If you are an officer of a person conducting a business or undertaking (PCBU) — a director, company secretary, or any person who participates in making decisions that affect the whole or a substantial part of the business — you have a personal legal obligation under Australian work health and safety law. This obligation is separate from and additional to the duties of the PCBU itself, and it cannot be delegated, insured against (in terms of criminal liability), or ignored.

Understanding your officer due diligence obligations and how a drug and alcohol testing program helps you meet them is not optional — it is a legal necessity.

The WHS Act and Officer Duties

Under section 27 of the Work Health and Safety Act 2011 (and equivalent provisions in state and territory legislation), an officer of a PCBU must exercise due diligence to ensure that the PCBU complies with its WHS duties and obligations. This is a positive duty — officers must actively take steps to ensure compliance, not simply avoid actively causing harm.

The due diligence obligation requires the officer to:

• Acquire and keep up-to-date knowledge of work health and safety matters.
• Gain an understanding of the nature of the operations of the business and the hazards and risks associated with those operations.
• Ensure the PCBU has appropriate resources and processes to eliminate or minimise risks to health and safety.
• Ensure the PCBU has appropriate processes for receiving and considering information about incidents, hazards, and risks, and for responding to that information in a timely way.
• Ensure the PCBU has and implements processes for complying with its WHS duties.
• Verify the provision and use of resources and processes.

Each of these elements has direct relevance to drug and alcohol testing programs.

Personal Liability Under Section 27

The penalties for officers who fail to exercise due diligence are significant and personal. Under the model WHS Act:

• Category 1 offence (reckless conduct exposing a person to a risk of death or serious injury): up to five years’ imprisonment and/or a fine of up to $600,000 for an individual officer.
• Category 2 offence (failure to comply with a health and safety duty exposing a person to a risk of death or serious injury): a fine of up to $300,000 for an individual officer.
• Category 3 offence (failure to comply with a health and safety duty): a fine of up to $100,000 for an individual officer.

These penalties are personal — they attach to the individual officer, not to the company. Directors’ and officers’ insurance may cover fines in some circumstances, but it cannot cover imprisonment, and it does not relieve the officer of the legal obligation itself.

It is worth noting that an officer can be prosecuted even if the PCBU is not prosecuted, and even if no incident has occurred — the failure to exercise due diligence is the offence, not the occurrence of harm.

How Testing Programs Demonstrate Due Diligence

A drug and alcohol testing program directly addresses multiple elements of the officer due diligence obligation:

Knowledge of Hazards and Risks

Substance impairment in the workplace is a recognised hazard. By implementing a testing program, the officer demonstrates that they are aware of this hazard and have taken steps to address it. Conversely, an officer who is unaware that substance use poses a risk in their workplace, or who is aware but has taken no action, is failing in their due diligence.

Appropriate Resources and Processes

A testing program requires resources — policy development, testing equipment or provider contracts, trained collectors, software for managing selections and results, and time for program administration. Allocating these resources demonstrates that the officer is ensuring the PCBU has what it needs to manage the risk.

Receiving and Responding to Information

A well-managed testing program generates data — selection records, test results, positive rates, trend analysis, and compliance reports. This data provides the officer with information about the current state of substance-related risk in the organisation and evidence that the PCBU is responding to that information.

Verifying Compliance

Officers must verify that the processes are not just in place but are actually working. Regular compliance reports, audit outcomes, and program reviews provide the evidence of verification. An officer who can demonstrate that they regularly review testing program data and act on the findings is in a far stronger position than one who simply assumes the program is running effectively.

Case Law and Regulatory Guidance

Australian courts and regulators have consistently held that officers must be proactive. Ignorance is not a defence — in fact, wilful ignorance (choosing not to enquire into safety matters) may be treated as an aggravating factor.

Key principles from case law include:

• Officers must take a hands-on approach to safety management, not merely rely on reports from management.
• The size of the organisation does not reduce the due diligence obligation — officers of small companies are held to the same standard as those of large corporations.
• Delegation does not equal discharge — an officer can delegate the implementation of safety measures, but they must verify that the delegated tasks are being performed.
• Systems must be audited — having a policy or program in place is necessary but not sufficient. The officer must ensure it is being implemented effectively.

Regulators have specifically identified substance management as an area where officers are expected to demonstrate proactive risk management.

Practical Steps for Officers

Officers seeking to demonstrate due diligence in relation to drug and alcohol risk should:

• Ensure a policy exists — a current, legally reviewed drug and alcohol policy must be in place.
• Approve adequate resources — the testing program must be adequately funded, including testing costs, software, training, and personnel.
• Review program data regularly — receive and review testing compliance reports at least quarterly. Understand the positive rate, the coverage rate, and any trends.
• Act on findings — if the data reveals issues (e.g., low testing coverage, high positive rates in a specific area, or procedural non-compliance), ensure that corrective action is taken and documented.
• Stay informed — keep up to date with legislative changes, case law developments, and industry best practice in drug and alcohol testing.
• Document your engagement — maintain records of board or executive discussions about the testing program, decisions made, and actions taken. This documentation is your evidence of due diligence.

The Cost of Inaction

The cost of implementing a drug and alcohol testing program is modest compared to the potential cost of not having one. A single serious incident involving substance impairment can result in prosecution (of both the PCBU and individual officers), workers’ compensation claims, civil litigation, regulatory sanctions, and reputational damage that takes years to repair.

For officers, the personal stakes — financial penalties, criminal record, and in the most serious cases, imprisonment — make the investment in a proper testing program one of the most straightforward risk management decisions available.

If you need a platform that makes it easy to implement, manage, and report on a drug and alcohol testing program — providing the evidence of compliance that officers need — start your free trial with FairTest and take a concrete step towards meeting your due diligence obligations.