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District Court 22 November 2019

SafeWork NSW v MMP Industrial Pty Ltd

[2019] NSWDC 854

Other
CRIMINAL LAW PROSECUTION WORK HEALTH AND SAFETY DUTY OF PERSONS UNDERTAKING BUSINESS OBJECTIVE SERIOUSNESS MITIGATING FACTORS

Citation: SafeWork NSW v MMP Industrial Pty Ltd [2019] NSWDC 854
Court: District Court of New South Wales
Date: 22 November 2019
Judge: Strathdee DCJ

Background

The defendant, MMP Industrial Pty Ltd, operated a paint and industrial chemical manufacturing business at a 12-warehouse complex in Mulgrave, NSW, employing around 50 workers. On 29 August 2016, a worker engaged in cleaning a 500-litre metal mixing vat was injured when static electricity ignited acetone vapours inside the vat, causing an explosion. The vat was not fitted with an earthing strap or non-static wheels, despite such equipment being available at the workplace.

The injured worker sustained partial thickness burns to his face, ear, and all ten fingers and both wrists. He required skin grafts at Concord Repatriation Hospital and was absent from work for approximately three weeks before returning to his previous role.

The defendant did not notify SafeWork NSW of the incident immediately as required by law. Notification came seven days later, on 5 September 2016, and SafeWork inspectors attended the site on 19 September 2016. The defendant was subsequently prosecuted on two charges under the Work Health and Safety Act 2011 (NSW).

  • Whether the defendant, as a person conducting a business or undertaking (PCBU), failed to ensure the health and safety of workers so far as was reasonably practicable, thereby exposing workers to a risk of death or serious injury, contrary to sections 19(1) and 32 of the WHS Act 2011.
  • Whether the defendant failed to notify SafeWork NSW immediately after becoming aware of a notifiable incident, contrary to section 38(1) of the WHS Act 2011.
  • What penalty was appropriate, having regard to the objective seriousness of the offences, mitigating and aggravating factors, and the defendant's guilty plea.
  • What additional orders (including training orders and a work health and safety undertaking) were appropriate.

Decision

The defendant pleaded guilty to both offences on 9 September 2019. On the primary charge under section 32, the court assessed the offending as involving a foreseeable and significant risk: the use of flammable solvents without adequate static discharge controls was a known hazard, earthing equipment was available but not used, and training was inadequate. The maximum penalty for the section 32 offence was $1,500,000.

The court fixed the appropriate base fine at $100,000 for the principal offence, reflecting the objective seriousness of the breach while taking into account mitigating factors including the guilty plea, the defendant's cooperation, and steps taken after the incident. That figure was reduced by 25 per cent to reflect the guilty plea, producing a fine of $75,000.

For the notification offence under section 38(1), the court fixed the appropriate fine at $1,000, reduced by 25 per cent for the guilty plea, resulting in a fine of $750. The maximum for that offence was $50,000.

In addition to the monetary penalties, the court imposed training orders and required the defendant to enter into a work health and safety undertaking, including developing a WHS plan addressing the management of dangerous goods and hazardous substances, and attending a review meeting with the SafeWork NSW Inspectorate upon completion of that plan.

Orders Made

  • Defendant convicted of the section 32(1) offence and fined $75,000 (reduced from a base of $100,000 by 25 per cent for the guilty plea).
  • Defendant convicted of the section 38(1) offence and fined $750 (reduced from a base of $1,000 by 25 per cent for the guilty plea).
  • 50 per cent of both fines ordered to be paid to the prosecutor pursuant to section 122(2) of the Fines Act 1996.
  • Training orders imposed, including requirements for appropriate WHS training for workers and management in relation to dangerous goods and hazardous substances.
  • Defendant ordered to develop a WHS plan in accordance with AS/NZS ISO 45001:2018 addressing risks associated with handling dangerous goods and hazardous substances.
  • Defendant ordered to enter into a work health and safety undertaking, including arranging a review meeting with SafeWork NSW Inspectorate within two months of completing the WHS plan.
  • Matter adjourned to 20 November 2020 for compliance check.
  • Defendant ordered to pay prosecution costs as agreed or assessed.

Key Takeaways

  • A PCBU's failure to fit readily available static-control equipment (such as earthing straps) to vessels used with flammable solvents can constitute a serious breach of the duty to ensure worker safety under section 19(1) of the WHS Act 2011, even where the maximum penalty is $1,500,000 and the fine imposed is significantly below that ceiling.
  • The obligation to notify SafeWork NSW of a notifiable incident arises immediately upon the PCBU becoming aware of the incident. A seven-day delay in notification, without more, constituted a separate offence under section 38(1).
  • A guilty plea attracted a 25 per cent reduction from the base fine on both charges, consistent with the approach in comparable WHS sentencing decisions cited by the court.
  • Beyond fines, the District Court used its sentencing powers to impose substantive remedial obligations, including training orders and a formal WHS undertaking tied to an enforceable compliance timetable, reflecting the Act's goals of specific and general deterrence.
  • Inadequate training in the handling of flammable liquids was identified as a contributing factor to the offending, reinforcing that procedural documentation alone (the defendant had a written safety procedure in place) does not satisfy the duty to ensure worker safety if that documentation is not effectively implemented on the floor.

Legislation and Cases Referenced

Legislation
- Work Health and Safety Act 2011 (NSW), ss 19(1), 32, 35, 36, 37, 38(1), 239
- Work Health and Safety Regulation 2011 (NSW)
- Crimes (Sentencing Procedure) Act 1999 (NSW)
- Fines Act 1996 (NSW), s 122(2)

Cases
- Bulga Underground Operations v Nash (2016) 93 NSWLR 338; [2016] NSWCCA 37
- Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610; [2000] NSWIRComm 71
- Department of Mineral Resources of NSW (McKensey) v Kembla Coal & Coke Pty Limited (1999) 92 IR 8; [1999] NSWIRComm 353
- Nash v Silver City Drilling (NSW) Pty Ltd; Attorney General for New South Wales v Silver City Drilling (NSW) Pty Ltd [2017] NSWCCA 96
- SafeWork NSW v Samuels [2019] NSWDC 111
- SafeWork NSW v Yan Huai Wu and Zenger (Aust) Pty Ltd [2018] NSWDC 211
- SafeWork (NSW) v Romanous Contractors [2016] NSWDC 48
- WorkCover (Inspector Calvez) v TAFE Commission [2014] NSWDC 108
- WorkCover v Brandown Pty Ltd [2015] NSWDC 261