“Not just in the mind” – WHS covers risks to mental health

Ben Urry, Associate Director

The traditional understanding of work health and safety ("WHS") is predominantly centred on the risk of physical injuries. Most cases that are reported, and most of the news headlines, focus on physical injuries or fatalities in “high risk” industries such as transport, construction, agriculture and manufacturing. The problem with this focus is it neglects a significant aspect of WHS that is on the rise, namely risks to psychological health or “mental wellbeing”. 

Two recent developments in Western Australia and Victoria attempt to “balance” this focus:

  • In Western Australia the risk of suicide and its management in the workplace lead the Western Australian Department of Mines and Petroleum to release a Bulletin last month dealing with suicide awareness in the resources sector ("Bulletin"). The Bulletin provides guidance on risk factors and methods for dealing with the risk of suicide in the workplace.
  • In Victoria WorkSafe Vic, in conjunction with the Department of Health and Human Services, announced a $50 million initiative called “WorkHealth” that will be launched in early 2018. WorkHealth is an online portal that provides strategies and guidance to Victorian employers in relation to improving mental health in the workplace, including self-assessments and the ability to link with similar businesses online. A link to the portal can be found here.

What is the risk?

Statistics from both the WorkHealth Initiative and Bulletin highlight just how extensive mental health issues in the community are, and why businesses should make improving the mental health of their workers a priority:

  • Around 20% of Victorians experience mental health concerns.
  • Non-high risk industries are often more affected. For example, creative industry workers in Victoria suffer the highest levels of depression and twice the number of suicide attempts as the general population.
  • As set out in the Bulletin, ABS statistics for 2015 indicated that suicide was the 13th leading cause of death, resulting in the loss of 3,027 lives. It was the leading cause of death among the 15-44 year age group.
  • Past survey data reveals that each year approximately 370,000 Australians think about ending their lives, with 65,000 suicide attempts.

Risks to mental health in the workplace might include such things as:

  • Workplace bullying, harassment or discrimination;
  • Restructures and redundancies, especially if handled poorly and creating ongoing uncertainty regarding job security;
  • Performance management and discipline processes that are not structured or implemented appropriately;
  • Interpersonal conflict between colleagues that does not necessarily amount to bullying but may involve strong differences of opinion or criticisms of personal beliefs or habits;
  • Excessive hours leading to fatigue, as tiredness can reduce emotional strength and resilience; and
  • Return to work processes following injury. This includes being kept away from work unnecessarily as for some people keeping occupied assists with mental health.

Risk and hazard assessments should include an analysis of risks to worker mental health, and the actions that are required to eliminate or minimise these risks. 

Psychological risk specific example – suicide

In the Bulletin a range of warning signs were identified as possible red flags for suicide risks in the workplace. These factors can be used as a guide (as they are non-exhaustive) and woven into risk and hazards assessments:

  • “Being withdrawn and unable to relate to co-workers;
  • Talking about feeling isolated and lonely;
  • Expressing fears of failure, uselessness, helplessness, hopelessness or loss of self-esteem;
  • Impulsivity or aggression;
  • Dramatic changes in mood;
  • Fragmented sleep or obvious tiredness;
  • Dwelling on problems with seemingly no solutions;
  • Speaking about tidying up affairs;
  • Threatening to hurt or kill themselves;
  • Talking or writing about death, dying or suicide;
  • Expressing no reason for living or sense of purpose.”

Dealing with risk of work-related suicides

In order to eliminate or minimise the risk, the Bulletin suggests that businesses should contemplate implementing health/wellbeing policies, providing access to employee assistance programs or other counselling, restricting access to possible means of suicide such as medications, pesticides and chemicals, and implementing appropriate training programs that incorporate elements of suicide prevention (for example, in conjunction with bullying/harassment training).

Lifeline 131 114

Beyondblue 1300 224 636

MensLine 1300 789 978

When employees’ social media activities impact on their employer

Jessica Anderson, Graduate Associate 

Social media has enhanced the opportunity for everyone to voice their opinions on a diverse range of subjects. But an employer does have at its disposal mechanisms to counter the publishing of content on social media by their employees that may be detrimental to it, even where this occurs outside of work or does not directly involve work matters.

In 2013, Army Reservist Bernard Gaynor published insulting comments on social media about a transgender officer and the “threat” of Islam. He also made comments criticising the federal government and a number of Australian Defence Force (ADF) policies. When asked to remove his posts, he refused. He was subsequently dismissed pursuant to the ADF’s power under Defence Force (Personnel) Regulations 2002 (Cth), which enabled the ADF to take disciplinary action to maintain the high standards of discipline required.

