Industrial Relations Commission of New South Wales in Court Session CITATION : WorkCover Authority of New South Wales (Inspector Tyler) v Workforce Link Pty Ltd [2001] NSWIRComm 24 PROSECUTOR WorkCover Authority of New South Wales (Inspector Tyler) PARTIES : DEFENDANT Workforce Link Pty Ltd FILE NUMBER: IRC 4525 of 1999 CORAM: Marks J CATCHWORDS : Occupational Health & Safety Act - Prosecution under s 15(1) - Plea of guilty - Defendant a labour hire company. LEGISLATION CITED : Occupational Health and Safety Act 1983 s 15(1) CASES CITED : Drake Personnel Ltd v WorkCover Authority of New South Wales (1999) 90 IR 432 HEARING DATES: 02/08/2001 DATE OF JUDGMENT: 03/08/2001 PROSECUTOR Ms P E McDonald of counsel SOLICITORS WorkCover Authority of NSW LEGAL REPRESENTATIVES: DEFENDANT Mr B D Hodgkinson of counsel SOLICITORS Blake Dawson Waldron JUDGMENT: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: MARKS J Thursday 8 March 2001 Matter No IRC 4525 of 1999 WORKCOVER AUTHORITY OF NEW SOUTH WALES (INSPECTOR TYLER) v WORKFORCE LINK PTY LTD Prosecution under s 15(1) of the Occupational Health and Safety Act 1983 JUDGMENT INTRODUCTION 1 By amended summons the prosecutor Inspector Ian Tyler of the WorkCover Authority of New South Wales has charged the defendant Workforce Link Pty Ltd with a breach of s 15(1) of the Occupational Health and Safety Act 1983 ("the Act"). The charge as contained in the amended summons is in the following terms: On 29th August 1997 at Corner of Market and Pitt Streets, Sydney, in the State of New South Wales, the defendant being an employer DID FAIL to ensure the healthy, safety and welfare at work of all its employees, in particular Hassan Simpson, in undertaking construction work with lifts, contrary to Section 15(1) of the Occupational health and Safety Act 1983 in such case made and provided. The particulars of the charge are: 1. The defendant employed Hassan Simpson as a trades assistant. 2. The defendant, pursuant to a labour hire agreement with Schindler Lifts (Australia) Pty Ltd provided to Schindler Lifts (Australia Pty Ltd the labour services of Hassan Simpson as a trades assistant at the said construction site. 3. The defendant filed to ensure that Hassan Simpson would not fall greater than 1.8 metres in height in contravention of Regulation 79(3) of the Construction Safety Regulations. 4. The defendant failed to ensure than an overhead protection platform was provided while undertaking the installation of a lift at the construction site which would prevent any material or objects from falling onto Hassan Simpson while he performed work. 5. As a result of the said failures, Hassan Simpson suffered ,multiple injuries. 2 Section 15(1) of the Act is in the following terms: 15(1) Every employer shall ensure the health, safety and welfare at work of all the employer's employees. 3 The defendant entered a plea of guilty and this judgment is concerned solely with penalty. FACTUAL BACKGRUND 4 The parties filed an agreed statement of facts which is in the following terms: 1. At all material times the Prosecutor was an Inspector duly appointed and empowered by S 48 of the OH & S Act 1983 to institute proceedings in the within matter. 2. At all material times Schindler Lifts Australia Pty Ltd was a company duly incorporated with registered office located at 52-54 O'Dea Ave Waterloo, NSW. 3. At all material times Schindler Lifts was contracted to Multiplex Construction (NSW) Pty Ltd to undertake the construction of lifts at the Grace Bros site on the corner of Market and Pitt Streets Sydney, NSW. 4. At all material times the defendant Workforce Link Pty Ltd was a company duly incorporated with registered office located at 593 Botany Road Rosebery, NSW. 5. At all material times the defendant provided labour hire services to Schindler Lifts under a partly oral and partly written labour hire agreement. 6. By letter dated 22 July 1997 the defendant advised Schindler Lifts that it was "responsible for the control and supervision of Workforce employees while they are on their premises". 7. At all material times the defendant employed Hassan Simpson as trades assistant and pursuant to the Agreement provided Hassan Simpson to Schindler Lifts as a trades assistant at the construction site. 8. At all material times Schindler Lifts employed a number of personnel at the construction site including Con Tsiribas as a leading hand fitter, Barry Murray as a Lift Fitter, Chris Collins as a Lift Fitter, Nicola Ceic as the Installations Supervisor and Richard Riley as the Project Manager. 9. On 29 August 1997 at 8.50am Hassan Simpson was erecting an overhead protective platform in lift shaft No 11 at the construction site when a timber joist which was approximately 4.9 metres long fell from the lift car above him in the same liftwell. The timber joist struck the platform he was working on, causing the platform to break apart. This resulted in Hassan Simpson falling approximately 8 metres to the bottom of lift shaft No 11. 10. As a result of the fall Hassan Simpson sustained multiple injuries including internal bleeding, fractured vertebrae, multiple fractures of the pelvis, multiple rib fractures, fractured top left shoulder, fractured right tibia, muscle damage to both shoulders, multiple lacerations, and chipped teeth. 11. On 29 August 1997 following the accident a Factual Inspection of lift shaft No 11 was undertaken. A Factual Inspection Report was prepared and photographs taken. 12. The investigation revealed that a decision had been made to dismantle the overhead protection platform in shaft No 11 at Level 6 and place this platform at Level B1 in the same shaft. 13. The overhead protective platform in lift shaft 11 at Level 6 was dismantled the previous week by Hassan Simpson and another worker. The timber was then stored on Level 5 floor level. 