WORK HEALTH AND SAFETY BILL

Second Reading

Adjourned debate on second reading.

(Continued from 3 April 2012.)

The Hon. J.A. DARLEY (15:32): I rise to speak on the Work Health and Safety Bill 2012. As members are aware, the bill provides for South Australia's participation in a nationally harmonised system of occupational health and safety, an issue which has been the subject of debate amongst successive governments across Australia for some 20 years.

The Work Health and Safety Bill, developed under the intergovernmental agreement for regulatory and operational reform in occupational health and safety, is part of an integrated package that also includes model regulations, model codes of practice and a national compliance and enforcement policy. Safe Work Australia is responsible for the development and evaluation of the bill while the commonwealth and individual states and territories are responsible for regulating and enforcing work health and safety laws in their jurisdictions.

The New South Wales government, which has consistently supported OH&S harmonisation, was the first state to introduce model legislation into their parliament. They, along with Queensland, the ACT and the Northern Territory, introduced the legislation with minor amendments that reflected the needs specific to those jurisdictions.

The legislation commenced operation in these states and the commonwealth on 1 January this year. In Tasmania, the commencement of the legislation has been delayed until January 2013. It is yet to be seen what the final outcome will be for Western Australia and Victoria. According to the Western Australian Commissioner for WorkSafe, the Western Australian government remains committed to the principle of harmonisation and continues to take steps to progress the implementation of the model work health and safety laws.

Whilst it is not intended that it will adopt the whole of the bill, it is likely that the Western Australian government will adopt the vast majority of the proposed model laws, save and except, perhaps, for provisions relating to union right of entry, stop-work orders by health and safety representatives and increased penalties.

The Victorian government initially indicated its in-principle support to harmonisation, subject to an assessment of the impact and benefits to Victoria. To that extent, the Victorian government initiated a Victoria-specific assessment of the legislation, which was undertaken by PricewaterhouseCoopers. At the same time, it also called on the commonwealth to defer the implementation of nationally harmonised occupational health and safety laws.

It is fair to say that the Victorian government remains dissatisfied with the model legislation, particularly as a result of the assessment undertaken by PricewaterhouseCoopers. A media release issued by the Victorian Premier, Ted Baillieu, on 12 April, states that the so-called reforms would take Victoria backwards and impact severely on the productivity of the state's small business, and I quote:

the proposed laws do not deliver on the intent of the COAG reform agreed to in 2008 which aimed to reduce the cost of regulation and enhance productivity and workforce mobility.

The media release goes on to state that it will cost Victoria $812 million to transition to the new model. Further, it would cost Victorian businesses $587 million a year to comply with the new legislation, with 78 per cent of those costs to be incurred by small single state employers. These figures are based on the assessment undertaken by PricewaterhouseCoopers on behalf of the Victorian government.

It is worth noting that the PricewaterhouseCoopers report has been criticised, particularly in relation to the accuracy of the information used to arrive at those figures. It has also been criticised for relying on research based, in part, on unconfirmed claims from small businesses. Indeed, the document disclaimer at the beginning of the report states that PricewaterhouseCoopers:

...have not sought any independent confirmation of the reliability, accuracy or completeness of this information. It should not be construed that PricewaterhouseCoopers has carried out any form of audit of the information that has been relied upon.

Further, the disclaimer goes on to provide that:

It is impossible to predict with complete accuracy the cost and benefits associated with the model work health and safety laws, but every effort has been made to use the most reasonable assumptions and methods for valuing the costs and benefits.

I raise this not because I necessarily agree with the views expressed, either by the Victorian government or its critics, but because this bill is intended to ensure national harmonisation. As such, it is important that we pay particular attention to all of the issues and concerns raised by our interstate counterparts.

In relation to industry, I note that the bill has the broad support of Business SA and the Australian Industry Group. The Australian Industry Group, in association with its affiliates, represents some 60,000 businesses in a broad range of sectors, including manufacturing, engineering, construction, automotive, food, transport, information technology, telecommunications, labour hire, printing, defence, mining equipment and supplies and airlines. Their submission on the bill outlines their strong support for this legislation, and I quote:

A single set of laws, replicated nationally, framed strongly and fairly, with underlying consistent enforcement protocols, is eminently preferable to the current situation, not only for those companies that operate or trade across jurisdictional boundaries, or in a national supply chain or market, but for any company.