In 2015, Gaynor challenged this decision, claiming that his comments were protected by the implied constitutional right of freedom of political communication. While he was initially successful in his claim, the Full Court of the Federal Court’s recent decision upheld the ADF’s right to sack Gaynor over his extreme social media comments. The regulation used by the ADF to dismiss Gaynor was found not to be designed to control freedom of communications, but rather was directed at the suitability of individuals to remain as officers of the ADF. The Court also ruled that in any event the implied freedom of political communication was only a limitation on the exercise of legislative power, and did not apply to all terminations resulting from inappropriate social media comments.

While most employers do not operate under these types of regulations, employers are able to act with respect to social media comments that affect their interests, just as the ADF could act to protect its interests.

As such, we have put together some reminders to help employers find the appropriate balance between allowing employees to express themselves through social media and maintaining the interests of the employer.

The employer’s interests

Employees must be guided by the interests of the employer. These interests may include reputation, appropriate standards of behaviour, as well as the proper way of dealing with clients.They are representatives of the organisation and should be made aware of their responsibilities to uphold the organisation’s reputation and business interests

Social media policies

As an employer, you can restrict how your employees use social media, to the extent that is necessary to protect the interests of your organisation. It is helpful to tailor your social media policy to fit the nature of the organisation. For example, what types of public interactions are necessary for the functioning of your business? Do you use social media to attract potential clients?

Policies help to ensure that employees are aware of their responsibilities in expressing views online and the consequences that may flow from their actions. Policies should make clear that social media should not be used for the purposes of inappropriate workplace behaviour, such as bullying or harassment. Gaynor should have known that his comments breached a number of policies, but he refused to take down his posts, which is where the difficulty started.

The tech tips that are sometimes forgotten

Content should be considered permanent and searchable, and content intended to be private may be re-broadcast. Make it known to employees that content they post on social media may be associated with their employer. Employees are often searchable on the organisation’s website, or perhaps the first two hits on google when typing in someone’s name could be their LinkedIn account or their Twitter account. Whether intentional or not, employees are readily linked with their employer.

Government Initiative for young job seekers

Erin Lynch, Associate Director

The Turnbull Government has introduced the Youth Jobs PaTH (Prepare –Trial- Hire) internship programs.

To participate in the program a person must:

  • be 17 to 24 years old;
  • have been on Jobactive, Transition to Work or Disability Employment Services for six months or more; and
  • be on income support payments.

Under the program, young job seekers will be given the opportunity to gain employment and to move off government income support. The three elements of the program are designed to achieve this outcome.

Prepare – employability skills training. In this stage young people will be provided with training for up to six weeks in basic employability skills including teamwork, communication, personal presentation and interview skills.

Trial – internship placements. The “Trial” element of the program, will allow eligible young job seekers the opportunity to participate in an internship ranging from four to twelve weeks. The participants will attend a business for between 15 and 25 hours each week. During this period the job seekers will not be an employee of the business and any payment received is not considered remuneration. To encourage young job seekers and business alike to participate in the program, participants will be paid a fortnightly incentive payment of approximately $200 per fortnight and, under a Bill that is currently before the Senate, this will be paid in addition to government social security benefits. Businesses who take part will receive a payment of $1,000 to help cover the costs of hosting an intern.

Hire – “youth bonus” wage subsidies. Businesses will be eligible to receive a Youth Bonus wage subsidy of up to $10,000 if they employ a young job seeker under the age of 25 who has been in employment services for at least six months.In addition, young job seekers will be able to have their social security payments restored (without having to make a new claim or serve a waiting period) if they lose their job with a youth wage subsidy employer through no fault of their own within a prescribed time frame.

Labor, the Greens and the ACTU have not supported the program, arguing amongst other things, that the program “poses a serious risk to young people and inexperienced workers, and could also undermine Australia’s entire wage system with interns earning only $4 an hour – potentially dragging down pay and conditions for all workers”.

Will it work?

It is well known that young people struggle to gain employment. This appears to come about through a combination of inexperience and lack of applicable skills and on its face the Youth Jobs PaTH program has been developed to address some of those deficiencies, particularly with the Prepare and Trial elements of the program.

The Parliamentary Library’s Bills Digest suggests that “to the extent that it is closely regulated, participants are furnished with relevant training and labour market experience, and there is at least some prospect of employment as a result of the program participation, then it might reasonably be argued that the program is less exploitative than existing work experience and Work for the Dole arrangements for young people on income support”.

As with all work for the dole schemes, the challenge is to provide genuine work experience and to have the right incentives in place to encourage employers to offer these opportunities and for young people to see it as a chance to develop their employability skills and to show a prospective employer what they can do. Oversight of the scheme to avoid exploitation is also a factor.

Ultimately, the new initiative is designed to enable employers to help young job seekers develop the skills, values and behaviours expected in the workplace and make available genuine work experience for willing job seekers.

Sign on the pixelated line… e-Mployment contracts in the digital age

David Weiler, Associate

The way individuals, corporations and governments are signing documents is rapidly changing. In the current commercial context, communications are almost entirely undertaken in an electronic form. The challenge for businesses is to ensure that documents are executed in a way that is legally binding, despite the fact that there may not be a hard copy of the document created or returned to them.

