By Brad Gardiner, 16 July 2015

NTC supports significant increase in penalties for those who breach chain of responsibility

Owner-drivers may face fines of up to $600,000 and five years in prison under a proposal to significantly increase penalties for chain of responsibility (COR) breaches.

The National Transport Commission’s (NTC) recently released discussion paper on reforming COR has flagged adopting the penalty framework contained in the Work Health Safety Act (WHS Act), which all businesses already need to comply with.

The NTC also wants to ditch COR’s existing prescriptive requirements in favour of the WHS Act’s primary duties approach, which provides an overarching responsibility a party must meet but gives them the flexibility to determine the approach they will take to comply.

The proposals are designed to align COR requirements within the Heavy Vehicle National Law (HVNL) with the WHS Act to remove duplication and inconsistencies, but it also may mean implementing harsher penalties.

“The maximum court-imposable fines under the HVNL ($20,000 for an individual) are significantly lower than the maximum court-imposable fines under the Model WHS Act,” the NTC’s discussion paper says.

“Maximum penalties for breaching the primary duties could be amended to be better aligned with the maximum penalties available under the national safety laws, including adoption of hierarchy of penalties based on the nature of the actual harm or damage caused.”

The WHS Act splits penalties into three categories based on the severity of the offence.

The maximum fine for an individual – such as an employee – in the highest offence category is $300,000 and/or five years behind bars.

The penalty for an individual running a business – such as a contractor or owner-driver – is $600,000 and/or five years in prison.

Even the maximum fines for the lowest offence category are significantly higher than what exists under the HVNL.

An employee can be fined up to $50,000, while someone running a business faces up to a $100,000 fine.

Depending on the offence, body corporates can be fined from $500,000 (lowest category) up to $3 million (highest category).

The NTC says it recognises a final determination on penalties cannot be made until the structure of primary duties is finalised, but it also makes clear that the existing penalties for COR offences are not good enough.

“Significant risks to road safety remain because the way the law is structured does not encourage CoR parties to proactively identify and prevent risks, and does not provide sufficient deterrent effect because appropriate penalties are not provided for,” the discussion paper states.

It adds that the penalties and the threat of imprisonment for breaches of the WHS Act are seen as essential to providing a level of deterrence.

“The maximum penalties reflect the level of seriousness of the offences and have been set at levels high enough to cover the most egregious examples,” the NTC says.

The discussion paper is currently open to industry feedback until August 7. A final version will be prepared for transport ministers to consider in November.

The NTC has recommended amendments to the HVNL be drafted in May next year and then implemented shortly after.

“It is anticipated that amendments to the HVNL will commence in late 2016 or early 2017,” it says.


A key feature of the NTC’s discussion paper is a proposal to alter how the industry complies with its COR obligations by introducing primary duties for operators, prime contractors and employers.

Primary duties are a feature of the WHS Act. They outline a party’s responsibilities in broad terms and allow a company flexibility to determine how to meet them.

“The flexibility inherent in a primary duties approach allows for innovation and adaptation in risk management, tailored to the circumstances of the party to whom the duty applies, their role within the chain of responsibility, the nature of the risk to be addressed, and the reasonableness of the party’s use of resources to meet the risk,” the NTC says.

It says the HVNL as it is currently drafted features detailed prescriptive requirements and does not encourage parties within the chain to proactively identify and prevent risks.

“Likewise, a large percentage of offences under the HVNL are dependent upon some harm or incident or injury having had occurred (i.e. permitting the use of an unsafe vehicle), rather than a proactive approach to enforcement where failing to ensure that a vehicle is safe triggers the offence,” the NTC says.

“Unlike many of the current prescriptive requirements under the HVNL, a failure to discharge primary duties should be considered a breach of the law in itself that is not dependent on the occurrence of some harm, incident or injury having already occurred. Accordingly it is considered that a failure to discharge (or breach) the primary duties should be an offence under the HVNL.”

The NTC says aligning the HVNL with the WHS Act will reduce inconsistencies but will not lead to a greater compliance burden on the transport industry.

“These primary duties will not increase the compliance burden on these parties, but instead seek to clarify the intent of existing obligations and ensure a more flexible outcomes-based approach to compliance,” the discussion paper says.

It goes on to say that a primary duty, if slotted into the HVNL, will identify the party with the responsibility, the duty they owe and how they must comply.

“It is proposed the key obligation of a primary duty holder should be to ensure the safety of road transport operations, vehicles, drivers and the general public,” the NTC says.

The agency also recommends the addition of role-specific duties for other parties in the transport supply chain, such as consignors and consignees, loaders,  loading managers and packers.

Furthermore, it says primary duties should also extend to executive officers of transport operators, prime contractors and employers and that the addition of a due diligence duty should be looked at.

“A due diligence duty would hold officers and senior managers accountable for managing and influencing behaviour without the corporation first having to commit an offence as is the current requirement under the HVNL,” the discussion paper says.

“The due diligence duty would also provide clarity to executive officers as to their responsibility to be aware of the hazards and risks associated with the business and provide safe work practices, ongoing compliance and continual improvement.”

The discussion paper also advocates changes to COR prosecutions by requiring defendants to prove their innocence.

It says the onus of proof for all executive officer liability offences should rest with the prosecution.

NTC CEO Paul Retter says the NTC’s proposals are an opportunity to restructure and consolidate existing obligations and to ensure all parties bound by COR take a proactive approach to meeting their responsibilities.

“These reforms also provide an opportunity to remove existing more prescriptive obligations and to better clarify the roles and responsibilities of all parties in the chain of responsibility, and executive officers,” Retter says.

Extracted in full from Owner Driver.