RICP can have long-term benefits for businesses

A registered code of practice can be used as proof of compliance during a police inspection or an audit

Last month, federal infrastructure and transport Darren Chester announced a $350,000 assistance package to support businesses develop new industry codes of practice suitable to their operating environments.

The funding is designed to encourage transport operators develop registered industry codes of practice (RICP) based on the National Heavy Vehicle Regulator (NHVR’s) recently-released Guidelines for preparing and registering industry codes of practice.

“A registered Industry code of practice establishes standards for organisations across the heavy vehicle supply chain on how to operate at a higher safety standard,” Chester says.

“Businesses that adopt a new code not only significantly reduce the risk of breaching the Heavy Vehicle National Law, but also improve their safety standards.

“This is another important step in the NHVR’s Safety Strategy, which includes new chain of responsibility laws, a national roadworthiness program, National Heavy Vehicle Inspection Manual and checklists.”

The move received a thumbs-up from NHVR, the Australian Trucking Association (ATA) and the Australian Logistics Council (ALC).

“The support from the federal government will allow industry bodies and code developers to offset some of the costs associated with delivering new codes,” NHVR CEO Sal Petroccitto says.

Both ALC and ATA believe that the new codes will help improve standards of safety in the transport and logistics sector.

“Codes of practice will provide a safer and more accountable heavy vehicle industry and we look forward to their development and implementation,” ALC MD Michael Kilgariff says.

ATA CEO Ben Maguire says having general safety duty on businesses is a key part of the industry best practice safety regulation.

“Under the Heavy Vehicle National Law, these codes are to be developed by industry in accordance with the guidelines now published by the regulator,” he says.

“In a series of discussions, the ATA and its members put forward closely argued views about issues including intellectual property, the use of examples in codes and how codes should be updated.

“I’d like to thank the NHVR and everyone involved for their willingness to engage in these detailed technical discussions.”

Maguire is confident that the registered codes of practice will complement ATA’s flagship TruckSafe program.

“Businesses in the TruckSafe program comply with five sets of standards and are audited regularly by experienced, qualified and objective auditors.

“It will be important for safety to have industry codes freely available – but the best way a business can demonstrate its safety and guarantee that it meets our standards is to have an audit certificate and the TruckSafe tick.”

Benefits of RICP

No matter how safely you conduct your day-to-day business operations, there is always a risk of things running off the track or an inadvertent breach occurring.

In such situations, simply having a risk management plan cannot serve as an adequate alibi to bail out operators from their role in the chain of responsibility (COR) and the Heavy Vehicle National Law (HVNL) requirements.

However, having a registered industry code of practice may help your defence in case of a breach of the law, an accident or an audit. This is one of the key distinguishing features of an RICP – its ability to play an evidentiary role in legal proceedings.

Although an RICP cannot guarantee immunity from potential penalties, having these NHVR-approved codes of practice in place can help reduce the severity of penalties and fines.

For instance, one of the requirements of an RICP is to have a well-documented compliance record, which can support an operator’s case while proving that an incident or accident is not part of pattern of consistent health and safety breaches.

Moreover, having a risk management plan based on a registered code of practice can ensure operators will be able to better satisfy safety obligations because their plan will be based on conditions specific to their business.

Therefore they will be able to identify risks and address HVNL obligations in the context that is specific to their operating environment.

The national regulator states that when a company or an individual adopts an RICP, they are “proactively meeting their chain of responsibility and driving obligations under the legislation and creating the standards under which their risk management process should operate”.

Legal matters

Not only can the RICP help individual operators, groups or corporations develop a compliance and safety risk management process to cater to the needs of their operating environment, but by implementing an RICP adopters may be offered protection from certain litigation.

The RICP can act as evidence in court to prove that the adopter complied with all relevant standards and procedures.

Safety

The regulator states that implementing risk management systems in accordance with an RICP raises awareness of risks and the efforts needed to mitigate them to satisfy safety obligations rather than just comply with the HVNL.

This, in turn, can lead to better allocation of safety resources, and an improved safety culture and performance, including regular maintenance of vehicle and equipment.

Compliance

NHVR states that a risk-based approach to managing safety enables operators to comply with the HVNL in a way that best suits their business.

This can increase the likelihood of becoming compliant with other health and safety and environmental regulations.

