Industrial Relations Commission of New South Wales in Court Session CITATION : Inspector Paul Mansell v Orica Australia Pty Limited [2002] NSWIRComm 155 PROSECUTOR: WorkCover Authority of New South Wales (Inspector Paul Mansell) PARTIES : DEFENDANT: Orica Australia Pty Limited FILE NUMBER: IRC 3911 of 2000 CORAM: Walton J Vice-President CATCHWORDS : Occupational health and safety - Alleged breach of s16 of the Occupational Health and Safety Act 1983 - Contractor suffered crush injuries when controls to a powered winch from which he was suspended in a confined working environment malfunctioned - Alleged failure to provide a safe system of work - Alleged failure to provide plant and equipment that was safe and without risk to health - Alleged failure to provide a safe means of egress from a 'confined space' working environment - Plea of guilty - Objective seriousness of offence primarily determinative of penalty - Contribution to risk by other parties - Assessment of culpability of defendant where third party involvement in creation of risk - Sentence determined by specific reference to offence charged - General and specific deterrence - Specific deterrence should usually feature in determination of penalty even when defendant is aware of obligations under the Act and has expended considerable efforts and resources on providing a safe workplace - Subjective features - Laudable efforts of defendant to provide safe workplace prior to and following accident and defendants approach to matters of health and safety result in significant reduction in sentence - Discount for plea of guilty, contrition and co-operation - Parity - Plea of guilty properly made and conviction entered - Penalty imposed - Costs LEGISLATION CITED : Occupational Health and Safety Act 1983 s 16 Occupational Health and Safety Act 2000 ss 139 141 and Schedule 3 Capral Aluminium Limited v WorkCover Authority of New South Wales (Inspector Mayo-Ramsay) (2000) 49 NSWLR 610 Fletcher Constructions Australian Limited v WorkCover Authority of New South Wales (Inspector Fisher) (1999) 91 IR 66 Griffiths v The Queen (1997) 194 CLR 293 Inspector Paul Mansell v Anytime Industrial Services Pty Limited (2001) 110 IR 34 Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 Lowe v R (1984) 154 CLR 606 Postiglione v The Queen (1997) 189 CLR 295 CASES CITED : R v Sharma [2002] NSWCCA 142 R v Thomson, R v Houlton (1999) 49 NSWLR 383 Ridge Consolidated Pty Ltd v Mauger [2002] NSWIRComm 108 State Rail Authority v WorkCover Authority of New South Wales (Inspector Dubois) (2000) 102 IR 218 WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Limited and Another (1999) 95 IR 383 WorkCover Authority of New South Wales (Inspector Carmody) v Consolidated Constructions Pty Ltd (2001) 109 IR 316 WorkCover Authority of New South Wales (Inspector Dawson) v Plastachem Pty Ltd & Ors (2001) 110 IR 351 WorkCover Authority of New South Wales (Inspector Farrell) v Schrader [2002] NSWIRComm 25 WorkCover Authority of New South Wales (Inspector Robert Stobo) v State Rail Authority of New South Wales [2002] NSWIRComm 72 HEARING DATES: 06/26/2001; 11/30/2001 DATE OF JUDGMENT: 07/12/2002 PROSECUTOR: Mr P Skinner of counsel SOLICITOR: Mr N A Correy Moray & Agnew Solicitors LEGAL REPRESENTATIVES: DEFENDANT: Mr R Crow of counsel SOLICITOR: Mr M Kellock Mallesons Stephen Jacques Solicitors JUDGMENT: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: Walton J, Vice-President 12 July 2002 Matter No. IRC 3911 of 2000 INSPECTOR PAUL MANSELL v ORICA AUSTRALIA PTY LIMITED Prosecution under s 16(1) of the Occupational Health and Safety Act 1983 JUDGMENT [2002] NSWIRComm 155 1 This matter concerns a prosecution brought by Inspector Paul Mansell of the WorkCover Authority of New South Wales ("the prosecutor") under s 16(1) of the Occupational Health and Safety Act 1983 of Orica Australia Pty Limited ("the defendant"). The matter now falls for consideration under the Occupational Health and Safety Act 2000 (see ss 139, 141 and Schedule 3 of that Act)("the Act"). 2 The prosecution arose out of an incident which occurred at the defendant's factory premises at Gow St, Padstow, when an employee of a contractor, engaged by the defendant to undertake maintenance work, was injured due to a failure in the operation of an electric hoist from which he was suspended. The contractor was suspended inside a 20,000-litre resin storage tank. The failure of the hoist resulted in it continuing to raise him, whilst he was within the largely enclosed tank. He was crushed against the roof of the tank whilst the powered hoist continued its work, resulting in fractured ribs, spinal vertebrae, severe bruising and a temporary loss of consciousness. 3 The charge contained in the summons issued on the defendant was in the following terms: On 12 August 1998 at the defendant's Dulux Australia resin manufacturing plant at 15 Gow St, Padstow in the state of New South Wales, the defendant being an employer did fail to ensure that persons not in its employment and in particular, John Todd, were not exposed to risks to their health and safety arising from the conduct of its undertaking, namely, the work of removing cooling and heating coils from a resin storage tank such work being carried out under the direction and control of the defendant, by the employees of the defendant's subcontractor Anytime Industrial Services Pty Limited, while they were at the defendant's place of work, contrary to section 16(1) of the Occupational Health and Safety Act 1983 in that the defendant: 1. Failed to provide or maintain a system for the removal of cooling and heating coils from within a resin storage tank that was safe and without risks to the health of persons not in its employment. 2. Failed to provide or maintain plant being used in the work of removing cooling and heating coils from a resin storage tank that was safe and without risks to the health of its employees. 3. Failed to make arrangements for ensuring the safety and absence of risks to health in connection with the use of plant, to wit a mechanical hoist which was being used to assist persons not employees in carrying out the work of removal of cooling and heating coils from within a resin storage tank. 4. Failed to provide such information, instruction, training and supervision as may be necessary to ensure the health and safety or persons not in its employment in relation to the work of removing cooling and heating coils from within a resin storage tank with the assistance of a mechanical hoist. 5. Failed to provide or maintain a means of egress from a confined space, to wit a resin storage tank, as was safe and without risks to health. 6. Failed to ensure that the work of removing cooling and heating coils from a resin storage tank was not carried out by using a mechanical hoist to support a person not in its employment, John Todd, within the tank contrary to Regulation 127(108) of the Construction Safety Regulations, 1950. 7. Failed to instruct persons not in its employment not to carry out the work involving the removal of cooling and heating coils from a resin storage tank by using a mechanical hoist, contrary to Regulation 127(108) of the Construction Safety Regulations, 1950, to support its non-employee, John Todd, in performing such work and in so doing failed to ensure the health, safety and welfare of its said employees. 4 The particulars of the charge contained in the summons were as follows: 1. The defendant was at all material times a company involved in various manufacturing processes including the manufacture of resin which was conducted form its Dulux Australia resin manufacturing plant at 15 Gow St, Padstow in the state of New South Wales ("the premises"). 2. Prior to 12 August 1998 and subsequently the defendant had a contract with Anytime Industrial Services Pty Limited, ("the contractor") to carry out general maintenance work for it at the premises. 3. On 11 and 12 August 1998, as part of its contract with the defendant, the contractor provided the services of a fitter and a trades assistant in order to carry out specific maintenance work on a resin storage tank known as the L tank ("the tank"). 4. The tank was situated in that part of the premises known as the resin storage plant. 5. Pursuant to its contract with the defendant the contractor supplied John Todd ("the injured worker") as the fitter and Greg Hogg ("the standby worker") as the trades assistant, ("the workers") to carry out the work for the defendant. 6. The contractor inspected the tank prior to the commencement of the work and determined that the inside of the tank where the work was to be carried out was a confined space. 7. Prior to 11 August 1998 it was agreed between the contractor and the defendant that the defendant would provide specific training to the contractor's employees for the purpose of carrying out the work required in the tank. 8. On 11 August 1998 the workers attended at the premises and were afforded training and instruction by the defendant's personnel for the purpose of carrying out the work in the tank. 9. The work to be carried out by the contractor's employees for the defendant was the removal of cooling and heating coils from inside the tank. 10. The tank was 3.6 metres high and 2.7 metres in diameter. There was a manhole access to the inside of the tank which was situated at the top of it approximately 220 millimetres from the outside edge. 11. The building in which the tank was situated had a steel roof structure that was 1.5 metres approximately above the manhole at the top of the tank. 12. The work to be carried out by the contractor's employees was the cutting away and removal of the heating and cooling coils from within the tank. 13. The defendant determined the work method to be adopted and determined and supplied the equipment to be utilised for the carrying out of the work. 14. Details of the work method and the equipment to be utilised as determined by the defendant included the following: (i) The injured worker was to be suspended inside the tank on a harness connected to an air powered mechanical hoist ("the hoist") attached to the steel roof structure of the building above the tank. (ii) A block and tackle was also to be attached to the steel roof structure to provide a lifting device for the purpose of supporting and removing the coils from inside the tank once they had been cut away by the injured worker. (iii) The injured worker was also to be provided with the necessary respiratory equipment to enable him to work within the tank. (iv) The workers were required to work as a team with one worker inside and one outside the tank and always to remain in sight of one another. (v) The standby worker be provided with a two-way radio to enable contact at all times with other site personnel. 15. The hoist provided by the defendant and used by the workers on 12 August 1998 was not a hoist which complied with the specifications set out in Regulation 127(66) of the Construction Safety Regulations, 1950. 