Industrial Relations Commission of New South Wales in Court Session CITATION : WorkCover Authority of NSW (Insp Penfold) v Pacific Dunlop Ltd t/as National Cables [2000] NSWIRComm 33 PROSECUTION: PARTIES : WorkCover Authority of NSW (Insp Penfold) DEFENDANT: Pacific Dunlop Ltd t/as National Cables FILE NUMBER: IRC1854 of 1999 CORAM: Kavanagh J CATCHWORDS : OHS - s15 - penalty - safe system of work established - misuse of established safe system for work - failure to re-train worker - effect of prior conviction on penalty LEGISLATION CITED : Occupational Health and Safety Act 1983 s15(1) Tyler v Sydney Electricity 47 IR 1 CASES CITED : Lawrenson Diecasting Pty Ltd v WorkCover Authority of NSW (Insp James Swee Ch'ng) (1999) 90 IR 464 Haynes v James Glass & Aluminium Pty Ltd (unreported, Fisher CJ, CT91/772-775, 20 May 1994) WorkCover Authority of NSW (Inspector Callaghan) v Saunders Constructions Pty Ltd (unreported, Maidment J, CT93/1062, 26.11.93) HEARING DATES: 02/04/2000 DATE OF JUDGMENT: 03/29/2000 PROSECUTOR: D.J. Brezniak of counsel SOLICITOR: WorkCover Authority of NSW LEGAL REPRESENTATIVES: DEFENDANT: J.J.E. Fernon of counsel SOLICITOR: Freehill Hollingdale & Page JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: KAVANAGH J Date: Wed 29 March 2000 IRC1854 of 1999 WORKCOVER AUTHORITY OF NSW (INSP PENFOLD) v PACIFIC DUNLOP LTD t/as NATIONAL CABLES Prosecution under s15(1) of the Occupational Health and Safety Act, 1983 JUDGMENT 1 This is a prosecution by Inspector Penfold, an inspector of the WorkCover Authority of NSW against Pacific Dunlop Ltd t/as National Cables (the defendant) for breaches of s15(1) of the Occupational Health and Safety Act, 1983 (the Act). 2 The summons relevantly states: On 24 August 1997 at 29 Davis Road, Wetherill Park, in the State of New South Wales, the defendant, being an employer, DID FAIL to ensure the health safety and welfare at work of all its employees and in particular Kevin La contrary to Section 15(1) of the Occupational Health and Safety Act 1983, in that it failed to provide such information and training on the safe operation of the Warehouse Two Rewind Machine as may be necessary to ensure the health and safety at work of its employees. Particulars of the charge are: (a) The defendant failed to inform its employees of a uniform, safe work practice to be adopted in circumstances where cable was wound incorrectly onto the dispatch spool of the said machine. (b) The defendant failed to provide refresher training on safe operating procedures for the said machine. (c) The defendant failed to document Kevin La's training history. 3 There was an agreed statement of facts which relevantly reads: 3. At all material times the defendant: (a) Occupied factory premises situated at 29 Davis Road, Wetherill Park in the state of New South Wales (the factory ). (b) Manufactured electrical cable at the said factory. (c) Employed Khai Hoan (Kevin) La, 31 years of age, as a warehouse storeman. (d) Owned and operated a Warehouse Two Rewind Machine (the Machine ). 4. At approximately 10.45am on Sunday 24 August 1997 at the said factory, Kevin La's leg became tangled in a loop of thermal plastic sheath cable that he was winding from the back spool onto the smaller dispatch spool of the said machine. As a result, he was pulled onto and around the dispatch spool of the said machine, causing his head to strike the concrete surface of the factory floor on up to two occasions. A fellow employee working on the machine with Mr La stopped the said machine and Mr La was conveyed to Liverpool Hospital for treatment. He died the following day as a result of the head injuries sustained in the accident. 5. On 25 August 1997 the Prosecutor conducted an inspection of the said factory. Photographs of the said machine were taken and a Factual Report compiled. Attached hereto marked "A" is a copy of the Report and photographs. The Inspector's Factual Report reads as follows: On 25 August 1997 I visited the premises of Pacific Dunlop Limited, National Cables Division at 29 Davis Road, Wetherill Park. I was met by Mr Dennis Willingham, General Manager, Mr Dennis Dogger, Plant Engineer, Mr Paul Vigel, Operations Manager, Ms Larraine Beltrami, Human Resources Manager, Mr Arthur Bell, employed by Richard Oliver, Risk Managers and Mr Charles Stone, maintenance Fitter and Occupational Health and Safety Committee member. All persons accompanied me to the Number Two Warehouse where I observed: 1. Located in the north eastern corner of the Number Two Warehouse approximately 7 metres from the eastern wall and 13 metres from the northern wall was located a Cable Rewind Machine, painted green with a blue arm. No brand name was evident. The machine was known as the Warehouse Two Rewind Machine and it was the only machine of its type in the area. This machine consisted of a rewind head 2.7 metres high by 3.0 metres wide by 1.7 metres long and consisted of a tubular steel frame supporting two power driven spool support arms which carried and drove a rewind spool to draw cable onto itself. These support arms were mechanical screw powered for height and clamped the spool; 2. The centre of the spool was