Business SA initially raised a number of concerns in relation to the bill, all of which I understand have now been addressed by the government. Those concerns will be elaborated on shortly. The fact that these groups, which represent such a broad range of businesses across Australia, support the bill cannot be overlooked. It is indicative of the progress that has been made with respect to the issue of occupational health and safety national harmonisation.

That said, I understand there are those members of Business SA who are not entirely happy with the decision to support the bill without further amendment. There are also other groups that remain concerned about the model legislation in general. The Motor Trade Association, for instance, whilst committed to the principle of harmonisation, has indicated its dissatisfaction with a number of aspects of the bill. I understand that other groups with similar concerns include the self-insurers' association, the Council of Small Business of Australia, the Real Estate Institute, the Hardware Association, the nursery and garden industry association, and the Urban Development Institute.

Perhaps the most vocal opponents to the bill have been the Housing Industry Association and the Master Builders Association who have highlighted a number of industry specific concerns. I will address some of these concerns in the context of the bill itself. Turning now to the bill, and as alluded to earlier, its primary purpose is to protect persons from work related harm. To that end, the overriding principle of the bill is that workers and other persons should so far as is reasonably practical be given the highest level of protection against harm to their health, safety and welfare from hazards and risk arising from work.

In light of this, the concept of a single nationally consistent legislative regime for occupational health and safety makes sense. Among other things, it would streamline the practices of employees and ensure that workers across Australia benefit from the same and the highest level of protection in the workplace. It would ameliorate the complexities in complying with occupational health and safety obligations for those businesses that operate nationally and it would ensure the same levels of maximum penalties which currently differ considerably across jurisdictions.

The mere fact that there are more than 70 pieces of primary legislation relating to occupational health and safety across Australia demonstrates the need for national reform. According to the Productivity Commission's 'Performance Benchmarking of Australian Business Regulation' report, businesses operating Australia-wide currently have to be aware of some 3,392 pages of occupational health and safety regulations; 1,068 from primary legislation; and 2,324 from formal legislation. In addition, they face 282 codes of practice at the state and territory level. Not only does this create a tremendously complex task in terms of being on top of all the regulatory requirements across various jurisdictions, it is also an extremely costly exercise for businesses.

It is these very issues that a national approach to occupational health and safety attempts to overcome. Having said that, I acknowledge that such a scheme is not without its problems. Throughout this debate many concerns have been raised regarding some of the key provisions and concepts proposed by the bill. The most controversial provisions include the establishment of duties of care for individuals and organisations and the associated concept of a person conducting a business or undertaking, the issue of the control test, the removal of the right to remain silent, union right of entry and, lastly, increased penalties.

In relation to the first three matters, the bill establishes a primary duty to ensure, so far as is reasonably practical, the health and safety of workers. The duty to ensure the health and safety of a worker applies to any person who by virtue of their activities can influence the health and safety of workers and those in the workplace. This is achieved through the inclusion of the concept of a person conducting a business or undertaking (otherwise referred to as a PCBU). The definition of a PCBU is intended to reflect the broad range of modern work relationships and business structures and to remove the uncertainty that currently exists around the responsibilities of, for instance, principles on the one hand, and subcontractors and labour hire companies on the other. This is, of course, only one example of the sort of relationship captured by the definition. A worker is also defined broadly to take into account the broad scope of contemporary work relationships.

As already mentioned, a PCBU's duties are not without qualification. Firstly, each PCBU is only required to discharge their duty to the extent to which the person has the capacity to influence and control the situation in question. Secondly, a duty imposed on a person to ensure health and safety requires the person to eliminate or minimise the risk only so far as it is reasonably practicable to do so.

The bill also defines what is intended to be included when considering what is reasonably practicable. Those considerations include the likelihood of the hazard or risk occurring, the degree of harm that might result from the hazard or risk, what the person ought to have reasonably known about the hazard or risk and ways of eliminating and minimising the risk, the availability and sustainability of ways to eliminate or minimise the risk and, lastly, the costs associated with eliminating or minimising the risks, including whether those costs are grossly disproportionate to the risk itself. This is not an exhaustive list and other relevant matters may also be taken into account when assessing a particular situation.

The main point of contention in relation to these provisions centres on the issue of control. Again, it is fair to say that those groups most opposed to this particular issue are the HIA and the MBA. They argue that the duties imposed under the bill should be confined only to those individuals who exercise direct control in relation to a risk to health and safety. Any person who does not have direct control of a risk should not have responsibility for eliminating or minimising that risk.

