Category: Prosecution

Is this really what due diligence was designed for?

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On 24 February 2016 findings were handed down in the prosecution of another company officer under the due diligence provisions of the WHS legislation.

In WorkCover Authority of NSW (Inspector Moore) E&T Bricklaying Pty Ltd [2015] NSWDC 369, Mr Kose, a company officer and on site representative of E&T Bricklaying was prosecuted for failing to exercise due diligence in breach of the New South Wales WHS Act.

It is not clear in what “capacity” Mr Kose was a company officer, whether he was a director, CEO or performed some other role. It also seems implicit in the judgement that Mr Kose was involved in the day-to-day work. At paragraph 10, the judgement states:

There were five personnel involved in the laying of the blocks. They were Mr Kose, Mr Rahimi …..

There is nothing particularly instructive about the case, and it certainly does not add anything to the body of knowledge about who is or is not a “company officer”. However, the case does raise an interesting question about whether these were the sorts of cases that changes under WHS legislation to create positive obligations of due diligence on company offices were designed to address.

It appears clear that in whatever capacity Mr Kose was acting, he was a hands-on company officer involved in the day-to-day operations of the business. A typical, small business working director.

Safety and health legislation around Australia has always had provisions enabling the prosecution, and the reasonably easy prosecution, of people in that position. In his excellent paper Personal Liability of Company Offices for Corporate Occupational Health and Safety Breaches: Section 26 of the Occupational Health and Safety Act 2000 (NSW), Neil Foster points out that the vast majority of prosecutions against directors and managers involved officers who were directly involved in making specific decisions that led to the injury or fatality, and that the majority of companies whose offices were prosecuted were small (page 114).

This pattern seems to be repeating itself given the short history of due diligence prosecutions to date, and that despite all of the hoopla and razzmatazz attached to WHS legislation, in practical terms absolutely nothing has changed.

To the extent that due diligence provisions make it easier to prosecute company offices and increases the penalties against them, those provisions  continue to be used against hands-on, working directors in small businesses. Senior executives and boards of large organisations who are not involved in the day-to-day operations of their businesses have nothing personal to fear from health and safety prosecutions.

I am not sure that was the point of the changes to WHS legislation, and it is certainly not what was sold – and continues to be sold – by the safety industry.

 

 

Rethinking safety prosecutions part 2

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Some time ago I wrote a post about the value of criminal prosecutions for safety breaches as part of effective safety management. The post is available HERE.

A discussion about the nature of “safety prosecutions” was recently held on LinkedIn following an article I posted about the acquittal of engineers involved in the Deepwater Horizon disaster in the Gulf of Mexico (see for example the CSB Report). You can see the LinkedIn discussion HERE.

Given the limited scope to expand a discussion in LinkedIn comments, I promised to write a more fulsome article, which I have attempted to do below.

The starting point for discussion about safety prosecutions is, I think, to understand what prosecutions are designed to achieve.

Inevitably in any discussion about safety prosecutions there is a multiplicity of views about what people perceive the process is designed to achieve. These include, compensation, punishment, deterrence and the opportunity to “learn lessons“.

In Australia at least, it seems unlikely that the current prosecution regime would fulfill any of these perceptions.

First, occupational safety and health prosecutions are not designed to compensate anyone. The workers compensation regime and/or civil proceedings (i.e. claims in negligence) are designed to compensate people for loss caused by workplace accidents and incidents. They are an entirely separate legal process, and compensation does not form part of the consideration of a criminal occupational safety and health prosecution.

Neither are occupational safety and health prosecutions designed as an opportunity to learn lessons. Prosecutions are typically run in relation to a very narrow set of charges and “particulars“. For example, if it is alleged that an employer failed to do everything reasonably practicable in that it failed to enforce its JHA procedure then the prosecutions about whether:

  1. The alleged failure occurred; and
  2. It was reasonably practicable for the employer to enforce that procedure.

There are no lessons about what might constitute a good JHA procedure, or a good process for ensuring that the procedure is followed.

