/or 20 years imprisonment.

The New South Wales and Victorian governments both commissioned reviews of their occupational health and safety legislation, in part to consider the desirability of introducing an offence of industrial manslaughter.

In Victoria the report on the Occupational Health and Safety Act 1985 (Vic) was presented to the Victorian government in March 2004. The report found that the current penalties for breaches of safety duties in Victoria were considerably lower than other jurisdictions. The report developed a range of complex recommendations, including:
  • clarifying the obligations of those involved in the workplace;

  • improving the opportunity for employees to participate in health and safety issues;

  • promoting fairer, consistent and transparent enforcement by WorkSafe with respect to inspection decisions, investigations and prosecutions; and
    increasing penalties for breaches of OHS obligations generally.
On 17 November 2004, Attorney-General Robert Hulls introduced an OHS bill into the Legislative Assembly. This bill was passed on 17 December 2004. The new law will repeal the Occupational Health and Safety Act 1985 and replace it with the Occupational Health and Safety Act 2004. The majority of the provisions of the new legislation are to come into effect on 1 July 2005.

Significant features of the legislation include:
  • replacing the general statement of maximum penalties under the 1985 legislation with specific penalties tailored for specific offences;

  • increasing the maximum fine for breaches of the general safety duties to 9000 penalty units ($920,250) for corporations and 1800 penalty units ($184,050) for individuals;

  • creating a new duty on employers to consult with employees, punishable by a fine of 900 penalty units ($92,025) for corporations and 180 penalty units($18,405) for individuals;

  • granting unions a right of entry where a breach of OHS legislation is suspected; and

  • creating a new offence of recklessly endangering persons at a workplace.

It is interesting to note that offences of the kind envisaged by the legislation could, in some circumstances, be covered by existing provisions of the Crimes Act 1958 (Vic). In fact, the new offence in section 32 of the Occupational Health and Safety Act 2004 (Vic) applies the same standards, tests and penalty as section 23 of the Crimes Act 1985 (Vic). Section 32 makes it an offence where a person “recklessly engages in conduct that places or may place another person who is at a workplace in danger of serious injury”. This offence is punishable by a maximum penalty of 1800 penalty units ($184,050) and/or five years imprisonment for individuals and, in the case of corporate offenders, a maximum fine of 9000 penalty units ($920,250).

Governments in most states and territories have increased their emphasis on OHS and this has resulted in substantially increased penalties for breaches of OHS obligations. It can be expected that employers who have not reviewed their systems and procedures for complying with OHS obligations will increase their risk to the full range of new penalties. It is important for company managers to consult their lawyers to keep abreast of developments.


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