Progressive Strata Services

Operation of Strata Title Body Corporate under the new regime in relation to Asbestos

Prelude

This  article  is  to  be  read  in  conjunction  with  the  Health  Work  and  Safety  Act  workbook  issued  by  Grace Lawyers  in February  2012.

This  article  is  to  review  the  basic  issues  that  have  been  raised  in  the  various  forums  on  the  issue  of asbestos  management.    Naturally  this  is  not  to  be  construed  as  legal  advice  and  individual  circumstances may  impact  on  comments  in this  article.

The  examples  and  various  sections  (to  make  it  easier)  focus  on  the  application  of  the  legislation  in  NSW.   The  system  should  be  identical  in  other  States  and  Territories as  they  join  (or  have  joined)  the  system.    For the  purpose  of  this  article  we  shall  use  the  generic  term  of  bodies  corporate  to  include  strata  schemes, community  associations,  body  corporates,  company  title  and  stratum  developments  except  where  specific reference  is  required. 

Commonwealth  Work  Health and  Safety  Bill

The  Commonwealth  Work  Health  and  Safety  Bill  (WHS)  was  introduced  into  the  House  of  Representatives on  6  July  2011.    The  reforms  came  about  as  a  result  of  the  July  2008  signing  by  COAG  (Council  of Australian  Governments)  of  the  Inter-Governmental  Agreement  for  Regulatory  and  Operational  Reform  in Occupational  Health and  Safety.

Each  jurisdiction,  including  the  Commonwealth,  has  developed  legislation  to  give  effect  to  the  Model  WHS, with  an  intended  focus  on  harmonizing  Occupational  Health  and  Safety  arrangements  through  the implementation  of  uniform  legislative  measures.    The  WHS  commenced  on  1  January  2012  in  New  South Wales,  Queensland  and  Northern  Territory  (the  remaining  States  continue  to discuss). 

The  WHS  2011  is  accompanied  by  the  Model  Work  Health  and  Safety  Regulations  (MWHSR).  The MWHSR  is  supported  by  a  number  of  model  Codes  of  Practice  which  were  agreed  to  by  all  Ministers  in December  2009. 

Asbestos issues

Chapter  8  of  the  MWHSR  deals  with  changes  to  the  practice  and  procedure  surrounding  Asbestos.  The MWHSR  set  out  a  number  of  obligations  upon  what  is  described  as  a  ‘person  conducting  a  business  or undertaking…’. (PCBU),  unless excluded  under  the  WHS  (see  WHS  workbook  for  discussion  on  PCBU).

Section  5  of  the  WHS  sets  out  what  a  person  conducting  a  business  or  undertaking  is  taken  to  include  and exclude  (see  workbook).  For  the  purposes  of  this  article it  will  be  assumed  that  the  building  is  a PCBU. 

Codes  of  Practice

There  are  currently  two  (2)  Codes  of  Practice  (Codes  of  Practice)  available  relating  to  the  obligations  of PCUB’s  regarding  Asbestos.  These  Codes of  Practice are: 

  1. How to Manage and Control  Asbestos  in the  Workplace; 
  2. How to Safely  Remove Asbestos. 

These  Codes  of  Practice  provide  guidelines  and  procedures  for  the  obligations  prescribed  under  the  WHS and  are  approved  codes  for  the  purposes  of  section  274  of  the  WHS.  While  compliance  with  the  Codes  of Practice  does  not  appear  to  be  mandatory,  it  is  our  recommendation  that  they  should  be  followed  by anyone who  has  a responsibility  under  the  WHS,  such  as  a PCBU.

In  light  of  the  fact  that  it  appears  as  though  most  strata  title  body  corporate  schemes  will  be  included  in  the new  regime,  at  least  in some capacity,  we  felt  it  necessary  to set  out  some  of  the  more important  aspects  of the  WHS  and  MWHSR.  These  are  discussed  below  and,  where  applicable,  are  dealt  with  by  the  draft Motion provided at  page  11  below. 

The  MWHSR 

Chapter  8  of  the  MWHSR  provides  for  the  regulations relating  to  Asbestos.

While  all  PCUB’s  and  responsible  persons  must  ensure  that  they  have  read,  understood  and,  where applicable,  implemented  the  obligations  and  requirements  of  Chapter  8  of  the  MWHSR,  we  have highlighted  a  number  of  the  more onerous  obligations  below.

