Industrial Court of New South Wales CITATION: Inspector Davidson v St Mary's Tyre Service (NSW) Pty Ltd [2008] NSWIRComm 226 PROSECUTOR PARTIES: WorkCover Authority of New South Wales DEFENDANT St Mary's Tyre Service (NSW) Pty Ltd FILE NUMBER(S): IRC 258 of 2008 CORAM: Marks J CATCHWORDS: OHS prosecution - guilty plea - penalty - employee killed while performing a task that he was not asked to do - at time of incident defendant did not have formal procedure in place to ensure employees were adequately instructed and trained about risk of injury - no evidence that victim was given training and instruction - breach of provisions of Act regarded as objectively serious - no prior conviction - general deterrent effect of penalty on employers in the industry and on the defendant - mitigation - defendant expressed contrition and remorse - defendant cooperated fully with WorkCover and complied with prohibition notices - demonstrated positive commitment to enhancing compliance with obligations under the Act - guilty plea entered at earliest reasonable opportunity - penalty imposed with moiety to prosecutor LEGISLATION CITED: Occupational Health and Safety Act 2000 HEARING DATES: 11 & 17 November 2008 DATE OF JUDGMENT: 2 December 2008 PROSECUTOR Mr M Cahill of counsel Solicitor Ms B Benson Legal Group LEGAL REPRESENTATIVES: WorkCover Authority DEFENDANT Mr M Shume of counsel Solicitor Mr G Phillips Middletons JUDGMENT: INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: Marks J Tuesday 2 December 2008 Matter No IRC 258 of 2008 Inspector Maree Davidson v St Mary's Tyre Service (NSW) Pty Ltd Prosecution pursuant to s 8(1) of the Occupational Health and Safety Act 2000 JUDGMENT [2008] NSWIRComm 226 1 The defendant, St Mary's Tyre Service (NSW) Pty Ltd, has pleaded guilty to a charge brought against it by the prosecutor, Inspector Maree Davidson of the WorkCover Authority of New South Wales, that it breached the provisions of the Occupational Health and Safety Act 2000 ("the Act"). This judgment deals solely with the question of penalty. 2 The charge is contained within an amended application for order filed at the commencement of the hearing on sentence on 17 November 2008. The defendant was charged that: "Being an employer, on 1 March 2006, at approximately 11.20am at the premises of Plasser Australia Pty Ltd…2 Plasser Crescent, St Mary's in the State of New South Wales (it)… (a)…failed to provide and/or maintain a safe system of work with respect to the changing of tyres on split rim wheel and tyre assemblies from vehicles; (b)…failed to provide such information, instruction and training as was necessary to ensure the health and safety at work of its employees, including Mr Butler, in that the defendant failed to provide adequate information, training and instruction to its employees with respect to safe methods for removing split rim wheel and tyre assemblies from vehicles; (c) As a result of the abovementioned failures, Kevin Butler was placed at risk of injury and was fatally injured." 3 I note that the original application for order was filed on 27 February 2008. After some preliminary hearings, the defendant entered a plea of guilty to the charge but not to the particulars on 11 July 2008. The proceedings were then set down for hearing before me for five days commencing on 11 November 2008. On that occasion, the parties indicated that agreement had been reached with respect to an amendment to the particulars of the charge and the matter proceeded accordingly. 4 An agreed statement of facts was filed which I set out hereunder (although I have not reproduced the documents referred to in [45], [46] and [47] of the agreed statement of facts.) "1. At all material times the prosecutor, Inspector Maree Davidson, was duly appointed under Division 1 of Part 5 of the Occupational Health and Safety Act 2000 ("the Act") and empowered under Section 106(1)(c) of the Act to institute proceedings in this matter. 2. St Mary's Tyre Service (NSW) Pty Ltd [ACN 106 478 264] ("the defendant") was, at all material times, a corporation whose registered office was situated at 14 King Street, Warrawong and is now situated at 2 Macquarie Avenue Penrith in the State of New South Wales. The Parties 3. At all material times the defendant was a body corporate. 4. At all material times Russell Alan Williams was a director of the defendant. 5. At all material times the defendant was an employer. 6. At all material times the defendant employed Kevin Butler. 7. At all material times Plasser Australia Pty Ltd was a body corporate 8. At material times Plasser Australia Pty Ltd employed John Burdzy as a mobile crane driver. The Mobile Crane 9. At all material times Plasser Australia Pty Ltd owned and operated a mobile crane, registration number NUN682. 10. At all material times the mobile crane, NUN682, was fitted, at the rear, with 2 split rim wheel and tyre assemblies. 11. At all material times, the two parts of each of the split rims on the rear of the mobile crane were secured together by 10 threaded studs fitted with nuts. In turn, the split rims and tyre assemblies were fixed to the rear hubs of the mobile crane by an inner rim of 8 threaded studs fitted with nuts. The 10 threaded studs fitted with nuts which secured the 2 parts of the split rim form an outer circle of nuts on the split rim. The outer and inner threaded studs and nuts are different sizes. 