A natural extension of these commercial practices is for employers to allow employees to sign their employment contracts using electronic signatures. The question from a compliance point of view is whether this impacts on the binding nature of the employment contracts and the enforcement of obligations contained in these contracts, such as restraints and extended notice periods.

When considering the appropriateness of e-signatures, it is useful to remind ourselves that even the President of the United States can satisfy the Constitutional requirement that he or she must “sign” a bill of Congress to turn the document into law by directing a subordinate to affix the President’s signature using an auto-pen, when he or she unable to be in the same location as the document1

Types of e-signatures

e-signatures fall into two principal categories:2

Electronic Signatures – this is simply an electronic symbol or process used to signify the execution, or acceptance of the terms, of an agreement. This type of e-signature might be a scanned signature or other form of electronic sign-off, or an email confirming acceptance of a document.

Digital Signatures – this term describes a method that uses an encrypted digital certificate to authenticate the identity of the signatory. In contrast to an electronic signature, a digital signature is linked to certain identifying information and provides for greater certainty and security around the circumstances of the e-signature.

The legislative regime

In Australia, the legislative framework makes it clear what requirements are relevant when considering the use of e-signatures. Commonwealth and State/Territory governments have in place legislation designed to provide certainty around electronic transactions in the form of uniform laws, referred to as the Electronic Transactions Act 1999 (“Act”).

The uniform laws provide that where a law (either at the Federal or State/Territory level) requires a handwritten signature, this requirement can be satisfied electronically, (unless the regulations specifically exclude the Act from operating in respect of certain circumstances). For the purpose of the Act, an electronic signature will have the same weight as a handwritten signature, and therefore a digital signature is not necessary. However, there may be circumstances where a business will choose to use a digital signature instead of an electronic signature for greater certainty surrounding the authenticity of a particular transaction.

The requirements for a valid e-signature under these laws are threefold, with each one serving its own purpose. The important take away from these requirements is the idea of capturing a person’s intention to be bound by a particular transaction or to undertake certain obligations.

Identification and intent

The overarching and leading determination of the validity of an e-signature under the Act is that it must use a method for identifying the person as well as indicating that person’s intention with in respect to the information communicated.

For example, a person’s email signature that sets out their contact information can be helpful as part of the method of identifying the person, but it is not helpful in indicating that person’s intention in relation to a particular transaction (such as accepting an employment contract). Instead, there would need to be an acknowledgement from the sender that they are accepting the terms of the agreement, for example, in the body of the email. Another way of confirming a person’s intention is requiring that person to take steps to tick a box electronically in order to accept the terms or indicate their agreement.

Reliability

The method used to communicate the signature must be appropriately reliable for the purpose for which the electronic communication was generated or communicated. This is viewed in light of all the relevant circumstances, including any indication by the parties themselves as to what is acceptable. For example, if an employment contract provides that an e-signature can be used, this would indicate the parties have deemed it to be reliable in the circumstances.

Consent

The final requirement under the Act is that the party receiving it (unless they are a government entity or official) must have consented to the method used to convey the e-signature. If a party requires a signature in a specific way (e.g. a signed original) then the provisions in the Act would be insufficient to establish the validity of the purported e-signature. This final point is crucial with respect to the broader use of e-signatures in relation to employment contracts.

Contractual relations

Given that e-signatures are permitted by law, the question then is whether there are any relevant constraints on using them in the context of employment contracts.

The employment relationship is one that lends itself to using e-signatures for a number of reasons, including:

  • the preference to store documents electronically rather than using hard copies for contracts and policies;
  • for the purpose of training and policy implementation, e-signatures give employers the ability to time-stamp and record when
    an employee has read and accepted a policy document; and
  • drawing employees’ attention to specific and important obligations in the employment relationship, such as a behaviour policy.

Some businesses are now shifting away from hard-copy “wet signatures”, however in doing so there are some aspects to which employers should pay particular attention. For example, where a term of a contract (such as a non-solicit/non-compete restraint) is particularly onerous, it may be helpful for an employer seeking to enforce such a clause that it had drawn the employee’s attention to the particular provision, possibly with a specific acknowledgment of the term. If the terms of an employment contract are contained separately from where an employee accepts the terms electronically, this may also increase the likelihood of the terms of the agreement being challenged. Having an integrated process where the terms of the contract and any relevant polices are accessed prior to any electronic acceptance of the terms will minimise this risk.

Key Takeaways

  1. Have a robust system which is capable of identifying the signatory.
  2. Always draw the terms and conditions of employment to the attention of employees prior to signing.
  3. Ensure that the storage of employment contracts is capable of providing for both e-signatures as well as wet signatures in the event e-signatures cannot be used by the employee.