16. The use of the hoist for the purpose of suspending the injured worker within the tank contravened Regulation 127(108) of the Construction Safety Regulations, 1950. 17. The defendant afforded training to the workers on 11 August 1998 instructing them how to carry out the work utilising the work methods and equipment referred to above. 18. At about 7.10am on 12 August 1998 the injured worker was suspended within the tank in carrying out the work of removing the coils. The injured worker directed the standby worker to lower him further inside the tank and then asked to be raised up again and in compliance with that direction the hoist was operated by the standby worker but the upward motion of the hoist continued and could not be stopped. The hoist continued to pull the injured worker whilst he was suspended in a horizontal position as the hook attachment for the harness being worn by him did not enable him to be pulled up vertically. 19. The hoist continued to pull out of control and forced the injured worker against the domed underside of the top of the tank. 20. The action of the hoist continued out of control for some time after the injured worker's body came into contact with the tank. 21. As a result of being forced into contact with the top of the tank the injured worker lost consciousness and sustained a number of fractures to spinal vertebrae. 22. The hoist had gone out of control because the control rod or paddle control to the hoist had been jammed by the chain from the block and tackle preventing the paddle control from stopping the hoist's upward movement. 23. The injuries sustained by the injured worker prevented him resuming his employment for in excess of seven days. The injured worker continued to be absent from work for a period of at least four months from the date of injury and suffered from physical and psychological injuries for which he was still receiving treatment at four months from the date of injury. 24. Subsequent investigations of the accident by the defendant concluded the causes to be the following: · Poor hoist design noting a powered hoist should not have been used to support the injured worker. · The shackle point of the hoist to the support beam was too congested as the block and tackle in the vicinity was connected too close to the hoist mechanism such that the crossover of chain ultimately fouled the hoist mechanism. · Access and egress from the confined space was not unobstructed. · The safety harness connection to the injured worker was via a single shackle point between the shoulderblades and this connection should have been made via a spreader bar to shackle points at each of the injured worker's shoulders. Statement of Agreed Facts 5 A statement of agreed facts was tendered in the proceedings in the following terms: 1. The informant is and was at all material times an Inspector duly appointed and empowered by section 48 of the Occupational Health and Safety Act 1983, to institute the within proceedings. 2. At all material times the defendant, ORICA AUSTRALIA PTY LIMITED [ACN 0004 117 828] was a company duly incorporated with its registered office at level 16, 1 Nicholson Street, Melbourne in the state of Victoria. 3. The defendant was at all material times a company involved in various manufacturing processes including the manufacture of resin which was conducted from its Dulux Australia resin manufacturing plant at 15 Gow Street, Padstow in the state of New South Wales ("the premises"). 4. Prior to 12 August 1998 and subsequently the defendant had a contract with Anytime Industrial Services Pty Limited ("the contractor") to carry out general maintenance work for it at the premises. 5. On 11 and 12 August 1998, as part of its contract with the defendant, the contractor provided the services of a maintenance fitter and a trades assistant in order to carry out specific maintenance work on a resin storage tank known as the L tank ("the tank"). 6. The tank was situated in that part of the premises known as the resin storage plant. 7. Pursuant to its contract with the defendant the contractor supplied John Todd ("the injured worker") as the fitter and Greg Hogg ("the standby worker") as the trades assistant, ("the workers") to carry out the work for the defendant. 8. The defendant inspected the tank prior to the commencement of the work and determined that the inside of the tank where the work was to be carried out was a confined space. 9. Prior to 11 August 1998 it was agreed between the contractor and the defendant that the defendant would provide specific training to the contractor's employees for the purpose of carrying out the work required in the tank. 10. On 11 August 1998 the workers attended at the premises and were afforded training and instruction by the defendant's personnel for the purpose of carrying out the work in the tank. Such training included training with respect to safety equipment to be used by the workers, the procedures to be followed to complete the work and emergency procedures. 11. The work to be carried out by the contractor's employees for the defendant was the removal of cooling and heating coils from inside the tank. 12. The tank was 3.6 metres high and 2.7 metres in diameter. There was a manhole access to the inside of the tank which was situated at the top of it approximately 220 millimetres from the outside edge. 13. The building in which the tank was situated had a steel roof structure that was 1.5 metres approximately above the manhole at the top of the tank. 14. In consultation with the workers, the defendant determined the work method to be adopted and determined and supplied the equipment to be utilised for the carrying out of the work. 15. Details of the work method and the equipment to be utilised as determined by the defendant included the following: (i) The injured worker was to be suspended inside the tank on a harness connected to an air powered mechanical hoist ("the hoist") attached to the steel roof structure of the building above the tank. (ii) A block and tackle was also to be attached to the steel roof structure to provide a lifting device for the purpose of supporting and removing the coils from inside the tank once they had been cut away by the injured worker. (iii) The injured worker was also to be provided with the necessary respiratory equipment to enable him to work within the tank. (iv) The workers were required to work as a team with one worker inside and one outside the tank and always to remain in sight of one another. (v) The standby worker be provided with a two-way radio to enable contact at all times with other site personnel. 16. The hoist provided by the defendant to lift the injured worker did not have appropriate safety gear or locking devices. 17. The defendant permitted the injured worker to rise on the hoist without obtaining the written approval of the WorkCover Authority. 18. The defendant afforded training to the workers on 11 August 1998 instructing them how to carry out the work utilising the work methods and equipment referred to above. Further, the workers were present whilst all elements of the confined space entry were double checked. To this end, a confined space clearance certificate and a cold work clearance certificate were issued by the defendant in respect of the work to be undertaken by the workers and such certificates were signed by the workers. 19. At about 7.10am on 12 August 1998 the injured worker was suspended within the tank in carrying out the work of removing the coils. The injured worker directed the standby worker to lower him further inside the tank and then asked to be raised up again and in compliance with that direction the hoist was operated by the standby worker but the upward motion of the hoist continued and could not be stopped. The hoist continued to pull the injured worker whilst he was suspended in a horizontal position and forced the injured worker against the domed underside of the top of the tank. 20. As a result of being forced into contact with the top of the tank the injured worker lost consciousness and sustained a number of fractures to spinal vertebrae. 21. The hoist had gone out of control because the control rod or paddle control to the hoist had been jammed by the chain from the block and tackle preventing the paddle control from stopping the hoist's upward movement. 22. The injuries sustained by the injured worker prevented him resuming his employment for in excess of seven days. 23. Subsequent investigations of the accident by the defendant concluded the following: a) Poor hoist design noting a powered hoist should not have been used to support the injured worker. b) The shackle point of the hoist to the support beam was too congested as the block and tackle in the vicinity was connected too close to the hoist mechanism such that the crossover of chain ultimately fouled the hoist mechanism. c) Access and egress from the confined space was not unobstructed. d) The safety harness connection to the injured worker was via a single shackle point between the shoulderblades and this connection should have been made via a spreader bar to shackle points at each of the injured worker's shoulders. 24. The defendant failed to ensure that persons not in its employment, and in particular John Todd, were not exposed to risks to their health and safety arising from the conduct of its undertaking, namely the work of removing cooling and heating coils from the resin storage tank in that it: a) Failed to provide or maintain a system for the removal of cooling and heating coils from within a resin storage tank that was safe and without risks to the health of persons not in its employment. b) Failed to provide or maintain plant being used in the work of removing cooling and heating coils from a resin storage tank that was safe and without risks to the health of its employees. c) Failed to make arrangements for ensuring the safety and absence of risks to health in connection with the use of plant, to wit a mechanical hoist, which was being used to assist persons not employees in carrying out the work of removal of cooling and heating coils from within a resin storage tank. d) Failed to provide or maintain a means of egress from a confined space, to wit a resin storage tank, as was safe and without risks to health. e) Failed to provide and/or maintain plant, to wit a mechanical hoist for lifting the injured worker, that was safe and without risk to the health of persons not in its employment, in that the hoist was not fitted with appropriate gear or locking devices. 6 It was the matters in paragraph 24 of the statement of agreed facts to which the defendant plead guilty. The prosecutor indicated that he did not press the charge as particularised in summons, to the extent that it differed from that contained within that paragraph. Evidence for the Prosecutor 7 In addition to the statement of agreed facts, the prosecutor tendered a report of the prosecutor compiled following an inspection on the day of the accident, a bundle of six colour photographs of the incident site taken at the time of the inspection and an extract from the Workcover Authority of New South Wales Prior Convictions Database. 