A recent decision by the NSW Industrial Relations Commission sheds some much-needed light on the extent of a Principal Contractor’s duty to supervise contractor compliance with SWMS. The PC, Diona, hired subcontractor Cahill to lay pipe, which involved the HRCW task of working near mobile plant. Cahill had prepared a SWMS, which Diona reviewed and approved. After a subbie hired by Cahill was injured, Safework NSW issued an improvement notice to Diona alleging they had failed to ensure Cahill complied with its SWMS.

On appeal to the NSW IRC, the Commission held that SafeWork NSW failed to
1.    consider the relationship between the parties and who had control of the work.
2.    address the impact of reasonable practicability, the structure of the Act, and the underlying balance of responsibility that each party should bear.
3.    consider why Diona solely held the obligation (to ensure compliance with the SWMS).

The Commission confirmed that the notice should have been issued to Cahill, not Diona, as they had control of the work and, therefore, the duty to ensure compliance with the SWMS. It was also noted that the duties of a PCBU undertaking the HRCW had been wrongly applied to Diona as PC. Interestingly, the Commission also noted that Diona’s actions in reviewing and approving Cahill’s SWMS perversely resulted in Diona taking on more legal obligations than if they had not done so. This decision is in direct contrast to the NSW DC decision of Mennen, which held that the Principal Contractor should have supervised the work of its contractors and ensured that it was performed in compliance with the SWMS provided by its contractor. (See my previous post about this).

Sue
Confused? Yep. What a debacle.