1 Mark Knoller, Obama uses autopen, again, to sign bill into law, CBS News

Global Guide to Electronic Signature Law

Transgender: a new frontier in workplace diversity

Michael Starkey, Associate

When it comes to the new frontier of workplace diversity, few issues stand out as prominently as the rights of transgender individuals, and the associated practical and cultural challenges for employers in ensuring that those individuals are supported in, and given every opportunity to contribute to, their workplace without risk of harassment, discrimination or victimisation. The need for employers to face up to those challenges was recently highlighted by The Report of the 2015 U.S. Transgender Survey, the largest survey of transgender people ever conducted, involving almost 28,000 individuals, and released in December 2016. It reported that, “in the year prior to completing the survey, 30 per cent of respondents who had a job reported being fired, denied a promotion, or experiencing some other form of mistreatment in the workplace due to their gender identity or expression, such as being verbally harassed or physically or sexually assaulted at work”. This article will explore the ways in which transgender rights at work are evolving (albeit unevenly across the globe), the challenges for employers when it comes to transgender issues, and how employers can capitalise on those challenges in order to create workplace cultures in which diversity and its benefits are embraced.

Evolving legal rights

It is in the realm of anti-discrimination law that the rights of transgender individuals at work are most rapidly evolving. However, the nature and extent of legal protections for transgender individuals in employment varies significantly across the globe.

A global snapshot

Australia

At the federal level in Australia, discrimination by employers specifically on the basis of an individual’s gender identity has been unlawful since 2013. All Australian States and Territories, with the exception of the Northern Territory, also explicitly make unlawful discrimination on the basis of gender identity, and in some of these jurisdictions these protections have been in place for some time.

Under federal legislation, employers have a responsibility to take all reasonable steps to prevent such discrimination (which may include harassment or victimisation) in the workplace and may be found vicariously liable for discrimination engaged in by their employees, unless they have taken all such steps. In effect, to avoid liability, Australian employers should have policies on transgender discrimination and harassment, thoroughly implement and train their employees in respect of these policies, and react swiftly to investigate any alleged discrimination or harassment.

On the topical issue of the use of toilets and other facilities, Australian anti-discrimination laws require employers to support transgender employees to use the toilets of the gender with which they identify, and employers run the risk of a discrimination claim by denying transgender employees access to appropriate toilets and facilities. Individuals who believe they have been discriminated against on the basis of their gender identity may complain to the Australian Human Rights Commission (or an equivalent State or Territory agency) in respect of that discrimination, and have the potential to be awarded compensatory damages in the event that such a complaint is ultimately successful in court. The treatment that an individual receives at work may also be the subject of proceedings under national labour laws if that treatment amounts to an unfair dismissal or a form of adverse action.

The United States

In the United States, there is no federal law which explicitly prohibits discrimination on the basis of gender identity. However, federal courts have held that discrimination on the basis of a person being transgender can constitute unlawful discrimination on the basis of sex. A number of States also have laws that prevent discrimination on the basis of gender identity.
However, in certain other States, transgender rights continue to be limited. Perhaps the most high profile situation in 2016 was with respect to North Carolina, where a law was passed to (among other things) prevent transgender people who have not taken surgical and legal steps to change their gender from using public restrooms of the gender with which they identify. While the law does not extend to private companies (which are able to continue to develop their own policies in respect of transgender rights in the workplace), the North Carolina situation highlights a greater degree of uncertainty surrounding transgender rights in the United States than in places such as Australia (particularly given the often robust relationship between State and Federal legislatures in the United States).

China

In China, there is no specific law or regulation that protects employees against discrimination on the basis of their gender identity.
In 2016, transgender rights in employment were placed under the spotlight in China after a transgender male brought a case before an arbitration panel against his employer on the basis that his employment was terminated on the basis of his gender identity. The complainant produced evidence of a sound recording in which he was told by his manager that wearing male clothing in the workplace would damage his employer’s image, and alleged that he was dismissed on this basis.
The arbitration panel rejected this evidence, holding that the conversation did not represent the employer’s intent because the manager did not work for the company’s personnel department, and accepting that the employer’s reason for dismissal was that the employee did not have the required skills for the job.

Transgender discrimination: what does it look like?

Whether unlawful or not, discrimination against transgender individuals may take many forms, including, but not limited to:
(a) refusing employment, promotion or training opportunities to a transgender employee because of their gender identity;
(b) refusing to work with, ignoring, bullying, harassing or ostracising transgender employees;
(c) refusing to share toilets and other facilities with transgender employees;
(d) invasive, inappropriate questioning about a person’s physical characteristics or their sex life; and
(e) refusing to use the transgender employee’s preferred name or refer to them by the gender with which they identify.
The challenge for employers in eliminating these forms of discrimination is addressing the underlying factors that perpetuate such practices, such as ignorance, lack of understanding, and prejudice.