As a more practical matter, prosecutions are very limited in their ability to teach us lessons because inevitably any decisions are made several years after the event occurred. In many cases decisions are not even published so that even if there were lessons that could be learned, they are not available to us.

Theoretically, prosecutions are designed to punish wrongdoers and provide both specific and general deterrence, that is, deter the guilty party from offending again and act as a warning to all other parties not to offend in the future.

Again, the evidence is far from clear that occupational safety and health prosecutions achieve this outcome, insofar as there does not appear to be evidence that a robust prosecution regime decreases the number of health and safety incidents.

For example, the ninth edition of the Workplace Relations Ministers’ Council Comparative Performance Monitoring Report issued in February 2008 show that Victoria and Western Australia, who had the lowest rate of prosecutions resulting in conviction at the time, also had the lowest incidence rates of injury and disease and enjoy the greatest reduction in average workers’ compensation premium rates over the three years to June 2006.

Of course, as with all statistical information, there could be any number of reasons for this finding. My point is not whether the finding is right or wrong. My point is we do not have the evidence and we have not had the discussion.

Although, the limited efficacy of criminal proceeding should not come as a surprise. The Robens Report published in the 1970s, an on which modern Australian health and safety legislation is based, identified:

The character of criminal proceedings against employers is inappropriate to the majority of situations which arise and the processes involved make little positive contribution towards the real objective of improving future standards and performance.

One of the ironies inherent in this discussion is that it is often the safety industry that is at the vanguard of the charge calling for significant prosecutions and directors to be sent to jail in the event of workplace accidents. This is the same industry that thrives on selling poor quality incident investigation processes based on a “no blame” culture.

It is interesting that the industry can say on one hand that we can only achieve effective safety outcomes where we don’t seek to blame, but that if something serious happens (i.e. someone dies) then there must be someone to blame and they should be prosecuted with the full force and effect of the law.

To me, this discussion is another example of the opportunity lost during the “harmonisation” of Australia’s health and safety legislation.

Rather than an informed discussion about how health and safety legislation could achieve the best health and safety outcomes, there seemed to be a broad assumption – not argued at best, unproven at worst – that, notwithstanding 20 or more years of history, prosecutions, large fines and personal liability was the best approach to improving health and safety outcomes in Australia.

I have personal views about what might be a better process to deal with those workplace accidents that are serious enough to warrant a “public response”, but this article is not the place to describe them. Rather, I hope that this article might prompt the safety industry to think more carefully about what it wants from its regulations and regulator and not use every workplace tragedy as an opportunity to promote the language of blame as an appropriate response to workplace accidents.

We cannot continue to promote safety using the message of fear and blame and then be surprised by how difficult it is to shift culture in an organisation.

 

Supplier of plant prosecuted for workplace injury

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In a recent prosecution under the the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (OPGGS Act) Hammelmann Australia Pty Ltd  was convicted and fined $20,000 for breaching their duties as a manufacturer of equipment used in a workplace.

The prosecution arose from an accident in March 2011 when a diver was seriously injured whilst using an underwater high pressure spray gun manufactured by Hammelmann. An investigation found that the high pressure spray gun was not supplied with any operating instructions providing specific information or directions on its safe use and maintenance.

The relevant clause of the OPGGS Act requires that manufacturers of plant supplied to offshore facilities must take all reasonably practicable steps to make written information available about the design, construction and safe use of that plant, and similar provisions exist in health and safety legislation in all other Australian jurisdictions.

Here is something misleading I read the other day ….

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I get lots of health and safety “alerts” and “bulletins” moving through my email in box. The following paragraphs in one of them caught my eye:

Safe Work Australia have set ambitious targets to reduce workplace injuries and fatalities – and they intend to meet them.

So while this means that penalties for safety breaches are higher than ever it also means improvement and infringement notices are being handed out far more often, regardless of whether or not an incident has occurred.

The article then goes on to suggest:

If you want to make sure you’re meeting all your workplace health and safety obligations you should consider subscribing to the [insert product here]

The implication here is that Safe Work Australia is somehow responsible for health and safety penalties and policing breaches of safety legislation, and that Safe Work Australia’s “ambitious targets” somehow drive the enforcement of safety legislation. This of course is nonsense.

