OHS Harmonisation - Private Equity Industry - April 2011With 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 to the Private Equity industry
One of the changes in the Workplace Health & Safety Act that businesses in the private equity industry should pay particular attention to is the new positive duty on “officers”. As most private equity businesses will appoint certain of their own employees to the board of the company that is being bought or invested in (Target Company), such persons will become “officers” of the Target Company and will therefore have an obligation to exercise due diligence to ensure that the Target Company is complying with its safety obligations. In addition, if the private equity business has employees that essentially act as shadow or de facto directors of the Target Company, these employees will also be considered to be “officers” of the Target Company. Accordingly, individuals within private equity businesses will be exposed to an increased risk becoming personally liable if they fail to exercise all due diligence in respect of safety in the Target Company.
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 and Codes of Practice
As private equity businesses invest in businesses in a number of different industries, private equity businesses will need to be aware of how the harmonised safety laws, particularly the draft Regulations and Codes of Practice, will impact on operations within those industries. We have addressed these issues within industry specific publications for the following industries:
- Agribusiness industry
- Commercial property industry
- Construction and infrastructure industries
- Energy & Resources industry
- Information technology industry
- Manufacturing and distribution industry
- Media and Entertainment industry
For further information about the new safety laws, please feel free to contact our office.