located 1.0 metres above the ground and the spool was 455mm wide by 500mm diameter. At the time electrical cable 15mm wide by 7mm thick and consisting of 3 multi strand copper wires was wound onto the spool to a diameter of 430mm; 3. Located on the inside of the northern support was an electronic length register which read 361.75; 4. Another electric power drive, painted blue, was mounted on the southern spool support arm which drove the spool via a constant ratio right angle drive from a 4.5kw electric motor; 5. Located on the western side of the rewind spool, supported on a rigid horizontal bar 1 metre long and 1.94 metres high were two vertically mounted free wheeling rollers 1.2 metres long by 70mm diameter and 70mm apart fitted on a swivel support. At the bottom of these rollers was a horizontal free wheeling roller 50mm diameter by 140mm long which was located 650mm above the ground. This roller assembly was used to guide the cable onto the rewind spool; 6. Also located on the western side of the rewind spool was a swivel support bar which carried a multi push button electronic control panel. This electronic control panel was on the front of a box which was 500mm long by 150mm wide by 90mm deep; 7. Located approximately 5 metres west of the rewind spool was a master spool of cable 1.6 metres diameter by 1.1 metres long, painted yellow, supported on a free wheeling shaft mounted on two green painted electric motor powered adjustable vertical arms. Mounted on one mounting pin was a disc brake drag assembly fitted with a double sided connecting arm to allow the master spool to be brake controlled via a locating pin. At the time of the inspection this locating pin was not fitted to the connection arm and the master spool was allowed to free wheel; 8. Located between the master wheel and the rewind head was a friction driven caterpillar type measuring device used to register the amount of cable used. The cable travelling through this device was 1.0 metres above the floor; 9. Located on the outside of the southern support arm of the rewind head of the machine was a rotary electrical on/off switch. This switch was located 1.44 metres above the floor immediately above a 415 volt electrical outlet and a 240 volt electrical outlet. 6. Attached hereto marked "B" is a copy of Prohibition Notice No 105957 issued to the defendant in response to the inspection. 7. The defendant had employed La since 14 June 1994. He was initially employed as a casual cable winder operating the Rewind machines before being permanently appointed to the role, and later transferred to the position of storeman in the sales warehouse. Both positions required him to operate the said machine. 8. La's initial training was conducted on-the-job through a "buddy system" with an experienced operator demonstrating the procedures. Mr La was trained by Pham Phuong Tam, the defendant's Training Supervisor for the Winding Department. Mr Tam supervised Mr La for more than one year, until Mr La was considered by Mr Tam to be sufficiently competent in the winding operation to operate it without direct supervision. Mr Tam indicated that in circumstances where cable was not being wound correctly onto the dispatch spool, La was trained to: (a) Turn the machine off. (b) Re-wind the cable onto the back spool. (c) Re-start the winder. 9. The practice adopted by some of the defendant's employees was to (a) Turn the machine off. pull the incorrectly wound cable off the dispatch spool onto the floor. (d) Re-start the winder. 10. La's accident was the result of him adopting the latter system (described in paragraph 9 above) of turning the machine off, pulling the incorrectly wound cable onto the floor (as opposed to re-winding it onto the back spool) and re-starting the machine. 11. How often the cable would wind incorrectly onto the spool was dependent upon the skill of the particular operator and the type of cable being used. One of the operators stated to the Prosecutor that flat cable, such as the plastic thermal sheath cable used by La at the time of the accident, would have to be re-wound up to twice per 8 hour shift. 12. On 2 September 1997 the Prosecutor interviewed the defendant's General Manager, Dennis Willingham. Mr Willingham stated that it was not the correct procedure to unwind product from the dispatch spools when the operator was unhappy with how the product was being wound. He indicated that the standard practice was to complete winding the dispatch spool, and if, by inspection it was considered that the cable was unsuitable for sale due to its appearance, it would be completely rewound onto another dispatch spool. 13. It emerged from the investigation that: (a) La had received training from the defendant when he commenced employment in 1994. (b) Although Mr La was trained through the "buddy system" for some time after his commencement, no refresher training was provided. (c) training records were not documented. (d) instructions for the safe operation of the said machine were not documented, although procedures for the winding machine were in the process of being documented at the time of the incident. (e) No risk assessment was undertaken concerning the task of winding cable onto the dispatch spools. 