Penalty push: WA Government introduces legislation to increase safety law penalties

What you need to know

• Amendments introduced into the WA Parliament substantially increase penalties under the Mines Safety and Inspection Act 1994 and Occupational Safety and Health Act 1984. 
• For corporations, penalties would increase by a factor of five or more.
• The legislation would bring penalties under both Acts into line with harmonised Work Health and Safety laws across Australia, and adds 14% for inflation.
• The test for penalties under each Act would remain unchanged.

What you need to do 

• Ensure you are up to date on the progression of the proposed amendments through Parliament.
• Notify officers and other relevant people within your organisation of the proposed changes and keep them informed of any new developments.

What is proposed 

The WA Government has introduced legislation to amend the Mines Safety and Inspection Act 1994  and Occupational Safety and Health Act 1984  to increase the penalties for offences in line with harmonised WHS legislation that applies elsewhere in Australia (other than Victoria), plus inflation.

The Bills were introduced and read a second time in the Legislative Assembly on 11 October 2017. 

The Bills increase the penalties under the MSI Act and the OSH Act very significantly (for corporations, by a factor of about five or more).

The Bills also propose increases by a factor of four in penalties for breaches of provisions where the penalty levels are not specified (eg duty to report some occurrences and situations, duty to provide specified information to health and safety representatives and continuing offences).  The proposed penalties are reflected in the table below.

Are there any proposed changes to the test for penalties?

The proposed changes in the Bills only affect penalty amounts; there is no proposed change in the test for penalties.  

Is WA progressing towards harmonised safety laws?

The WA Government has established a Ministerial Advisory Panel that is currently preparing a Work Health and Safety Bill to cover both general industries and resources (mining, petroleum and pipelines).  This Bill is to be based on the model Work Health and Safety Act with relevant industry regulations.  The Government does not expect to introduce a bill to Parliament until mid-2019.

The former Government tabled a Work Health and Safety Bill 2014 as a green bill for consultation purposes.  That Bill was also based on the model Work Health and Safety Act, but it was not progressed in Parliament.

The model Work Health and Safety Act contains some significant differences to the current WA laws, including obligations of due diligence for officers. 

How have the penalty amounts been determined?

As the table shows, where possible, the current four penalty levels have been equated to the three offence categories in the model Work Health and Safety Act. 

As there is no equivalent in the model Work Health and Safety Act to the current level 3 penalty (which applies to breaches causing death or serious harm), the penalty for what is now level 3 is based on the mid-point between the model Work Health and Safety Act's Category 1 (recklessly exposing an individual to a risk of death or serious injury) and Category 2 (breach of duty that exposes an individual to a risk of death or serious injury or illness), plus inflation.

All of the proposed penalties have been adjusted to reflect inflation of 14% since March 2010, around when the model Work Health and Safety Act penalties were first developed, and rounded for simplicity.

Requirements for the Bills to be passed

For the Bills to pass in the Legislative Council, the Government needs the support of the Liberals or the cross bench.  The green Bill tabled by the former Liberal Government contained penalty levels consistent with the model Work Health and Safety Act.

Implications of the Bills 

Officers

Under current laws, where a corporation commits an offence, an officer also commits the offence if it is proved that the offence occurred with the consent or connivance of, or due to any neglect by, the officer.  The penalty for an individual then applies.

If passed, for a first offence the Bills would expose officers to penalties of up to:

• $400,000 for a level 3 breach (general duty breach resulting in serious harm or death), and

• $600,500 and imprisonment for five years or both for a level 4 breach (general duty breach involving gross negligence and resulting in serious harm or death).

Corporations

For a first offence, corporations would be exposed to penalties of up to:

• $2,000,000 for a level 3 breach (general duty breach resulting in serious harm or death); and
• $2,700,000 for a level 4 breach (general duty breach involving gross negligence and resulting in serious harm or death).

The penalties for subsequent offences would increase to $2,500,000 and $3,500,000 respectively.

While many corporations are most concerned about the impact of a serious incident on the family and workers concerned, and to a lesser extent the reputational damage for the corporation, the huge increases to the maximum penalties are likely to be of concern.

When would the penalties start applying?

The Bills provide that the changes to penalties will commence on a day or days to be fixed by proclamation.  It is unlikely that the penalty changes would apply to offences committed before any of the changes come into effect.  

Author: Marie-Claire Foley; Partner.