12. At all material times the 10 nuts securing together the 2 parts of the split rim fitted to the rear left hand side of the mobile crane, registration number NUN682, were painted red to distinguish those nuts from the 8 nuts used to secure the split rim wheel and tyre assembly to the left hand hub of the mobile crane. 13. At all material times, the split rim wheel and tyre assembly fitted to the left rear of the mobile crane bore a plaque that read: "WARNING, DO NOT LOOSEN BOLTS PAINTED RED UNTIL TYRE IS FULLY DEFLATED." 14. By contrast, at all material times, The 10 nuts that secured the two portions of the rear right hand split rim which was the subject of the incident were not clearly painted with red paint to distinguish then from the 8 nuts that secured the split rim wheel and tyre assembly to the vehicle; and there was no signage on the wheel or the rear right-hand side of the vehicle indicating that the outer ring of nuts secured a split rim assembly such that the tyre should be deflated before those nuts were loosened. Ordering the replacement tyre 15. On or about 28 February, 2006 Mr Burdzy, the crane driver employed by Plasser Australia Pty Ltd, who drove and operated the mobile crane NUN682, made a complaint to another of Plasser's employees, Geoffrey Owen, that the right hand rear tyre fitted to the mobile crane was bald and required replacement. 16. Following Mr Burdzy's complaint, Mr Owen placed a telephone order for a replacement tyre with Allan Budin at the defendant. 17. After receiving the order for a replacement rear tyre, Mr Budin placed an order for a replacement tyre with Bearcat, a supplier of industrial grade tyres. 18. On 1 March 2006 Terry Murray received a telephone call, whilst working at the defendant, regarding an order for a replacement tyre for one of the rear tyres on Plasser's mobile crane. 19. Mr Murray then completed a field service request form noting that an order had been placed by "Scott", on the Plasser account, for a replacement tyre (tyre size: 18x4x28). The following service details were included: "Inspect. Ring back if tyre and wheel is still on unit." 20. When interviewed after the incident Mr Murray stated that he assigned Mr Butler the job of inspecting the mobile crane and instructed Mr Butler that he was to go to Plasser's premises to inspect the vehicle on his return journey from premises at Mount Druitt to which Mr Butler was delivering tiles. 21. As a consequence of his instructions to Mr Butler, Mr Murray stated he did not expect Mr Butler to undertake any work on the mobile crane at the Plasser's premises without calling in first. 22. Consistent with Mr Murray sending Mr Butler to inspect the mobile crane, Mr Butler did not have a porta power and a replacement tyre with him when he attended at the site and he was not in a position to replace the tyre in situ. Attendance at Plasser Australia Pty Ltd 23. On 1 March 2006 Mr Burdzy noticed a "tyre truck" pull up outside the profile shop at the rear of Plasser's premises, next to the subject mobile crane. Mr Burdzy then saw Mr Butler get out his gear, start the compressor on the back of the "tyre truck" and then, start undoing nuts on the rear right hand wheel and tyre assembly of the mobile crane with a pneumatic ratchet gun. 24. Mr Burdzy then approached Mr Butler and said: "Everything OK, you know what you are doing?" To which Mr Butler replied: "I know what I'm doing" Mr Burdzy observed that Mr Butler was undoing the "outside wheel nuts" on the rear right wheel and tyre assembly of the mobile crane. 25. However, as the ratchet gun Mr Butler was using was very noisy, Mr Burdzy walked away from the crane. 26. A short time later, Mr Burdzy walked back towards the area in which the crane was parked and when very close to where the deceased was working, Mr Burdzy saw the rim, on which Mr Butler was working, move slightly. Mr Burdzy felt that "something wasn't right" and he took one or two steps back away from the crane. Mr Burdzy then heard an explosion and saw Mr Butler thrown into the air by the force of air and water escaping from the split rim wheel and tyre assembly on which Mr Butler was undoing the outer circle of wheel nuts. Mr Burdzy estimated that Mr Butler was thrown approximately 6 to 7 metres before Mr Butler slumped into a 44 gallon drum. 27. The NSW Ambulance Service was called and Mr Butler was taken by ambulance to Nepean Hospital. 28. On 5 March 2006 Mr Butler, whilst still an inpatient at Nepean Hospital died of injuries sustained in the subject incident. Systems of Work St Mary's Tyre Service 29. Prior to and at the time of the subject incident, the defendant had no formal documented occupational health and safety systems manual. 30. The defendant's safe work methods principally relied upon safe work practices learnt by senior staff through training that had been provided to them in previous jobs with other employers operating in the tyre industry. 31. The defendant had no formal competency assessment systems for assessing the competency of its employees and the company relied principally on informal, undocumented, "on the job" assessments of its workers' trade skills and competency by senior members of staff. 