14. In response to the accident and the Prohibition Notice issued by the Prosecutor, the defendant decommissioned the said machine and undertook to introduce a series of remedial measures. The proposed course of action was detailed in a letter from Willingham to the Prosecutor on 1 September 1997 and is attached hereto marked "C". 15. . . . 16. The defendant, PACIFIC DUNLOP LTD [ACN: 004 085 330] , operates under a divisional structure using business names rather than under a corporate structure. The National Cables business at Wetherill Park has not been the subject of an occupational health and safety prosecution. However, in its capacities other than this business, the defendant company has had the following prior convictions recorded: 23.06.87 FSIA S.48(1)(C) $500 unknown 23.06.88 OHS S.15(1) $3,000 David Gault Industries 14.05.90 FSIA S.27 $800 unknown 06.08.90 FSIA S.27 $1,000 Pala Manufacturing 28.10.91 OHS S.15(1) $2,000 Dunlop Footwear 25.03.93 OHS S.15(1) $2,000 unknown 13.05.94 OHS S.15(1) $2,500 Improdex 12.12.94 FSIA s 27 $2,500 Viplas Olympic 11.8.95 FSIA s 27 $3,000 Dunlop Footwear 13.8.96 OHS s 16(1) $3,000 Pala Manufacturing 3.2.97 CS Regs 121 $4,500 Tyrecycle 9.2.98 OHS s 16(1) $8,000 Dunlop Bedding 4 The defendant, through Mr Fernon of counsel, enters a plea of guilty to the charge which, on an examination of the facts, is considered by the court to be appropriate in the circumstances and the court accepts the plea. AS TO PENALTY 5 Counsel for the Prosecution, Mr D. Brezniak, submits given the nature and quality of this offence, a significant penalty should be imposed. The prosecutor has chosen to charge that the defendant failed to properly inform and train its employees. There is no charge before the court of an unsafe system of work. However, by way of video evidence it is obvious the defendant company has completely revised its system of work. The spool machine involved is now encased in steel and the operator has been moved outside the steel enclosure. Further electrical connections to the doors if the steel enclosure is opened ensure the spools stop operating. Any loose or lax cable could now not be caught around the body of the operator as occurred in this accident. 6 The prosecution submits the penalty for this offence is $500,000, but the offence attracts a further consideration of penalty under the provisions of s51 because the defendant company had 13 prior convictions. In attracting the further penalty under s51(1) the maximum penalty at the relevant date, the date of the accident is $750,000. (see Insp Mayo-Ramsay v Capral Aluminium Ltd (on appeal) (unreported, Hungerford J, 9 April 1999; Insp Tyler v NSW Roads and Traffic Authority, unreported, 31 August 1999). The Court accepts this is an appropriate matter for the application of s51(1). 7 In assessing the gravity of this offence the court keeps in mind the words of Hill J in Tyler v Sydney Electricity (47 IR 1) at (5): The gravity of the damage or injury actually resulting from breach does not, of itself, dictate the amount of penalty. However, the gravity or otherwise of the potential risk flowing from breach and its foreseeability are clearly relevant as are the measure of gravity of the breach itself and the measure of culpability. 8 In Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Insp James Swee Ch'ng) ((1999) 90 IR 464) the Full Bench recently commented as to the court's obligation: . . . it is important to reiterate that the primary factor to be considered when a judicial officer is determining the appropriate sentence to impose is the objective seriousness of the offence charged. In case of prosecutions under the OH & S Act, this proposition has often been expressed by saying that the 'true measure of penalty lies in the nature and quality of the offence'. and: It has been observed on a number of occasions that subjective factors which mitigate the seriousness of the offence or exculpate the accused must be secondary to the consideration of the nature and quality of the offence. and: The proper approach is first to consider the gravity of the offence viewed objectively. The Full Bench cites with approval a passage from the judgment of Fisher CJ in Haynes v James Glass & Aluminium Pty Ltd (unreported, CT91/772-775, 20 May 1994) where his Honour said: (at 23) ...While previous good industrial citizenship and the absence of prior convictions are proper considerations, their importance lies well behind the two primary aspects of the matter, namely the nature and quality of the offence and the clear policy of the Act in relation to the establishment of safe standards and the protection of the workforce. 9 In the Court's assessment as to the nature and quality, that is, the gravity of this offence, Mr Brezniak submitted this tragic death occurred because a safe system of work in place was not followed by the employee and the employed had not been properly trained in the circumstances. Simply put he submits as in the agreed statement of facts the deceased was trained to: 1. Turn the machine off. 2. Rewind the cable onto the large spool. 