The Health and Safety at Work Act 2015 comes into force in April, and many businesses are scrambling to ensure that their operations comply. To help decipher the Act, we have prepared the following overview of its key provisions and potential implications for your business. For more detailed and tailored advice, please contact one of our team.
The Pike River coal mining accident in 2010 is often cited as a catalyst for reforming New Zealand’s health and safety laws. Despite a common belief that WorkSafe’s predecessor OSH was an overbearing bureaucratic presence in the workplace, New Zealand’s health and safety record remains poor compared to our international counterparts. Kiwis are twice as likely to be injured at work than Australians, and more than five times than workers in Britain. Around 1 in 10 workers are harmed at work each year, with approximately 200,000 claims being made annually to ACC for costs associated with work-related injuries or illnesses. Five New Zealand industries fare particularly badly, accounting for more than 50% of all workplace injury entitlement claims. Moreover, there is potential for catastrophic harm in high risk industries (such as mining, and major chemical storage and processing facilities).
In response to this problem, the Government established an Independent Taskforce on Workplace Health and Safety in June 2012. The Taskforce did not identify a single critical factor behind New Zealand’s poor health and safety record. Rather, it reported a number of significant weaknesses in the system were to blame, stemming from a failure to implement the Robens health and safety model. Originating in the UK, the Robens model imposes broad performance-based standards rather than prescriptive, sector-specific rules.
The Health and Safety at Work Act 2015 aims to embrace the Robens model by introducing broad duties to eliminate or minimise risks to health and safety so far as is reasonably practicable.
The Act comes into force on 4 April 2016, and is New Zealand’s most significant health and safety reform in over 20 years. It aims to correct the various failures of the previous regime, including unclear expectations, poor worker engagement, and a risk tolerant culture. The Act’s stated purpose is to “provide for a balanced framework to secure the health and safety of workers and workplaces”.
The Act provides for a “regulator”, defined as the crown entity Worksafe, or a relevant designated agency. The regulator has a broad role which includes monitoring and enforcing compliance with the Act and Regulations, publishing information regarding compliance with the relevant legislation, and promoting and supporting research, education and training in work-related health and safety. It will also be the primary prosecutor of alleged breaches of duty under the Act (although private prosecutions are permitted in limited circumstances).
The Act creates a category of duty holders known as persons conducting a business or undertaking (PCBU). PCBUs will generally be legal entities (such as companies) rather than individuals, although sole traders or those who are self-employed may also qualify.
PCBUs have a duty to ensure, so far as is reasonably practicable, the health and safety of those who work for the PCBU while they are working, and whose activities in carrying out work are influenced or directed by the PCBU. The phrase “reasonably practicable” is defined with reference to the likelihood of a hazard or risk occurring, the degree of harm that may result, the knowledge of the PCBU regarding the hazard or risk, the availability or suitability of means of minimising the risk, and the cost associated with eliminating or minimising the risk. In addition to their primary duty of care, PCBUs have a duty to engage with workers, along with a suite of additional duties depending on the role and function of their workplaces.
The Act contemplates that more than one PCBU may have the same duty; in these cases, the PCBUs are required to consult, cooperate and coordinate together (thus avoiding the need to determine who has ultimate responsibility).
The Act also provides for two other classes of duty holders: Officers, and Workers. Officers include directors of companies (where the company is a PCBU), partners of a partnership (where the partnership is a PCBU), and any person who occupies a position comparable to a company director of any body corporate or unincorporated body that is a PCBU. Officers of a PCBU have a statutory duty to exercise due diligence to ensure that the PCBU complies with its duties or obligations. Officers can be convicted or found guilty of a failure to exercise due diligence regardless of whether or not the PCBU has been convicted or found guilty of a breach of duty. ‘Due diligence’ is defined as taking reasonable steps to:
- acquire knowledge and keep up to date with health and safety matters;
- gain an understanding of the nature of the operations of the business or undertaking of the PCBU and the associated risks and hazards;
- ensure that the PCBU has appropriate resources and processes to eliminate or minimise risks to health and safety;
- ensure that the PCBU has appropriate processes for receiving and considering information regarding incidents, hazards and risks and for responding to that information in a timely way;
- ensure that the PCBU has, and implements, processes for complying with any of its duties or obligations; and
- verify all of the above processes.
Workers are defined as individuals who carry out work in any capacity for a PCBU. Workers have less onerous duties, which include obligations to:
- 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 as far as he or she is reasonably able with any reasonable instruction given by the PCBU to allow the PCBU to comply with the Act or Regulations; and
- co-operate with any reasonable policy or procedure of the PCBU relating to health and safety.