In an effort to overcome these concerns, the government has indicated its willingness to insert an additional clause that further qualifies a PCBU's responsibility by providing that, if a person does not have direct control of a particular risk, the extent to which they must eliminate or minimise the risk depends on the extent to which they have the capacity to influence the matter. I understand this additional clause has the support of Business SA and the Ai Group. However, after several discussions with both the HIA and MBA, it would appear that they are still not satisfied with what is being proposed.

Another point of contention in the bill involves the removal of the right to remain silent. Clause 172 of the bill currently provides that the privilege against self-incrimination is abrogated. The practical effect of this is that a person is compelled to comply with the requirements of this provision, which include answering questions or providing information or documents, even if to do so would incriminate or expose the person to penalty.

In an effort to strike a balance between these two factors and, more specifically, the abrogation of a person's common law right, the bill further provides that any information provided by an individual is not admissible against them in any subsequent civil or criminal proceedings. As a matter of principle, I would not be willing to support such a provision; however, I understand the government is now willing to concede to delete this provision, particularly in response to representations made by Business SA.

A more contentious issue in the bill relates to union right of entry. Clauses 117 and 121 of the bill provide that a union official may enter a workplace for the purposes of inquiring into a suspected contravention that affects a worker or for the purposes of consulting on work health and safety matters. In the former case—that is, entry on the grounds of a suspected contravention—the union official need not provide prior notice. In the latter case, a minimum of 24 hours notice is required before entry.

The provisions, although not identical, are consistent with the current right of entry provisions that apply in relation to industrial relations matters by virtue of the commonwealth Fair Work Act 2009. According to the government and the unions, the move towards union right of entry on occupational health and safety grounds is a natural progression that would bring South Australia into line with other states.

Again, there has been a lot of conjecture around these provisions of the bill with the HIA and MBA being those most vehemently opposed to it. The MBA argue that their current system whereby all duty holders, including health and safety representatives, can request the assistance of the regulator is the most preferred option. Further, they argue that, although union right of entry is premised as a means of improving safety, in the case of construction sites this does not appear to be the case and such powers are often misused and abused by unions as an industrial tool which only serves to trivialise safety matters.

The MBA is concerned that work health and safety right of entry rules will further exacerbate this problem and only serve to expand the scope for misuse by union officials. Further, they argue that any suggestion that the entry permit system will provide adequate policing is nonsense as permits are rarely, if ever, restricted even in the case of the most flagrant breaches. Their ultimate position is that union right of entry should be scrapped altogether. Short of that, and at the very least, they argue that safeguards should be implemented to prevent a return to what they called the bad old days by modifying the union right of entry provisions regarding notice and stop-work orders consistent with the Fair Work Act.

Many of the same concerns have been raised by the HIA who argue that union officials are not safety experts and, as such, have no place in determining safety issues. They argue for the deletion of the whole of part 7 of the bill. I understand that many of the MBA and HIA's concerns will be addressed through amendments to be moved by the Liberal Party.

There are, of course, a number of safeguards proposed in the bill to deal with union officials who may abuse their privilege. For one, they have to be licensed and they must hold an equivalent permit under the Fair Work Act. They must also have completed relevant training and their permit may be subject to conditions imposed by the authority. Where the conditions of a permit are breached or a union official acts in an improper manner in the exercise of their role, their permit can also be suspended or revoked. Further, where a union official intentionally and unreasonably obstructs a person or disrupts a workplace or otherwise acts in an improper manner, they face a maximum penalty of $10,000.

As an aside issue, what I do find interesting is that the bill does go slightly further than the Fair Work Act in relation to union right of entry for suspected contraventions insofar as the Fair Work Act limits a union official's entry to sites where members of the union who perform work on the premises and whose industrial interests the organisation is entitled to represent are present. I am sure that in practice this is not difficult to overcome insofar as union officials can and probably do enter on different grounds but still investigate suspected breaches in cases where they do not have actual members at a site.

I understand the reason the bill goes slightly further is that by limiting the scope to members only it is easy for employers to identify which staff member contacted a union official. This only serves to create more angst on the part of employees who may become fearful of losing their jobs if it becomes known to their employer that they have contacted the union in relation to a worksite issue. I accept that this may very well be the case. I only make the point because I think that it is important to highlight the difference between this bill and the provisions of the Fair Work Act in relation to union right of entry.

