Citation: Safework NSW v NSW Formwork Pty Limited [2019] NSWDC 631
Court: District Court of New South Wales
Date: 8 November 2019
Judge: Russell SC DCJ
Background
NSW Formwork Pty Limited was a subcontractor engaged to provide formwork, steel fixing and concrete services at a three-storey residential construction site in Croydon, NSW. The head contractor was HCM Building Pty Ltd. NSW Formwork's contractual obligations expressly included installing and maintaining starter bar caps on all reo bars in formwork areas.
On 6 April 2016, NSW Formwork's director instructed one of its employees, a formwork leading hand, to use a laser level to mark the underside of a formwork deck in the basement level. No equipment was provided to the worker to carry out the task safely. The worker found an aluminium stepladder and used it to perform the work. He fell from the ladder and was impaled on an exposed vertical steel reo bar that had no protective cap.
The reo bar entered through the worker's right buttock, traversed his pelvis, and exited at his right hip. Emergency services used a grinder to cut the bar, leaving a section inside his body. He required surgery at Royal Prince Alfred Hospital and was discharged approximately nine days later. NSW Formwork pleaded guilty to failing to comply with its work health and safety duty under the Work Health and Safety Act 2011 (NSW), thereby exposing the injured worker and its site foreman to a risk of death or serious injury.
Legal Issues
- The objective seriousness of the offence and where it sat within the range of comparable WHS prosecutions
- The appropriate weight to give mitigating factors, including the guilty plea, absence of prior convictions, and expressions of remorse
- Whether aggravating factors, including the foreseeable nature of the risk and contractual responsibility for reo bar caps, warranted a higher penalty
- Whether NSW Formwork had demonstrated a reduced financial capacity to pay a fine
- The appropriate quantum of the fine, including the discount for the guilty plea
Decision
The court characterised the offence as occupying the low to mid-range of objective seriousness. The risk of a worker falling from a ladder was foreseeable and the consequences of landing on an uncapped reo bar were plainly severe. Importantly, the contract between NSW Formwork and HCM Building expressly required NSW Formwork to install and maintain starter bar caps. The company had therefore assumed direct contractual responsibility for the very hazard that caused the injury.
The court identified several mitigating factors: the early guilty plea, no prior WHS convictions, cooperation with investigators, expressions of remorse, and steps taken after the incident to improve safety practices. However, it found these were counterbalanced by the seriousness of the actual harm, the foreseeability of the risk, and the fact that NSW Formwork as the specialist formwork contractor was best placed to address the hazard.
On capacity to pay, the court rejected the submission that the fine should be reduced. The company's financial statements raised more questions than they answered. With an annual turnover exceeding $3 million and year-on-year growth, the court was not satisfied NSW Formwork had limited means. It also noted that the lifestyles of the director and company secretary appeared inconsistent with the wages the company recorded as paying them.
The court set a base fine of $200,000 and applied a 25 percent discount to reflect the guilty plea, arriving at a final fine of $150,000. It also ordered that 50 percent of the fine be paid to the prosecutor pursuant to section 122(2) of the Fines Act 1996, and that NSW Formwork pay agreed prosecution costs of $33,000.
Orders Made
- NSW Formwork Pty Limited convicted of the offence
- Fine of $150,000 imposed (reduced from a base of $200,000 by 25% for the guilty plea)
- 50% of the fine ordered to be paid to the prosecutor pursuant to section 122(2) of the Fines Act 1996
- NSW Formwork ordered to pay the prosecutor's agreed costs of $33,000
Key Takeaways
- A subcontractor's express contractual responsibility for a specific hazard, such as maintaining reo bar caps, is a significant factor in assessing objective seriousness under the Work Health and Safety Act 2011 (NSW).
- The District Court confirmed that a company bears the evidentiary onus of demonstrating reduced financial capacity when seeking a reduction of a WHS fine; unsatisfactory or inconsistent financial evidence will not discharge that onus.
- Where a defendant's financial statements are incomplete or raise doubts, and its principals appear to enjoy a lifestyle inconsistent with declared remuneration, the court may decline any reduction for financial hardship.
- General deterrence carries substantial weight in WHS sentencing, and a sizeable fine remains appropriate even where mitigating factors, including an early guilty plea and post-incident remediation, are present.
- Failing to provide any equipment to a worker before directing them to perform a task at height, in an area containing uncapped reo bars, will be treated as a foreseeable and preventable risk capable of grounding a serious WHS conviction.
Legislation and Cases Referenced
Legislation
- Work Health and Safety Act 2011 (NSW), ss 19, 32
- Crimes (Sentencing Procedure) Act 1999 (NSW)
- Fines Act 1996 (NSW), ss 6, 122(2)
- Occupational Health and Safety Act 1983 (NSW)
Cases
- Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266
- Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338
- Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96
- Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610
- Mahdi Jahandideh v The Queen [2014] NSWCCA 178
- Markarian v The Queen [2005] HCA 25; (2005) 228 CLR 357
- Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120
- Green v The Queen [2011] HCA 49; (2011) 244 CLR 462
- Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465
- WorkCover Authority of NSW (Inspector Carmody) v Consolidated Constructions Pty Limited [2001] NSWIRComm 263
- Inspector Howard v Baulderstone Hornibrook Pty Limited [2009] NSWIRComm 92