8 The inspection report tendered into evidence was a single page document which described the physical layout of the accident site in somewhat more detail than the agreed statement of facts. For the purposes of sentencing, it is not necessary to set out the evidence contained in that report. The extract from the prior convictions database indicated that the defendant had some eight prior convictions under the Act; six before the Chief Industrial Magistrate's Court, one in this Court and one in the predecessor to the Commission in Court Session, the Industrial Court of New South Wales. 9 The prosecutor gave further oral evidence to clarify what was shown in the photographs of the incident site. He was not required for cross-examination. Evidence for the Defendant 10 The defendant tendered five affidavits in support of its plea in mitigation of sentence. Those affidavits were deposed by Mr Michael Francis Siely, the former Operations Manager of the defendant and current Operations Manager of Selleys Pty Ltd, Ms Christina Antoinette (Anne) Smith RN, the National Occupational Health Services and Workers Compensation Manager for the Dulux, Berger and British Paints divisions of the defendant, Mr Patrick Joseph Hanrahan, the Corporate Safety Health & Environment Manager of the defendant, Mr Krste Corapovski, the Production Manager of the defendant and Mr Alan Au-Yeung, the Property Service Manager of the defendant. 11 Mr Siely gave evidence explaining the business of the defendant company, his role in the business and the circumstances in which the work giving rise to the injury came to be performed on the day of the accident. Broadly summarised, he stated that the defendant had operated a manufacturing plant producing various materials (in particular, unsaturated polyester resins) at its Padstow site for some 40 years. That plant was decommissioned in July 2000. At the time of the accident, August 1998, the defendant had engaged a company called Anytime Industrial Services Pty Ltd ("Anytime Industrial") to provide a full time mechanical contractor and a full time electrical contractor at the site. Anytime Industrial also provided other contract labour for specific tasks from time to time. No written contract existed between the defendant and Anytime Industrial, however, the arrangement between those companies was not in dispute in these proceedings. Anytime Industrial would ensure that any persons provided to the defendant were suitably qualified to perform the relevant work. The defendant would ensure that any workers, so provided, were given proper site induction training and provided proper training for the specific task to be undertaken. Mr Seily stated that the task of undertaking the training to be provided by the defendant to the employees of Anytime Industrial generally fell to the defendants Site Engineer. At the time of the accident, Mr Au-Yeung held that position. 12 As a part of its operations, the defendant maintained a series of resin storage tanks. These tanks required cleaning, usually on a yearly basis, to prevent an excessive build up of hardened residue reducing the storage capacity of the tanks. This process usually involved an emptied tank being sparged with steam for a period of approximately two weeks to loosen the hardened resin. The residue would, on Mr Siely's evidence, normally fall to the floor of the tanks and be scooped out manually. On this occasion, after having been sparged with steam, it became clear that manual cleaning would be required. As a part of this cleaning, Mr Seily, in conjunction with Mr Corapovski, the defendant's Production Manager of the Resin Plant, decided to remove a number of redundant cooling pipes within the tank. 13 To undertake these tasks, the defendant engaged Anytime Industrial. Mr Seily described the events surrounding the engagement of the contractors in this way: On 11 August 1998, two contractors from Anytime Industrial, John Todd and Greg Hogg ("the contractors") arrived to cut out the pipes and clean the tank. Alan Au-Yeung and I conducted the training of the contractors in relation to the specific task of cutting out the pipes and cleaning the L tank. In normal circumstances, as the Operations Manager, I would not be involved in the issuing of cold or hot work clearances and this would be done by either Kris Corapovski or Alan Au-Yeung. However, as this job also required a confined space clearance and was a relatively complicated operation with a higher degree of risk than usual, I had instructed Alan Al Yeung that I wanted to be present at the issuing of the confined space clearance certificate. The issuing of the confined space clearance certificate took approximately four to five hours because I wanted to ensure that the contractors understood what they were to do and that they were confident we had done everything possible to ensure their safety. At approximately 8.30am on 11 August 1998 Alan Au-Yeung, the contractors and I went to the L tank. Alan Au-Yeung and I showed the contractors that the mechanical isolations had been made on the tank i.e. the redundant water pipe had been terminated and blanked going into and out of the tank; the nitrogen line which had run into the top of the tank had been terminated; the drive belt on the motor for the stirrer in the tank had been removed; and that the stirrer motor had been disconnected. 14 Mr Siely gave evidence that he and Mr Au-Yeung, in the presence of the contractors, then tested the tank for flammables and oxygen, instructed the contractors on the use of the two-way radio and took the contractors through the Cold Work and Confined Space Work clearance certificates. The contractors were given specific instructions: Neither of you are to be inside the tank for any more than 40 minutes at a time. The standby person must be able to see the person inside the tank at all times. If one of you has to go to the toilet, then the other had to get out of the tank. Do you understand this? It is very important. 15 Mr Seily gave evidence that the method of access and egress to the tank was decided upon in a discussion between himself, Mr Au-Yeung and the contractors. Due to the confined space within the tank, the need for the contractors to have both hands free to operate the relevant tools and the narrow opening, it was considered ladders would be unsuitable. Having decided upon the method ultimately adopted (that is, using the powered winch to support the worker), Mr Au-Yeung and Mr Seily demonstrated the proper use of the winch. In the presence of Mr Au-Yeung and Mr Seily the contractors then demonstrated the use of the winch and indicated that they were comfortable using it. Mr Seily gave evidence of then having left the scene of the accident. Mr Au-Yeung remained with the contractors. 16 Mr Siely gave evidence of having been made aware of the occurrence of the accident on his way into work at 8am on the day of the accident. He immediately commenced an internal investigation, interviewing a number of employees near the accident site. A preliminary report of his investigation was forwarded by way of email communication to the General Manager of Dulux Operations, Mr John Blackwood, and a number of other relevant persons at 5.30pm on the day of the accident. At 9.30pm that evening Mr Blackwood replied to Mr Siely's email indicating that as the accident "was potentially more serious than the end result", he wished to be involved in the investigation. The preliminary report was sent to Workcover on 14 August 1998, indicating several corrective measures that were to be taken by the defendant. A further investigation, involving Mr Blackwood, Mr Au-Yeung, Ms Anne Smith, Mr Simon Taylor and Mr Peter Hunt was undertaken on 18 August 1998 at the Padstow site. A draft investigation report was forwarded to various personnel of the defendant and amendments were made following the feedback received. 17 The final report of the investigation was prepared on 28 August 1998 and contained the following recommendations for corrective action: a) Determine what non-powered personnel rescue equipment is available, and identify suitability for each confined space on site; b) Withdraw the pneumatic winch from use on personnel; c) Clarify the requirements of the various statutory regulations and modify the Model Procedure accordingly with respect to powered personnel lifting equipment; d) Modify Model Procedures to ensure unobstructed use of manholes for personnel access. Clear statement in procedure; e) Review the procedure for removing pipework from tanks; and f) Assess additional training needs for confined space clearance authorisers and site maintenance personnel required to enter confined spaces. 18 Mr Seily also provided evidence as to the corrective actions taken following the accident: a) The purchase of purpose-built equipment for entry into and exit from confined spaces. This equipment conforms with Workcover guidelines and is non-mechanical. [A copy of the invoice relating to the purchase of this equipment in an amount of some $2,800 was annexed to Mr Siely's affidavit]. b) The pneumatic winch was immediately withdrawn from use on personnel; c) The requirements of the various statutory regulations were clarified and the Model Procedure modified accordingly with respect to powered personnel lifting equipment. [Copies of the previous procedures and the amended procedures were annexed to Mr Seily's affidavit]. d) The procedure for removing the pipes from the L tank was reviewed by Alan Au-Yeung. It was decided to firstly cut the pipes using a hacksaw; secondly, for the person to leave the inside of the tank, and then thirdly to pull the pipes out of the L tank using a rope. This job was not finished, however, as it was ultimately decided that the L tank was no longer needed; e) The training needs for people authorised to issue confined space clearance certificates and site personnel to enter confined spaces was assessed by myself and Alan Au-Yeung. 