Importantly, the duties under the Act extend beyond ensuring that harm does not occur, to minimising and eliminating risk. This means that harm is not a necessary component of any breach of the Act.
The regulator may initially issue notices for non-compliances. This requires a person to remedy or prevent a contravention of the Act or Regulations (improvement notices), or to cease any activity that poses a serious risk to the health or safety of any person (prohibition notices), or to preserve a particular site in order to facilitate the regulator’s compliance powers (non-disturbance notices). In the event that the regulator cannot issue a prohibition notice due to being unable to find the person to whom the notice should be issued, the Act confers a broad power on the regulator to “take any remedial action necessary to make the workplace safe.”
The Act also provides that the regulator may accept enforceable undertakings in connection with contraventions or alleged contraventions with the Act or Regulations in circumstances not involving reckless conduct. A breach of such an undertaking is an offence, attracting fines not exceeding $50,000 for an individual, and $250,000 for any other person.
Finally, the regulator can prosecute duty-holders for alleged offences under the Act. Successful prosecution can result in substantial fines of up to $600,000 for Officers, $300,000 for Workers, and $3,000,000 for PCBUs. Officers and Workers may also be imprisoned for up to 5 years for reckless breach of a duty with risk of death or injury.
Further sources of guidance and regulation
The Act will be supported by a large suite of sector and issue specific regulations. The first tranche of these regulations has been released, and includes regulations specific to petroleum and mining, adventure activities, and asbestos (among others).
Section 222 of the Act also provides for the regulator to develop Approved Codes of Practice. These are not enforceable, but will be admissible in civil or criminal proceedings as evidence of whether or not a duty under the Act has been complied with. The regulator can also create guidelines.
How will the new regime affect you?
Any person or entity who qualifies as a PCBU should have a comprehensive Health and Safety Policy in place, which satisfies the new duties introduced by the Act. Non-human PCBUs should identify their Officers, and create a plan for how they will exercise due diligence in their duties.
Any PCBU may initiate the election of one or more health and safety representative, or establish a health and safety committee. Depending on the size of a business, the desires of its workers, and whether it operates within a high-risk sector, these may be mandatory requirements for PCBUs. Regardless of whether there is a representative(s) or a committee, all PCBUs must ensure that there is a clear process for worker participation and engagement with health and safety matters.
We note for completeness that volunteers (such as those participating in fund-raising, assisting with sports or recreation clubs or educational institutions, or providing care for another person in their home) are not affected. However volunteer workers (such as those carrying out work for a PCBU on a regular and ongoing basis, with the PCBU’s knowledge or consent, and comprising an integral part of the business or undertaking) are affected as they qualify as Workers pursuant to s.19.
The broad statutory duties of PCBUs, Officers and Workers outlined above demonstrates how the Robens model encourages duty-holders to proactively take steps towards workplace health and safety, rather than doing the bare minimum. Perhaps the biggest hurdle that New Zealand faces is the widely-held “she’ll be right” attitude, which typically tolerates some level of risk.
It remains unclear precisely how these tests will be applied in different contexts and industries. We expect these uncertainties to be clarified incrementally as case law develops. Until then, PCBUs, Officers and Workers alike will be understandably nervous about the new statute.
However, whilst many will lament the onerous new statutory obligations, in light of the substantial and often unquantified human cost of workplace deaths and injuries – not to mention an annual cost in the billions to New Zealand’s economy – the law change will surely be worthwhile if it results in greater safety for workers.
 Independent Taskforce on Workplace Health and Safety Safer Workplaces Consultation Document, p 2.
 Executive Report of the Independent Taskforce on Workplace Health and Safety, p 10.
 These industries are manufacturing, construction, agriculture, forestry and fishing.
 Executive Report of the Independent Taskforce on Workplace Health and Safety, p 10-11.
 Health and Safety at Work Act 2015, s.30.
 Health and Safety at Work Act 2015, s.3.
 Health and Safety at Work Act 2015, s.143-144.
 Health and Safety at Work Act 2015, s.36.
 Health and Safety at Work Act 2015, s.22.
 Health and Safety at Work Act 2015, s.34.
 Health and Safety at Work Act 2015, s.123.
 Health and Safety at Work Act 2015, s.47.
 Health and Safety at Work Act 2015, s.226.
 Health and Safety at Work Act 2015, s.62-63.
 Workplace-relate injuries were estimated to have cost $3.5 billion in 2010; Executive Report of the Independent Taskforce on Workplace Health and Safety, p 10.