My main issue in relation to union right of entry has less to do with union officials entering worksites themselves and more to do with the performance of SafeWork SA in relation to compliance and enforcement issues. As far as I am concerned, the role that unions play in terms of suspected safety contraventions is one that should rest fairly and squarely with SafeWork SA and, frankly, I struggle to see the point of any new legislation without a significant change in the culture and attitude of SafeWork SA.

You can have the best legislation, but unless it is backed by best practice and enforced effectively it becomes a pointless exercise. I accept that, in many instances, workers may feel more comfortable calling the union representative as opposed to SafeWork SA in relation to a safety breach, but what this demonstrates to me is that, for whatever reason, workers do not trust SafeWork SA. You may argue that they fear for their jobs and that it is therefore easier to contact a union representative as opposed to SafeWork SA. Again, I do not doubt this but contacting SafeWork SA can be done confidentially and, indeed, anonymously, so I think there is more to it than just the fear of losing jobs.

I also accept the argument that union right of entry provides a means of having more eyes and ears on the ground but, again, I come back to the point that we should not have to rely on union officials to do the job of SafeWork SA in relation to safety breaches. The tragic situation of the recent deaths related to the desalination plant springs to mind as a perfect example of SafeWork SA failing to adequately follow up and address concerns expressed by workers, which ultimately resulted, very tragically, in the death of not one, not two, but three workers.

We can argue all day about whether those were workplace accidents or not, and, as we know, in two instances they have been deemed not to be workplace accidents. However, I think that is irrelevant here. On several occasions I heard from more than one business and trade organisation that the conditions at the desal plant were an accident waiting to happen; that eventually someone would be killed. Certainly, what whistleblowers have claimed publicly is a culture of unsafe work practices and cutting corners in order to meet unrealistic deadlines.

The point is, if experts and businesses involved in the project were not only thinking it was an accident waiting to happen but talking about it, then why was SafeWork SA not there to prevent it? If there is one thing I have learnt through my dealings with the construction industry, it is that news travels fast. So how is it that everyone except for SafeWork SA, the body responsible for policing safety in the workplace, could know about a situation that ultimately ended in tragedy, even if you accept that there was only one work-related death?

If the issue is one of resourcing, then this is something that needs to be addressed by the government. Again, I see no point in introducing new laws if they are not accompanied by adequate resourcing in the areas that count, not just in areas that appear in government television advertisements or awards for good performance, but in expenditure for more inspectors on the ground at the coalface, ensuring accidents do not occur in the first place. Coincidentally, in response to a question asked only yesterday, the minister indicated that there were an overwhelming eight nominations for SafeWork SA awards.

We have also heard countless claims in relation to the inaccuracy of work-related injury statistics and the under-reporting of accidents, particularly with respect to the building industry. My question in relation to this is: what has SafeWork SA done about it? What measures have been taken to take into account that in some industries accidents go unreported? I mean measures relating not only to better statistics, but to better safety outcomes.

If SafeWork SA knows that a particular industry is not currently complying with the legislative requirements in terms of health and safety—and I am not pointing the finger at any particular industry—then how will new legislation improve this? If you are going to have good laws, you also need good policy and a well-designed and resourced organisation to implement these. In my view, none of these exist in this case. Moreover, there needs to be more of a focus on prevention rather than prosecution.

I foreshadow that I will be moving a number of amendments intended to provide further safeguards and overcome at least some of the concerns raised in relation to union right of entry. In addition to increasing penalties for breaches of permit conditions, I will propose that union representatives be required to notify SafeWork SA prior to entering a worksite and that SafeWork SA be required to establish and maintain a policy that relates to the extent to which their own inspectors will attend at workplaces when notified of the proposed entry of union permit holders.

I will also be proposing that the act be subject to a review three years after its commencement and that as part of that review an assessment of the effectiveness or otherwise of that policy be undertaken. Data relating to the extent to which SafeWork inspectors have attended workplaces will also need to be included in that report. I have discussed these amendments with various union representatives, and generally speaking they appear supportive of these measures.

In relation to penalties, the bill proposes a scheme with increased penalties and, in the worst case scenario, imprisonment. Again, the HIA and the MBA are opposed to any increase in penalties, arguing that the current range of fines is appropriate. As members are aware, currently the levels of maximum penalties vary consistently across jurisdictions. If we are to have nationally harmonised laws, I think the range of penalties is one area that should remain consistent across jurisdictions.