32. The defendant's principal, albeit unwritten, safety rule was that inflated tyres on split rims should be deflated before any repair work was to be performed. This was a rule that was reinforced orally and followed on the job. 33. The defendant, considered the removal of split rim wheel and tyre assemblies (including the existing tyre) from vehicles and the replacement of the existing tyres on split rim wheel and tyre assemblies a job for two experienced men. This was a task usually assigned to two particular senior staff who were experienced in working with split rim assembles, namely, Mick Simpson and David Evans. 34. Mr Evans stated in his record of interview that, when working on split rim wheel and tyre assemblies, the invariable rule which he followed was that the tyre had to be deflated before work commenced. 35. Mr Butler, the injured worker, commenced employment with the defendant, on 6 October 2005, as a tyre fitter and was considered by Mr Williams and Mr Budin to be a competent tyre fitter. 36. Mr Williams and Mr Budin both believed that the deceased came to the defendant with extensive experience in the industry. 37. However, no documented reference checks were undertaken by or on behalf of the defendant to confirm Mr Butler's training or work experience in the industry. 38. 39. Further, prior to the incident the defendant did not provide Mr Butler with any formal training, any instructions or any information in relation to the fitting of inflatable tyres to split rim wheel and tyre assemblies. Plasser Australia Pty Ltd 40. Plasser had in place some occupational health and safety systems, including a contractor management system, together with an active occupational health and safety committee. 41. Prior to the incident, Plasser had in place written safe work procedures for a large range of activities undertaken at the factory, a contract labour management procedure, a visitor safety procedure and a wide array of safety management procedures. 42. However, the occupational health and safety systems which Plasser had in place prior to the incident, including the contractor management system, were not actively or effectively managed prior to and at the time of the incident. 43. As a consequence, Mr Butler was permitted to commence work at Plasser's site without having registered his arrival, without any site safety induction and therefore, without any person from Plasser checking Mr Butler's credentials and the reason for his presence on site and/or the provision of any supervision, apart from Mr Burdzy's informal inquiry about what Mr Butler was doing after Mr Butler had already commenced work on the rear right-hand wheel assembly of the mobile crane. 44. Further, despite the fact that prior to the incident the nuts securing the parts split rim wheel attached to rear left-hand side of the vehicle had been painted red, as warning, and a warning notice regarding the deflation of the tyre had been fitted to the rear left hand side of the vehicle, Plasser had not taken any steps to ensure that the split wheel and tyre assembly attached to the rear right-hand side of the vehicle was similarly marked and/or that warning notices had been attached on or adjacent to that wheel assembly. Investigation of the Incident 45. On 1 March 2006 whilst at the site Inspector Davidson took a number of photographs which are attached and marked 'A'. 46. On the 4 March 2006, Inspector Davidson issued three improvement notices to the defendants (7-103595, 7-103596 and 7-103597). Attached, marked with the letter "B", are copies of each of the three Improvement Notices. 47. On the 10 March 2006, Inspector Davidson issued a prohibition notice to the defendant to prevent the inflation of large industrial tyres outside a safety cage (149919). Attached, marked with the letter "C", is a copy of the Prohibition Notice. Action Undertaken since the Incident 48. In response to the notices issued by Inspector Davidson the defendant has a. developed a risk assessment template which has been used to conduct a risk assessment of work undertaken whilst changing a split rim wheel and tyre assemblies. b. provided training to all employees on proper safe work procedure for working with split rim wheel and tyres assemblies. c. provided training to all supervisors on consultation and risk management in the workplace d. reviewed work practices for working with split rim wheel and tyre assemblies and developed a safety manual. e. developed a formalised system to conduct proper reference checks on all potential employees. f. developed and implemented an induction package for all new employees together with a plan to review 49. The defendant cooperated with the investigation by WorkCover. The Defendant's Criminal History 50. The defendant has no prior criminal convictions." 5 In addition to the agreed statement of facts, the defendant relied upon an affidavit of Allan Budin, its general manager, who also gave oral evidence including evidence in cross-examination. 