Workplace Safety and Health: Chief Executives and Directors Held Personally Liable
Code of Practice launch signals possible active enforcement stance to hold Chief Executives and Board of Directors personally liable for any breach of duties to ensure workplace safety and health
The launch of the Code of Practice on Chief Executives’ and Board of Directors’ Workplace Safety and Health Duties (the “COP”) on 19 September 2022 and its planned elevation to an Approved Code of Practice in October 2022 may signal active enforcement in the near future against top directors for workplace safety and health lapses. Accordingly, companies and their management may wish to seek legal advice on their obligations under the Workplace Safety and Health Act 2006 (“WSHA”).
By default, directors can be held personally (and criminally) liable for any offence committed by their company under the WSHA unless they can show (a) that the company’s offence was committed without his or her consent or connivance, or (b) he or she had exercised all such diligence to prevent the commission of the offence having regard to the nature of the director’s functions. If convicted, directors can be sentenced to a fine of up to $200,000 or be imprisoned for up to 2 years, or both. The provision makes no distinction between directors located locally and those located overseas.
While the ability of the State to hold directors liable is not new, the COP removes key ambiguities over baseline standards expected in exercising “all such diligence”. In the same stroke, any prosecution brought against directors can leverage on the COP to disprove any such “due diligence” defence by directors should there be non-compliance on applicable practices.
The move to publish factors relating to director due diligence is similar to the approach in jurisdictions such as the United Kingdom (where enforcement policies and factors are published online) and Australia (where “due diligence” is defined in its written law). A scan of the “frequently asked questions” issued alongside the COP shows language that leans towards enforcement. It is foreseeable that Singapore would be keen to prosecute suitable cases in the near future amidst rising workplace fatality rates. Its move to have the COP expeditiously gazetted as an Approved Code of Practice in October 2022 [The ACOP status enables the Prosecution to admit it into evidence for criminal proceedings with increased ease.] can also be seen as a key preparatory move for its use in future prosecutions.