Industrial Relations Commission of New South Wales in Court Session CITATION : Inspector Victor Larobina v Fastform NS Pty Limited [2002] NSWIRComm 343 Prosecution: PARTIES : Inspector Victor Larobina Defendant: Fastform NS Pty Limited FILE NUMBER: IRC7320 of 2001 CORAM: Kavanagh J CATCHWORDS : Prosecution under s15(1) of the Occupational Health and Safety Act 1983 - plea - systems of work and daily inspections in place - failure in two safety inspections to recognise a risk to safety in unsupported area of scaffold - corporation unable to produce records of implementation of safety procedures allegedly in place - failure to co-ordinate tasks - corporate identity ceases trading - penalty LEGISLATION CITED : Occupational Health and Safety Act 1983 Lawrenson Diecasting Pty Limited v WorkCover Authority of New South Wales (Inspector James Swee Ch'ng) (1999) 90 IR 464 Haynes v James Glass & Aluminium Pty Limited (unreported CT772-775 of 1991, 20 May 1994) Inspector Louise May v McDonalds Australia Limited [2002] NSWIR Comm 179 Ferguson v Nelmac (1999) 92 IR 188 CASES CITED : Tyler v Sydney Electricity (1993) 47 IR 1 Melbourne v The Queen 198 CLR 1 Capral Aluminium Limited v WorkCover Authority of New South Wales (Inspector Mayo-Ramsay) (2000) 49 NSWLR 610, (1999-2000) 99 IR 29 Fisher v Samaras Industries Pty Ltd(1996) 82 IR 384 R v Thomson, R v Houlton (1999-2000) 49 NSWLR 383, (2000) 115 A Crim R 104, R v Sharma [2002] NSW CCA 142 HEARING DATES: 08/27/2002; 11/22/2002 DATE OF JUDGMENT: 12/20/2002 Prosecutor: Ms J Fredman of counsel Solicitors: Mr G.Henderson/Ms P.Tumpey Phillips Fox LEGAL REPRESENTATIVES: Defendant: Mr J.A. Tudehope of counsel Solicitors: Mr D.L. Bentley Thomson Bentley JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: KAVANAGH J Date : Fri 20 December 2002 IRC7320 of 2001 INSPECTOR VICTOR LAROBINA v FASTFORM NS PTY LIMITED Prosecution under s15(1) of the Occupational Health and Safety Act 1983 JUDGMENT [2001] NSWIRComm343 1 This prosecution is brought by the WorkCover Authority of New South Wales through Inspector Victor Larobina under the provisions of s15(1) of the Occupational Health and Safety Act 1983. 2 It is alleged the defendant corporation: Fastform NS Pty Limited (ACN 002 863 498), an employer, breached s 15(1) of the Occupational Health and Safety Act 1983 on 10 November 1999 at premises located at Westfield Shopping Centre, Burwood Road, Burwood in the State of New South Wales ("the premises") in that it failed to ensure the health, safety and welfare at work of its employees, in particular, Jovo Jovic. In particular, the defendant failed to ensure a safe system of work for employees involved in the stripping of formwork at the level 3 car park area of the premises ("the stripping process"), in that: (a) it failed to ensure adequate supervision and training of employees carrying out the stripping process; (b) it failed to ensure adequate information and instructions were provided to employees carrying out the stripping process; (c) it failed to ensure that the means of access and egress to the formwork on which employees were carrying out the stripping process was adequately supported; (d) it failed to ensure employees were provided with adequate fall protection when exposed to a risk of falling from heights; (e) it failed to identify and control the hazard posed by an unsupported plywood sheet present in the area in which employees carried out the stripping process; (f) it failed to ensure an adequate system for the identification and rectification of potential hazards at the premises. 3 A plea of guilty was entered by the defendant. 4 An agreed statement of facts was tendered: 3. At all material times FastForm NS Pty Limited (ACN 002 863 498) was a corporation with its registered office located at Level 4, Barclays Building, 75 King Street, Sydney in the State of New South Wales. 4. The Prosecutor has conducted investigations into the circumstances surrounding an accident which occurred on 10 November 1999 at the Westfield Shopping Centre site, Burwood Road, Burwood, in the State of New South Wales ( premises ) and from those investigations he is able to state the following either from his own knowledge or upon information and belief. 5. At all material times FastForm NS Pty Limited : (a) was engaged in building construction activities at the premises; (b) was contracted by Westfield Design & Construction Pty Limited (ABN 53 000 267 265) to provide formwork at the premises; (c) employed Jovo Jovic ( Jovic ) as a formwork labourer at the premises; (d) employed Ozegovan Osteoja ( Osteoja ) as a leading hand at the premises; (e) employed Markku Tapio Savolainen ( Savolainen ) as a site foreman at the premises; (f) employed Andrew Watson ( Watson ) as site safety officer at the Premises. 6. On 9 November 1999 and the morning of 10 November 1999 Jovic was engaged by the Defendant to strip formwork beneath the level 3 parking area concrete slab at the premises. Following morning tea on 10 November 1999 the leading hand, Osteoja, instructed Jovic to enter the level 3 parking area to remove plastic form tie cones and patch holes in the parapet wall forming the outside perimeter of the level 3 parking area ( the patching process ). 7. Formwork protruded from beneath the parapet wall of the level 3 parking area. The formwork extended approximately 750mm to perimeter metal screens. 8. Access to the outside parapet walls where the plastic form tie cones ( cones ) were situated required Jovic to stand on the formwork. Jovic began removing the cones by standing on the formwork in approximately the middle of the building. 