New WHS laws will require close cooperation between labour hire companies and cl...


The harmonised Work Health and Safety laws will have a greater impact on labour hire companies that any other industry, says employment law expert Charles Cameron.

Speaking at an RCSA breakfast in Sydney this morning Cameron, a policy advisor for the RCSA, said the model WHS Laws will have the most impact on industries where multiple duty-holders are present, such as labour hire.

The new laws, which will be introduced in January, have redefined the traditional employee-employer relationship. 'Employees' have been replaced by 'workers' (which can include anyone from an on-hire worker, to a sub-contractor to a more traditional employee) and 'employers' have been replaced by 'persons who conduct a business or undertaking', he said.

Cameron warned that this new definition eliminated the "blast wall" protecting host employers, labour hire firms and contractors from one another, so that if an OHS obligation violation occurs, all parties share responsibility.

"[The laws say] we're all one big happy family here. If you guys don't cooperate, you don't coordinate, you don't communicate, we're all going down together," he said.

"I believe that the on-hire sector, and especially those other industries that have multiple duty-holders (multiple employers and businesses all working in conjunction with one another) … [will] have more impact from these new laws than any other form of employment," he said.

Cameron said obligations for multiple duty-holder workplaces are much wider and complex within the new legislation and will require more cooperation and coordination between host employers, independent contractors and labour hire firms.

Compliance will be a competitive edge
Under the new system, Cameron said, clients would become aware that "if they don't provide or engage a good on-hire firm they will be importing risky people into their environment".

From a sales point of view, this could be an advantage. A company that built a reputation for being highly compliant with the laws would have a selling point over competitors whose OHS policies were not up to scratch, Cameron said.

Pressure to include "hold harmless" clauses will rise
Cameron warned that the new relationship between on-hire firms and host employers could see an increased use of "hold harmless" clauses (clauses in client contracts that require labour hire employers to bear the hosts' costs for breaches of OHS obligations).

While this wouldn't help host employers avoid prosecution, it would lessen their exposure to financial penalties, said Cameron.

Clients would begin pushing recruitment companies a lot harder to provide them with indemnification from liability, he said.

Preparation is crucial
Cameron recommended that recruitment and on-hire firms take a number of steps to prepare themselves for the new laws, including:
  • Conduct a 'workforce scope audit' to determine who is defined under the new laws as a member of your workforce;
  • Reflect the new definition of worker and client responsibility in your workers contracts;
  • Train recruiters on how to record information properly. Cameron said that while consultants could usually gather information themselves about potential OHS issues with a host employer, a person with appropriate OHS qualifications would need to assess this information, determine the risks and put in place control measures;
  • Establish protocols to ensure the client or host employer will undertake OHS duties - don't just rely on a contractual agreement;
  • Undertake a 'system gap analysis', comparing your current OHS management system with the new laws. This should then be tabled at a board meeting where, if needed, a new system should be adopted;
  • Determine who are 'officers' within your business, and who therefore can be held liable for prosecution under the new laws. Cameron said officers could be loosely defined as "directors of organisations and individuals who make, or participate in making, decisions which affect the whole or a substantial part of the business";
  • Educate officers on the need for them to exercise due diligence to ensure the company complies with the laws;
  • Educate clients about potential liability and obligations to on-hire workers; and
  • Discuss with clients their existing consultation provisions and establish compliant provisions if none are in place.