Challenges for employers

The law is not the limit

In addressing transgender issues, employers should aspire to adopt best practice strategies rather than be guided by the minimum standards set by the law in their jurisdiction. Employers should adopt the mindset that, as well as being a benefit in itself, workplace diversity produces other tangible benefits for businesses in terms of boosting morale, inclusion, motivation, and creativity, and consequently has a positive impact on productivity and innovation.

Understanding the term “transgender”

One challenge confronting employers is the number of ways in which being transgender can be described. One of the broadest and most inclusive definitions being used is that a transgender person is a person whose gender identity is different to the physical sex they were assigned at birth. While legal definitions of what is encompassed by the term “transgender” may vary from jurisdiction to jurisdiction, in terms of best practice, employers should consider viewing transgender issues at work through a broad lens in order to avoid marginalising those who may identify as transgender despite not qualifying in terms of a legally defined threshold.

Challenging unconscious bias

While it is clear that employers need to take appropriate steps to counsel employees who overtly exhibit prejudice against transgender individuals, employers also need to be aware of and respond to unconscious bias that may exist within their organisations and affect their workplace practices in order to ensure that discrimination against transgender employees does not occur.

Recruiters and people managers should be trained on the nature of unconscious bias (that is, that they may make decisions based on judgments they are unaware of and that are influenced by their background and personal experience) and encouraged to question the reasons for which decisions are made with respect to certain employees or prospective employees. All employment related decision making should be based not on a personal attribute such as gender identity, but on the basis of an individual’s merits. In addition, how “merit” is constructed needs to be examined to ensure that this is not affected by preconceived ideas about what capabilities an individual might bring to the job or whether they will be a good “cultural fit” for a workplace.

Gender identifiers and other terminology

As transgender protections are still evolving globally, there are a number of questions that are yet to be answered about how far the protections afforded by the law extend. For example, in Australia, while it is clear that the tangible detriments outlined above constitute unlawful discrimination, it is less clear what employers are required to do with respect to a variety of administrative matters relating to the employment of transgender employees.

For example, it is not entirely clear whether a person who identifies as transgender, but may not have any official documentation from relevant government agency to confirm this, can insist that their employment records be changed to reflect the gender they identify with rather than the physical sex they were assigned at birth.

In terms of creating a culture which embraces transgender individuals, it is important that employers refer to transgender employees (both in the workplace and in official records, wherever possible) using their preferred name and preferred gender pronouns, and that they require (through policies) that their employees do the same. It is also important that the transgender individual is consulted about which name and pronoun they wish to be used and, for individuals who are transitioning, if and when they would like any change to commence.

Developing meaningful policies

While informing employees through policies that discrimination against transgender individuals is unacceptable workplace behaviour (and unlawful, if that is the case) is important, transgender policies should be as much about fostering inclusivity and support for transgender individuals in the workplace as they are about setting appropriate guidelines for behaviour.
For example, best practice policies often include provisions which make employees aware that their employer will work with them to develop a transition plan if this is desired, and include information about what a transition plan might involve (for example, in respect of communications with other employees about the transitioning employee’s gender identity and decision to transition).

Dealing with potential hostility

Employers also need to be prepared to work with the fact that other employees may express some hostility or animosity towards a transgender individual at work. While acknowledging that some employees might find the situation confronting, ultimately employers need to convey a clear message that inclusion and non-discrimination is the required standard of behaviour of all employees.

Implementing best practice

It is clear that there are a number of challenges facing employers as they work to support transgender individuals at work. By giving consideration to the issues below, employers can best position themselves to embrace these challenges through building workplace cultures that foster respect for diversity in all its forms.

  • Does the business have the right framework in place in terms of policies and procedures, including regarding the disclosure by employees of personal information of a highly sensitive nature?
  • Do any administrative changes need to be made in order to reflect a transgender employee’s preferred gender? For example, to existing employment records or recruitment forms (including by giving employees the option to not specify their gender), and in respect of how the employee is to be referred in terms of name and pronouns.
  • Does any training need to be undertaken (for example, on unconscious bias) to ensure that there is strong leadership in terms of transgender issues?
  • Does the business need to make any changes to ensure that the overall culture of the workplace conveys the support that exists for transgender individuals, including those who may not have yet communicated that they are transgender?

Ultimately, employers need to be aware that the legal landscape globally is evolving, and that some jurisdictions require a proactive response on the part of employers to transgender rights at work. While other jurisdictions may lag behind, there are clear benefits from an inclusive approach to diversity which extends to transgender issues. Positive messaging about and effective implementation of an organisation’s diversity and inclusion strategies can not only boost productivity by creating workplaces in which people of all backgrounds are given the support they need to contribute fully, but can also enhance an organisation’s brand in the marketplace. If the history of movements for diversity tells us anything, it is that employers should get on board now, or risk falling behind the pack.

