The Reports from the Royal Commission into Pike River and a separate Health and Safety task force made it clear that New Zealand’s health and safety laws were not fit for purpose. The government’s response has been a complete overhaul of our health and safety framework.
On 29 October 2013, an “exposure draft bill” was released by the Ministry of Business, Innovation and Employment (“MBIE”). This bill has been out for consultation ever since, however, only half of the potential changes are known, because the “exposure draft bill” is being released in two tranches.
One of the most significant changes is the likely elevation of responsibilities imposed on directors and senior managers and an alteration of the focus towards risk-based assessments. Those in “governance roles” are going to be required to assume a positive “due diligence” duty.
This obligation is going to be on directors and “any other person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the business (for example, the chief executive or a chief financial officer)”.
“Due diligence” is going to require:
- Acquiring and keeping up to date knowledge of health and safety matters;
- Gaining an understanding of the risks and hazards associated with the conduct of the business;
- Ensuring the business has, and uses, appropriate resources and processes to eliminate or minimise risks to health and safety;
- Ensuring the business has appropriate resources and processes for responding to information regarding incidents, hazards and risks in a timely way; and
- Ensuring the business has, and implements, processes for complying with duties.
The governing principle of the changes is that workers should be given the “highest level of protection” against harm to their health, safety and welfare from hazards and risks arising from work as is “reasonably practicable”.
At present the current law requires the taking of “all practicable steps” to ensure the safety of employees while at work, and the elimination, isolation or minimisation of “hazards”. However whereas currently a director can only be liable for a HSE breach where the director has directed, authorised, acquiesced or participated in a breach, going forward a director will be required to be actively involved in ensuring HSE systems meet all requisite standards.
Allied to these changes is a five-fold increase in penalties. Penalties for the most serious of breaches could attract fines of up to $600,000 and/or imprisonment for five years for an individual and up to $3 million for a body corporate. Graduated levels of penalties for different types of offending is likely.
The new regulator, WorkSafe New Zealand, is up and running and is likely to be better resourced and staffed to monitor and prosecute. Rules for employee participation in their employer’s health and safety policies are likely to prove challenging for employers.
A private member’s bill is a proposed law put forward by an individual MP. These bills are not part of the Government’s planned legislation. A ballot is held to select which bills get to be debated.
A recent example of a private member’s bill which has made its way into employment law is Tau Henare’s Employment Relations (Workers’ Secret Ballot for Strikes) Amendment Bill, which now requires unions to hold secret ballots of all their members before going on strike.
Conversely, National MP Jami-Lee Ross’ Employment Relations (Continuity of Labour) Amendment Bill failed late last year to make it past the first reading. This Bill would have allowed employers an unlimited ability to hire people to do the work of striking or locked out employees. Consequently, the various limits that exist on when striking or locked out employees can be replaced, remain in place.
Most recently, National MP Paul Goldsmith has put forward the Employment Relations (Freedom of Contract for Higher Earners) Amendment Bill. This Bill would allow employers and employees to contract out of personal grievance law if the employee earns over $150,000. Inevitably this would have the effect that all those employees would have clauses in their employment agreements removing this right.
Various political parties, including Labour, have expressed tentative support for the Bill. The Bill has been put in the ballot but has not been drawn. Simon Bridges, the Minister of Labour, said that National supported the Bill but that it wanted to get advice on whether it should become a Government Bill.
The Bill has sparked some interesting debate. Some say the Bill will be useful and will prevent the sorts of golden handshakes often given to high paid employees. Others say we are all equal before the law and that there is no reason to treat higher earners differently.
Australia has a law automatically exempting employees who earn over A$129,000 from bringing a personal grievance.
It is an interesting issue, so watch this space.