November 2016

Introduction

The law governing health and safety obligations in New Zealand was recently updated with the introduction of the Health and Safety at Work Act 2015 (‘the Act’). This Act imposes legal obligations on people conducting any business activity in New Zealand. All New Zealand businesses should be updating their practices and procedures to comply with the Act’s requirements. But how does the Act affect voluntary organisations, like sports clubs, community charities and arts societies? What obligations do the officers, committee members and managers of these voluntary organisations have to manage health and safety? Can the officers of voluntary organisations face legal liability for injuries suffered by their volunteers? The purpose of this article is to provide an outline of the legal obligations that voluntary organisations have to ensure the health and safety of people affected by their activities and the risks of liability for the officers of such organisations.

When does the Act apply to a voluntary organisation?

The Act only applies to people and organisations conducting a business or undertaking (referred to as ‘PCBUs’ in the Act). The Act imposes significant obligations on PCBUs together with potentially significant penalties for any PCBU that fails to comply with those obligations. The officers of PCBUs also have significant obligations and can face personal penalties if they fail in their duties. The first step in understanding how the Act applies to voluntary organisations (and their officers) is therefore to determine whether they qualify as PCBUs for the purposes of the Act.

The definition of PCBU in the Act specifically excludes ‘volunteer associations’. A volunteer association is a group of volunteers (incorporated or unincorporated) working together for one or more community purposes where none of the volunteers employs any person to carry out work for the association. A central element of this definition is the reference to ‘employs’. Consequently, a voluntary organisation that is entirely voluntary and does not have any employees is excluded from the Act. Any voluntary organisation that has employees (even if it only has one, part-time, employee) will be a PCBU and will therefore need to comply with the Act in the same way as any commercial business.

The obligations of voluntary organisations that are PCBUs

If a voluntary organisation is an employer it will be a PCBU and will have to comply with the Act. The Act creates a primary duty of care for all PCBUs to ensure, as far as is reasonably practicable:

1. The health and safety of their workers (including volunteer workers but excluding casual volunteers);
2. The health and safety of any other workers whose work is influenced or directed by the PCBU (such as contractors for the PCBU); and
3. That the health and safety of other people is not put at risk by the PCBU’s activities.

The Act also provides that PCBUs must actively engage with their workers about health and safety issues and ensure that they give their workers reasonable opportunities to participate effectively in improving health and safety in their workplace.

The Act can impose significant penalties on PCBUs that fail to meet these obligations. Penalties can also be imposed on officers of PCBUs that fail to comply.

The application of these obligations, and what qualifies as ‘reasonably practicable’ actions, will vary from organisation to organisation. Each PCBU needs to consider its own working environment, the risks faced by its workers and those affected by its activities, and how to reasonably respond to those risks. Consequently, the practical implications of the Act will be very different for a charity building affordable housing than for a gardening club. A voluntary organisation that is a PCBU needs to take its obligations under the Act seriously, and take independent expert advice if necessary, to ensure that it complies with its obligations.

Who are the workers that these obligations relate to?

The Act creates obligations that all PCBUs owe to their workers. Significantly, the Act defines ‘worker’ to include both paid employees and ‘voluntary workers’. There are some important distinctions between employees and voluntary workers but those differences relate to their participation rights (employees have more rights to engagement and participation with their PCBU than volunteer workers are entitled to). PCBUs have the same obligations to protect the health and safety of their voluntary workers as they do to protect their employees.

The Act defines ‘volunteer worker’ to mean any person who carries out work in any capacity for a PCBU with the knowledge or consent of the PCBU, on an ongoing and regular basis, that is an integral part of the PCBU’s business or undertaking. The following casual volunteers do not qualify as ‘volunteer workers’:

1. Any volunteer who participates in a fund-raising activity;
2. Any volunteer who assists with sports or recreation for an educational institute, sports club, or recreation club;
3. Any volunteer who assists with activities for an educational institute outside the premises of the educational institution; or
4. Any volunteer who provides care for another person in the volunteer’s home.

What obligations do voluntary organisations that are PCBUs have to those who are not employees or voluntary workers?

The obligations of PCBUs go beyond protecting only their employees and volunteer workers. PCBUs must also ensure, as far as reasonably practicable, that their activities do not put anybody else’s health and safety at risk. This obligation covers any casual volunteers who do not qualify as ‘volunteer workers’ and extends to cover all people who may be affected by the organisation’s activities.

The obligation to take all reasonable steps not to put at risk those affected by an organisation’s activities is particularly significant for voluntary organisations, which are generally focused on providing services to the wider public. As examples:

1. Sports clubs and community groups that are PCBUs and build facilities for use by members of the general public (such as cycling trails, walking tracks or children’s playgrounds) must ensure that their construction work and the completed work does not put potential users at risk;
2. Sports clubs that are PCBUs and that organise sporting tournaments need to ensure that the tournament does not put at risk any of the volunteers, participants or spectators at the tournament;
3. Charitable organisations that are PCBUs that provide services to people must ensure that those services do not put potential recipients at risk;
4. Art and culture groups that are PCBUs must ensure that any sculptures or art work they commission or display does not put viewers at risk.

What obligations do the officers of voluntary organisations have?

