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Due diligence for officers
How has ‘due diligence’ changed the law in WA?
If you are an officer, you will need to be proactive in making sure that the business is meeting its work, health and safety obligations.
Under the Occupational Safety and Health Act 1984, officers could be held personally liable if the company was found guilty of breaching their safety obligations and it was proved that the breach happened with the consent or was attributable to the negligence of an officer.
Now, there is a positive duty to meet due diligence requirements, regardless of whether there is a breach. This means you will need to have evidence to show you are meeting your obligations (e.g. if you are audited) and risk prosecution (personally) if you are unable to demonstrate due diligence.
Are you an officer?
WHS Act defines ‘officer’ to have almost the same meaning as it does in the Corporations Act 2001. This means you are an officer if (among other things):
- you are a director or secretary of your company; or
- you are making or participating in making decisions that affect the whole or a substantial part of the business; or
- you have the capacity to affect significantly the business’s financial standing;
- the directors of the company are accustomed to acting in accordance with your instructions or wishes;
- you are a trustee or a person administering an arrangement between a company and someone else.
What is due diligence?
If you are an officer of a person conducting a business or undertaking, you need to be aware that the new WHS Act provides that due diligence includes taking reasonable steps to:
- acquire and update your knowledge of health and safety matters; and
- understand the operations being carried out by the business and the associated risks and hazards; and
- ensure the business has, and uses, appropriate resources and processes to eliminate or minimise health and safety risks arising from the work being done; and
- ensure the business has appropriate processes in place to receive and respond promptly to information regarding incidents, hazards and risks; and
- ensure the business has, and uses, processes for complying with duties or obligations under the WHS Act.
You also need to ensure you can verify the provision and use of the resources and processes you have in place for complying with your due diligence obligations.
Read more information about the health and safety duty of an officer.
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