9. Jovic removed a length of approximately 3 metres of cones before stepping on a piece of formwork ply that was not supported. Jovic fell approximately 4 metres onto concrete and the edge of a sheet of formwork plywood. As a result, Jovic sustained a ruptured bladder, a fractured pelvis and injuries to the scrotum, penis and back. 10. Jovic was an experienced formwork labourer and had been employed by the Defendant for approximately 3 years and 5 months. 11. Jovic did not receive any warning from the Defendant that the piece of formwork ply forming part of the formwork extruding from the outside perimeter of the parapet wall was not supported. 12. Jovic was not adequately supervised by the Defendant while performing the patching process. 13. Jovic had attended lectures on the WorkCover Code of Practice for formwork but he did not have a detailed knowledge of the Code of Practice for formwork. 14. The Defendant's site Safety Management System required the Area Construction Manager to perform daily inspections of parts of the premises where the Defendant's employees were working to identify, control and rectify potential hazardous situations. The Defendant did not require documentation of the daily inspections. The premises covered an entire city block and a number of levels, however, on 10 November 1999, the Defendant's employees were working in two areas at the Premises: (a) an area 20 metres x 20 metres in size on the Wilga Street side of the Premises; and (b) an area on the opposite side of the Premises near a cinema complex. 15. Savolainen was acting in the position of Area Construction Manager on 10 November 1999 and carried out an informal site inspection of the premises. He did not identify the removal of the support from underneath the formwork protruding from the perimeter parapet wall on the level 3 parking area which caused Jovic to fall. No documentation was made of the informal site inspection on 10 November 1999. 16. A Safety Officer, Watson, was employed by the Defendant at the Premises. The Defendant's Safety Management System required the Safety Officer to conduct inspections at regular intervals. On 10 November 1999, the Safety Officer conducted a number of site inspections at the Premises but did not identify the removal of the support from underneath the formwork. 5 Ms J. Fredman of counsel appeared for the prosecution and Mr A.J. Tudehope of counsel appeared for the defendant. The prosecution tendered the agreed statement of facts, site photographs and the industrial record of the company. The defendant relied upon two affidavits of Mr Andrew Watson, the Site Safety Officer, an affidavit of Mr Mario Dolso, the Managing Director of the company, an affidavit of David Lance Bentley, Solicitor, containing statements from the WorkCover Authority and an affidavit of Melvyn James Crook, an Occupational Health and Safety Systems Advisor. Mr Dolso gave oral evidence and was cross examined. The hearing was over two days as the defendant was allowed an adjournment to prepare its material. Much documentation, including affidavits, were not originally put in proper form before the court. On the second day of hearing, the court received Mr Dolson's affidavit and he was then in court. 6 The court must assess the nature and quality of this offence, that is the gravity of the offence viewed objectively (see Lawrenson Diecasting Pty Limited v WorkCover Authority of New South Wales (Inspector James Swee Ch'ng) (1999) 90 IR 464 (at 474) and Haynes v James Glass & Aluminium Pty Limited (unreported decision, CT772-775 of 1991, 20 May 1994). 7 The Westfield Burwood site extension project covered a whole city block and stood over a number of levels in height. The defendant company had responsibility for supplying and removing formwork at the site. It also had the responsibility for patching a concrete floor, on the roof of a car park under which the formwork was erected. The formwork overhung the concrete floor to allow a walkway around the perimeter. 8 On site were Mr Jovic, a labourer, Mr Ozegovac Osteoja, the leading hand, and Mr Markku Tapio Savolainen, site foreman. Mr Jovic was a fifty-three year old gentleman who had seven years experience as a labourer. He had been employed by the defendant company where Mr Mario Dolso was the Managing Director for approximately three years five months. Mr Osteoja instructed Mr Jovic to go up on to the level 3 parking area to patch the concrete edges to finish off the concrete pour for the roof car park. As Mr Jovic went around the perimeter checking and patching he also had to remove the plastic cones from the perimeter parapet wall. Mr Jovic was therefore walking along the formwork on the outside edge of the parapet wall which formed the perimeter of the Level 3 parking area. He had taken up from the formwork about 15 to 20 cones and covered about three metres patching as he went along when he stepped onto an unsupported piece of plywood constituting part of the walkway over the formwork along which he was walking. That section of the walkway area collapsed under his weight. Mr Jovic fell four metres on to concrete on the floor below. He suffered a ruptured bladder, a fractured pelvis and injuries to the scrotum, penis and back. 9 It is relevant to note as to the gravity of this offence that Mr Jovic suffered serious injuries (see Inspector Louise May v McDonalds Australia Limited [2002] NSWIRComm 179 [at 45]. 