Citation: SafeWork NSW v Broadspectrum (Australia) Pty Ltd [2018] NSWDC 7
Court: District Court of New South Wales
Date: 2 February 2018
Judge: Kearns DCJ
Background
Broadspectrum (Australia) Pty Ltd (formerly Transfield Services) provided repair and maintenance services at the Botany Industrial Park under contract to Qenos Pty Ltd. Within the site, the defendant controlled a compound containing a workshop and open yard where equipment and engineering materials were stored, including on a steel cantilever-style storage rack located outdoors.
On 29 January 2015, a boilermaker and pipefitter engaged through a labour-hire arrangement was directed by the defendant's supervisor to retrieve a steel pipe from the rack. There were no witnesses, but the rack collapsed as the worker accessed it, causing him to fall and suffer fatal injuries. The rack had been exposed to severe atmospheric corrosion, being near Botany Bay and a former chemical plant site. Its hollow base frame members were open-ended, allowing rainwater to pool and corrode the structure from within. No corrosion protection, galvanisation, or protective coating had been applied.
SafeWork NSW prosecuted the defendant for failing to comply with its duty under section 19(1) of the Work Health and Safety Act 2011, which requires a person conducting a business or undertaking to ensure the health and safety of workers whose activities it influences or directs. The defendant pleaded guilty.
Legal Issues
- Whether the defendant breached its duty under section 19(1) of the Work Health and Safety Act 2011 by failing to take reasonably practicable steps to manage the risk of the rack collapsing due to corrosion
- What penalty was appropriate, having regard to the objective seriousness of the offence, deterrence, and the defendant's mitigating circumstances
- The weight to be given to the defendant's guilty plea, post-incident remediation, good corporate character, and cooperation with the regulator
Decision
The defendant pleaded guilty, and the sentencing exercise centred on determining the appropriate fine within the statutory maximum of $1,500,000. Kearns DCJ accepted the Agreed Statement of Facts, which established that no corrosion protection had been applied to the rack in contravention of the relevant Australian Standard, that the rack's base members were open to the elements, and that no inspection process had specifically identified the rack as plant requiring assessment.
The court addressed the defendant's submission that Australian Standard AS 4100-1998 did not apply to it on the basis that the standard governed design and fabrication rather than ongoing maintenance. His Honour observed that even if the standard did not technically bind the defendant, it reflected well-understood principles about the need to protect steel structures from corrosion, and the agreed facts expressly stated that the absence of protection was "in contravention of the Standard." The defendant had the means and knowledge to act and did not.
On objective seriousness, the court found the offence was of moderate seriousness. The risk of death or serious injury from a collapsing rack was foreseeable and preventable, but the court noted the defendant had existing safety procedures and had not ignored safety altogether. On specific deterrence, the court found this was a minor factor given the defendant's swift and substantial post-incident response, including reviewing 1,871 racks across 198 sites, increasing leadership engagement, and achieving a 20% reduction in injury rates nationally over two financial years.
In mitigation, Kearns DCJ accepted the defendant's genuine remorse and acceptance of responsibility, its full cooperation with investigators, its extensive post-incident remediation, its one prior conviction dating from 2002 (assessed in the context of the defendant's scale of operations), and its record as a corporate citizen engaged in significant community and Indigenous support initiatives. A 25% discount was applied for the early guilty plea.
Orders Made
- The defendant was convicted and fined $240,000, with a moiety (half) payable to the prosecutor.
- The defendant was ordered to pay the prosecutor's costs in the agreed sum of $51,000.
Key Takeaways
- A company that controls a worksite bears a duty under section 19(1) of the Work Health and Safety Act 2011 to protect workers it directs, even where those workers are formally employed or engaged through a labour-hire or subcontracting arrangement.
- The District Court found that Australian Standards relating to corrosion protection of steel structures, while potentially directed at designers and fabricators, remain relevant to assessing whether a duty holder understood or should have understood the risks posed by unprotected steel in a corrosive environment.
- An agreed statement of facts that expressly states a contravention of an Australian Standard carries significant weight at sentence, even where the defendant raises subsequent technical arguments about the standard's scope.
- Extensive post-incident remediation, including large-scale equipment audits, revised systems, and measurable improvements in injury rates, can reduce the weight given to specific deterrence at sentence, though it does not displace the need for general deterrence in work health and safety matters.
- A 25% discount on the otherwise applicable penalty is available for a guilty plea entered at the first available opportunity, consistent with the Crimes (Sentencing Procedure) Act 1999.
Legislation and Cases Referenced
Legislation:
- Work Health and Safety Act 2011 (NSW), ss 19(1), 32
- Crimes (Sentencing Procedure) Act 1999 (NSW)
Standards:
- Australian Standard AS 4100-1998: Steel Structures, cl 3.5.6
- AS/NZS 2312.1:2014: Guide to the Protection of Structural Steel Against Atmospheric Corrosion by the Use of Protective Coatings
Cases cited: No cases were cited in the portions of the judgment provided.