19 Having reviewed the model safe procedures documents in relation to both "lifting equipment" and "entry into confined spaces" annexed to Mr Siely's affidavit, it is apparent that the defendant has undertaken, since the accident, a significant review and amendment to its relevant policies. As to the amendments to the lifting equipment policy, significant amendments have been made to the procedures to be undertaken prior to the selection of lifting equipment for a particular task. These changes required the identification the particular employee who is responsible for the matters raised in the policy. That employee is required to undertake an extensive risk assessment, covering not only the design of the machine, but the materials from which it is constructed to ensure that it is suitable to the task at hand. Where there is any doubt, the policy requires that a materials expert be approached to determine the particular device's suitability to the task. It requires the relevant employee to ensure that the equipment has been properly tested and certified with the Workcover authority or other relevant statutory authorities. The new lifting equipment policy also significantly amended the procedures in clause 4.2.2 of the model procedures, providing for "safe lifting practices". Other than requiring that any installation of lifting equipment shall be completed by properly authorised and qualified individuals, it contained amendments in the following terms: Lifting equipment shall only be used for the purposes for which it was designed. In particular, people should only be lifted or suspended by equipment specifically designed for that purpose. Each operation involving lifting of people shall be specifically approved by the Responsible Manager Engineer and, where required by local legislation, by the statutory authority. Note: "Fall and Arrest" harness, lifelines and winch blocks are not generally designed for continuous use under load and in such cases shall not be used to suspend people for work. 20 In relation to the training needs of persons doing confined space work, the defendant sent some eight people to undertake a Workcover approved training course entitled "Confined Space Training Course" conducted by the Mines Rescue Services of New South Wales. The policy on entering confined spaces was amended significantly so as to provide, inter alia, for a more extensive risk assessment and established a flowchart of actions to be taken before confined space work was to be undertaken. 21 There was contained within the photographs annexed to Mr Siely's affidavit two photographs which I consider warrant mention. The first is a large banner displayed in the defendant's resin plant, bearing what was described by Mr Siely as the defendant's "safety motto": "No Injuries to Anyone, Ever". The second was a large board which recorded the occurrence of injuries in the workforce of various levels of seriousness: medially treated injuries, lost time injuries and like matters. Mr Siely indicated that the defendant kept records of safety performance in view of the workforce for "their own edification and improvement". The photograph of the board in evidence (which was taken at the time of the factory closing down in July 2000) indicated that the last "lost time injury" was the injury giving rise to these proceedings. 22 In cross-examination, Mr Seily indicated that whilst he was aware that there was, at the time of the accident, a regulation in force which required the defendant to attain the approval of the Workcover authority prior to using powered lifting equipment, he conceded that he was unaware of the precise terms of the regulation and that he was now aware that the regulation was applicable to the work performed at the time of the accident. Mr Seily stated that if the same work was to now be performed, the requisite approval would have been obtained. There were now both specific procedures in place and extra training provided, specifically in relation to confined space work, which covered quite comprehensively the regulations associated with such work, so as to prevent such a situation happening again. He conceded that it may be possible for a powered winch to be contemplated for use in similar circumstances, but that if such equipment was to be used, there was a process in place where a panel of people would have to be satisfied of the safety of such activity before the activity was undertaken. 23 Mr Alan Au-Yeung was the Site Engineer at the Dulux manufacturing plant at Padstow at the time of the accident. He was responsible for maintenance and the managing of capital projects at the Padstow site. Mr Au-Yueng was responsible for the organisation and supervision of contractors who came onsite for the purposes of performing maintenance work. He was also the person responsible for the site safety and induction training provided to contractors by the defendant. 24 Mr Au-Yeung described the arrangement between the defendant and Anytime Industrial in the following way: The arrangement with Anytime was flexible. It typically worked by way of myself, Kris Corapovski or Michael Siely telephoning Anytime in relation to a particular job and asking for contractors able to perform that job. Anytime is a small company and we did not expect them to fully train the contractors they sent to work at Dulux. The general arrangement was that we would induct the contractors and instruct them in the safety relevant to the job they were performing. 25 Mr Au-Yeung gave evidence similar to that of Mr Siely in relation to the training provided to the contractors on the day of the accident and so need not be set out in detail. It is sufficient to say, Mr Au-Yeung was not able to recall whose suggestion it was to have used an electric winch for the tasks and that it was he who had undertaken the certification requirements for cold and confined space work. He had been approved to undertake these certification tasks after having attended a training course organised by the Workcover Authority. It should also be noted that Mr Au-Yeung gave evidence that at approximately 1pm on the day prior to the accident he had checked "the equipment" was working and observed "the contractors perform a successful test of the winch". Mr Au-Yeung gave similar evidence in relation to the investigation conducted by the defendant, the recommendations and the corrective action taken following the accident. He also gave evidence of having attended the confined work space training course run by Mines Rescue as referred to in Mr Siely's evidence. 26 Mr Krste Corapovski described the circumstances which gave rise to the need to perform the subject work on the day of the accident and the circumstances surrounding the work being performed on the day of the accident. This evidence was in similar terms as to that earlier set out from Mr Seily's affidavit. However, it should be noted that it was Mr Corapovski that certified the contractors as ready to perform the work on the day of the accident. He had been instructed by Mr Au-Yeung, as noted in his evidence, in relation to testing the atmosphere in the tank and running through the requisite instructions with the contractors prior to those persons commencing work on 11 August 1998 (the day prior to the accident). He had undertaken these tasks and signed the requisite certificates of competency on the morning of the accident. A statement written by him on the morning of the accident was annexed to his affidavit. He was not required for cross-examination. 27 The defendant also called Ms Christina Antoinette (Anne) Smith - the National Occupational Health Service's and Workers Compensation Manager for the defendant. Ms Smith's evidence went mainly to the approach of the defendant to matters of health and safety prior to the accident. In particular, her evidence went to what was required of contractors when coming onto the Padstow site. 28 Ms Smith was appointed the Occupational Health and Safety Nurse for the Dulux and Berger Paints Divisions of the defendant in 1988. In 1994, she was appointed the Safety, Health and Environment ("SHE") Manager for Dulux, including the resin plant at Padstow. In that role, her duties included "the role of Occupational Health and Safety Nurse, safety and health training and promotion, assistance with accident investigation, the conduct of safety audits for the defendant, the conduct of annual external SHE Audit Review Meetings and various other safety and health related activities". In 1998, she was appointed a member of the Occupational Health and Safety Committee for the Padstow site. This committee was made up of 65% worker representation and 35% management representation comprised of two representatives from each department of the defendant. 29 In Ms Smith's evidence, the committee would meet monthly to "discuss general safety issues and any injuries or incidents that occurred". The committee would also set topics for internal monthly "Housekeeping & Safety" audits, other SHE safety initiatives and to set topics for in-house information sessions called "Toolbox Talk Sessions". These talk sessions included a variety of topics related to safety in the workplace including fire extinguisher training and care, the use of personal protective equipment, pedestrian safety on site and manual handling. 30 In her role as SHE Manager, Ms Smith assisted the site manager in the development of annual SHE plans for the Padstow site. Extracts from the 1998 annual plan were annexed to Ms Smith's affidavit. The extract highlighted a number of health and safety related initiatives that were adopted by the defendant at its Padstow plant, including two ongoing safety awareness programmes referred to as Unsafe Act Prevention (UAP) and the Padstow Seek Out Safety (SOS) competition. The material referred to the "vision" of the SHE program which was in the following terms: SH&E VISION NO INJURIES TO ANYONE, EVER In addition we aim to achieve § An injury and illness free workplace, § With zero loss of containment, § Zero environmental contamination, § Zero hazardous waste, § Reduced energy consumption and § Produce products that are safe and environmentally acceptable. 31 Ms Smith stated: The Dulux Resins business was very proud of its excellent safety record and in approximately July 1998 all Resins personnel received a certificate recognising their contribution to the outstanding achievement of zero MTI's (Medically Treated Injuries) for the three year period of 13 July 1995 to 13 July 1998. 32 A copy of this certificate was annexed to Ms Smiths affidavit. In cross-examination, Ms Smith indicated that the award was an award given to the employees of the Padstow site, not on some more general basis. 33 Ms Smith also gave evidence of having been involved in the development of the defendant's contractor induction program: Another of my duties was to assist in developing the contractor induction program. The program was then administered by the various line managers to whom the contractors would report. In or around March 1991 I developed a contractor induction program for the Padstow site consistent with the Orica Model Procedure on Contractor SH&E management, with the then manager of the Resin Plant at Padstow, Andre Israel. 34 A copy of the defendants model procedure on contractor SH&E management was annexed to Ms Smith's affidavit. Ms Smith summarised the induction program in her affidavit: Pursuant to the Padstow contractor induction program, a contractor commencing at the Padstow site would: a) Have the various policies of the site explained to them, for example, the no smoking policy and emergency procedures; b) Complete a "Contractor health Questionnaire Card". This card was then placed in a sealed envelope addressed to my attention. As the Occupational Health Nurse, I maintained and stored the confidential medical files of personnel working at the Padstow and Rhodes sites. [A copy of this leaflet was attached to Ms Smiths affidavit] c) Read the leaflet labelled "Padstow site - your safety" which stated the various policies that applied to their work on the site, the requirement for work permits (clearances), the emergency procedures for the site, and emergency phone numbers. The contractors were required to retain this leaflet. [A copy of this leaflet was annexed to the affidavit]. d) Complete the "SHE Induction Evaluation" which involved answering questions in relation to the policies which had been explained during the induction program. [A copy of this evaluation form was annexed to the affidavit]. e) Complete a "Site Record of Induction" which would indicate that the various policies and safety information had been explained to the contractor. [A copy of this record was attached]. 