10 While the gravity of injury arising from the breach does not of itself dictate the level of penalty, the occurrence of death or serious injury can manifest a degree of seriousness to the relevant detriment to safety. As Wright J, President said in Ferguson v Nelmac (1999) 92 IR 188 (at 204): . . . where a fatal injury has occurred, that is a factor to be taken into account and is often, of itself, reflective of an offence the nature and quality of which is serious. Wright J, President endorsed the well acknowledged words of Hill J in Tyler v Sydney Electricity (1993) 47 IR 1 (at 5): The gravity of the damage or injury actually resulting from breach does not, of itself, dictate the amount of penalty. However, the gravity or otherwise of the potential risk flowing from breach and its foreseeability are clearly relevant. . . . 11 The dissembling of the formwork was being performed by the defendant company from the lower level and Mr Jovic could never have seen that some support struts under the part of the formwork on which he trod had been removed. 12 The defendant's Area Construction Manager, Mr M. Savolainen, had carried out one of his daily inspections to identify and control potential hazardous situations on the site on that day. The Area Construction Manager's site inspections were not required to be documented. On the morning of the incident, Mr Watson, Safety Officer for that defined area had also carried out a safety inspection. Neither identified that the supports had been moved from underneath the perimeter formwork ply, in an isolated area, which was that part of the perimeter walkway on which Mr Jovic was required to work. 13 Mr Osteoja had attended lectures related to the code of practice for formwork construction and dismantling. He had also received a site induction training. However, there was no work method related to the stripping down, that is, the dismantling of the formwork. The company could offer no explanation for the odd piece of formwork being dismantled. They investigated the incident suspecting a tampering on site. As to whether there could have been a failure of the formwork supports, this was denied by the defendant. Photographic evidence showed the support struts were lying around the site after the incident. There is no explanation offered as to why the support struts were taken down in this isolated area. The photographs tendered indicated there was hazard tape identifying where the formwork was being dismantled. It lay some metres away but within the area where the incident occurred. The cause of the incident is not however the issue before this Commission sitting in Court Session but rather the risk to safety and the nexus between the act or omission of the defendant and the identified risk. 14 Mr Jovic was required to perform his duties on equipment which was a risk to his safety in that formwork on which he was required to walk was not supported for the taking of his weight. He was not provided with adequate fall protection when asked to perform the duties from a height. He was required to perform a duty on a hazard which went unrecognised by the defendant who conducted safety inspections. In effect the worker was sent to work 12 feet or 4 metres up from the ground to walk on ply board which was unsupported and hanging over the edge of a concrete pour and above a concrete ground base. The worker was required to work from height with no restraining equipment. All such failures by the defendant led to a risk to safety. 15 This was a most serious breach of the Occupational Health and Safety Act. 16 A number of subjective features are taken into account in consideration of penalty. However, such consideration is secondary to the consideration of the nature and quality of the offence (see Lawrence Diecasting Pty Limited at 474). 17 Matters revealed in evidence are of concern. All the site records as to the implementation of the existing safety policy on the worksite of the defendant are missing. The fact there is no record of past best practice on this site is a matter of grave concern to the court and one acknowledged by Mr Dolso to be of concern to him as he represented his company's interests. It has been explained all records including site safety inspections, weekly progress meetings, toolbox meetings, site instructions were lost from this site when the company moved off the site due to the opening of the Westfield Burwood Shopping Mall extension. The affidavits of employees on site had to be relied upon as to whether the inspections were carried out. No employee was cross examined. 18 The corporate character/reputation of a company is relevant in a consideration as to mitigation of penalty (see full discussion of the nature of character and reputation evidence in Melbourne v The Queen 198 CLR 1; WorkCover Authority of NSW (Insp Dubois) v Transfield Pty Limited (unreported, IRC6985 of 1999, 8 November 2000), WorkCover Authority of New South Wales (Inspector Ankucic) v McDonalds Australia Limited & Anor (2000) 95 IR 383; WorkCover Authority of New South Wales (Inspector Mauger) v Ridge Consolidated Pty Ltd [2000] NSWIRComm15 (published 8 March 2001); WorkCover Authority of New South Wales (Inspector Farrell) v Forgacs Shipyard Pty Ltd [2000] NSWIRComm227 (published 12 October 2001); see also discussion referred to in WorkCover Authority of NSW (Insp Hopkins) v Profab Industries Pty Ltd (No. 2) (2000) 101 IR 92). The company is a wholly owned subsidiary of the Dolso Fastform Group of companies. The defendant company was formed in 1994. It is a formwork company. It provides support on a number of significant major building sites in New South Wales