This article is about whether WHS reports for strata schemes are a legal requirement.
Question: What are the legal requirements for WHS reports for strata schemes? What recourse do lot owners have when a strata management company disregards explicit instructions not to arrange a report?
Are strata management companies legally required to engage a professional for a WHS report generated by default? Is the strata management company required to provide comparable quotes, consultation and lot owner approval?
Lot owners in our strata scheme asked our strata company not to arrange WHS reports without approval, and the strata company arranged the same report again, ignoring instructions. What can we do?
Answer: Check the wording of your contract, but it may be something you have signed up for.
There is no legislative requirement for body corporate schemes to have work health and safety reports.
However, some managing agencies may include a clause that the scheme must have an inspection periodically and that the managing agent has the right to approve this as part of their management contract. Check the wording of your contract on this point, but it may be something you have signed up for.
If there is nothing in the contract about this, the inspection is just like any other maintenance work you arrange and should be approved by the committee accordingly. If the company is not following standard processes, you need to ask them why.
If it is a contractual obligation and you have asked for it to be removed, the agency may be within its right to require the inspection, but it should have discussed this with you and why it views it as necessary. If they don’t, I expect you will be annoyed as customers and may look at alternative managers when the time comes.
If the managing agent has booked the work without approval, the committee could refuse to pay the invoice. Write explicitly to the manager advising the reasons why.
There is a question of whether it is reasonable to make these inspections mandatory. The companies that have such policies in place will argue that it is for the scheme’s benefit to ensure it is safe and that having the manager organise it automatically saves time.
There’s some truth to this, and it’s not bad to mandate compliance obligations. However, check that your strata scheme is getting value from the expense and your managing agency hasn’t only put this system in place because it is an easy money maker.
A good test of your agency might be to ask your managing agency whether they receive any commission or other payment from the company they are booking the safety works through. If they are, it gives you an indication that they are likely to be putting profit before good policy.
I prefer if consideration of WHS reports are a mandatory item that strata scheme owners consider at their AGM each year, just as they are required to vote on having an audit. It wouldn’t solve all problems, but at least it would force owners to consider whether the report was beneficial.
Maybe other regulations could be introduced – annual safety reports could be required for buildings over 40 lots for example. They could be required at buildings where less than half of residents were owner-occupants. Please feel free to add your ideas to the comments below.
Body corporates need to be more conscious of safety issues and their liability risks. Much of the discussion around this at the committee/owner level gets lost as people get anxious about spending money or don’t understand their obligations around site maintenance. This results in many buildings carrying significant safety risks for extended periods without putting serious plans in place. That’s a bad outcome for strata buildings, so it is not surprising that companies are trying to bring measures to control that. Having managing agencies that automatically book reports they profit from may not be the best solution, but this kind of policy is an outcrop of a system that fundamentally fails to address the key issues around safety maintenance obligations.
William Marquand
Tower Body Corporate
E: willmarquand@towerbodycorporate.com.au
P: 07 5609 4924
This post appears in Strata News #735.
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Read next:
- NAT: Q&A Indemnity, Waivers & Hold Harmless Clauses in Strata Management Contracts
- NAT: Work Health and Safety in Strata
- NSW: Important Work Health & Safety Case Part 2: Owners Corporation fined $225,000.00 as a PCBU
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