14. On the day of the accident Hassan Simpson travelled in the false car to Level 4 and he was passed a length of timber. He then drove the car to Level B1 and unloaded the timber onto that level. He then went back up and obtained a stack of sheets of plywood, and brought them down to Level B2. Hassan Simpson and others then measured the dimensions of the lift shaft whilst standing at the doorway to the liftwell. 15. Con Tsiribas and Hassan Simpson then proceeded to lay the first of the joists on their flat. They then questioned Chris Collins as to whether the joists should be laid on their flat side or on their edge. The supervisor Nicola Ceic advised that they were safe to lay on their flat. A second joist was laid and a sheet of ply was placed on the joists and a second sheet of ply was also placed on the joists. A further joist was then laid onto the platform and Hassan Simpson climbed onto the platform to position the joist. At that time he called out to Chris Collins who was on the upper levels of Level 4 to bring a safety harness down. At that time Con Tsiribas and Hassan Simpson sat on the platform at Level B1. Chris Collins then drove the false car down and passed a harness to Hassan Simpson. At that point Con Tsiribas requested Chris Collins t obtain 2 more joists from Level 5. 16. Con Tsiribas then left the platform and was speaking to the supervisor Nicola Ceic. 17. Chris Collins took the car to Level 4. He exited at Level 4 walked to Level 5 and requested Barry Murray to assist him to lay the timber joists on the floor of the car. As the timber joists were too long and too close inside the car they were placed standing on the floor of the false car. The timber joists then slid down from Level 5 onto the false car standing on an angle. 18. The false car was then moved down to Level 4 due to the length of the timber joists. When the car was moved one timber joist was flung onto the front wall and dropped vertically between the front of the car and the lift wall. At that point Chris Collins sung out the word "Under" as he could see that Hassan Simpson as in the shaft at the B1 level on the platform under construction. The timber joist struck the platform causing it to fall apart and causing Hassan Simpson to fall into the pit below. 19. The timber joist that fell down from Level 5 was approximately 4.9 metres long by 200 mm wide and 48 mm thick. 20. The false car is a suspended platform which is suspended by steel wire rope and moved up and down by an electric winch. The false car is used as a working platform for installing lift guide rails. 21. Hassan Simpson had worked in lift construction and modification from March 1997. 22. Mr Simpson was attended by the site first aider and Emergency/Ambulance Services Personnel subsequently removed him from the base of lift shaft 11 and transported him to St Vincent's Hospital. It also appears that the emergency officers used the previously unsecured ladder access. 23. Subsequent to the accident Schindler Lifts produced a work method statement for removal of work deck and protective decks specified for lifts 11 to 13 at Sydney Central Plaza. The statement dated 1 September 1997 notes "the false car is not to be used as a means of lifting." 24. At all material times there was no overhead protection platform in place whilst Hassan Simpson was undertaking work on the installation of a lift at the construction site which would have prevented any material or objects from falling onto him whilst he performed work underneath. 5 Additional factual material was filed by the prosecution consisting of the Inspector's factual inspection report and a number of diagrams and photographs and a record of the defendant's prior conviction. The defendant was fined in the Chief Industrial Magistrate's Court on 6 July 1999 the sum of $3,000 for breach of s 15(1) of the Act. 6 The defendant tendered an affidavit of Mr David Lehmann, its Occupational Health and Safety Officer who had been employed by the Workforce International Group since 20 October 1997. His evidence went predominantly to systems which have been introduced by the defendant company and the group of which it is a part since the accident which gave rise to these proceedings. ASSESMENT OF PENALTY 7 I observe initially that the maximum penalty by reason of the application of s 51A of the Act is $750,000. So much was submitted by counsel for both parties. 8 At the outset it is necessary to identify the nature and quality of the offence. This must be undertaken in the context that the defendant operated as a labour hire company. The manner in which obligations imposed by the Act and in particular s 15(1) of the Act operated on labour hire companies was discussed by a Full Bench of this Court in Drake Personnel Ltd v WorkCover Authority of New South Wales (1999) 90 IR 432. In a joint judgment Wright J, President and Walton J Vice President said: The obligations of a labour hire company under the OH&S Act have been considered on a number of previous occasions by this Commission and its predecessors. The judgment of Hungerford J in Petar Ankucic v Drake Personnel Ltd t/as Drake Industrial (unreported, Hungerford J, IRC96/6475, 6476, 6477 and 6479, 25 November 1997) concerned a prior prosecution of the appellant. That prosecution arose from an incident in which an employee of the appellant, Mr Douglas, sustained an injury whilst operating a woodworking machine at the premises of another company, Warman International Ltd. The appellant pleaded guilty in that case and was fined a total of $25,000. Considering the question of penalty, his Honour commented (at p382): The failure here to ensure the safety of Mr Douglas arose in a situation where he was directed by his employer, the defendant, to perform work for a third party, Warman, at that third party's premises. In such a situation, my view is that an employer has a special responsibility to ensure the health, safety and welfare of its employees at the other workplace for no reason other than that that workplace is removed form the employer's direct management and control and would usually be at a location foreign, or at least