35 Ms Smith stated that the contractors involved in the accident had been through this induction program. 36 The defendants model Contractor Safety Health and Environment policy identified key requirements as follows: KEY REQUIREMENTS 2.1 Evidence of past SH&E performance and commitment to management of SH&E performance shall be included in the selection criteria for Contractors, commensurate with the risk associated with the work to be performed, the hazards present in the work area and the degree of supervision to be provided. 2.2 The SH&E implications of all aspects of the work to be performed shall be considered and relevant matters relating to the management of safety, health and environment issues shall be specifically included in the contract, and sub-contracts where applicable. 2.3 Contractors and subcontractors shall be checked to ensure they are appropriately licensed, authorised and technically competent to carry out the work to be performed. 2.4 Contractors shall be required to provide all relevant information regarding the safety occupational health and environmental implications of the work they will perform. 2.5 Contractors shall be given all relevant information regarding the company's materials, products and activities which may impact on the safety, occupational health and environmental impact of the work to be performed. 2.6 Contract employees shall receive appropriate induction training prior to commencement of work. 2.7 Contractors equipment shall be inspected and tested in accordance with applicable Model Procedures. 2.8 Contractor activities shall be adequately monitored throughout the work. 2.9 Emergency Plans shall include suitable arrangements to control emergencies which may arise from contractor activities and to minimise the impact of emergencies on contract personnel. (refer MP-SG-020) 2.10 Accidents, occupational diseases and other SH&E incidents arising from Contractor activities shall be reported and investigated in accordance with MP-SG-026. 37 The remainder of the policy was directed to giving effect to these key requirements. Of particular relevance to these proceedings are the provisions which relate to the use and checking of equipment, the provision of clearance certificates and required supervision: 4.6 Contractors Equipment A list of equipment to be provided by the Contractors, plus the safety requirements of that equipment, shall be included in the Contract. Contractor's equipment shall be checked prior to use. The minimum requirement is a visual inspection. Many sites will require a higher degree of inspection (e.g. testing of electrical equipment by an Electrician, lifting gear by a Rigger etc.) and such inspection is to be arranged by the Nominated Manager. A recommended equipment check-list is given in Appendix A 38 The first item noted on the aforementioned checklist (contained in Appendix A to the policy) was equipment related to "lifting appliances": 1. Lifting Appliances (refer also MP-SF-009 Lifting Equipment) § Soundness and Condition of all equipment and gear, especially slings § SWL displayed § Equipment appropriate for the work to be carried out § Competency of Operators (certificates) § Current certificates for mobile cranes § Storage arrangements 4.7 Clearance Certificates Clearance Certificates must be obtained by Contractors and Sub-Contractors before commencing work, refer to Clearance to Work (MP-SF-004) Special clearances were required for: § Excavation/Break-in Authority (MP-SF-003) § Control of Hot Work (MP-SF-028) § Entry into Confined Spaces (MP-SF-002) § Radiation Protection (MP-SF-006) § Work on High Voltage Equipment & Systems (MP-ET-022) § Work at Heights/Work on Roofs (MP-SF-007) § Work on Live Electrical Low Voltage Equipment & Systems (MP-ET-023) § Isolation from Stored Mechanical Energy (MP-SF-024) 4.8 Monitoring of Contractor Activities The nominated manager shall conduct periodic assessments and monitor the Contractor's activities to ensure full compliance and ongoing ability to comply with all agreements and instructions related to safety, occupational health and environmental protection a well as the criteria set out in the selection process. This shall include: a) Monitoring of Unacceptable Risks, to ensure that: § Orica employees or other persons on site on Oirca business are not exposed to unacceptable risk as a result of the Contractor's activities. § Orica activities do not expose Contractor's personnel to unacceptable risk b) Ensuring that Contractor's personnel are supervised at all times, either by Contractor's Supervisor or by a Company Supervisor. 39 Ms Smith also gave evidence of having counselled employees following the accident and having attended upon the family of the injured worker whilst he was in hospital to explain what had happened, inform them of the investigative procedures that would be undertaken and offer assistance. 40 The final witness called by the defendant was Mr Patrick Joseph Hanrahan, the Corporate Safety Health and Environment Manager of the defendant. 41 Mr Hanrahan's evidence provided background on the defendant company, its operations and the significant effort that the defendant expends on ensuring the health and safety of its workforce. 42 The defendant is a part of an international group of countries which operate in some 31 countries throughout the world with a revenue in excess of $4 billion annually. The defendant and its related companies manufacture and supply industrial and specialty chemicals, agricultural chemicals and fertilisers, commercial explosives and mining chemicals, paints and other consumer products sold under well known brands such as Dulux, Selleys and Cabots. 43 Mr Hanrahan stated that up until June 2000, the defendant, trading as Dulux, operated a resin manufacturing plant in Padstow, New South Wales. The plant was initially developed by British Paints for the purpose of manufacturing alkyd resin, a key component of solvent based paint. In 1988 Dulux purchased British Paints and took over the plant. The defendant sold its resin manufacturing business to Nuplex in August 1999, but continued to operate under a toll manufacturing agreement which ended in June 2000. The defendant continued to have some aspects of its business operating under the trading name Selleys from the Padstow site. The Selleys business is essentially concerned with the manufacture of home handyman products, in particular, sealants and adhesives. 44 Mr Hanrahan identified the defendant's 'vision' in relation to matters of health and safety: Orica has a strong safety culture with its vision of "no injuries to anyone, ever". This symbolises Orica's commitment to eliminate all injuries, illnesses, environmental incidents and other adverse safety health and environment ("SH&E) incidents and acknowledges the belief that all such incidents are foreseeable and preventable. Orica's aim is to continually reduce the number of injuries and other adverse SH&E incidents. 45 Mr Hanrahan indicated that the defendant's vision, policy, standards and model procedures are summarised in its Field Guide (a copy of which was annexed to his affidavit). The Field Guide was a comprehensive document setting out, in some detail, the defendant's Safety, Health and Environment strategy. The strategy was stated broadly in the Field Guide in the following terms: Orica's strategy for meeting its SH&E commitments and for achieving the Vision is to have in place: a) Equipment and materials that are designed and maintained fit for purpose b) Well communicated values and behaviours that promote continuous SH&E performance improvement through leadership and personal responsibility; and c) SH&E management procedures which describe systems of work that ensure the integrity of equipment and materials and people-based control measures is sustained. 46 To achieve this admirable goal, the defendant established what were described as 19 SH&E Standards which specify minimum performance standards for the conduct of all its operations and identify the areas in which the defendant measures performance against established benchmarks. The nineteen standards are: 1. Safety Health and Environment commitment; 2. Management and resources 3. Communication and consultation 4. Selection and training 5. Material hazards; 6. Acquisitions and divestments' 7. New plant, equipment and process design; 8. Management of change; 9. Safety Health and Environment assurance; 10. Systems of work; 11. Emergency plans; 12. Contractors and suppliers; 13. Environmental impact; 14. Resource conservation; 15. Waste management; 16. Soil and groundwater protection; 17. Product stewardship; 18. Safety, Health and Environment performance and reporting; and 19. Auditing. 47 Each of these standards were supported by model procedures. There were, at the time of the hearing, some 100 model procedures that had been produced. Each model procedure identified the key requirements for areas of common concern and provided guidance as to how the requirements could be achieved. Each model procedure, amongst other things, provided a procedure for risk identification and assessment, recognised legislative requirements and regulation, specified a safe system of work including for job checks and required levels of supervision and internal auditing procedures. Compliance with the 19 set standards and the key requirements of all model procedures was expressed to be "mandatory". In cross-examination Mr Hanrahan explained that the model procedures were a minimum mandatory standard. Each business unit was expected to use them as a base for the development of their own local materials which were to take into account local requirements such as relevant legislation or other forms of regulation. 48 In addition to the localised auditing which was described in each of the model procedures, there were 4 types of global auditing procedures which varied with their degree of complexity. These included a "Business SH&E Review" which was an audit conducted by the "business management team" at least once every two years (these reviews were led by a "senior corporate person" such as Mr Hanrahan, the defendant's chief engineer or an independent business manager); a SH&E Management System Audit conducted at least every two years, providing an overall assessment of the effectiveness of the Standards and Key requirements from the model procedures for each operation (these reviews were conducted by independent auditors); a Significant Risk Assessment Audit conducted every 4 years to verify whether the equipment, people and procedures used to control significant areas of risk continue to be appropriate and a Regulatory Compliance Review conducted every four years which examined both internal licensing requirements and compliance with legislative requirements. 