Regulation 419

Regulation 419 of  the  MWHSR  provides  that  a PCUB  must  not  carry  out,  or  direct  or  allow  a  worker  to carry out,  work  involving  asbestos,  with  a  maximum  penalty  of  thirty  thousand  dollars  ($30,000.00)  in  the  case  of a breach  of  the  prohibition  by  a body  corporate.

However,  there  are  over  12  exceptions  to  this  prohibition.  Notably,  this  prohibition

  1. does  not  apply  to  maintenance  of,  or  service  work  on,  non-friable  asbestos  or  ACM,  fixed  or installed  before  31  December  2003;  
  2. does not  apply  to  management  in accordance  with the  MWHSR  of  in situ  asbestos  that  was installed or  fixed  before  31  December  2003;
  3. does not  apply  to  the  removal  of  asbestos  of  ACM,  including  demolition. 

Accordingly,  in  order  to  ensure  compliance  with  this  regulation,  knowledge  of  the  location  and  type  of  all asbestos  present  in  the  applicable building  is  essential.

Regulation 425

Regulation 425  provides  for  the  establishment  and maintenance of  an  Asbestos  Register.

A  PCUB  with  management  or  control  of  a  workplace  must  ensure  that  a register  is  prepared  and  kept  at  the workplace.

This  regulation does  not  apply  in circumstances where: 

  1.  the  workplace  is  a  building  that  was constructed  after  31  December  2003;  and
  2.  no  asbestos  has  been  identified  in  the  workplace;  and
  3.  no asbestos  is  likely  to be present  at  the  workplace  from  time  to  time.

Further,  there is  no  requirement  to create  a  new  asbestos  register  if  one  is  pre-existing.

Accordingly,  unless you  are  a PCUB  with management  or  control  of  a workplace,  Regulation 425  does  not apply  to you.

If  the  building  is  deemed  to be  a workplace,  Regulation 425 will  not  apply  to you  if:

  1.  the  building  was constructed  after  31  December  2003;  and
  2.  no  asbestos  has  been  identified  in  the  workplace;  and
  3. no  asbestos  is  likely  to be  found.

However,  all  three  (3)  of  the  above criteria  must  be satisfied  for  the  exemption  to  apply. 

Regulations 426  through  430

Regulations 426  through  430 provide  for  the  access,  review  and management  of  the  Asbestos Register.  In the  event  that  Regulation  425 applies  to you,  these Regulations  will  apply  to you  in circumstances  where: 

1.You  are  a  PCUB;  and

2.  You  have the  management  or  control  of  a workplace;  and

3.  The workplace  was constructed  prior  to 31 December  2003.   

The  maximum  penalty  for  a  breach  of  Regulations  425  through  430  by  a  body  corporate  is  eighteen thousand  dollars  ($18,000.00),  except  for  Regulation  429,  which  carries  a  maximum  penalty  of  thirty thousand  dollars  ($30,000.00). 

Part  8.6  –  Demolition  and Refurbishment:  Regulations  447  through 457

Regulation  447  through  457  provide  for  the  demolition  and  refurbishment  of  buildings  under  the  new regime.

These  regulations  do  not  apply: 

  1.  to structures  built  or  installed  after  31  December  2003;  or
  2.  to  minor  or  routine  maintenance work,  or  other  minor  work;  or
  3.  the  building  is  not  deemed a  workplace.

Accordingly,  these Regulations will  apply  to you  in circumstances where:

  1.  You  are  a  PCUB;  and
  2.  You  have the  management  or  control  of  a workplace;  and
  3.  The workplace  was constructed  prior  to 31 December  2003. 

In  any  other  circumstance,  unless  expressly  stated,  these  regulations  will  apply  to  a  strata  title  body corporate.  The  maximum  penalty  for  breach  of  these  regulations  is  between  eighteen  thousand  dollars ($18,000.00)  and  thirty  thousand  dollars  ($30,000.00)  depending  on  the  offence.

How  do bodies  corporate keep  compliant?

Under  the  duty  of  care  obligations  and  the  asbestos  provisions,  a  PCBU  must  take  reasonable  steps  to ensure  the  safety  of  all  workers  and  contractors  onsite.

