Question: Excluding requirements for cleaning pools, what are the regulations for third party cleaners when they step onto common property? Are they required to sign in? Should they provide the body corporate with proof of insurance?
Answer: Should a body corporate engage a contractor that does not have insurance in place, the body corporate could be taking on these responsibilities and liabilities.
Tyrone Shandiman, Strata Insurance Solutions:
Our response is limited to insurance advice. We cannot advise on the regulations applicable to contractors accessing the site.
From a strata insurance perspective, tradespeople are not required to be insured as a condition of cover under the strata policy. Notwithstanding, it is recommended that the body corporate engage contractors with insurance.
A contractor’s public liability policy will cover the contractor for legal claims against them for personal injury and property damage.
This is important for anyone engaging a contractor, as it gives the body corporate or injured person recourse against the contractor’s insurance, should an injury or damage event occur for which the contractor is liable. Without cover, the injured parties may not be in a position to receive compensation for an event.
Additionally, if the contractor causes damage to the building and their action results in a strata insurance claim, the strata insurer can recover against the contractor (and their insurance policy). This will have a positive impact on the building’s claims history.
Dakota Panetta, Solutions in Engineering:
This is a very multifaceted answer, so my first suggestion is to seek advice from a WHS practitioner or lawyer who can articulate the WHS needs of your specific scheme or portfolio, both in regard to physical hazards and the risks associated with organising workers.
The first delineation a strata scheme needs to determine is if they would be deemed a PCBU (Person Conducting a Business or Undertaking) in regards to the WHS framework.
If the answer is yes, your duties as a strata scheme are significantly greater than a scheme that would not be deemed a PCBU.
Whilst a strata scheme may, at times, be exempt from being a PCBU, the strata management firm never will be. Consequently, the strata management firm could be caught up in any WHS issues that arise by being the entity that organises and directs the contractors, in this instance the cleaners.
So, to protect both the strata scheme and the strata management firm, there needs to be a very clear WHS policy in place:
- identifying risk onsite at a property
- managing insurance risk in the event of an incident.
If any PCBU is directing or allowing work to take place onsite (note that under WHS law, a workplace is any place where a worker goes to conduct their work), they must ensure the site and the means of entering and exiting the site are free from hazards.
If hazards do exist that invariably cannot be removed, the PCBU entity controlling the contractor (worker) must ensure that their workers are appropriately prepared and briefed, and this can include a sign in and induction (being shown around the property).
Under most Australian WHS legislation, it is an offence to engage a person to do work if that work requires specific qualifications or experience, e.g. working at heights and the entity that engages them, e.g. the body corporate, could be held liable for this offence.
Specifically regarding insurance, it is a best practice scenario when appointing contractors to complete work on common property rather than a mandate.
Should a body corporate engage a contractor that does not have insurance in place, the body corporate could be taking on these responsibilities and liabilities. For example, where a contractor engaged by the body corporate gets hurt, and the contractor does not have insurance, the body corporate can be held responsible for the medical expenses and liability of that contractor.
Tyrone Shandiman
Strata Insurance Solutions
E: tshandiman@iaa.net.au
P: 1300 554 165
This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisenent Australia AFSL No 240549, ABN 15 003 886 687.
This post appears in Strata News #691.
Dakota Panetta
Solutions in Engineering
E: dakotap@solutionsinengineering.com
P: 1300 136 036
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