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Exercising Due Diligence when it comes to safety

Exercising Due Diligence for Work Health & Safety

As a business owner, company director or executive you have a legal duty to ensure a safe work environment for your people

The acts and regulations in the various jurisdictions require officers to exercise ‘due diligence’ and take ‘reasonable steps’ to ensure compliance. With the threat of criminal prosecution, hefty fines and even jail time in the event of a serious incident, understanding exactly what ‘due diligence’ means at a practical level is critical.

As workplace safety and risk management specialists, we work closely with companies in all sectors to help their officers fully understand their obligations. Often we find there is confusion around what constitutes ‘due diligence’ and what is required from officers. Ultimately, it comes down to actively identifying and monitoring safety hazards and ensuring appropriate control measures are implemented.

Your duty as an officer

The legislation requires officers to exercise ‘due diligence’ and take reasonable steps to ensure their organisation’s compliance with OHS requirements. These duties cannot be delegated. To fulfill these duties officers need to:
  • Have an up-to-date understanding and knowledge of the OHS requirements;

  • Understand the general hazards and risks associated with the organisation’s operations;

  • Ensure appropriate resources (both human and financial) are in place and used to eliminate and / or minimise risks;

  • Make sure that appropriate processes for receiving, reviewing and responding to information about incidents, hazards and risks are in place (and are actually utilised);

  • Ensure that the organisation implements and maintains processes for ensuring safety compliance such as: – Consultation – Training and instruction – Reporting of notifiable incidents.

Demonstrating due diligence

In order to demonstrate due diligence, officers must ensure that they:

​Understand the risks and hazards

Provide staff with adequate safety resources

Appropriately manage hazards, risks and incidents

​This involves:

  • A regular process of reviewing and identifying the hazards and risks which surround the core operational activities.

  • Continually reviewing and improving the organisation’s Safety Management System(s)

​Resources need to include:

  • Ensuring that there is a suitable safety infrastructure in place (e.g. a Safety Management System)

  • Providing staff with access to people with safety expertise – both internally and externally (including legal counsel and safety consultants)

  • In Victoria there is a specific duty to employ or engage people suitably qualified in OHS to advise officers on employee health and safety

​Officers are required to:

  • Actively monitor hazards and risks

  • Action and maintain documented processes for reporting safety hazards, incidents, completing investigations and reviewing controls

  • Ensure effective and timely reporting systems are in place

There are a variety of different steps officers can and should be taking to demonstrate that they are exercising due diligence and meeting their OHS responsibilities pursuant to the Act.

At a practical level, these will include:
  • Verbalising the organisation’s safety expectations and improvements to process, rather than just talking about ‘commitment to safety’.

  • Officers holding direct reports accountable and actively monitoring their performance when it comes to safety (making safety a part of their KPIs).

  • Demonstrating the organisation’s focus on safety through impactful and visible activities including leadership visits, safety inspections and walk throughs.

  • Understanding the risk profile of the organisation and how the risks are being controlled.

  • Seeking out regular reports and reviews as to the effectiveness of the organisation’s Safety Management System.

  • Actively encouraging people within the organisation to report incidents and hazards (creating a safety aware culture within the organisation).

  • Taking part in safety consultations and forums.

Consequences for officers not meeting their responsibilities

The penalties for officers not meeting their obligations are significant. They are not just based on the consequences of a safety breach (i.e. in a worst case scenario where someone is injured or killed) but also on the seriousness or gravity of the risk caused by the breach.

For instance, in Victoria under Industrial Manslaughter legislation, employers can face fines of up to $16.5 million for failing to meet their safety obligations. While individual officers face possible criminal prosecution, jail terms of up to 20 years and fines of up to $1.65 million can result if their actions or omissions:
  • Cause the death of an employee or member of the public;

  • Involve a breach of an OHS duty;

  • Are deemed negligent.

Good leaders recognise that their people are the most important assets of their business and provide their team with safe workplaces to ensure that they return home to their families healthy and safe after a day’s work.
At Risk Strategies we are about protecting people and powering business. We work with businesses across all sectors to help them ensure they comply with health and safety requirements and that the owners, directors and executives understand and meet their duties as officers.

If you or your team need help understanding your duties or reviewing your safety management systems, Risk Strategies is here to help.


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