49 In addition, Mr Hanrahan gave evidence of regular training being undertaken "at all sites in respect of all relevant aspects of safety to their operations". This included "basis of safety programs", described as being "behavioural safety programs" focussing on the risks of significant incidents and causes and learning from major incidents. He stated: The "basis of safety" program is about accumulating safety related knowledge gained from experience of major incidents in Orica's operations and similar operations elsewhere in the world and ensuring that it becomes "living" knowledge so that major hazards, and the rationale for critical control measures, are understood at all levels of a factory team from the site manager to operation and maintenance technicians. 50 Mr Hanrahan gave evidence of the defendant having a "very good safety record". Of 69 chemical companies which partook in a safety performance study conducted by the Plastics and Chemical Industry Association, the relevant industry body for the plastics and chemical industries, the defendant and three subsidiaries (Incitec Limited and Qenos Limited) had the lowest lost time injury frequency rates and were in the lowest four medical treatment injury rates. On Mr Hanrahan's evidence, that study demonstrated that the defendant's lost time due to injury was approximately "one quarter of the surveyed PACIA companies average". Further, the defendant has, for seven out of the 13 years in which the awards have been operating, won the TG Crane/PACIA Health and Safety Innovation Award. 51 Whilst not able to establish a specific figure, the defendant expended a significant proportion of its $133,356,000 in capital expenditure on safety, health and environment matters. Further, the defendant expended approximately $5 million on salaries in Australia and New Zealand for safety and health professionals. Additionally, in Mr Hanrahan's view, approximately 5-20% of a line manager's working time was spent directly on safety, health and environment matters. He also noted that the defendant contributed monies to a number of charities, in the order of $145,000 in the 2000 to 2001 financial year. Prosector's Submissions 52 Mr Skinner of counsel who appeared on behalf of the prosector, submitted that despite the "laudable" efforts of the defendant to engrain matters of health and safety into its operations, the primary assessment of penalty was the objective seriousness of the offence. As such, the penalty imposed in this matter still needed to reflect the fact that the failure on behalf of the defendant to properly assess the risks associated with the use of an electric winch in relatively dangerous circumstances. The maximum penalty for the offence was, due to the defendant's prior convictions, $825,000 having regard to s 51A of the Act: see Capral Aluminium Limited v Workcover Authority of New South Wales (Inspector Mayo-Ramsay) (2000) 49 NSWLR 610. 53 An additional feature which added to the assessment of seriousness of the offence, was that there was, at the time of the accident, and had been for some considerable number of years, a regulation which prohibited the use of a powered hoist to lift persons without the express consent of the WorkCover Authority: see reg 127(108) of the Construction Safety Regulation 1950. The existence of this regulation demonstrated, in the prosecutor's submission, that the risks posed by the use of the powered hoist were clearly foreseeable: Capral Aluminium. 54 Mr Skinner submitted that matters of both specific and general deterrence ought feature in the assessment of penalty in these proceedings. 55 As for subjective features, the prosecutor submitted that the defendant was entitled to have taken into account in its favour the steps it had taken following the accident, its generally good approach to matters of health and safety and its plea of guilty which the prosecutor accepted was an early plea. 56 The prosecutor sought a moiety of any fine imposed and costs. Defendant's Submissions 57 Mr R Crow of counsel, who appeared on behalf of the defendant, submitted that there were six principal matters which should act to mitigate any penalty imposed. 58 Firstly, the defendant was well aware of its obligations under the Act and had developed thorough formal procedures in an endeavour to discharge those obligations. Indeed, in the defendant's submission, health and safety matters were incorporated into the core objectives of the business. It carried those objectives into its global operations in countries where matters of health and safety are not given as high a priority as in New South Wales. As such, Mr Crow contended that there was no need for there to be special or specific deterrence as an element of penalty in this matter. Mr Crow's submission did, however, recognise the need for any penalty imposed to contain an element for general deterrence. 59 Secondly, whilst the defendant conceded that its procedures failed to ensure the health and safety of the injured workers in this case, Mr Crow submitted that the defendant's Padstow plant had a very good safety record. The evidence disclosed that, for more than three years between 1995 and 1998, the Padstow plant had not occasioned one accident that gave rise to the need for medical treatment. In this regard, the Court should have regard to the fact that the defendant operates in the industry of chemical manufacture, an industry which, in the defendant's submission, carried with its certain inherent risks, given that it deals on a daily basis with dangerous chemicals and materials. The defendant was aware of the extra precaution that needs to be exercised in an industry of this nature and contended that the absence of injury was reflective of the efforts the defendant had taken to ensure the health and safety of its place of work. In that context, having regard to the size and nature of the defendant's workforce, it was submitted that the record of seven convictions in a period of 17 years was a "good record" of which the defendant was "justifiably proud". 60 Thirdly, Mr Crow submitted that the defendant was entitled to have taken into account in its favour, the rapid steps that it had taken to investigate the incident and the assistance and the co-operation it had afforded the prosecutor. Further, it was entitled to have taken into account the steps it took immediately following the accident to ensure a similar event did not happen in the future. The type of winch that was used in the proceedings was no longer used for the purposes of hoisting people. A manual winch was purchased for that purpose and the defendants manuals were amended accordingly. Further, extra training was provided in relation to confined spaces work. 61 It was submitted that the defendant was entitled to have taken into account the contrition which it had expressed to the Court. The defendant considered the accident was serious. The conduct of the defendant since the accident manifestly bears out the defendant's acceptance of that fact. In addition, the defendant was entitled to have taken into account its good corporate citizenship, manifested both in the proactive stance it took in relation to matters of health and safety and in relation to the charitable causes which it supported. 62 As to the nature of the accident, the defendant submitted that it was an unusual operation in that it was not part of the defendant's regular operations. It was a modification to plant in a difficult working environment. There were procedures in place for the use of contractors in the performance of work, procedures for the use of lifting equipment and procedures for the confined space work. Whilst these procedures were followed, they unfortunately did not prevent the accident. It was submitted that the real failure in the circumstances surrounding this prosecution was the failure to properly assess the risks associated with the equipment used; that is, the failure to recognise that a powered winch was inappropriate for the confined space work being performed. The winch was tested prior to use. The contractors were trained and observed in its use. The failure was to recognised that something might foul the controls. 63 The defendant conceded that there were, in essence, three failures which gave rise to the relevant risk; the failure to properly assess the use of a powered winch as inappropriate for the task at hand, the failure to recognise that the winch and the block and tackle could act conjunctively to prevent the proper control of the powered winch and thirdly, the failure to use a proper harness to connect the injured worker to the winch chains. Whilst the first of these failures was the most serious, in the defendants submission, the relevant risk posed by the use of the powered winch was not such as to warrant it being considered readily foreseeable, in the way that phrase is often used in the context of penalty proceedings, so as result in a significant increase in penalty. 64 Finally, the defendant submitted that it was entitled to a significant discount in relation to what it submitted was a plea of guilty at the earliest available opportunity. In this case, the defendant entered a plea of guilty some six weeks after having been served with the charge - this should, in the circumstances of these proceedings, warrant the maximum discount for the plea as discussed in the relevant authorities: see State Rail Authority v Workcover Authority of New South Wales(Inspector Dubois) (2000) 102 IR 218 and R v Thomson; R v Houlton (1999) 49 NSWLR 383. Further Written Submission 65 After having reserved judgment in this matter, Kavanagh J delivered judgment in related proceedings: Inspector Paul Mansell v Anytime Industrial Services Pty Limited (2001) 110 IR 34. That judgment dealt with sentencing of the company which provided the contractors to the defendant in these proceedings, Anytime Industrial, for an offence under s 15 of the Act. The Court, of its own motion, reopened the proceedings and called the parties before it on 2 November 2001 to ensure that counsel had an opportunity to put submissions in relation to any issue that may have arisen in these proceedings, in light of the decision of her Honour. The parties requested an opportunity to provide written submissions. Those submissions have now been received. 66 The prosecutor submitted that, whilst the Court would plainly determine sentence in these proceedings based upon the evidence tendered to the Court within these proceedings, in approaching sentencing, it was necessary for the Court to apply the principles of consistency and parity in sentencing referred to in Capral Aluminium (at [56]-[57]). 