Work health and safety legislation in every state and territory places obligations on consultants to do what is “reasonably practicable” to ensure that the buildings they design are safe. The sting in the tail of these obligations is the power of work health and safety regulators to prosecute designers for breach, seeking to impose fines and, in the very worst cases, imprisonment.

There was a lot of interest in this topic in 2012-2013 when most of Australia switched to “harmonised” work health and safety (“WHS”) law. Since then, it has gone quieter – but should we say that no news is good news just yet? Let’s take a quick look at where the last 10 years have left us.

How “harmonised” are we?

In the late 2000s, every jurisdiction in Australia committed to adopting the model Work Health and Safety Act that we call the “harmonised” law. Between 2012 and 2013, each jurisdiction adopted the harmonised law, except for Victoria and Western Australia. Victoria still shows no sign of joining the harmonised regime. Western Australia finally passed the harmonised law in 2020, but its main parts will remain inactive until Parliament sets a commencement date for the legislation.

Apart from those two jurisdictions, the rest of the country now has consistent WHS law based on the harmonised model. There are some variations between harmonised jurisdictions, such as maximum amounts of fines, but the specific design obligations in the next section are consistent across all of them.

What does the harmonised law require of consultants?

The main obligation specifically for designers is s22 of the relevant Work Health and Safety Act in each of the harmonised jurisdictions, which requires designers of a building or structure to “ensure so far as is reasonably practicable” that it is “designed to be without risk to … health and safety”. Designers must take into account the safety of persons who use the building (i.e. those who work in it, including cleaning and maintenance), who construct the building, who carry out reasonably foreseeable demolition, or who are even “in the vicinity” of it.

The harmonised law also created new reporting obligations for designers. One of these is to provide adequate information about the purpose for which the building was designed, any relevant calculations or testing, and any conditions necessary to use the building safely (s22(4)). Another is to provide a written report on design-related risks to the safety of persons who carry out construction work, limited to risks associated with the particular design (reg 295, Work Health and Safety Regulations).

The legislation does not provide any template for these reporting obligations. As a result, many designers have developed safety checklists, risk registers, or similar reports to fulfil both reporting obligations in one document.

All these obligations apply to businesses that design structures or plant used as, or at, a workplace. This would include architects, building designers, structural engineers and mechanical engineers among others. Non-designers have their own WHS obligations too, but these are outside the scope of this article.

Penalties vary between harmonised jurisdictions, and higher fines apply to companies than to individuals. In NSW, the maximum penalty for a regular breach by a company is over $600,000 and, for the most serious breaches that recklessly expose a person to risk of death or serious injury, that maximum goes up to over $3.8 million plus up to 5 years’ prison.

Design obligations in non-harmonised states

 In Western Australia, the relevant safe design provisions are quite similar to the harmonised provisions outlined above. In Victoria, s28 of the Occupational Health and Safety Act 2004 is simpler than the harmonised law, and requires designers only to “ensure, so far as is reasonably practicable” that the building is “designed to be safe and without risks to the health of persons using it as a workplace for a purpose for which it was designed”.

The good news – few prosecutions

The good news is that it appears there have been very few successful prosecutions of consultants for breaches of these safe design obligations, in the 10 years since the harmonised law commenced. This perhaps indicates that consultants are taking their safety obligations seriously and producing safe designs.

Examples of actions taken against consultants are rare, but they include:

• $250,000 fine for a structural engineer when a crane attached to raised grillage collapsed during construction due to incorrect load calculations.
• $190,000 and $250,000 fines respectively for the structural engineers who produced and certified drawings for excavation works for a retail/residential development where the excavation work collapsed during construction due to inadequate engineering supports.
• $8,000 fine for a geotechnical engineer for failing to take sufficient action after a collapse of rock fabric during excavation, which was followed 4 days later by a more serious collapse
• An enforcement notice against a designer for failing to note in their risk register the risk of precast hollowcore panels falling while they were being raised into position (but this notice was based on a unique WA regulation that will be rendered obsolete once WA sets a commencement date for the harmonised law)

One common factor in all these actions is the occurrence of a serious incident with potential to cause workplace deaths (and in the first case, the incident did cause very serious injuries to workers on the crane). This is where regulators focus their limited resources, and where designers would want to take the greatest care.

The bad news – prohibitions on insurance for fines

From the 2000s onwards, insurers responded to consultants’ concerns about the fines for safe design breaches by offering some insurance cover for them, sometimes under professional indemnity insurance (usually sub-limited to a fixed maximum e.g. $500,000) or for higher amounts under separate statutory liability policies.

However, safety regulators complained that access to insurance undermined the deterrent effect of fines.

The result is that new laws in NSW, Victoria and Western Australia now effectively prohibit insurers from providing cover for WHS fines and penalties. Other jurisdictions may introduce similar laws.

Despite these prohibitions on insurers covering fines, professional indemnity policies will generally cover civil claims arising out of WHS duties (e.g. compensation claims by an unhappy client or injured worker), and insurers may also be able to cover the costs of legal advice to defend a prosecution.

 What can I do?

Good design underpinned by good procedures is the best method of risk management, even more so since WHS fines are now uninsurable in three jurisdictions. Some important resources and records for all designers include:

• A formal policy that emphasises that your business understands and places importance on its safety obligations, including safe design. (Even if not a formal requirement of WHS legislation, your policy and procedure will affect safety regulators’ impression of your business.)
• A procedure and templates that support your staff to meet safe design obligations, including the s22(4) and reg 295 reporting obligations under the harmonised law.
• Records of research, directions and decisions around safety matters on each project. A risk register can be used to track the resolution of each safety issue, including noting down any residual risks that were not able to be resolved by design.

Government and some commercial clients will often demand some or all of these documents as a condition of working for them.

Resources

Taking a leading role in education, SafeWork Australia has many useful resources, and its Model Code of Practice: Safe Design of Structures (October 2018) contains practical examples of design-related safety risks. This Code of Practice has considerable weight in the harmonised states as evidence of required standards of practice, so it should form part of every designer’s library. Consultants should also check the guidance from the WHS regulator in each state and territory in which they work, as these are the regulators who conduct prosecutions. For example, WorkSafe Victoria’s Designing Safer Buildings and Structures (2005) provides guidance on Victorian design duties.

At informed by Planned Cover, we have two separate Practice Guides providing an overview of safe design obligations in harmonised and non-harmonised jurisdictions. These can be downloaded from our website with a Planned Cover login.

For practices with over 10 professional staff, safe design is one of the topics on which we can provide a free in-house seminar to help your team understand its obligations. This can also be a handy opportunity for senior staff to make the whole office aware of the business’s procedures and resources on safe design and another valuable risk management tool.

So far, it seems that safe design legislation has not led to a raft of prosecutions against designers. The challenge is to periodically review policies and procedures, and to educate the next generation of designers, so that we can keep it that way.

Wendy Poulton
Manager Risk Services

This article is only general advice in respect of risk management. It is not tailored to your individual needs or those of your business, nor is it intended to be relied upon as legal or insurance advice. For such assistance you should approach your legal and/or insurance advisors.