Like J.K. Rowling's fantasy film Fantastic Beasts and Where to Find Them, enforceable undertakings are the magical creatures of work health and safety law, allowing defendants to devote their time and resources to initiatives that correct the behaviour that led to risk, reduce the likelihood of future incidents occurring and making right the harm caused as result of the incident, instead of defending a prosecution and facing fines of up to AU$1.5 million.
But how does a business go about obtaining a work health and safety (WHS) enforceable undertaking? This update sets out some important insights obtained from SafeWork NSW (SafeWork) including as part of a recent legal forum on enforceable undertakings.
What is an enforceable undertaking?
An enforceable undertaking is a commitment that the behaviour that led to an alleged contravention of the Work Health and Safety Act 2011 (NSW) (WHS Act) has ceased, and will not reoccur. The enforceable undertaking is a type of restorative justice with the business implementing strategies that deliver WHS benefits to workers, industry and the community in lieu of being prosecuted for an alleged contravention of the WHS Act.
Upon accepting an enforceable undertaking, SafeWork will discontinue the prosecution for the alleged contravention. The enforceable undertaking is "enforceable" because a failure to comply can lead to a fine of up to AU$250,000 plus costs, and orders to comply with the enforceable undertaking.
Interest in enforceable undertakings is sky-rocketing. Enforceable undertakings began in NSW in 2012. Since then SafeWork has accepted three enforceable undertakings in 2014, nine in 2015 and had accepted seven by October 2016, with approximately 20 more proposals under consideration.
When to apply for an enforceable undertaking
A serious incident will generally lead to a business being notified that it is being investigated by SafeWork. A prosecution may be a product of the investigation however the primary purpose is to determine the cause of the incident and focus on preventing the harm from occurring again in the future. According to SafeWork there is no benefit in applying for an enforceable undertaking in anticipation of a prosecution, and, in fact, SafeWork discourages this, finding it clearer for all parties involved to treat the commencement of a prosecution as a trigger for any enforceable undertaking discussions.
What is the process?
Phone call. Call SafeWork NSW to have a "without prejudice" conversation about an enforceable undertaking.
Initial meeting. The first meeting will generally be with senior management of SafeWork, members of the Enforceable Undertaking Advisory Service and senior management of the business. It allows both parties to discuss the enforceable undertaking process including the capability and commitment required of the business. The business then has the opportunity to decide whether entering into an enforceable undertaking with SafeWork NSW is the right option for them.
Second meeting. Once a business has committed to developing an enforceable undertaking, a workshop is held to discuss the business’s ideas for the strategies that will create long term WHS benefits for the workplace, the industry and community. The business can bring a concepts paper to the meeting, or just the concepts.
Proposal. The business submits a "without prejudice" enforceable undertaking proposal in the form of a template provided by SafeWork NSW. The Enforceable Undertaking Advisory Service will provide feedback to assist the business to present an enforceable undertaking proposal that is appropriate to be considered by SafeWork. Where a business is planning to partner with a third party to assist in the delivery of a strategy, the proposing business must ensure that the third party has the willingness and the resources to deliver their component of any strategies. This commitment must be expressed in the enforceable undertaking proposal.
Consideration by SafeWork. SafeWork will consider the proposal before determining whether to ultimately accept or reject an enforceable undertaking with a business. Often the proposal will be returned with questions and comments to allow for refinements to create an enforceable undertaking with strategies that have a real chance of reducing harm in workplaces and creating awareness of WHS risks in the industry and community.
Verification. If an enforceable undertaking is accepted, the Advisory Service will hand-over the enforceable undertaking to a single dedicated Inspector whose role is to verify that the enforceable undertaking is implemented appropriately by the business. SafeWork will work closely with the business to facilitate the successful completion, however, the onus is on the business to display compliance over the life of the enforceable undertaking.
Successful enforceable undertaking proposals
Whether a proposal for an enforceable undertaking is accepted or rejected is solely within the discretion of SafeWork.
The most successful enforceable undertaking proposals:
- align with the WHS Road Map for NSW and specifically the Action Areas identified as priorities to build workplace capabilities and prevent harm;
- focus on a small, yet sustained number of strategies (around six) that have a real chance of realising long term change and reducing harm in the future;
- are creative or innovative e.g. design and development innovation;
- find novel ways to connect with the business's sector, community and networks e.g. regional awareness campaigns, helping small or like businesses, providing support to young or injured workers;
- are in proportion to the size and capability of the business;
- include consultation with workers about the development of the proposal (including potential strategies), and throughout the life cycle of the enforceable undertaking;
- incorporate strategies for ensuring that officers exercise due diligence and are actively involved in WHS in the business;
- have built-in evaluation criteria with a strong evidence base that allows all parties to see whether a strategy has achieved its intended purpose or anticipated outcomes.
In addition to what is in the enforceable undertaking, the business must demonstrate that its most senior management are committed to the proposed enforceable undertaking. In some cases, SafeWork’s decision around whether to accept an enforceable undertaking will also be assisted by written submissions that provide context for the proposed enforceable undertaking such as information about the business, its commitment to WHS both past and present and, importantly, address the circumstances of the alleged contravention from the business’s perspective.
Unsuccessful enforceable undertaking proposals
Under the WHS Act, an enforceable undertaking cannot be accepted for a Category 1 offence, which is the most serious type of offence as it involves alleged reckless conduct. Most prosecutions, however, fall under Category 2, in which case an enforceable undertaking can be requested. Currently though, under SafeWork Guidelines, if an incident involves a fatality or very serious injury, the business will need to demonstrate that exceptional circumstances exist which would make an enforceable undertaking an appropriate enforcement outcome for the alleged contravention.
While SafeWork will consider all proposals for an enforceable undertaking, it is unlikely that a proposal will be accepted if there was a high impact harm, a foreseeable risk and little was done to eliminate or minimise the risk.
Factors that could lead to an enforceable undertaking proposal being rejected include:
- a lack of regard to the risk that gave rise to the incident;
- where little or nothing has been done to respond to the incident, as this calls into question the business's level of commitment to the prevention of harm;
- a poor track-record on WHS and workers compensation matters; and
- not having the right attitude and commitment to the proposed enforceable undertaking, including denial of responsibility for the harm caused.
While SafeWork does not make a recommendation to reject a proposed enforceable undertaking lightly, if this does occur, there are reasons for this outcome. These instances will generally fall into one of four categories:
- fatality or very serious injury matters where there are no exceptional circumstances that would support an enforceable undertaking;
- little or nothing was in place to manage the risk that gave rise to the incident in the first place;
- a failure by the business to meet timeframes during the proposal development process; or
- where a business doesn’t produce strategies that have merit.
The last two points raise issues as to the business's commitment and capability.
While applications for enforceable undertakings are increasing in popularity, businesses should in the first instance be focused on reducing harm and building their safety management systems so that an incident is unlikely to occur in their workplace.
If a serious incident does occur, take care of the injured worker and his or her family. Cooperate with SafeWork through any investigation and take appropriate remedial steps to ensure the incident doesn’t happen again. These are some of the factors which will be taken into account when determining whether an enforceable undertaking is the appropriate enforcement outcome.
And lastly, if applying for an enforceable undertaking, don't just recycle other enforceable undertakings and focus on lasting changes that will increase awareness of the importance of safety in the workplace and will reduce the risk of harm in the future.