unfamiliar, to the employees concerned. The evidence established that the defendant did not satisfactorily attend to this aspect and it was not until Mr Davey was engaged that specially designed safety policies and procedures were implemented. But that was in July 1997, at least two years after the present offences were committed; Mr Douglas thereby suffered injury resulting in absence from employment for a period of at least two months and with a permanent deficit in the use of his right hand. It is no answer, in my view, in reduction of penalty otherwise considered appropriate for the defendant to plead reliance on Warman as the client to take appropriate steps to ensure safety in the workplace for all persons engaged at its premises. True it may be that Warman itself may have offended against the Occupational Health and Safety Act , but that does not, it seems to me, lessen the seriousness of the offences committed here by the defendant as the employer. It is that feature of this case which gives to the assessment of penalty such a degree of importance as will encourage employers in a business similar to that of the defendant to implement appropriate steps to ensure the safety of their employees whose labour is hired to third parties and at the same time to deter employers for failing to take such steps. See also WorkCover Authority of New South Wales (Inspector Dubois v Industry Staffing Services Pty Ltd t/as Action Workforce (1999) 89 IR 430. The observations of Hungerford J set out above were made in the context of determining the appropriate penalty to be imposed following a plea of guilty. However, we consider that they are equally applicable when considering the liability of a labour hire company under the OH&S Act. A labour hire company cannot escape liability merely because the client to whom an employee is hired out is also under a duty to ensure that persons working at their workplace are not exposed to risks to their health and safety or because of some alleged implied obligation to inform the labour hire company of the work to be performed. In our view, a labour hire company is required by the OH&S Act to take positive steps to ensure that the premises to which its employees are sent to work do not present risks to health and safety. This obligation would, in appropriate circumstances, require it to ensure that its employees are not instructed to, and do not, carry out work in a manner which is unsafe. (at 455-6) 9 The concession by the defendant by its plea of guilty and also during the proceedings that there was no detailed system in operation at the time of the injuries sustained by Mr Simpson as required by s 15(1) of the Act, indicates that this is a serious offence. In making these observations I am conscious that the particulars contained in the amended summons are confined in essence to a failure to ensure that Mr Simpson would not fall greater than 1.8 metres and a failure to ensure that an overhead protection platform was provided. 10 Mr Hodgkinson of counsel who appeared for the defendant referred me firstly to paragraph 15 of the agreed statement of facts. That makes reference to the fact that Mr Simpson called for a safety harness and that it was passed to him. Mr Hodgkinson submitted that this indicated that there was a harness available for use, Mr Simpson was aware of it and presumably familiar with its use and that this impacted upon any allegation that the defendant had failed to ensure that he would not fall greater than 1.8 metres in height. I was also referred to paragraphs 12 and 13 of the agreed statement of facts. Mr Hodgkinson said that these paragraphs demonstrated that a system of the use of overhead protection platforms was in place, that the relevant platform had been dismantled and that Mr Simpson was in the process of placing it on another level when the accident occurred. This impacted also on the allegation that the defendant failed to ensure that an overhead protection platform was provided while undertaking the installation of the lift. By way of corollary argument Mr Hodgkinson stressed that the risk to Mr Simpson and his resultant accident arose as a result of the failure of Schindler Lifts to put in place a proper system of work to ensure the safety of all concerned in the operation. Whilst these submissions did not go to liability they did affect the culpability of the defendant. I accept these submissions. 11 Mr Hodgkinson in his submissions emphasised also the fact that the defendant had changed its systems substantially and had determined to cease operating in the construction area. I should add that the evidence of Mr Lehmann was to the effect that the defendant was part of a group of eighteen to twenty companies all of which operated as labour hire companies in a number of different areas covering a broad range of industries. Between 600 to 800 employees are engaged on a weekly basis depending on seasonal and other factors. The company has only one prior conviction for an offence under the Act and asserts that it has a good record accordingly. 12 Finally, I should add that the defendant entered a plea of guilty at the earliest possible opportunity. 13 In all the circumstances I am of the opinion that an appropriate penalty to be imposed on this defendant is the sum of $70,000 to which a discount of 25 percent should be applied because of the early plea of guilty, leaving a net penalty of $52,500. 14 The prosecution sought and the defendant consented to the awarding of a moiety and the awarding of costs. ORDERS 15 I make the following orders: 1. The defendant is found guilty of the offence with which it is charged in the amended summons and convicted accordingly. 2. The defendant is fined the sum of $52,500 with a moiety to the WorkCover Authority of New South Wales. 3. The defendant is to pay the costs of the prosecution. I grant liberty to apply in the event that costs cannot be agreed. _________________ 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.