67 As to consistency, it was submitted that the two sentences must both be within the range appropriate to the objective gravity of each offence and to the subjective circumstances of the particular offender. No submission was made that the sentence imposed by Kavanagh J on the co-offender was not within that appropriate range. 68 As to parity, the prosecutor made the following submission: As to parity, Kavanagh J expresses in her judgment opinions as to the relative culpability of the co-offenders. If upon the evidence before it this Court was inclined to draw conclusions as to the relative culpability of co-offenders, which it may choose not to do in its discretion, those conclusions may or may not be consistent with the conclusions of her Honour made upon the evidence before her. That consistency or inconsistency may be relevant to the application of the principle of parity by this Court in the sentencing exercise, or to a Full Bench upon any appeal by either offender, in the following way: a) If this Court drew a conclusion on the evidence before it as to the relative culpability of the co-offenders that was consistent with her Honour, subject to the subjective circumstances of the instant defendant, one would expect the instant defendant to receive a heavier sentence. b) If this Court drew a conclusion on the evidence before it as to the relative culpability of the co-offenders that was inconsistent with her Honour, upon the same logic one would expect the instant defendant to receive a lighter sentence. However, it has been said on many occasions by the Courts that the sentencing exercise ultimately is discretionary and is not able to be approached upon a rigid formalistic basis - e.g. the High Court recently in Wong & Leung v The Queen [2001] HCA 64, 15 November 2001. In all the circumstances before it, both objective on the evidence before it and subjective to the instant defendant, and taking account of principles of parity, this honourable Court may without error still impose a sentence from within a wide possible range. 69 The defendant submitted that it did not wish to add anything to the further submissions of the prosecutor and that it relied upon the evidence and submissions at the hearing. Consideration 70 At the outset, the strident steps taken by the defendant to ensure the health and safety of its workforce should be acknowledged. Whilst they will be dealt with later in this decision, the detailed procedures, encompassing as they did risk assessment procedures, supervisory arrangements and in particular the adoption of elaborate systems of work (which have been designed to ensure a safe workplace) should, in my view, act to significantly mitigate what would otherwise be a significant penalty. 71 Having made that observation, it is well settled that the primary factor for consideration when determining penalty in sentencing proceedings under the Act is the objective seriousness of the offence: Lawrenson Diecasting Pty Ltd v Workcover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464, Fletcher Constructions Australian Limited v Workcover Authority of New South Wales (Inspector Fisher) (1999) 91 IR 66. 72 In making that assessment it will be appropriate to have regard to the contribution of Anytime Industrial to the relevant risk. That assessment may assist in the determination of the level of culpability of the defendant for the offence charged: Workcover Authority of New South Wales v McDonald's Australia Limited and Another (1999) 95 IR 383 at 437 and Workcover Authority of New South Wales (Inspector Carmody) v Consolidated Constructions Pty Ltd (2001) 109 IR 316 at [46]. However, it is wrong, in my view, to make that evaluation for the purpose of apportioning the overall penalty which may be said to be appropriate in the circumstances of a particular incident giving rise to prosecutions under the Act: Consolidated Constructions at [46]. When determining an appropriate penalty for a defendant in circumstances where more than one individual or legal entity can be said to have contributed to the relevant risk, it is primarily important to assess the nature and contribution of the defendant to the relevant risk: see Workcover Authority of New South Wales (Inspector Farrell) v Schrader [2002] NSWIRComm 25 (at [61]) (cited with approval by the Full Bench in Ridge Consolidated Pty Ltd v Mauger [2002] NSWIRComm 108 (at [33])). 73 Thus, the focus of attention in the assessment of penalty remains the objective seriousness of the offence. The penalty ultimately imposed must fall within the range appropriate to the objective gravity of the particular offence and to the subjective considerations of the particular offender: Capral at [63]. Although arising in a different context (namely, a prosecution under s 17 of the Act), I would reiterate, in this context, my observations in McDonalds (at 447): In light of these findings, this case does not demand more extensive comments in relation to the delegation of duties to third parties. However, I would express my doubt that an argument such as that raised by the defendants would normally result in the very substantial reduction in penalty sought by the defendants. I do not consider that a person who has control of non-domestic premises made available as a place of work or control of plant provided for use or operation at work and who fails to ensure that the premises or plant are safe could escape the bulk of their culpability under s17 of the Act by seeking to delegate responsibility for maintenance to third parties. In many instances it would be quite proper to contract third parties to conduct maintenance, for example. However, some responsibility will normally remain to consider what services should be provided and, so far as possible, to ensure that the services were performed adequately. At the very least, the defendants in this case were involved to that extent, although for the reasons I have given, there was not sufficient fulfilment of their obligations under the section. 74 The failures alleged in this matter, as finally pressed by the prosecutor (and identified in the statement of agreed facts) were, broadly stated, a failure to provide a safe system of work, a failure to provide safe equipment for the performance of the work and a failure to provide a safe means of egress from the tank (which was, in essence, an aspect of the failure to provide a safe system). The central risk to safety occasioned by the defendant was the use of the power operated winch to suspend and move the contractors. A related risk factor was the use of the chain over and pulley system to remove the materials from the tank (thereby creating the risk that the controls for the powered winch would be fouled). 75 The defendant was the entity responsible for fashioning the system of work and selecting the appropriate equipment. 76 Anytime Industrial did have an obligation to assess the systems and environment provided by the defendant, so as to satisfy itself that its employees were safe and not subject to risk (or to take such steps as were necessary to so satisfy itself). It was a total failure to perform this independent assessment that, no doubt, significantly influenced the penalty imposed upon it. However, the defendant did not merely rely upon the expertise of a contractor to perform the subject work. By designing the method of carrying out the work, providing the requisite machinery and equipment and giving instructions as to the application of the same, it substantially established and controlled the system of work which encompassed the requisite risk. When assessed in this way, it was plainly the defendant who should be considered the more culpable for the failure to provide a place of work that was safe and without risk to the health of persons not in its employ. 77 I consider that these conclusions are entirely commensurate with the observations of Kavanagh J in Anytime Industrial which were as follows (at [26] and [29]): 26 As an employer [Anytime Industrial] has an absolute obligation to provide a risk free work environment for its employees. So too does the employer conducting an undertaking at its place of work, namely, [the defendant]. Large corporations, once they contract-out their work must empower, within the contractual relationship, the contractor to play a role in the decision making process even if it is the Principal's defined safety procedures that are followed for the risk assessment of the task and the design of the work method to be adopted. … 29 While a contractor must be involved in the development of work safe practices on industrial sites on which their employees are sent to work, commensurate with their responsibilities and liabilities under the Act, so too the Principal, on whose worksite the task is performed, must carry a significant burden especially if, in the circumstances, it takes the primary responsibility for devising the system of work. 78 Other features of this case which are relevant to the assessment of the objective seriousness to the offence in this case include that the relevant maximum penalty applicable was $825,000. The defendant had a large workforce and operated in an industry which was, in my view, inherently dangerous. 79 I concur with the submissions of the prosecutor that the risk created by the selection of a powered winch for lifting a person in a confined working environment, such as the resin tank, was foreseeable. The operation of power operated lifting equipment to suspend and move persons in a confined space (with a narrow and single point of egress) represented, in my view, a plainly foreseeable risk that any malfunction (or mal-operation) may cause the very crushing injuries here encountered. This is a fortiori the case when that equipment is operated in close proximity to equipment which may foul its operation. That the risk was foreseeable results in a necessary increase in the objective seriousness of the offence: Capral Aluminium. In addition, the simple remedial measures taken following the accident, although laudable in their own right, demonstrate the simple steps which could have been taken to remove such risk. 80 Further, I consider that the risk posed by the use of the winch resulted in every prospect of very serious injury being borne by the worker in the circumstances of this case. 81 However, two final matters should be noted when discussing the objective seriousness of this offence. This was not a case in which the defendant had not turned its mind to matters of health and safety in its place of work. As earlier mentioned, there were extensive and detailed policies put in place by the defendant. Further, this was not a case where there had been a failure to properly promulgate its policies. On the evidence, Mr Seily and Mr Au-Yeung were aware of the relevant policies relating to work performed by contractors for working in confined spaces and for work involving lifting equipment. On the evidence, those policies were followed in relation to the training of the contractors from Anytime Industrial. Indeed, counsel for the prosecutor described the preventative actions taken by the defendant as "laudable". These matters all reduce, in my view, the objective seriousness of the offence in this case as they demonstrate there was a system in place to ensure safety. However, the system was in all the circumstances inadequate. 