Work Health & Safety issues in strata buildings with commercial income

Do you live in a strata building which also has a commercial income stream from commercial use of its common property? If so, you need to ensure that the OC  building adheres to the higher level of legal requirements required under the Work Health & Safety legislation – in NSW at least.

The recent decisions from the “Maluko” case makes this abundantly clear.  A worker was killed due to a damaged gate in a strata building site. The strata manager was fined $150k, according to the Illawarra Mercury. The Owners Corporation was fined $225k plus $40k in costs, and the business involved was fined $1.7m.

Bannermans Lawyers recommend that OC’s should :-
“Following the Decision, group title structures such as owners corporations who are PCBU’s should ensure that they have the following:

An officer (such as a committee member) armed with a suitable WH&S policy to adequately implement, assess, train, induct and manage the risks and WH&S Policy as required by section 27 of the Act;
Ensure that suitable inclusions in quote requests addressing the Act are included;
Ensure adequate insurance for the legal defence costs, as $50,000.00 is woefully inadequate. Bear in mind that you cannot insure against (or claim indemnity in respect of) the substantial penalties for incidents occurring after 10 June 2020; and
Take compliance measures as required by the Act.”

So, the upshot is that if your strata building is carrying out commercial activities, either in a lot or using its common property, the OC has a higher responsibility under WH&S legislation to manage any safety issues arising from that commercial activity. OCs and their strata committees, need to take an active role in policing the WH&S activities of all that commercial activity – as do their strata managers.

Plus, now from the Maluko case result, the insurance premiums of such buildings may increase, as the obvious added risk involved becomes apparent.

To quote from the Sparke Helman commentary linked to below:-

“There is concurrent liability under the WHS Act, meaning multiple persons can have the same WHS duty for the same work activity and, therefore, can all be potentially liable.  In this case, Maluko, the Owners Corporation and the strata manager all had concurrent obligations to manage the risk of the gate falling, and were all subsequently prosecuted and convicted. The extent of each person’s obligations and resulting liability depends on their ability to influence and control relevant matters. As the person with management and control of common property, a commercial owners corporation has a high degree of influence and control of matters on site. An owners corporation cannot simply ‘leave it’ to other persons (e.g. the strata manager) and it is required to discharge its duties to the extent it has the capacity to influence and control the workplace.”

Add this issue to the agenda for your next SC and general meetings, if your building is this type!

See the full commentary from Bannermans Lawyers here=>

Important WH&S Case Update for the Strata Industry: Part 1

Important Work Health & Safety Case Part 2: Owners Corporation fined $225,000.00 as a PCBU

Also, see this commentary from Sparke Helman Lawyers =>

https://www.sparke.com.au/insights/owners-corporation-strata-manager-and-business-convicted-under-the-whs-act/