WHS incidents in the workplace: reducing the fallout

Ben Urry, Associate Director

Even where an organisation has implemented “best practice” procedures and training with respect to work health and safety (“WHS”), things can and do go wrong. Where a WHS incident occurs, the important thing for an organisation is how it responds to the incident. Responding in an appropriate and timely fashion can make a significant difference to the level of liability and exposure for an organisation as well as for individual workers, managers and officers who may be involved in the incident.

A common complaint raised by organisations with respect to WHS is that it is “too hard”, “too complex” or “too expensive” to comply. While a proactive and preventive approach (including policies, procedures and training) is the best way to reduce the overall risks to WHS, in the event that an incident occurs, an organisation needs a strategy to frame how it will react. A thorough understanding of the parameters of the obligation to notify a health and safety regulator (“Regulator”), when it may be necessary to seek legal advice, and the rights and obligations of duty holders and the Regulator, can make a considerable impact on the outcome.

Uncertainty over incident management: statistically speaking

In a report published by SafeWork Australia in August 2016 titled “Perceived Levels of Management Safety Empowerment and Justice Among Australian Employers”, small to large businesses were surveyed as to how well they believed they managed WHS. These statistics reveal that, especially among small businesses (which make up over 90% of all Australian businesses), incident management and reporting still has a long way to go. By way of example:

  • 45% of small businesses (having less than 19 employees) do not collect accurate information from incident investigations;
  • approximately 32% of small businesses look for someone to blame rather than the underlying causes when investigating an incident;
  • businesses with young workers tended to be more safety conscious than other businesses; and
  • 10% of businesses in the manufacturing, transport, postal and warehousing industries indicated that fear of negative consequences discourages workers reporting incidents.

It is crucial for businesses of all sizes to understand the basics of incident management.

What is notifiable?

So what if someone is injured or falls ill? Should you be informing the Regulator each time someone gets a paper cut or only where there is a fatality? How soon should you tell the Regulator? Given that the Regulator is often the authority that can bring WHS prosecutions against organisations and individuals, care should be taken in meeting your notification obligations. In jurisdictions which have adopted the model WHS laws (being all States and Territories other than Victoria and Western Australia), it is a requirement that the Regulator be notified immediately if it constitutes a “notifiable incident”. But what does this mean exactly? A “notifiable” incident is defined to include a death, serious illness/injury or dangerous incident.1

A serious illness/injury includes:

  • immediate treatment as an in-patient in hospital;
  • immediate treatment for:
    • amputation;
    • serious head/eye injury, burn or lacerations;
    • separation of skin from underlying tissue (e.g. scalping or degloving);
    • spinal injury;
    • loss of a bodily function;
  • medical treatment within 48 hours of exposure to a substance; and
  • anything prescribed by the Regulations (for example, in NSW this includes such things as infections associated with blood- borne illnesses and occupational zoonoses such as Q-fever or Hendra Virus).2

 

A dangerous incident includes:

  • an uncontrolled:
    • escape, spillage or leakage of a substance;
    • implosion, explosion or fire;
    • escape of gas, steam or a pressurised substance;
  • electric shock;
  • fall or release from height of any plant, substance or thing;
  • collapse, overturning, failure or malfunction of, or damage to, any plant that is required to be authorised for use under the Regulations;
  • collapse or partial collapse of a structure;
  • collapse or failure of an excavation or of any shoring supports;
  • inrush of water, mud or gas in workings, in an underground excavation or tunnel; and
  • interruption of the main system of ventilation in an underground excavation or tunnel.

While the above definitions appear comprehensive, it can be difficult at times for organisations to determine whether a particular incident falls into one of those categories. For example, if a worker suffers a serious strain or sprain to their foot after colliding with a forklift and is treated at hospital on the same day in an emergency department, does this require notification? The standard reaction of most organisations would be “yes as hospital treatment was involved”, but it is possible to be treated in hospital as an outpatient and not an inpatient. Outpatient treatment for such an injury is not subject to the requirement to notify. Where in doubt external legal advice should be sought as soon as possible to ensure appropriate compliance with the notification requirement.

When an incident occurs, regardless of whether it is notifiable or not, an organisation should conduct an investigation (formal or informal) to determine how to rectify the situation, if at all possible, to avoid further risks to health and safety.

Internal investigations and privilege

Incident investigation is not simply a matter of nominating a person within the organisation to conduct the investigation. Rushing off and investigating a matter without taking time to plan and develop a strategy can increase exposure to liability, especially in circumstances where the incident may be one which could lead to an investigation or prosecution by a Regulator.

One of the biggest issues we see with organisations in this position is failure to consider whether privilege applies.

