The Work, Health and Safety and Other Legislation Amendment Bill 2023 (WHSBill) has passed the Queensland Parliament and will commence on a day to be fixed by proclamation.

The WHS Bill introduces provisions similar to those in place in New South Wales, Western Australia and Victoria, making it an offence to offer, enter into or receive the benefit of an indemnity for penalties under the Workplace Health and Safety Act 2011 (Qld) (Act). In addition to penalties, the new provisions will deem indemnity/ insuring clauses void.

The WHS Bill proposes to introduce section 272A, which provides as follows:

Section 272A – Insurance or other indemnity against penalties

(1) A person must not, without reasonable excuse –

(a) enter into a contract of insurance or other arrangement that purports to insure or indemnify a person for a liability for all or part of a monetary penalty under this Act; or

(b) provide a contract of insurance or an indemnity for a liability for all or part of a monetary penalty under this Act; or

(c) take the benefit of a contract of insurance or other arrangement, or an indemnity, that purports to insure or indemnify a person for a liability for all or part of a monetary penalty under this Act.

Maximum penalty – 500 penalty units.

(2) Subsection (1) places an evidential burden on the accused to show a reasonable excuse.

(3) A term of a contract of insurance or other arrangement, or an indemnity, is void to the extent it purports to insure or indemnify a person for a liability for all or part of a monetary penalty under this Act.

The WHS Bill includes transitional provisions that set out how, amongst other things, section 272A will impact insureds and insurers under relevant policies of insurance entered into prior to section 272A commencing.

The WHS Bill provides in section 326 (our emphasis):

Section 326 – Application of s272A

(1) Section 272A(1)(a) and (b) applies in relation to a contract of insurance or other arrangements entered into, or an indemnity provided, on or after the day that is six months after the commencement.

(2) Section 272A(1)(c) applies to a person on or after the day that is 18 months after the commencement.

(3) Section 272A(3) applies in relation to a contract of insurance or other arrangement entered into, or an indemnity provided, on or after the commencement.

The effect of section 362 includes that:

  • it will not be an offence to enter into or provide a policy of insurance or indemnity for a period of six months after the commencement; however the relevant indemnity/insuring clause will be deemed void by operation of section 272A(3) if entered after commencement;
  • indemnity/insuring clauses in policies entered into prior to commencement of section 272A(3) will not be deemed void by this section; however
  • an insured will need to receive the benefit of the contract of insurance within 18 months from commencement of section 272A, otherwise penalties may apply.

The transitional provision may give rise to issues where there are claims made on policies entered into prior to commencement of section 272A, but where the benefit of the insuring clause might not be received inside 18 months.

Insurers and insureds alike ought to carefully consider the new provisions and should seek advice as required.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.