I note that the government has also indicated its willingness to delay the commencement of the legislation and apply a 12-month transitional provision for significantly new regulatory requirements that are contained in the model regulations in order to provide a reasonable period of adjustment for businesses. This move has also been welcomed by Business SA and other business organisations and will go some way towards alleviating their concerns regarding compliance.

Lastly, another aspect of the bill which has raised a great deal of concern, not only amongst businesses who will be directly impacted by it but also amongst many of us lawmakers, relates to increased red tape. Last month I travelled to Sydney to meet with various representatives from stakeholder groups, including unions, WorkCover (being the regulator of health and safety issues for New South Wales), and the building industry.

The purpose of my trip was to gain a better understanding of the practical effect of this legislation in a jurisdiction where it was operational. What I learned from my trip to Sydney was that there were mixed views in relation to the impact this legislation has had on that state. For instance, one prominent builder (who I will not refer to by name) indicated that in his opinion the legislation had contributed towards the stagnation of the housing industry in Sydney.

Coincidentally, and on the positive side, he also indicated that he was not concerned about union right of entry and, in fact, welcomed any health and safety representatives onto his site. This builder's main concern with the scheme was in relation to the Safe Work method statements and risk assessments which, in his opinion, required too many resources.

He was of the view that if these processes were simplified and centralised with clearer guidelines for businesses the system would work a lot more efficiently and at a more reasonable cost for businesses. He was also critical of WorkCover's lack of support towards businesses and claimed that the practice of referring them to private consultants in terms of ensuring compliance was only leading to further increased cost. Many of his concerns were echoed by other representatives of the building industry.

Overall, the impression I got from builders was one of too much red tape. WorkCover, on the other hand, seemed to think that the system was working okay and that there had been a change in attitude throughout the organisation since the change of government in that state. In the past few months, I have also put to the minister countless scenarios and asked for responses in relation to what the practical effects will be for South Australian businesses, whether they be small operators or large operators, when this legislation goes through.

I have tried to establish what an ordinary business will have to do in order to comply with this legislation, how that differs from what they do now and, importantly, whether this will result in overly cumbersome paperwork especially in the case of small businesses. The intention of this legislation is not to bog businesses down in paperwork: it is to improve workers' safety. Indeed, I think at least one of the overarching objectives of this legislation was to develop a scheme that ensured that the benefits and the new regulatory requirements were not outweighed by unreasonable increases in costs, whilst also ensuring that worker safety remained at the forefront.

This was certainly the point behind the Productivity Commission's benchmarking report referred to earlier. We often hear claims about the world as we know it coming to an end as a result of new and more complex legislation. More often than not and over time we see businesses adapt to change and continue to operate without too much of a problem; sometimes, however, I think we get it wrong and businesses are forced to cope under excessive pressure.

It is extremely important that we give due consideration to this issue during the committee stage debate and take whatever steps are necessary to ensure that businesses are not unduly impacted by this legislative package. If there is one thing that has become apparent to me after many long and protracted meetings with various groups from both sides of the fence, it is that a one-size-fits-all approach in this instance is proving difficult in terms of reaching agreement. Having said that, I remain hopeful that many of the concerns raised can be addressed through the committee stage of the debate and through regulation.

In closing, this is a very significant piece of legislation and it will have broad implications for South Australian businesses. It is therefore extremely important that we get it right and that we not try to rush the bill through without a thorough and robust debate. I have raised the concerns of industry groups such as MBA, the HIA, Business SA and the Ai Group because they have played a very proactive role in the development of this bill.

Since coming to this place my office has advocated for a number of families who have lost loved ones in workplace accidents. I have worked closely with Andrea Madeley, the founder of Voice of Industrial Death, a woman who is truly worthy of praise for all her hard work and for the priceless support that she has been able to provide to family members who have lost loved ones.

If you consider what Andrea has been through herself as a result of losing her own son in a workplace accident, you have to marvel at her ability not only to help others but also to continue to push for tougher compliance and enforcement of health and safety in the workplace. It is extremely important that we not lose sight of this during this debate. I also remain hopeful that we not lose sight of the purpose of this bill, that is, to protect workers from injury, something which I feel has at times been overlooked throughout the debate.

Debate adjourned on motion of Hon. J.M. Gazzola.