The model WHS laws incorporate the meaning of ‘officer’ as it is defined in section 9 of the Corporations Act 2001 (Cwlth). The Corporations Act definition of ‘officer’ in turn includes "a receiver, or receiver manager, of the property of [a] corporation", and "an administrator of the corporation". It also includes "an administrator of a deed of company arrangement executed by [a] corporation", and "a liquidator of [a] corporation".
When an insolvency practitioner is appointed, the officer provisions of the model WHS laws are activated. Under the WHS laws, if a person conducting a business or undertaking (PCBU) has a duty or obligation under the WHS laws, an officer of the PCBU must exercise due diligence to ensure that the PCBU complies with that duty or obligation.
The term ‘person conducting a business or undertaking’ or PCBU replaces the term ‘employer’ utilised in pre-reform health and safety legislation and captures natural persons, corporations, joint venture partners and partnerships. Accordingly, on appointment, to almost any entity that operates in Australia, insolvency practitioners attract duties to exercise due diligence in relation to health and safety.
For officers, due diligence under the model WHS laws includes taking reasonable steps:
The new WHS due diligence requirements impose significant positive obligations on officers. Receivers, administrators and the like should be particularly focused on these obligations because they aren’t typically familiar with the activities or machinations of the businesses they are appointed to. Adding to the burden is the fact that it is often difficult for businesses struggling financially to maintain necessary standards - the flow on effect being degradation in key business areas including health and safety.
Insolvency practitioners operating in jurisdictions which have adopted the WHS laws should take positive steps to:
Insolvency practitioners who are in jurisdictions that are yet to nationalise should also be taking similar steps in order to prepare for when the laws are introduced in their jurisdiction.
For a more detailed analysis of where each jurisdiction currently stands on introducing the harmonised laws, refer to our recent ‘state of play’ alert.
For an overview of other key changes that will flow from nationalisation, refer to our earlier alerts in relation to the WHS laws’ implications for directors and for the mining industry and to our soon to be released Directions 2012 report.
For further information we welcome you to contact our OHS team.
Who does this affect?
Insolvency practitioners, particularly, receivers, administrators, receiver managers and liquidators.
What do you need to do?
You should be taking positive steps to ensure that you will be compliant upon appointment including, but not limited to, attending training about compliance with the duties and developing tools and acquiring manuals and the like to assist in demonstrating compliance.