3. Restart the winder. 10 However, the practice adopted by some of the defendant's employees including Mr La was to: 1. Turn the machine off. 2. Pull the incorrectly wound cable off the small spool onto the floor. 3. Restart the winder. 11 This breach of an established system allowed loose unwound cable to gather about the feet of the operator. The cable became entangled around Mr La's leg causing him to be pulled to the ground striking his head which injury led to death. 12 It is agreed about twice per 8-hour shift the small spool would have to be rewound. The evenness of the cable winding process was dependent upon the skill of the operator and the type of cable being used. The cable was rewound when it looked untidy and, by its appearance, became unsuitable for sale. The rewinding process would involve rewinding the cable onto the large spool and beginning the process again. 13 There is no evidence before the court as to how often this "short cut" to the rewinding process, which left the cable loose on the floor, was taken by the workers. 14 However there was evidence there was no specific "task directed" training and instruction given to Mr La after an on-the-job instruction under a "buddy" system where Mr La was supervised for one year after he was hired. The deceased therefore conducted this machine operation for a further two years without any re-training or specific task supervision. The machine had no instructions for operating procedure attached to it to assist or remind the operator as to correct procedures. 15 At the time of the accident there were approximately 170 employees working at the Wetherill Park site. Mr La was one of its employees and had worked with the company for 3 years. 16 The defendant in addressing the seriousness of the offence tendered 3 affidavits, a video of the machine process and a significant safety planning programme. 17 The defendant relied upon the affidavit of Dennis Willingham, as the defendant company's Manager, Sales Operations for Business Integration and Occupational Health and Safety. He opined that from 1984 he worked with a Richard Oliver, an outside External Risk Management Consultant in designing this new factory at Wetherill Park to incorporate the latest safety management techniques and procedures. The factory cost Pacific Dunlop approximately $18 million. 18 At the time the deceased began work, the company had in place a significant Occupational Health and Safety Program. Throughout the deceased's employment there existed in this warehouse an active Occupational Health and Safety Committee of which Mr La was a member. The Committee looked at "on the job" problems and kept significantly detailed minutes which were sighted by the court. There was in existence a Safety Information Handbook given to each worker, coordinated by Pacific Dunlop, the parent company, but with incorporation as to task related detail from local site managements. At the Wetherill Park warehouse there was also an Induction Book for staff. Mr La had been given copies of the Safety Handbook and the Induction book. 19 There was also a programme for "on-the-job" training provided to employees not only task related but which incorporated manual handling training, first aid training, risk identification and assessment training. Internal and external personnel regularly undertook safety audits and risk assessments. Such audits were conducted on a two-yearly basis at the Wetherill Park site. Recommendations arising out of such audits were given a timetable for implementation. 20 After the incident all employees have been retrained especially following the installation of the machine in a steel encasement. Further, operating procedure guidelines are now laminated and attached to the controls of the machine. They are to be reviewed regularly by the machine control operators. 21 Mr Roger Alan Eustace also gave evidence by affidavit. He is the General Manager, Risk Management and Insurance, at Pacific Dunlop. He reports to the board on a monthly basis on injury rates to employees and the lost time for injury statistics now compiled by the company as well as providing annual reports directed to on-site safety. He oversees the operation of the various committees organised by risk managers with emphasis on safety procedures within the corporation. 22 The affidavit evidence persuades the court this company is aware and was aware prior to this tragic accident, of the need for vigorous safety standards in its workplace. I have perused the prepared documentation headed "Safety and Risk Management Self-Assessment Questionnaire Guidance Notes and Defined Terms", dated September 1999 and the "Safety and Risk Management Core Operating Procedure Outlines" as well as the updated introduction to "Safety and Risk Management for Standards and Self-Assessment Questionnaire 1999". I note also the motto of Pacific Dunlop which is printed on all such documentation, "Pacific Dunlop believes all accidents are preventable". 