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Elevating the duty to ensure psychosocial safety: Consequences for non-compliance (Part 3)

18 April 2023

6 min read

#Workplace Relations & Safety

Published by:

Kelvin Lee

Elevating the duty to ensure psychosocial safety: Consequences for non-compliance (Part 3)

Earlier in this series, we shared an overview of the relevant codes of practice for managing psychosocial hazards in the workplace in different states and explored some practical considerations for businesses when identifying, assessing and controlling psychosocial risks.

In our final part of the series, we consider potential consequences businesses could face if they fail to comply with the relevant codes of practice aside from potential breaches and penalties under the Work Health and Safety Act 2011 (WHS Act).

The WHS Act

Whilst the WHS Act requires “persons conducting a business or undertaking” (PCBUs) to comply with an approved code of practice (OR manage hazards arising from their business in a way that is different to the code but at the same, or a higher, standard than the code), there is no direct breach or penalty for failing to comply.

However, as discussed in our second article here, the WHS Act provides that an approved code of practice is admissible in a proceeding as evidence of whether or not a duty or obligation under the WHS Act has been complied with. If there is a workplace incident that involves a psychosocial hazard, the code of practice can be used as evidence and the court may have regard to the code as evidence of what is known about the hazards and risks, risk assessment or risk controls for psychosocial hazards and rely on the code of practice to determine what is reasonably practicable in the circumstances.

What is reasonably practicable for a small business will be different to what is reasonably practicable for a national or multinational company. Therefore, employers should be careful not to compare their business and resources against another company that is significantly larger.

Other consequences

There are other consequences that could impact a business if they fail to comply with the relevant codes of practice. We look at three types of consequences below.

Regulatory investigations

Where workers feel like their employer is not taking action, workers can make a complaint about psychosocial hazards at work to their local workplace health and safety regulator, like Work Health and Safety Queensland (WHSQ). Even without an incident, an inspector can enter a place that is a workplace at any time, with or without the consent of the person with management or control of the workplace (see sections 163 to 165 of the WHS Act).

When an inspector enters a workplace, they may take several actions, which include, but are not limited to:

  • making inquiries at the workplace; and
  • inspect and examine anything, including a document, at the workplace.

Where an inspector reasonably believes that a person is contravening a provision of the WHS Act, which includes the requirement to comply with approved codes of practice, the inspector can take enforcement action against the PCBU. These may include:

  • issuing an improvement notice; and
  • issuing a prohibition notice.

In recent years, WHSQ has increased their enforcement actions following some criticism of its approach to hard compliance, a finding in the Best Practice Review of Workplace Health and Safety Queensland conducted in 2017. As such, businesses should take compliance seriously and pay attention to the wording of the relevant provision (described below), even if they believe failing to comply with the code is insufficient to warrant the issuing of a prohibition notice.

The WHS Act allows an inspector to issue a prohibition notice if they “reasonably believe” that an activity at a workplace poses or will pose a serious risk to the health and safety of a person “emanating from an immediate or imminent exposure to a hazard”. Such activities may include violence and aggression, bullying and/or harassment, including sexual harassment. Further, an inspector may give a direction prohibiting the carrying on of the activity, or the carrying on of the activity in a stated way, “until an inspector is satisfied” that the matters that give rise to the risk have been remedied.

Prohibition notices are significant and can severely impact businesses, especially where any alleged activity giving rise to the serious risk involves senior members of the business.

Union right of entry

If a union holds a WHS entry permit, one of its officials may enter a workplace for the purpose of inquiring into a suspected contravention of the WHS Act or the Electrical Safety Act 2002. The WHS entry permit holder must reasonably suspect that the contravention has occurred or is occurring before entering the workplace.

In cases where union members within the workforce make complaints or raise concerns with their union that the business is not complying with the Managing the risk of psychosocial hazards at work – Code of Practice, union officials will have cause to enter the workplace. This is significant in industries with a strong union presence, especially in circumstances where issues surrounding work environments and employment conditions are common psychosocial hazards.

Workers’ compensation claims

Workers’ compensation claims will not be new to most businesses. Traditionally, workers face particular challenges in claiming compensation where their claim involves an element of management action. This is because section 32(5) of the Workers’ Compensation and Rehabilitation Act (WCR Act) excludes claims for compensation for psychological injuries arising out of, or in the course of, reasonable management action. Where a worker has made complaints or raised concerns about psychosocial hazards in the workplace, if those are not addressed, it may lead to time off work and consequently a workers’ compensation claim.

There is no definition of what “reasonable management action” is so it is an objective test. There are also cases that have confirmed that “reasonable management action” does not need to be perfect and so there are many instances in which some conduct has been considered to be a “blemish” on an otherwise reasonable record of management action.

Where a workers’ compensation claim involves claiming unreasonable management action, businesses may be able to use documented control measures (for example, policies and procedures) to prove that the business has managed the worker in a reasonable way. Additionally, the control measures implemented may also be useful in disproving a workers’ expectation or perception of reasonable management action. It is therefore important for businesses to ensure any complaints and concerns raised by workers are documented clearly and references should be made to relevant control measures.

It is also important to note that in circumstances where it is traditionally hard for workers to prove that management action was not reasonable, there is scope for this landscape to change now that there is a positive duty to manage the risks associated with psychosocial hazards. How businesses respond to complaints about common psychosocial hazards, such as low control over work, unpredictable hours or high job demands, may now be relevant for any workers’ compensation claims.

Where documents exist that clearly show how the business intends to control the risks and a business fails to meet its own control measures, workers could potentially use this to prove that there was either no management action taken or it was unreasonable management action.

Final words

It is crucial for businesses to not overcomplicate or overcommit on their control measures, but to put in place reasonable, practical and achievable measures to address any complaints or concerns raised by workers.

We hope this series of articles can assist you in considering your business’ approach to compliance with the new code of practice for psychosocial hazards.

If you have any questions about the regulations and codes of practice in the different states, please get in touch with a member of our national Workplace Relations & Safety team below.

The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

Published by:

Kelvin Lee

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