Safe Work Australia, as described in it’s 2013-2016 Strategic Plan:

… is the body leading the development of national policy to improve work health and safety and workers’ compensation across Australia. The interests of the Commonwealth, states and territories as well as workers and employers in Australia are all represented.

It has no role in enforcing or prosecuting health and safety legislation.

Health and safety is “enforced” by individual State Government departments with responsibility for safety and health, and cases are prosecuted through the State or Federal Court systems, depending on the specific piece of health and safety legislation in question. Prosecutions are usually managed by Government prosecutors, such as the relevant State Solicitor’s office of the Department of Public Prosecutions.

Interestingly the 2013-2016 Strategic Plan goes on to say:

Together we will work to achieve:

  • Significant and continued reductions in the incidence of work-related death, injury and illness including through:
    • reduced exposure to work-related hazards causing injury and illness
    • improved quality of workplace controls, and
    • an improved work health and safety framework, increased work health and safety awareness and skills and an evidence base which informs policy and practice.
  • Improved outcomes for injured workers and their employers through more effective, efficient, clearly understood and sustainable workers’ compensation arrangements.

No mention of big fines or legal proceedings to achieve their objectives!

If companies are going to try and flog their safety solutions using “fear“, they should at least be accurate.

 

Comcare v Transpacific Industries

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Comcare v Transpacific Industries [2015] FCA 500 is an interesting case that looks at the liability of an employer for the death of a non-employee in a motor vehicle accident. In February 2011 a Transpacific employee driving a garbage collection truck ran into a vehicle killing the driver. Subsequent investigations revealed that the truck had faulty brakes.

The case provides some very interesting insights into the “illusion of safety” where it appears that, notwithstanding regulator approval and a routine maintenance regime, the high risk of poorly maintained brakes on a garbage truck was not identified.

There is also an interesting point raised in the case about the extent to which an employer should monitor the work of an employee who has been issued a warning for safety related breaches. Should an employer monitor the employee until they are satisfied that they are working in accordance with the safety requirements?

A short video presentation about the case is available here.

You can access a copy of the case here.

I have read and understood ….. What is the value of providing safety documents to employees?

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A recent NSW Industrial Relations Court decision has agitated the question of whether an employer needs to provide written safe work procedures to its employees as part of their duty to provide a safe workplace.

In Inspector McCarthy (nee Shaw) v Siva & Jeya Pty Ltd [2015] NSWDC 15 a company and its director were prosecuted after an employee suffered severe burns while filling a burning pot used to heat food trays for a buffet style meal. The pots were filled using methylated spirits.

One of the allegations in the case was that the employer had not provided the employee with a “written safe work method” for the task. The Court found that the failure to provide the written information was not a breach of the employers obligations:

I do not think that the case for providing her with a written safe work method is made good. The written document for an immigrant such as Anisha may be difficult to comprehend and follow and may not necessarily be effective. A spoken direction is more likely to be effective.

This is not unprecedented, or unsurprising. In a 2013 South Australian decision, Moore v SD Tillett Memorials Pty Ltd [2013] SAIRC 47 it was alleged by the prosecution that the employer should have kept a record of a training document, and who that document was provided to. In relation to that allegation the Court said:

This is of course desirable but what would it have achieved against a background of constant verbal reinforcement? Recording who received the document had not been carried out in the past although there was a universal awareness of the document by the employees and former employees …

Another instructive case is Inspector Shepherd v Desiya Pty Ltd [2013] NSWIRComm 9. In that case workers were provided with “on the job” training in relation to operating machinery and traffic management in a work yard. An employee was killed when he was hit by a truck.

One of the allegations against the company (which was ultimately convicted) was:

The training and assessment of drivers of yard trucks was done via ‘on the job training’ and assessment.

One the job training is a legitimate training method, indeed, as illustrated by the Siva & Jeya Pty Ltd case, may be the appropriate method. In the case of Desiya, on the job training was a deliberate and legitimate strategy:

Verbal instructions were commonly used … as a control measure against employees with poor literacy skills not understanding the written instructions contained within training documentation.