Costs and productivity

Having proper safety and risk management systems in place can also reduce the risk of incidents and accidents, which results in:

• “reduced direct costs such as damage, recovery, injury and lost time;

• reduced indirect costs such as insurance premiums, legal exposure, and internal investigations”.

It can also improve productivity by reducing down time as result of avoidable delays.

Audits and penalties

With improved safety, operators are likely to reduce the number of audits to which their business is subjected.

It also means fewer penalties and cancellations of permits or approvals under the HVNL, and reduced exposure to civil claims.

Cost and financial assistance

Developing a registered industry code of practice does not come without financial costs.

The process involves paying the regulator two sets of fees, in addition to time and resources spent during the development phase.

However, the government aims to encourage operators to get on board with this practice with its funding assistance package.

NHVR fee

A person or entity developing an RICP has to pay assessment and registration charges to the regulator.

This fee is applicable to the developers of the RICP and not the adopters i.e. parties that are not directly responsible for the development of the RICP but are linked to the developers via chain of responsibility obligations.

However, adopters are eligible to buy proprietary tools or services from the regulator.

Registering an RICP involves two sets of fees:

1. Administrative fee: is charged following the end of the initial consultation period when an operator gets the go-ahead from NHVR to begin the process of developing an RICP.

2. Assessment fee: is paid after NHVR’s assessment of the draft code. The cost varies depending on the scope and complexity of the code, and resources needed for its assessment.

Financial assistance and eligibility

Petroccitto says Commonwealth’s $350,000 assistance package aims to offset certain costs associated with the development and registration process.

The funding will be available to eligible operators until January next year.

The funding assistance form can be submitted after NHVR has approved an individual or company’s notice of intention (NOI) as part of the initial consultation phase.

How to develop an RICP

An individual, group or corporation can develop a registered industry code of practice based on the recently-released Guidelines for Preparing and Registering Industry Codes of Practice.

These guidelines provide direction for developers including information such as what an industry code of practice must include, how it must be prepared and how it must be registered with the regulator.

The regulator stipulates that an RICP must be accurate and easy to understand.

It recommends using “plain English” to avoid ambiguity because the document will be used by various readers including the code adopters, authorities and, in some cases, the courts.

Mandatory steps to follow:

1. Industry consultation

The regulator mandates that an RICP developer “must consult comprehensively with the relevant industry sector and show that it has incorporated regulatory, technical, industry body and operator advice and experience. It must also consult with the persons on the list provided to the developer by NHVR.

2. Purpose and scope

Developers must clearly state the purpose and the scope of the proposed industry code of practice. The application should identify and include the following:

industry sectors to be covered by the code
activities within that sector that are to be covered
parties responsible for those activities
other parties associated with those activities through chain of responsibility obligations
parts of the HVNL invoked by the industry code of practice.

3. Risk management process

In accordance with AS/NZS ISO 31000:2009 Risk Management — Principles and Guidelines, developers must follow a thorough risk management process to develop the key content of the RICP. It includes:

a) identifying types of risks associated with each activity relevant to that industry;

b) assessing these risks, and

c) outlining the types of controls that can be applied to these risks.

A good place to start the risk identification process is to consider the HVNL requirements in relation to:

vehicle roadworthiness and suitability of vehicles and equipment for a task
mass, dimension and loading limitations
driver fatigue and fitness for duty
high risk behaviour that can affect the task.

4. Guidance for adopters

NHVR warns that an RICP can only identify foreseeable risk types but all industries and activities can face unanticipated risks at some point.

Therefore it mandates that an RICP must explain to all code adopters “how they can use the risk management process to identify, assess and treat risks within their own enterprise”. It involves:

developing a risk management process
implement control measures mitigate risks within the business compliance systems
document the customised risk management process in employment agreements.

Maintenance and review

The RICP remains valid for a period of five years, following which the regulator calls for reassessment of the codes.

A reminder is sent to the developer a year before the nominated end date. It is up to the developer to decide whether they wish to review the codes.

In case they do not want to review their existing codes of practice, the RICP ceases to exist at the end of the five-year term.

However, if they plan to re-validate their codes the process calls for an internal review, the results of which must be submitted to NHVR at least six months before the end date of the existing RICP.

Either way, the regulator will publish the developer’s response on its website.

If the developer finds that there is no requirement for a change in the exiting RICP, they will be expected to provide detailed reasons and evidence for their findings.

The regulator will appoint an assessment team to conduct a full review of the developer’s new codes of practice and decide either to: