Citation: Safe Work (NSW) v Schaefer Systems International P/L [2016] NSWDC 321
Court: District Court of New South Wales
Date: 28 November 2016
Judge: Judge AC Scotting
Background
The defendant company supplied and project-managed industrial storage systems but engaged specialist contractors to perform physical installation work. In 2013, it contracted with a client to extend an existing racking system at a warehouse in Prestons, NSW, and engaged an experienced installation subcontractor to carry out the work. The defendant maintained two employees on site: a project manager who visited approximately weekly and a site supervisor who attended daily for several hours.
The installation subcontractor in turn used labour hire workers, including a casual employee with no prior experience in installing industrial storage systems. On 9 September 2013, that worker was laying flooring components on a second mezzanine level, approximately six metres above the ground. He walked on the unguarded right-hand side of a conveyor structure and fell through an unguarded edge, landing on the concrete floor below.
The worker sustained a traumatic brain injury, spinal fractures, a kidney laceration, and a lung contusion. No employees of the defendant were on site at the time of the incident. The defendant's site supervisor had last attended three days earlier and had given only a general direction that handrails needed to be installed on finished areas of that level.
Legal Issues
- Whether the defendant, as a person conducting a business with a health and safety duty under s 19(1) of the Work Health and Safety Act 2011, failed to comply with that duty in a way that exposed a worker to a risk of death or serious injury contrary to s 32 of that Act
- What was the appropriate penalty, having regard to the objective seriousness of the offence, applicable mitigating factors, and relevant sentencing principles including parity, totality, deterrence, and the utilitarian value of a guilty plea
Decision
The defendant pleaded guilty to the charge. The court accepted the Agreed Statement of Facts and proceeded to sentence. The maximum penalty for the offence under s 32 of the Work Health and Safety Act 2011 is a fine of $1.5 million.
Judge Scotting assessed the objective seriousness of the offence as falling in the low to mid range. The defendant had overall responsibility for the installation despite engaging a subcontractor day-to-day. The Safe Work Method Statement, which the defendant had reviewed and approved without requiring changes, identified the risk of falls from height and prescribed control measures. However, the defendant's systems did not require its site supervisor to verify whether those control measures were actually in place before handrails were installed. The absence of any defendant employee on site on the day of the incident was treated as a relevant factor going to the degree of the defendant's direct oversight at the critical time.
The court identified several mitigating factors. The defendant had no prior convictions, had cooperated with the investigation, was unlikely to reoffend following substantial revisions to its safety systems, and had demonstrated genuine remorse and contrition through its senior management. The defendant's engagement of an experienced subcontractor with a strong prior safety record across eighteen previous projects was also noted, though it did not displace the defendant's own obligations.
The court determined a base fine of $150,000 and applied a 20% discount for the guilty plea, which had been entered on the date of the amended summons in September 2016. The discount was at the upper end of the 10 to 25% range, reflecting in part delays caused by parallel negotiations involving the subcontractor. The resulting fine imposed was $120,000, with 50% directed to the prosecutor under s 122(2) of the Fines Act 1996.
Orders Made
- The defendant was convicted of the offence under ss 19(1) and 32 of the Work Health and Safety Act 2011
- A fine of $120,000 was imposed (reduced from a base of $150,000 by a 20% guilty plea discount)
- Pursuant to s 122(2) of the Fines Act 1996, 50% of the fine was ordered to be paid to the prosecutor
- The defendant was ordered to pay the prosecutor's costs as agreed or assessed
Key Takeaways
- A business that engages a subcontractor for installation work does not shed its own health and safety duty under s 19(1) of the Work Health and Safety Act 2011; overall responsibility for the installation remained with the defendant despite the subcontractor managing day-to-day work.
- Reviewing and approving a Safe Work Method Statement without requiring changes does not satisfy a duty holder's obligations where its own systems fail to verify that control measures identified in the SWMS are actually implemented on site.
- The District Court treated the absence of the defendant's own personnel from the site at the time of the incident as a relevant circumstance, noting the gap between the defendant's supervisory arrangements and the conditions that existed when the incident occurred.
- A guilty plea discount of 20% (within the 10 to 25% range) was applied where the plea was entered at the time of the amended summons, with the delay partially attributable to a third party's separate negotiations with the prosecutor rather than any dilatoriness by the defendant.
- Post-incident remediation, including the introduction of a Safety Management Plan, mandatory workplace inspection checklists, and fall protection requirements for subcontractors, supported findings of genuine remorse and a low likelihood of reoffending, and were weighed as mitigating factors in sentencing.
Legislation and Cases Referenced
Legislation
- Work Health and Safety Act 2011 (NSW), ss 19(1), 32
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3, 3A, 21A(3)(e), 21A(3)(g), 21A(3)(i), 21A(3)(k), 21A(3)(m), 22
- Fines Act 1996 (NSW), ss 6, 122(2)
Cases
- Bulga Underground Operations Pty Ltd v Nash [2016] NSWCCA 37
- R v Thomson & Houlton (2000) 49 NSWLR 383
- R v Borkowski (2009) 195 A Crim R 1