In order  to  do  this  it  is  suggested  the  following  approach be  undertaken:

  1.  A  decision  must  be  made  at  a  meeting  to  obtain  a  report  on  the  current  status  of  the  building  as  it applies to asbestos;
  2.  A suitably  qualified  person  needs  to  be  engaged  to  carry  out  the  inspection  (this  can  be  in  conjunction with the  general  inspection  for  compliance with the  WHS  in any  case);
  3.  The report  needs  to do  the  following: 

a.  Determine  whether  the  building  is  subject  to  any  exemption;

b.  Determine  whether  the  building  has  any  asbestos  (this  in  conjunction  with  the  report  on safety/risks). 

4.  If  no  asbestos  is  found  the  report  to  be  tabled  at  a  meeting  and  accepted,  kept  on  file  and  kept  at  the premises  for  future  reference.

5.  If  asbestos is  found  an  Asbestos  Management  Plan  and Register  to be  prepared  and:

i. one be  kept  with the  records  of  the  body  corporate;

ii. one to  be  kept  on  site  for  access  by  trades  if  and  when they  attend  the  premises; 

iii. one  to  be  issued  to  all  owners/occupants  of  the  building  advising  of  the  Plan  and Register  and  guidelines  when carrying  out  any  work; 

iv. place  adequate  signage  around  the  premises  advising  of  the  risks. 

6.  Where  any  works  are  to  be  conducted  at  the  premises  (including  work  orders  issued)  the  contractor must  be  advised  that  there  is  asbestos  at  the  premises,  where  to  find  the  Asbestos  Management  Plan and Register  and who  is  the  point  of  contact  at  the premises.

7.  All  Plans  and Registers  must  be  kept  up  to date  and ensure  contractors  are advised  of  any  risks  etc.  A process  for  obtaining  the  reports  and  making  the  documents  available  should  be  approved  by  a resolution at  either  a  general  or  committee  meeting  (recommended  each 12 months). 

There  may  be  occasions  where  decisions  are  made  not  to  comply  with  the  requirements  (and  the  motions may  fail).    In  these  instances  bodies  corporate  (and  potentially  managers)  will  need  to  be  apprised  of  the risks  for  that  non  compliance. 

How  do I find  a  good  consultant/expert? 

In  engaging  any  contractor/expert  bodies  corporate  must  be  diligent  in  who  they  engage  (as  there  are parts  of  the  legislation  that  do  not  absolve  a  body  corporate  from  liability  even  when  they  have  engaged an  expert).    The  following can  be  used  as a  guide: 

  • The person  should be  trained to handle  the  type  of  item  found  (or  expected  to  be  found);
  • The person  should  trained to  take  samples  (if  required);
  • The person  should have  knowledge and  expertise  in identifying  asbestos; 
  • The  person  should  be  able  to  properly  determine  the  risks  associated  with  the  type  of  asbestos found;
  • The person  should have  expertise in  managing asbestos  (maintenance,  management,  removal); 
  • The  person  should  be  familiar  with  the  type  and  style  of  the  building  to  be  inspected  (and  have experience in  similar  buildings); 
  • The  person  should  be  familiar  with  the  type  and  style  of  the  building  to  be  inspected  (and  have experience in  similar  buildings); 
  • Reports  should be  professional  and have limited  exclusions. 

What  are  the  fines  for  non-compliance

As  with  any  legislation  the  sting  is  in  the  tail,  under  the  WHS,  the  maximum  fines  for  non-compliance  are severe  and  exhaustive.  There  are  certain  penalties  that  range  up  to  $3  million  for  a  body  corporate  found guilty,  $600,000  for  individuals  such  as  committee  members/owners  or  in some  instances  jail  terms.

Whilst  these  are  the  maximum  fines  under  the  proposed  laws  the  non  compliance  by  bodies  corporate  of even  the  simplest  issue  may  result  in  fines  and/or  claims  against  it.

Conclusion

The  new  legislation  places  more  onerous  obligations  on  bodies  corporate.    They  are  required  to  take  a more  pro-active role in  the management  of  risk  at  their  premises.

The  Executive  Committee  needs  to  work  closely  with  their  managing  agents  and  consultants/experts  to ensure  that  the  measures  are  in  place  and  risks  identified  (and  dealt  with).    There  needs  to  be  an  ongoing risk  management  system  developed  and regularly  reviewed  and updated.