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September 2001

The Health And Safety In Employment Act


While many employers now actively comply with the Health and Safety in Employment Act 1992 (the Act), one issue which has lacked clarity has been that of defining the obligations of a "principal". This is a company or person who engages contractors and in turn subcontractors ("contractors"). It was not until 1997 that the issue was definitively addressed in the Court of Appeal Decision of Central Cranes Limited v Department of Labour. A review of this case may assist principals in becoming more aware of their areas of responsibility and liability.

Application of the Act

The object of the Act is to provide for the prevention of harm to employees at work. Employers are encouraged to take responsibility for the management of health and safety. The Act imposes a general duty to take all practicable steps to ensure health and safety in the workplace (e.g., providing and maintaining a safe work environment, maintaining facilities for the safety of employees and ensuring machinery and equipment is designed and set up to be safe for employees). A breach of the Act, and subsequently prosecution, potentially results in significant penalties.

Responsibility to Contractors

Since the Act’s inception, principals have experienced uncertainty as to their responsibility to contractors. The Central Cranes case has reduced this uncertainty. It is now incorrect to assume that there is no duty owed by principals to their contractors. While a principal may promote the safety of his or her employees, the obligations to a contractor called to the workplace to perform various tasks must also be attended to. The principal cannot assume that if the contractor is employed by another company then the responsibility for the health and safety rests solely with the employer.

Principal’s Liability

The Central Cranes case involved a prosecution under the Act of a principal where a contractor was seen working 41 metres above a construction site without a helmet or protective harnesses. The principal argued that it was the contractor’s employer (not the principal) who should be responsible for the safety of the contractor. The Court of Appeal rejected this argument and clarified the law in relation to a principal’s responsibilities finding that, although the responsibility primarily rests with the employer, the principal’s responsibilities are not to be diminished.

The Court of Appeal observed that under the Act a principal is required to take "all practicable steps". It continued to find that a principal cannot be distanced from what occurs in the workplace simply because a contractor is involved and that contractor in turn owes more direct duties to his or her employees. The Court would not set down a clear detailed code of what is practicable in the circumstances. What is practicable, will be determined on the facts of each case.

Risk Management

A principal, to actively manage risk of prosecution under the Act, should put appropriate procedures in place to ensure contractors and sub-contractors are meeting their obligations to employees. Positive steps should be taken to ensure that the employees of contractors and sub-contractors are not harmed. As may have been the case in the past, the principal cannot simply leave health and safety matters to contractors and sub-contractors. Acting under the guidance of legal or specialist advice, the wise principal can design compliance plans. When engaging contractors and subcontractors, the principal is advised to make it a term of the contract that the contractor complies with the principal’s health and safety policies and codes and with his or her own policies and codes.