If the recently-released Bill becomes law, directors and other “responsible person(s)” of aged care providers could face serious criminal penalties, including going to prison for up to 5 years and large fines. Those occupying these roles may, naturally, be concerned about what their risk exposure will be under these provisions.
Below, we outline the circumstances in which you as a responsible person might face prison time and what steps you can take now and in the future to protect against that risk.
1. Does this risk apply to me?
The term ‘responsible person’ is a defined term in the Draft Bill. Under the Bill, you are a ‘responsible person’ if you:
are a member of the governing body for a provider, or otherwise responsible for executive decisions, or
have authority or responsibility (or significant influence over) planning, directing or controlling activities,
and if a registered provider delivers or proposes to deliver funded aged care services, then you are also a ‘responsible person’ if you are any person who is:
a registered nurse and has responsibility for the overall management of nursing services, or
responsible for the day-to-day operations of the registered provider.
2. Does this mean I can be sent to prison for any breach by the provider?
No. While you and your organisation should always seek to fully comply with all provisions, responsible persons only risk prison if:
they as individuals commit a “serious failure” to conduct due diligence to ensure the provider complies with section 120 of the Draft Bill; and
that serious failure results in a care recipient’s death, severe injury, or illness.
Under section 120 of the Draft Bill, a registered provider must ensure, as far as is “reasonably practicable”, that its conduct does not adversely affect the health and safety of care recipients while delivering their aged care services. Section 121 gives a non-exhaustive list of due diligence activities board members (and other responsible persons) must perform.
A responsible person can be convicted or found guilty of an offence under section 121, regardless of whether the provider is convicted or found guilty of an offence under section 120. This means the draft Bill allows for situations where you as an individual could be convicted and go to prison for a breach of your personal obligations even if the organisation has not breached a registered provider obligation.
3. Does this mean I can be sent to prison if I make any due diligence errors?
No. The risk of prison only arises if:
the error has caused or contributed to a care recipient’s death, serious injury or illness, and
the error is serious enough to amount to a “serious failure”. The error may be a single act, failure to act, or a systemic pattern of poor conduct.
If such an error arises, a responsible person can still avoid prison if they can prove they have a reasonable defence.
4. What should I do?
It is prudent to undertake an audit of your organisation and your role within the organisation. This audit should include an assessment of how well you and the organisation are equipped to meet the obligations under the draft Bill, should that draft Bill become law. This may include reviewing current policies, procedures, resourcing, culture and systems to ascertain whether they will be fit for purpose under those laws.
If these provisions become law, and you are alleged to have committed a breach of laws where imprisonment is a potential penalty, you should immediately seek legal advice from a representative who can advise you about your prospects of raising a successful defence and present that defence on your behalf.
Need help?
Aged care providers and their boards need peace of mind that they understand and can manage their risk exposure under these potential new laws. It can be difficult to accurately assess risk and what to do in response from within. We can provide peace of mind by conducting an independent audit and helping you implement an action plan before the new Act comes into effect (which is scheduled to happen on 1 July 2024). Call us now to find out more.