Legal professional privilege (now referred to as client legal privilege) provides protection for confidential communications between a lawyer and their client where these might otherwise be required to be produced in court or similar proceedings. The key to such privilege is that the dominant purpose of the communication must be for obtaining legal advice or preparing and/or conducting litigation. Speaking to your external legal advisors as soon as possible after an incident occurs and before speaking to the Regulator can assist in determining whether a formal approach covered by privilege is warranted. Importantly, care should be taken when relying on in-house counsel, as the fact that these individuals “wear two hats”, being a commercial and legal one, may result in the privilege being waived.3

A common mistake many organisations make is partially or even fully completing their investigation before speaking to their external legal advisors. An investigation report can contain findings about what the organisation has done wrong and may attribute responsibility for certain failings within the organisation, giving the Regulator a useful outline of possible breaches for its investigation and/or prosecution. As a matter of best practice we recommend taking the time to make contact with your external legal advisors before investigating or notifying the Regulator.

Regulator response: know your rights, but also know theirs

So either through notification or through other means (for example, reporting by a workers’ compensation insurer), the Regulator becomes aware of issues within your organisation. Now what?

The two main functions of the Regulator are to monitor and enforce compliance with WHS legislation and to provide advice and information on WHS to duty holders and the community generally.


The powers of WHS Inspectors are broad and far-reaching. These powers include, without limitation, the ability to:4

  • inspect, examine and make inquiries at the workplace; and
  • bring their own equipment, take measurements, conduct tests and make sketches or recordings (e.g. film, audio, photographs). 

More specifically, upon entering a workplace Inspectors can require a person to:

  • provide details on the whereabouts of a document;
  • produce the document if they have access or control of it; and
  • answer questions put by the Inspector.

Importantly, at least in “harmonised” jurisdictions there are provisions dealing with self-incrimination. Typically, in ordinary criminal matters an individual is not compelled to answer any questions or provide information which may tend to incriminate him or her. Such protection does not apply in WHS matters (other than in South Australia) as individuals are compelled to answer, subject to privilege. At no stage, absent a Court order, should privileged materials be shown or otherwise provided to an Inspector.

The trade-off for the loss of this right is, although a person must provide non-privileged incriminating evidence if asked, such evidence cannot be used against that person in criminal or civil proceedings (unless the evidence provided is misleading or fraudulent). “The catch?” The protection only applies where the information is provided to an Inspector when he or she is exercising their powers under legislation, and not where the information is provided voluntarily.

While cooperating with the Regulator as much as possible is the correct basis for approaching incident management, this cooperation should occur in a context where the Regulator complies with its obligations at law, including allowing legal representation and providing a statutory caution before requiring answers to be provided. This caution should refer to the provisions regarding self-incrimination and the protection afforded by client legal privilege. If the caution is not provided, or individuals are uncertain about whether it is necessary, there is no restriction on seeking a short break to obtain legal advice before embarking on answering questions or providing documents.

Key Takeaways

  1. Notify a notifiable incident. If in doubt, seek legal assistance from your external legal advisors.
  2. Speak to external legal advisors as soon as an incident occurs to determine the best approach to an investigation and privilege.
  3. Understand that the Regulator is never really “off the record” when conducting an investigation and avoid giving opinions or speculation – stick to the facts.
  4. Remember to obtain the caution and respond only to the specific question(s) asked.
  5. Check the applicable local laws – States and Territories do have subtle variations.

1. See for example section 35 Work Health and Safety Act 2011 (NSW).

2. For assistance see SafeWork Australia’s “Incident Notification Information Sheet”

3. See for example Victorian WorkCover Authority v Asahi Beverages Australia Pty Ltd (Ruling) [2014] VCC 1260

4. See for example Part 9 Work Health and Safety Act 2011 (NSW)

Show me the money: cashing out leave entitlements


Sam Cahill, Associate 
Employers and employees may occasionally find it mutually convenient to “cash out” a portion of an employee’s paid leave entitlements. While this can serve as a useful tool for managing an employer’s leave liabilities, the cashing out of leave entitlements is subject to strict rules, which can vary considerably depending on the type of leave involved and the source of these rules. In this article, we examine the most common rules relating to the cashing out of annual leave, personal/carer’s leave and long service leave, and the opportunities they may present to employers.

Annual leave

Cashing out of annual leave is governed by the National Employment Standards (“NES”) in the Fair Work Act 2009 (Cth). The NES provides different rules depending on whether or not the employee is covered by an industrial instrument (a Modern Award or Enterprise Agreement).

Employees covered by a Modern Award

The NES provides that, where an employee is covered by a Modern Award, the employer and employee may only agree to cash out annual leave if this is expressly permitted by the terms of the relevant Award.1

During the Four Yearly Review of Modern Awards, the Fair Work Commission developed a new “model” annual leave award clause, which has since been inserted into most but not all Modern Awards.2 This means that an employer will need to check the applicable Award to determine whether cashing out is permitted and, if so, the conditions that will apply.