6 The unfortunate incident which gave rise to these proceedings occurred on 1 March 2006 when Mr Butler was asked to attend at the Plasser premises solely for the purpose of inspecting the tyre. The precise instructions were those outlined in [19] of the agreed statement of facts. As is clear from the evidence, Mr Butler was not instructed to perform any work on the tyre, was not carrying any equipment which would have allowed him to properly attend to the repair of the tyre, did not have present any person to assist him in the operation of what was clearly a two-person job and he was physically unable to have either loaded the tyre on to his vehicle to take it away nor was the vehicle capable of transporting the tyre. 7 Mr Budin had worked in the tyre industry since 1964. He gave evidence of the continuation of a business known as St Mary's Tyre Service since 1948 although its current corporate ownership has only existed since 26 September 2003. 8 Mr Budin explained the construction of two-piece split rim wheels which consisted generally of "between two and five pieces and hold the tyre to the rim by way of a flange and locking ring. The tyre, flange and locking ring are held in place by the internal pressurisation of the tyre. Split rim wheel assemblies are always fitted with a tube and rust band." Furthermore, they have "two sets of nuts and bolts. One set of bolts and nuts holds the rim together whilst the second set of bolts and nuts holds the wheel to the hub of the vehicle…In my experience the outer nuts are painted red in colour and there is a tag affixed to the wheel which identifies that the outer nuts should not be loosened until the tyre has been deflated. In my 44 years in the industry I have dealt with between 20 and 30 wheels of this style and type." Furthermore, according to Mr Budin, it is customary to fill between two-thirds and three-quarters of the inner tube with water, the remaining part of the tube being filled with air. 9 It was the evidence of Mr Budin that no work should be performed on a split-rim wheel without the tyre being deflated and certainly the tyre assembly should be deflated prior to removal. Mr Budin said that if he had been involved in attending to the tyre of the mobile crane at the Plasser premises, he would have first spun the wheel so that the valve was located "at 6 o'clock", then removed the valve assembly to allow the water to drain and finally to allow the remaining air in the tyre to equalise with the atmosphere. At that stage, he would have broken the beads of the tyre with a porta power equipment and would then have undone the wheel nuts and removed the outer section of the wheel. All of this would have been attended to on site. 10 Mr Budin gave evidence that Mr Butler commenced work with the company on 6 October 2005 and that he had previously worked with Mr David Evans with another company which had provided similar services to the defendant. Mr Butler had worked in the industry as a tyre fitter for at least 10 years. When Mr Budin met Mr Butler one week after he started work with the defendant, he observed him working on "…a number of different tyre and wheel assemblies which included split rim truck and divided rim forklift industrial assemblies. From this observation I am able to say that he demonstrated a general competency to remove tyre and wheel assemblies from the types of vehicles dealt with by the company. In particular, I observed him work on truck split tyre rims and forklift split rims. The forklift split rim wheel and tyre assemblies were similar in style to the wheel he was working on at the time of this unfortunate incident…Even though I considered him to be a competent tyre fitter, I would not have sent him to do the work on this wheel by himself." 11 The situation, therefore, is that the defendant's personnel sent Mr Butler to the Plasser site with specific instructions which were limited to an inspection of the tyre. It was not intended that Mr Butler would do anything more than inspect the tyre, nor was it contemplated by the defendant's personnel that he would seek to do any work on or about the tyre. Certainly, he did not have the equipment to enable him to undertake any work. 12 There is no evidence as to what motivated Mr Butler to attempt to perform any work on the tyre. There is no explanation as to why he attempted to loosen the wrong set of nuts, even though there was no paint to indicate which nuts held the tyre in place and which held the wheel to the hub of the vehicle. The objective seriousness of the offence 13 As is clear from the agreed statement of facts, the defendant did not at the time of the incident have any formal procedures or protocols in place to ensure that its employees were adequately instructed and trained about the risk of injury associated with carrying out work on tyres of this kind and a process by way of supervision to ensure that that instruction and training was put into effect. Even though there was some suggestion that the defendant had in place informal processes of training and instruction which included an admonition that tyres of this nature should be deflated before either being worked upon or removed, there is no evidence that Mr Butler was given any such training and instruction. There was evidence that he had performed work on one such tyre in the past but that was after it had been punctured and the tyre had obviously been deflated. 