Compliance check: Malaysia: recent updates to statutory Health and Safety duties at work

The Occupational Safety and Health (Amendment) Act 2022 (OSH Amendment Act) will come into effect on 1 June 2024. The OSH Amendment Act expands the applicability of existing safety duties under the Occupational Safety and Health Act 1994 (OSHA) to most workplaces, and introduces new safety obligations and increases penalties for safety violations.

Extension of Scope

Currently, the OSHA applies throughout Malaysia to specific industries set out in the First Schedule, including manufacturing, mining and construction industries.

The OSH Amendment Act will expand the applicability of the OSHA from 1 June 2024 to all places of work throughout Malaysia with limited exceptions. Existing obligations under the OSHA, including to implement a policy on workplace safety and health under section 16, will now apply to most workplaces.

New Safety Obligations

The OSH Amendment Act will also introduce new safety obligations from 1 June 2024, including:

• a principal must ensure safety and health of the contractor, any subcontractor and the employees of the contractor and subcontractor when at work. A principal is defined as a person who in the course of or for the purposes of their trade, business, profession or undertaking contracts with a contractor for the execution by or under the contractor of the whole or any part of any work undertaken by the principal;
• an employer must develop and implement procedures to deal with emergencies that may arise in the course of employees’ work;
• an employer with at least five employees (except for occupiers of a place of work who are required to appoint a safety and health officer under section 29 of the OSHA) must appoint an employee to act as an occupational safety and health coordinator to coordinate safety and health issues at the workplace; and
• an employer must conduct health and safety risk assessments in relation to any person who may be affected by their work at the workplace. If the risk assessment indicates that risk control is required to eliminate or reduce the risk, the employer must implement such control.

Failure to comply with these obligations will attract penalties, including a fine of up to RM50,000 or RM500,000 depending on the breach.

Increased Penalties for Safety Breaches

The OSHA Amendment Act will also increase the applicable penalties for safety breaches, including:

• increasing the maximum fine for breach of the duty to ensure employees' safety, health and welfare at work or to establish a safety and health policy from RM50,000 to RM500,000;
• increasing the maximum fine under section 51 of the OSHA on general penalties from RM10,000 to RM100,000. For a continuing offence, the maximum fine will be increased from RM1,000 to RM2,000 for every day or part of a day during which the offence continues after conviction;
• increasing the maximum fine for failure, without reasonable excuse, to comply with an improvement or a prohibition notice issued under section 48 of the OSHA from RM50,000 to RM500,000. For a continuing offence, the maximum fine will be increased from RM500 to RM2,000 for each day during which the offence continues;
• increasing the maximum fine for the failure to establish a safety and health committee from RM5,000 to RM100,000 and the maximum imprisonment term from six months to a year; and
• increasing the maximum fine for the failure to appoint a safety and health officer from RM5,000 to RM50,000.

Note also that where a company commits an offence under the OSHA or its subsidiary legislation, any person who:

• was a director, compliance officer, partners, managers, secretary or similar officer within the company;
• was purporting to act in the capacity or was in any manner or to any extent responsible for the management of any of the affairs of the company; or
• was assisting in the management of the company,

may now be jointly and severally liable for offences committed by the company. This is a broader category of individuals than the existing rules, which cover only director, manager, secretary or other like officer of a body corporate.

The OSH Amendment Act also creates a presumption that the above persons will be deemed to be guilty of that offence unless they can prove that offence was committed:

• without their knowledge; and
• without their consent or connivance, and that they have taken all reasonable precautions and exercised due diligence to prevent the commission of the offence.

Key Takeaways

Employers that were not previously covered under the regulations must now comply with the existing, and the new, obligations under the OSHA.

Employers must ensure that their board of directors and senior employees are cognisant of the heightened risk of personal liability and increased penalties associated with safety breaches under the amended OSHA. Compliance with safety obligations should be key item on the board's agenda, and its importance recognised from the top down and across all levels of the organisation.

Herbert Smith Freehills LLP has extensive experience on workplace health and safety compliance. To find out more, contact fatim.jumabhoy@hsf.com.