The model Work Health and Safety Act (the model Act) will commence in each jurisdiction in Australia from 1 January 2012. A key change to be made by the model Act will be to move away from reliance on the employment relationship as the determinant of who has duties and obligations and who is to be protected from risks to their health or safety.
The new primary duty holder will be a person conducting a business or undertaking (PCBU). The duties of an employer will be assumed by the PCBU.
But why was this approach chosen and who is a PCBU?
Why move away from titles and labels?
Employment has traditionally been the means by which people have been engaged to carry out work. That is no longer the case, with cascading contracting arrangements, labour hire, student placement and various other arrangements also being common. There are also people who provide their services as volunteers, often working alongside employees.
Placing duties on an employer for the health and safety of employees either leaves many unprotected, or requires complex and misunderstood deeming provisions (such as those in Victoria deeming contractors and their employees to be employees of the employer that engaged the contractor).
Often the issue is less about lack of coverage and more a perception by the duty holder that the obligations do not apply to them when in fact they do. Changing the terminology to be about being a person conducting a business or undertaking removes that perception. If you are engaged in business, the duty applies to you and it applies to anyone who may be affected by your business or undertaking.
Who is a PCBU?
A PCBU is a person conducting a business or undertaking. It is the legal entity conducting the business or undertaking and not the individual worker or officer. The concept applies whether or not the business or undertaking is for profit. It also applies whether or not the business or undertaking is conducted alone or jointly with others.
The concept of a business is easily understood and will cover an overwhelming majority of organisations. In essence, this is carrying out activities in an enterprise for reward. The term PCBU goes further, however to include an ‘undertaking’. This is to capture organisations who are involved in potentially complex and sophisticated activities in which people provide services to them, but do so on a ‘not for profit’ basis.
In the same way that a person should not be allowed to be exposed to risk at work merely because they are a volunteer, an organisation should not escape duties of care simply because they are charities, not for profit organisations or public sector organisations.
Each partner in a partnership is a PCBU.
It is the carrying out of work by one person for another, as part of an enterprise that is not purely social or domestic or recreational that will determine who owes and is owed a duty of care under the model Act.
Who is not a PCBU?
A volunteer association, comprised solely of volunteers who do not employ any person to do work, will not be a PCBU. A social club or minor football club may fit into that category, so long as they do not employ anyone. A charity or other community organisation that does employ anyone will not be excluded.
The model Act provides that the regulations may exclude a ‘person’ from being a PCBU. The draft regulations will exclude a strata title body corporate that is responsible for common areas used only for residential purposes, unless that body corporate engages any worker as an employee.
What is the duty of a PCBU
A PCBU must ensure, so far as is reasonably practicable, that the health and safety of other persons is not put at risk from work carried out as part of the conduct of the business or undertaking. That is, a person will be liable under the duty if they expose another person to risk to their health and safety and the risk arose from work carried out as part of the conduct of the business or undertaking of the person. T
his is an expansion of the traditional perception of work health and safety obligations. We say perception because for a long time the existing duties have been expanded by the Courts to apply to a range of situations which might be labelled public safety for example. There is no doubt that the new duty extends to those situations and more.
It is the activities that determine the duty – the label is just the start
Being a PCBU will not attract any health and safety duties unless the PCBU carries out activities that are identified in one of the duty provisions. A PCBU will owe a health and safety duty if, in the course of conducting the business or undertaking it:
- Engages or causes to be engaged (through sub-contracting) a worker to carry out work
- Directs or influences work carried out by a worker
- Has the management or control of the workplace in which work is done, or
- Designs, manufactures, imports, supplies, installs, commissions or constructs plant, or structures or substances for use as or at a workplace.
That is, the PCBU will attract a health and safety duty if it arranges for work to be done, directs or influences it, or contributes something for the work to be done.
The standard of conduct required of a PCBU is to do what is ‘reasonably practicable’
Each of the health and safety duties of a PCBU is qualified by the concept of doing what is reasonably practicable. This requires a PCBU to provide the highest level of protection that is reasonably able to be done in the circumstances, weighing up the gravity of the harm, its likelihood, the possible risk controls and (after all of that) considering the costs of the various control options.
Although some may be concerned at the potential for inappropriate application of duties to some community organisations, this qualifier applied to the circumstances, and the proper exercise of discretion by the regulator, should make unjust consequences unlikely.
The concept of PCBU has been adopted to clearly provide that those who carrying out work for another, in all but the most obviously solely domestic or recreational arrangements, are provided with protection by those who may affect their health or safety. Titles, labels and deeming provisions will no longer cloud the ‘cause and effect’ nature of health and safety duties. Organisations need to consider how this expanded duty affects them and to revise their health and safety management systems accordingly. Close collaboration between the people with responsibilities for quality, public safety, product safety, security and environment will be warranted in the new regulatory environment.