82 Secondly, the prosecutor submitted, and the defendant conceded, appropriately in my view, that general deterrence was relevant to the assessment of penalty in this matter. 83 On balance, I consider this to be a serious offence. 84 The prosecutor also contended that specific deterrence was relevant to the assessment of penalty in these proceedings. The defendant has submitted that it was well aware of the obligations imposed upon it under the Act and, as it has taken extensive steps to ensure compliance with those obligations, there was no need for specific deterrence to feature in the assessment of penalty. The principles associated with elements of deterrence were most recently discussed by a Full bench of this Court in Capral Aluminium (at [71] - [80]). Further, I have recently had opportunity to consider a similar submission in WorkCover Authority of New South Wales (Insp Robert Stobo) v State Rail Authority of New South Wales [2002] NSWIRComm 72 (at [54] - [60]). 85 Having set out the relevant passages from Capral Aluminium, the Court in Insp Stobo v State Rail Authority continued (at [56]): 56 It should be firstly recognised that the Court in Capral Aluminium (at [55] and [74]) rejected a contention by the then appellant that considerably less weight should have been given to deterrence due to its attempts, both before and after the incident, to ensure the safety of workers (including the provision of safety equipment) and the fact that the employer was a safety conscious employer. The Court found that both general and personal or specific deterrence were matters which should normally play a role in sentencing under the Act and that, although there are exceptional cases requiring a departure from that approach, they are rare (at [ 74]). 57 Further, the Court considered that it was unlikely that the weight to be attached to specific deterrence could be reduced to zero in cases of offences under the Act. The primary feature that controlled the weight to be given to specific deterrence was the "propensity to re-offend", noting that the objective of specific deterrence is to deter the particular offender from repeating the offence (at [76] - [77]). The Court considered that for specific deterrence to be disregarded in the sentencing process, the offender would need to demonstrate the risk of re-offending was low or non-existent; be that because of demonstrated rehabilitation or because the offender would not have the opportunity to commit a similar offence in the future (at [77]). 58 Where the offender continued to be an employer, the risk to safety of its employees or contractors may exist or be possible. Thus, the Court came to the view that in most cases it will be necessary to have regard to the need to encourage a sufficient level of diligence by the offender in the future by specific deterrence. 59 It follows, in my view, that notwithstanding the somewhat strident steps taken by the defendant to ensure the occupational health and safety of its employees (to which I will return in relation to the subjective features of this matter), the penalty in this matter should reflect the need for specific deterrence. 86 I noted that the defendant continued to operate rail maintenance vehicles and employed a significant number of persons in this State and continued (at [59]): The Court is not satisfied that there is no potential for the defendant to re-offend: Capral Aluminium at [77], R v MacDonnell (unreported, Court of Criminal Appeal, 8 December 1995). The matter does not fall within the class of exceptional cases identified in Capral Aluminium where specific deterrence is inappropriate. 87 I adopt that discussion for the purposes of determining sentence in this case. Whilst the defendant should be applauded for its general approach to matters of health and safety, I approach the question of deterrence in this matter on the basis that "both aspects of deterrence are matters which should normally be given weight of some substance in the sentencing process": Capral Aluminium (at [74]). Whilst it must be recognised that there may be exceptional cases where matters of specific deterrence are not relevant, this is not a case which falls within that exceptional class. The defendant continues to operate in this State, it continues to have a significant workforce in this State (although I note on the evidence it has been somewhat reduced in recent years) and its operations continue be within what may be considered inherently dangerous industries such as the manufacture of explosives for use in mining and industrial chemicals. Specific deterrence will feature in my assessment of penalty. 88 Turning then to the subjective features of the defendant, on the evidence, the written procedures the defendant had in place were extensive in their scope and detailed in their terms. Further, as earlier identified, the relevant officers were aware of the policies and took steps to ensure that they were complied with. That is, the induction training was provided, the risk assessment was undertaken, the contractors themselves were consulted, the requisite task specific training was provided and the necessary cold and confined work certificates had been provided. In the circumstances of these proceedings, I am satisfied that the procedures in relation to the use of contractors encompassed significant steps to ensure the safety of the workforce. Further, I am satisfied that the defendant was and is aware of its obligations under the Act and has expended considerable effort and resources to comply with them. In addition, the fact that Mr Seily, the Operations Manager of the Padstow plant, personally took an interest in the manner in which the contractors from Anytime Industrial were to be instructed for the work in the resin tank lends at least some support to the defendant's submission that safety was an important feature of the defendant's business. This should count in the defendant's favour in the assessment of penalty. 89 I have also had regard to the alterations to its policies and procedures after the accident and the other efforts taken on behalf of the defendant to ensure that similar situations do not arise in the future. 90 As for the defendant's plea of guilty, I am satisfied that the plea was entered at the earliest practicable opportunity and that the defendant should receive the maximum 'discount' for the plea of guilty in accordance with the guideline judgment in R v Thomson; R v Houlton (2000) 49 NSWLR 383 as recently approved by the Court of Appeal in R v Sharma [2002] NSWCCA 142 and reaffirmed by the Full Bench of this Court in Ridge Consolidated Pty Ltd v Mauger [2002] NSWIRComm 108. The defendant should receive the maximum 30% discount for its early plea of guilty. I have taken into account, in this respect, that the defendant conducted an investigation in order to prevent future occurrences and provided the report arising therefrom to the prosecutor. It further directly assisted the prosecutor during its investigation. I acknowledge the contrition it expressed through its counsel in these proceedings. 91 The final matter requiring attention in these proceedings is the issue of parity. This principle is important for the proper administration of justice: Griffiths v The Queen (1997) 194 CLR 293 at 326-327; McDonalds at 434. It is well settled parity in sentencing has developed as one of the tools a judge has at his or her disposal to ensure that there is equal justice under the law: Lowe v R (1984) 154 CLR 606 at 610, Postiglione v The Queen (1997) 189 CLR 295. As was stated by the joint judgment of Dawson and Gaudron JJ (at 301-302) in Postiglione: Equal justice requires that like should be treated alike but that, if there are relevant differences, due allowance should be made for them See also the judgment of Kirby J (at 341). 92 The judicial discretion exercised when determining sentence must ensure that a defendant which has committed a similar offence does not feel some 'justified sense of grievance' when regard is had to the penalty imposed on a co-offender. 93 As earlier identified, the present defendant is to be considered, in my view, of significantly greater culpability than Anytime Industrial, given its greater degree of control over the design and implementation of the method, means and supervision of the tasks being performed. Further, there are a number of features present in these proceedings which did not pertain the prosecution of Anytime Industrial. The maximum penalty applicable to the present proceedings in $825,000 whereas that applicable in the Anytime Industrial prosecution, having regard to the judgment of Kavanagh J, was $550,000. There are also a number of subjective features of this defendant which, as earlier noted, weigh in its favour in the assessment of penalty. In particular, the significant effort and resources the defendant has expended on providing appropriate systems, training and procedures to ensure a safe workplace should be taken into account in this respect. 94 I consider that the plea of guilty was properly made and enter a verdict accordingly. For the foregoing reasons, I consider, after a discount for the subjective factors earlier identified, an appropriate penalty for the offence as charged to be a fine of $90,000. The prosecutor should have a moiety of the fine. 95 As to the prosecutor's application for costs, the appropriate approach to the question of costs in summary prosecution proceedings under the Act was recently considered by a Full Bench in WorkCover Authority of New South Wales (Inspector Dawson) v Plastachem Pty Ltd & Ors (2001) 110 IR 351. I adopt the exposition of principle in that judgment (at [48] - [50]). In accordance with the discussion in Plastachem, the Court as presently constituted has power to award costs in favour of the prosecutor. In this regard, the Court must exercise its discretion as to costs in accordance with what is in the Court's view 'just and reasonable'. There is nothing to suggest that it is not just and reasonable for the prosecutor to have its costs in the ordinary way. Costs were not opposed by the defendant. 96 I make the following orders: 1. The defendant is fined an amount of $90,000 with a moiety thereof to the prosecutor; 2. The defendant is to pay the prosecutor's costs in an amount as agreed between the parties or, failing agreement, as assessed. The parties are to file agreed short minutes setting out the appropriate order for the Court in relation to the quantum of costs in these proceedings within 21 days . _________________ 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.