including Westmead Hospital, the Casino and Market City. It has employed up to 292 tradesmen including carpenters, fork lift drivers, leading hands and labourers. Prior to the incident, the annual average gross turnover of the defendant was approximately $8,000,000.00 up to and including the year ending 30 June 2000. After 30 June 2000, the holding company of the defendant company, Dolso Construction, decided to simplify its overall operation by transferring activities from subsidiaries of the holding company, including the defendant company, to a construction company known as Dolso Constructions Pty Limited. Income to the defendant company ceased at 30 June 2000. It was of concern that perhaps, due to this incident, the company ceased operations at 30 June 2000. Mr Dolso assures the court the corporate changes were a restructure to simplify his operation. The company has contributed significantly to employment in the construction industry throughout New South Wales. 19 As to the industrial record of the Dolso group, one associated company had a recorded conviction. This company performs work in an industry with high risk. It has no recorded convictions against it and has operated in the construction industry for eight years prior to the incident. The work the defendant company performed is now integrated into the work of a company known as Dolso Constructions Pty Ltd but trading as Proform Systems. I accept all the name changes have been made for business streamlining but I do so with the assurance site safety is of paramount importance to Mr Dolso through all his company operations. 20 Consideration must be given when assessing penalty to elements of specific and general deterrence to compel attention to safe working. It is a fundamental duty of the court to ensure the penalty for a breach of the Occupational Health and Safety Act 1983 compels attention to the occupational health and safety standards and to ensure the punishment is proportionate to the offence (see Capral Aluminium Limited v WorkCover Authority of New South Wales (Inspector Mayo-Ramsay) (2000) 49 NSWLR 610; (1999-2000) 99 IR 29 [at 74] and Fisher v Samaras Industries Pty Limited (1996) 82 IR 384 (at 388)). 21 As to specific deterrence, the company, immediately after the incident, reassessed its system of work. There is now a cross check made with the supervisors in their morning inspection on site to identify work hazards. There has, although not as an instant reaction to this incident, been put in place a new restructured system of safe working reflecting the ideals of consultation with employees as enunciated in the 2000 Act. The revised system of work now adopted by Proform Systems was put in place for the company by an occupational health and safety advisor. The new system requires a full and definitive work method statement for each task and the input from individual employees in the design of the work method. The requirements under the 2000 Act to provide full representation and information as to both the design and implementation of those work methods is now recognised. The company understands it must be able to show its records to provide that information. The "lost in the move" plea put before the court will not in the future be acceptable under the Act to persuade that there was full compliance with written standards and that those standards were applied in positive action "on the job". 22 The defendant company through its managing director has expressed his contrition and ongoing concern over the incident. He assured the court the injured employee was given assistance as to medical attention and a gradual return to work programme was designed for him with light duty work. The employee is now not in their employ. 23 I am persuaded there was the appropriate scaffold in place for the walkway and photographic evidence revealed hazard tape marked out the area where the scaffolding was being removed. The removal of the scaffold supports in one small area, on which an employee was required to walk, in the circumstances, however was a serious breach of an employer's obligations under the Act to ensure the safety of Mr Jovic. More particularly so, when two safety inspections were carried out and failed to identify the risk to safety. This was a serious breach of an employer's obligation under the Act where penalty must compel attention to safe working. 24 I accept the company co-operated with the WorkCover Authority and provided it with assistance in their investigations. The company has entered an early plea of guilty. The prosecution supports the defendant's submission in the circumstances this early plea has a utilitarian value. There were some three mentions before the court, however, between the issue of the summons and the plea. Accordingly, I allow a discount of 20 per cent for the plea of guilty entered to the charge (see R v Thomson; R v Houlton (1999-2000) 49 NSWLR 383, (2000) 115 A Crim R 104; and R v Sharma [2002] NSWCCA 142). 25 The maximum penalty that is applicable for this breach is $550,000. 26 I take into account the gravity of the offence and the relative subjective features placed before the Commission Sitting in Court Session and the discount allowed for the utilitarian value of the plea. 27 I find the defendant guilty. 28 The defendant is fined in the sum of $130,000.00 with a moiety to the WorkCover Authority. 29 The defendant should meet the prosecutor's costs including two days for hearing in a sum as might be agreed. I grant liberty to apply. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.