23 Notwithstanding the very comprehensive and very expensive risk management program in place in this corporation, a risk existed at this worksite. An operator stood controlling a machine which evidence reveals required rewinding at least twice per shift. In the re-winding operation loose cables gathered at Mr La's feet. The operator, for all of the risk management assessments and his active participation in OH&S programmes did not recognise the serious risk the unwound cable about his legs could be to his health and safety. The site safety committee nor any general assessment recognised in daily operation of this machine there was a risk to safety. 24 While this worker may have been initially trained and instructed as to the correct procedures these procedures, from the evidence, were not vigorously enforced. There was at least a rewind of these reels twice each shift. The evidence concedes some of the workers used this short-cut way to rewind the reels. Management did not recognise the risk to safety from the loose cable on the ground. No one on any of the site safety committees recognised the risk this adaptation of the established procedures created. Once more, the expenditure of huge amounts of money to put safety programmes into place did not provide the answer to the risk of injury to an employee. On-the-job training as to the need for adherence to established safety procedures must be rigorously enforced. 25 The defendant has, since the accident, refined the system of work and also its on-the-job training. I am satisfied it has made every endeavour to ensure the risk to safety no longer exists in relation to the operation of this machine. There was however an obvious risk for injury to employees. Notwithstanding the expenditure of significant moneys, the performance and awareness of the individual employee is the real reflection of site safety. An employee must be properly trained in both task specific procedures and a recognition of general site safety standards. This tragic accident reveals there was no rigorous enforcement of a safe system of work. The accident is a reflection of the lack of rigorous training of the employees. Further the employee did not recognise he was creating by breaching an established system of work and an unsafe work environment. The words of Maidment J in WorkCover Authority of NSW (Inspector Callaghan) v Saunders Constructions Pty Ltd (unreported judgment, CT93/1062, 26.11.93) are apposite: Commendable though it is to introduce appropriate occupational health and safety measures after the event it needs to be remembered that the legislation is not directed at ex post facto measures, it requires positive preventative steps being taken to ensure that workers are afforded safe working environments irrespective of their own laxities. 26 The defendant pleads in mitigation it offered the appropriate care and attention to the family of the deceased. The defendant has expressed its contrition and expended considerable monies to ensure site safety in the performance of this task. An early plea of guilty was entered and full co-operation was given to the WorkCover Authority in its investigations. There has been now implemented a rigorous re-training programme. The court has given consideration to these mitigating factors in its determination as to penalty. 27 The defendant is a corporation of means able to meet its commitments. 28 There was a further matter of concern to the court in that filed with the agreed statement of facts in October 1999 was a record of the prior convictions of the company for breaches of the Act. The record given to the court neglected to record the last conviction of the company, a significant breach of the Act under s15(1) which attracted a fine of $30,000 in July 1998. The Authority's records were well out of date and the concern of the court is that a significant conviction would not have been put before it had it not been for the defendant themselves meeting their obligations to properly inform the court. 29 The court addressed this problem once before and drew it to the WorkCover's attention and the court has been given assurances there is now an updated computer system. Again the court repeats its concern. 30 The defendant, as to its industrial record, submits Pacific Dunlop is a conglomerate company which has a number of specific independent companies conducting various activities in its corporate structure. The defendant informs the court the operations of National Cables, the division of the Corporation before the court, does not have any recorded convictions against it. It acknowledges the conviction and fine of $30,000 in 1998 but pleads every endeavour has been made to address the concerns and re-iterates its commitment to safety at its worksite. The court also notes the charge before it relates not to an unsafe system of work but to the appropriate training of employees. This, the court perceives is a serious but lesser breach of the Act in all the circumstances. Nonetheless, because of the industrial record of the company the breach attracts the provisions of s51 of the Act and the maximum penalty is $750,000. 31 I find the defendant guilty. 32 The defendant is fined $90,000 with a moiety to the WorkCover Authority. *********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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