OHS Harmonisation - Energy & Resources Industry - April 2011

With the public consultation period drawing to a close, the harmonised safety laws across Australia are one step closer to becoming a reality. With only nine months to go until the new laws commence operation, it is important to assess the impact of the new laws and whether your business is in a position to comply.

Significant change for the energy and resources sector

One of the changes in the Workplace Health & Safety Act that businesses in the energy and resources sector should pay particular attention to is the new positive duty on “officers”. As a significant number of energy and resources businesses operate through a number of separate legal entities, the question will be the extent to which officers of a holding company will owe a duty of care of care in respect of related entities, and in particular the entity employing staff or the entity owning and responsible for maintaining plant and other assets.

This duty will arise directly if a board member of the holding company is also a director of the related entities. Of more concern though is whether the duty will arise in a context where the board members of the holding company are not directors of the related entities but are seen to be acting as shadow directors of the related entities. In that case, members of the board may be considered to be “officers” of the related entities and accordingly be exposed to becoming personally liable if they fail to exercise all due diligence in respect of safety in those entities.

The new Workplace Health & Safety Act will also introduce significant changes to the management of safety in Australia, including:

• Duty of Care - an expanded duty of care on all businesses and undertakings
• Consultation - a broader requirement to consult and co-ordinate on safety with workers, contractors and others affected by the business or undertaking
• Reputation – an approach to enforcement through greater use of adverse publicity orders
• Intervention at the business – greater avenues for intervention by unions and the regulator at your business
• Shift in attitude – by the regulators and courts in adopting a “uniform” approach to investigation and enforcement

We addressed these issues in more detail in the publication OH&S Harmonisation in November 2010. We also provided a User’s Guide to the practical aspects of the Workplace Health & Safety Act.

New Regulations

In addition to the major changes taking place as a result of the Workplace Health & Safety Act, the draft Regulations also will implement significant changes impacting the energy & resources sector. In general terms, some of the areas that businesses operating in the energy & resources sector will need to consider are the following:

• Abrasive blasting – Specific control measures are required including the use of a blasting cabinet or blasting chamber where reasonably practicable. Otherwise, workers must be protected by the use of engineering controls, administrative controls and personal protective equipment. Requirements in relation to ventilation, waste materials and washing facilities are also included and there are restrictions in the use of certain hazardous chemicals for abrasive blasting.
• Hazardous Chemicals – Pesticides, drugs and poisons may now require separate hazardous substance labelling under the Regulations. Further, hazardous chemicals will include articles, waste and hazard chemicals generated in the work place. Regulations impose requirements to identify hazards and control risks associated with the use of hazardous chemicals; labelling and safety data sheets; and notifying the regulator if quantities of dangerous goods at a particular site exceed specified threshold quantities.

Further, the Regulations deal with hazardous atmospheres to ensure exposure standards for substances are not exceeded. There are also changes to lead risk work and provisions relating to asbestos.

• Major hazard facilities – MHF’s are facilities that have hazardous chemicals in amounts that exceed specified threshold quantities. The Regulations provide for the registration or licensing of MHFs and for the duties of operators. The MHF businesses will need to be aware of the definition of a “major incident” as this will impact on the obligations of the operator.
• Confined Spaces – Changes to the Regulations to do with work that occurs in a “confined space” will need to be examined carefully. In particular, a change in the definition of “confined space” which is one which must have a restricted means of both entry and exit. There is a requirement for a business to identify all hazards and assess all risks to the health and safety of workers; review risk assessments and also ensure that the worker does not enter a confined space unless a confined space entry permit has been issued for the work.
• Falls – Regulations will now provide that a business must identify all fall hazards associated with the business and identify and control the risks of persons falling by adopting the hierarchy of controls. This hierarchy includes performing the work on the ground or a solid construction, the use of fall prevention devices and, ultimately, implementing administrative controls. If administrative control measures are the only control mechanism used then there must be a record as to why other measures are not being implemented.
• Mines – Mining Regulations have not yet been released for public comment. The expected Regulations will cover a core of common provisions including appointment of mine operators, risk control measures in mines, safety management systems, emergency management systems, emergency response plans and mine survey plans and records. Each jurisdiction may retain its own mine specific legislation.

New Codes of Practice

Businesses will also need to pay careful attention to the new codes of practice to be issued by Safe Work Australia including those relating to:

• hazardous manual tasks
• preparation of safety data sheets for hazardous chemicals
• general risk management (chemicals)
• storage and handling of dangerous goods
• abrasive blasting
• welding

For further information about the new safety laws, please feel free to contact our office.