The difficulty lay, not in the strategy, but the execution.

The competence of the trainee or trainer was not assessed against any documented objective criteria. After this ‘training’ process, if the driver was assessed as competent by the supervisor they were then permitted to operate the truck.

There are many appropriate and legitimate ways that an employer can discharge their obligations to ensure that employees are trained and competent to perform their work safely. These might include formal class room training, on the job training, computer based training, the use of written work instructions and so on.

The lessons from these, and similar cases, is that simply providing safe work procedures to employees is not sufficient to discharge and employers obligations. In all likelihood, simply providing training, no matter what its purported “quality” will not be sufficient either.

Documented safe work procedures should be developed and maintained, but they are not an end in themselves – they are simply the evidence of the “objective criteria” against which workplace safety will be judged.

To discharge obligations to ensure relevant training and competency in the workplace, employers need to be able to demonstrate that:

  1. Workers have been provided with the relevant information about how to do their job safely;
  2. Workers understand that information;
  3. Work is actually performed in accordance with the training; and
  4. There is ongoing supervision and enforcement of the training.

Equally importantly, this does not require dumbing everything down and treating workers like fools. Give workers the information they need to do their job safely, trust them and supervise them with respect – you might just be surprised by the results.

Case discussion: Capon v BHP Billiton – Part 2 the appeal

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Early in 2013 BHP Billiton was convicted and fined $130,000 following a fatality at one of its facilities in Port Hedland. They were also ordered to pay $300,000 in legal costs.

Amongst the reasons for the conviction was BHP’s apparent failure to implement and enforce its own requirements for supervision and risk assessments by workers.

A video presentation and discussion about the case is available by following the link below:

Capon v BHP Billiton Iron Ore PH 1917/11

On 28 July 2014, the Western Australian Supreme Court allowed, in part, an appeal by BHP against the conviction. A key finding was that, while BHP did not enforce or supervise its own processes in relation to JHAs or Take 5s, that failure did not “cause” the fatality.

You can access a copy of the case here:

BHP Billiton Iron Ore Pty Ltd v Capon [2104] WASC 267

You can also see a video presentation and discussion about the case by following this link:

BHP Billiton Iron Ore Pty Ltd v Capon [2104] WASC 267 – discussion

(There is also an App available if you want to download the presentation to your device and view it later – iSpring Mobile Player)

A key question that comes out of the case – and one that I think has had some relevance for a number of years now is, what value does the JHA process add to our safety management system, and is there a case for removing them from our day to day processes?

At least, it seems that there is an arguable case that the JHA process should not be adopted with such lemming like dogma, and we can consider front line risk assessment processes that actually add value to our business.

 

 

 

 

 

 

Contractor Safety Management: Waco Kwikform Ltd v Perigo

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A recent NSW Court of Appeal decision has examined the very interesting (and vexed ) issue of how the actions of a Principal can create liability, by taking over responsibility for a Contractor’s safety system of work.

In Waco Kwikform Ltd v Perigo and Workers Compensation Nominal Insurer [2014] NSWCA 140, the Court found, in part, that by developing a Safety Work Method Statement, Waco had taken primary responsibility for the safe system of work out of the contractor’s hands.

You can see a video presentation about the case by clicking here.

And apologies, but there has been a little bit of a glitch in the sound quality – there is sound but you might need to turn it up.

I also need to let you know that there is a new app available to make watching these video updates easier. You can find it by clicking here.

The app will allow you to watch the presentation, or download it so you can watch it offline later.

Best Regards.

Do we need to rethink safety prosecutions?

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I have seen a number of recent posts and comments on various sites, noting where company executives have been prosecuted and jailed for health and safety breaches. The general tone of the observations has been that this is an approach that should be adopted in Australia, and that the relevant authorities should be far more active in pursuing these types of prosecutions.

Set out below is an article that I did for IFAP in Western Australia. It appears in the December issue of SafetyWA.

The article suggests that there might be more to a prosecution approach than meets the eye, and perhaps even an argument that safety prosecutions could undermine the end goal of trying to achieve “safe” workplaces.