The officers of voluntary organisations that are PCBUs also have obligations under the Act. They must exercise due diligence to ensure that their PCBU complies with its duties. Officers must exercise the care, diligence, and skill that a reasonable officer would exercise in the same circumstances, taking into account the nature of the organisation’s business, the position of the officer and the nature of the responsibilities they take on. Consequently, although all officers of a PCBU have responsibilities for complying with health and safety obligations, some officers may have additional liabilities by virtue of their position or responsibilities. For example, a PCBU’s dedicated health and safety officer may have more risk of liability than other officers.

What about voluntary organisations that are not PCBUs?

Voluntary organisations that are not PCBUs (i.e. voluntary organisations that have no employees) have no legal obligations under the Act. However, that does not meant such organisations and their officers have no health and safety obligations. There are still some general legal principles that apply and create obligations for all voluntary organisations in relation to health and safety, whether they are PCBUs or not.

In many western countries outside New Zealand, individuals who suffer loss because of another person’s or organisation’s negligence can sue the person or organisation at fault. To succeed with such a claim, the person who suffered the loss needs to prove that a duty of care was breached, that the breach of that duty directly caused the relevant loss and that some monetary compensation should be paid. Negligence claims can be used in these countries to obtain compensation for personal injury and for property damage.

However, negligence claims for personal injury are not possible in New Zealand because of our accident compensation scheme. This scheme, governed by the Accident Compensation Act 2001, generally prevents an injured person from suing for compensation for their injury. Claims are only possible where the negligence is so severe that some sort of punishment is warranted. The accident compensation scheme therefore provides a significant amount of protection for voluntary organisations and their officers (whether they are PCBUs or not). Because of the ACC scheme, voluntary organisations that are not PCBUs can only face liability for personal injury if the organisation and its officers have acted so badly that a court agrees that they have acted with significant and gross negligence making some sort of monetary punishment appropriate. Such claims are difficult to make and not common.

Significantly, although the ACC scheme generally prevents liability for personal injury, it does not prevent claims for property damage arising from negligence. Voluntary organisations and their officers can be liable for property damage that arises from their negligence.

As a hypothetical example, if a charity constructs a cycleway and a cyclist using that cycleway has an accident and breaks both their bike and their arm, the cyclist could sue the charity for the damage to their bike, but not their arm. The charity may have to pay compensation to the cyclist if they can prove that the accident occurred because of the charity’s negligence when building the cycleway. If the cyclist can prove that the charity’s work was grossly negligent, they may also be able to sue for additional compensation for their personal injury (‘exemplary damages’) to provide some punishment for the charity. The cyclist will have these rights regardless of whether the charity involved is a PCBU. If the charity is incorporated, the charity’s officers should not be personally liable, unless they were particularly negligent in carrying out their duties.

Advice for voluntary organisations

In summary:

1. Any voluntary organisation that has employees will be a PCBU covered by the Health and Safety at Work Act 2015 and will need to comply with the wide range of health and safety obligations imposed on every PCBU under that Act.
2. Those obligations relate primarily to the organisation’s employees and volunteer workers, but also create obligations for the benefit of anyone else affected by the organisation’s activities (including its casual volunteers).
3. The duties imposed on PCBUs, and their officers are extensive and any voluntary organisation that is a PCBU should obtain detailed and independent advice about its activities to ensure that it complies with its legal obligations.
4. Voluntary organisations that do not have employees are not covered by the Act. Neither the organisation or its officers have any liability or risk under the Act.
5. Consequently, all voluntary organisations should be cautious when considering employing anyone to carry out any work for the organisation. As soon as a voluntary organisation employs someone (even if it is only for an hour a week), the organisation will become subject to the Act and will be subject to obligations not only to the new employee but also to all of the organisation’s voluntary workers and anyone else affected by the organisation’s activities. If a voluntary organisation needs work completed, it should consider whether the work can be completed by someone other than an employee (such as under a contracting arrangement) or whether the organisation can be restructured. Legal advice should be obtained about these arrangements as the distinction between an ‘employee’ and a ‘contractor’ is fraught with difficulty and any restructure needs to be carefully managed to be effective.
6. Voluntary organisations that are not covered by the Act should still actively take steps to protect the health and safety of those affected by their activities. Although legal liability for the organisation (and its officers) is unlikely and limited by the ACC regime, prudent steps to protect health and safety should still be taken in order to:

• Protect the organisation’s volunteers and users of its services;
• Protect the organisation’s reputation and funding;
• Limit the risk of negligence claims for property damage; and
• Limit the risk of negligence claims for personal injury arising from gross negligence.

1. All voluntary organisations should have indemnity insurance to cover the risk of claims for property damage and should discuss with their insurance advisors whether any other insurance is possible and appropriate.

Health and safety is an important responsibility for all organisations, including those in the voluntary sector. However, it is important that concern for avoiding risk and responsibility does not stifle the activities of voluntary organisations. Voluntary organisations that have the financial resources to employ staff need to comply with the Health and Safety at Work Act 2015 and that is reasonable – employees of voluntary organisations are just as entitled to be safe at work as those working in the for-profit sector. However, completely voluntary organisations do not have the same obligations. Although they should still take the health of their volunteers and beneficiaries seriously, the volunteers involved with governing such organisations do not need to be unreasonably concerned about the risks of personal liability. As long as they act reasonably, without negligence, they should not be personally liable for injuries arising from their voluntary activities.