The model clause provides that an employer and employee may agree to cash out up to two weeks of annual leave in any 12-month period, provided that the employee will have at least four weeks of annual leave remaining after the cashing out takes effect.
Among other things, the model clause also provides that:

  • each occasion of “cashing out” must be subject to a separate written agreement between the employee and employer;
  • the agreement must include details of
    the amount of leave being cashed out, the amount of money being paid to the employee and the date on which payment will be made;
  • the agreement must be signed by the employer and employee and, if the employee is under 18 years of age, by the employee’s parent or guardian; and
  • the employer must keep a copy of the agreement as an employee record.

Employees covered by an Enterprise Agreement

The NES provides that, where an employee is covered by an Enterprise Agreement, the employer and employee may only agree to cash out annual leave if this is expressly permitted by the terms of the Agreement. Unlike Modern Awards, there is no standard annual leave clause for Enterprise Agreements. This means that an employer will need to check the applicable Enterprise Agreement to determine whether cashing out is permitted and, if so, the conditions that will apply.

For example, the Inghams Enterprises (Lisarow) Enterprise Agreement 2014 includes a provision for cashing out annual leave. It provides that:

“An employee may request in writing to forgo one week of annual leave and to receive payment of that amount (including the leave loading) in lieu of taking the leave. Payment is conditional on the Company agreeing to the request. The employee must have at least four weeks of accrued leave remaining after the pay-out and can only request payment twice per year. Where an employee elects to receive a payment in lieu of taking annual leave, their annual leave entitlement shall be reduced by the quantum of the annual leave payment”.

Employees who are not covered by a Modern Award or Enterprise Agreement

The NES provides that, where an employee is not covered by a Modern Award or an Enterprise Agreement, the employee and employer may agree to cash out annual leave, provided that the employee will have at least four weeks of annual leave remaining after the cashing out takes effect.4

The NES also provides that:

  • each agreement to cash out must be a separate agreement in writing; and
  • the employer must pay the employee at least the full amount that would have been payable to the employee had the employee taken
    the leave.

We note that cashing out of annual leave is prohibited for employees whose employment is governed by the Annual Holidays Act 1944 (NSW) (this will usually be public sector employees).

Personal/Carer’s leave

The NES provides that, where an employee is not covered by a Modern Award or an Enterprise Agreement, he or she is not permitted to cash out personal/carer’s leave.

Employees who are covered by a Modern Award or Enterprise Agreement may cash out personal/ carer’s leave if this is expressly permitted by the relevant Award or Agreement.5 However, given that the NES does not require personal/carer’s leave to be paid out on termination, it is very rare for Awards or Agreements to permit cashing out of this entitlement, and perhaps even rarer for an employer to be willing to do so.

Long service leave

Cashing out of long service leave is governed by the rules of the relevant State or Territory long service leave scheme.

Cashing out of long service leave is permitted in South Australia, Western Australia and Tasmania.In these jurisdictions, an employee and employer may agree to cash out an entitlement to long service leave after the entitlement has been accrued. The agreement to cash out must be in writing (and, in South Australia, signed by the employer and employee).

In Queensland, an employee may only cash out long service leave with the permission of the Queensland Industrial Relations Commission (“QIRC”).7 The QIRC may grant a request to cash out long service leave only if it is satisfied that the payment should be made on compassionate grounds or on the ground of financial hardship.

Cashing out of long service leave is unlawful in New South Wales, Victoria, the Northern Territory and the Australian Capital Territory.

 Key Takeaways

  1. Cashing out annual leave can be an effective way of managing excessive leave liability.
  2. Employers should consider engaging in discussions to cash out annual leave for employees who:
    1. have at least six weeks of annual leave accrued; and
    2. are not covered by an Award or Agreement, or are covered by an Award or Agreement that expressly permits cashing out of annual leave.
  3. Employers with an Enterprise Agreement are subject to the cashing out provisions contained in the Enterprise Agreement. If the Agreement does not expressly permit cashing out of annual leave, given the changes that have been made to Modern Awards, consideration should be given to inserting such a clause when the Enterprise Agreement is re-negotiated.
  4. There is limited capacity for the cashing out of personal/carer’s leave and long service leave.
  5. Given the penalties that can be enforced for breaches of the cashing out provisions, we recommend that employers take a cautious approach to employee requests to cash out leave entitlements. If necessary, an employer should seek specific legal advice on whether it can lawfully enter into a cashing out agreement with a particular employee, and if so, what conditions will apply.

1. Fair Work Act 2009 (Cth), s 92.

2. For example, see clause 29.9 of the Clerks – Private Sector Award 2010.

3. Fair Work Act 2009 (Cth), s 92.

4. Fair Work Act 2009 (Cth), s 94.

5. Fair Work Act 2009 (Cth), s 100.

6. Long Service Leave Act 1987 (SA), s 5(1a); Long Service Leave Act 1958 (WA), s 5; Long Service Leave Act 1976 (Tas), s10.

7. Industrial Relations Act 1999 (Qld), s 53.