I am not trying to suggest a “correct” approach, but like so much that we do in safety, we should not just assume that a prosecution approach is right. Perhaps it is time for the genuine debate and critical thinking that was missed during the harmonization process.

The value of safety prosecutions in Western Australia

Criminal prosecutions for safety and health breaches are generally regarded as an important element of effective regulation of safety and health behaviour. Part of that is the commonly accepted belief that the higher the penalties for health and safety breach, the more effective the deterrent effect of prosecution is likely to be.

I, for one, am not entirely convinced that prosecutions are in fact an effective measure for improved safety performance (ironic from a lawyer, I know).

Some studies have suggested that criminalising safety breaches can have an adverse effect on safety (See for example, International Journal of Applied Aviation Studies, Volume 10, Number 1, 2010, page 31 on).

Australian studies have shown that the vast majority of prosecutions of “Company Officers”, have been of small businesses – directors who are “hands on” in the business (see for example Foster, N. (2005) Personal Liability of Company officers for Corporate Health and Safety Breaches: Section 26 of the Occupational Health and Safety Act 2000 (NSW). 18 Australian Journal of Labour Law, 107). This obviously calls into question the equity of offences aimed at Company Officers.

Anecdotally, my own experience is that the response of many organisations to increased legal liability for safety and health breaches is not improved safety risk management, but improved legal risk management. Just witness the harmonisation debate over the last 5 years – a debate that has been lead almost entirely by legal commentators, not the safety profession.

The psychology here is also interesting.

A number of years ago, while working as principal safety advisor at Woodside Energy, some people far cleverer than me in the area of safety culture advised that to change human behaviour, the best strategies were to ensure that consequences for individuals were:

  • Certain;
  • Immediate; and
  • Positive.

If people always got immediate, positive feedback whenever they did the right thing for safety, then this would drive the right behaviour.

The least effective way to drive change? Consequences that are uncertain, delayed and negative (think safety prosecutions!)

Leaving aside for one moment broader philosophies about safety prosecution in general, what value do they provide to the understanding of safety management

In October 2013, BHP Billiton Iron Ore and HWE Newman Services were convicted and ordered to pay a total of $363,000 in safety fines and costs, after a mobile maintenance supervisor was killed while working on the tyre of a heavy earth mover in Western Australia.

The worker was fatally struck by a tyre handler device, which sprung off the tyre when it was overinflated.

The incident occurred in August 2008

There is a well-worn saying that justice delayed is justice denied. Similarly, safety lessons delayed are safety lessons lost, and in this case the lessons learned are not available to us until 5 years after the event? Except that they aren’t.

The prosecution occurred in the Magistrate’s court, and decisions are not freely available or published. There is no published judgement that we can look to, to understand the safety management failures behind the event. It seems that the sum total of information that might have generated valuable insights into important safety management failures around risk management, contractor safety management or other critical safety management elements is – zero

I have been involved in safety law and safety management for the best part of 24 years. There are some things I know, and an enormous number of things that I do not know. But one thing that I do know to an absolute certainty is that organisations do not examine their safety management systems with anywhere near the level of rigour that they are subject to in legal proceedings. For all its faults, the legal process has the potential to offer some genuine insights into the failure of safety management, but clearly, that potential cannot be realised where cases take years to finalise, and there is no record of the findings to review.

Perhaps it is time to re-examine the role of prosecution and inquiry in safety management and to think differently about what the response to safety failures ought to be. Certainly, the current approach cannot be blindly accepted as adding value.

Contractor safety management series Part 4: The Queen v ACR Roofing

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The Queen v ACR Roofing involved a fatality at a construction site, when a worker was electrocuted after a crane contacted overhead power lines. The worker was employed by a sub-contractor engaged by a 3rd party, and did not have any contractual relationship with ACR, the company that was prosecuted.

The case explores a number of interesting concepts, including whether a sub-contractor can be “engaged” when there is no contractual relationship. The case also explores the ongoing issue of “control” in a contracting relationship, and considers what role the relative “expertise” of the parties has in determining who has control.

You can access a video presentation about the case here.