14 On one view of it, as stressed by the defendant, its breach of the Act consisted of its failure to instruct Mr Butler not to perform any work on the tyre and to reinforce this in some way. The prosecutor submitted, however, that if Mr Butler had been properly instructed and trained about the risk of injury associated with performing work in and about the tyre without ensuring that it had first been deflated, it is more likely that he would have been conscious of the danger of what he was doing at the time of the incident and therefore less likely to have done it. In the context that the Act is to be applied, as is well known, in circumstances where employees are sometimes inclined to be careless, inattentive or even act foolishly, I agree with the submission of the prosecutor in this regard. Indeed, the prosecutor submitted that the defendant should have informed Plasser that Mr Butler was being sent out not to change the tyre but to carry out an inspection only and in this way Plasser personnel would have been armed with sufficient information to ensure that sufficient supervision was given to Mr Butler to ensure that he stayed within his brief. 15 In my opinion, care needs to be taken to ensure that the absolute obligation which is imposed by the Act is not formulated in a manner which would make strict compliance with the expectations of the WorkCover Authority of New South Wales either almost impossible or which would render such strict compliance an oppressive burden. One might extrapolate such a submission to include any situation where an employer sent an employee to third party premises for the purpose of carrying out work where some degree of danger attended the performance of that work. Communication of the exact limits of the work to be performed by the employer to the third party client with an exhortation to ensure that only that work that was to be performed by the employee in the manner specified might require a further layer of supervision within many organisations. In assessing the objective seriousness of the offence in these proceedings, I do not take into account that the defendant should have informed Plasser concerning the precise limits of what Mr Butler was to do when he attended their premises. 16 Given that the work that Mr Butler attempted to carry out, albeit not part of any instructions that he was given, was highly potentially dangerous, but noting that it was work that was associated with the kind of work that he carried out, I regard the failure to put in place an appropriate system of instruction, training and supervision as being a serious one. Accordingly, when viewed objectively, the breach by the defendant of the provisions of the Act as charged is objectively a serious one. 17 The defendant has no prior conviction and the maximum monetary penalty is $550,000. 18 In fixing penalty I will also take into account the general deterrent effect that any penalty will have in and about the operation of the work of other employers in this industry and, hopefully also, persons employed in the industry. There is evidence as referred to in the agreed statement of facts that the defendant has undertaken a number of steps to enhance its commitment to its obligations under the Act so that, to this extent, the specific deterrent effect on the defendant of any penalty assessed will be reduced to some extent. Nevertheless, I intend to have regard to the deterrent effect of the penalty on the defendant when assessing its quantum. Mitigation 19 There are a number of matters that I propose to take into account in accordance with the well-settled sentencing principles which will have the effect of lessening the quantum of the penalty to be imposed. The defendant has expressed contrition and remorse for what occurred and assisted Mr Butler's widow after the incident. It has co-operated fully with the WorkCover Authority of New South Wales in its investigation of the incident and has complied with a number of prohibition notices issued against it. Furthermore, it has demonstrated a positive commitment to enhancing compliance with its obligations under the Act as is referred to in the agreed statement of facts and is the subject of elaboration in the evidence of Mr Budin. 20 There is evidence that the defendant has supported a number of charity and service organisations and has made a substantial contribution to the placing of students as part of a program designed to introduce them to work in the industry. 21 I take into account also that the defendant entered a plea of guilty at a time which I assess was the earliest reasonable opportunity for it to do so and, to this extent, I intend applying a discount of the order of 25%. 22 Initially, the defendant foreshadowed that it would mount an argument for reduction of the penalty on the basis of its incapacity to pay, but did not pursue this submission. 23 Finally, the defendant asked that WorkCover take some steps to issue guidance to employers in the industry to produce some comprehensive and appropriate guidelines for the carrying out of work so as to minimise the risks of injuries of the kind that led to Mr Butler's untimely death. I confirm, having discussed with counsel for the prosecutor a recommendation that WorkCover give consideration to such an initiative. 24 In all the circumstances, I assess an appropriate penalty in the sum of $85,000. The prosecutor sought a moiety of the penalty and an order for costs, which were not opposed. Orders 25 1. The defendant is found guilty of the charge brought against it and convicted accordingly. 2. I impose a penalty of $85,000 with a moiety to the prosecutor. 3. The defendant is to pay the costs of the prosecutor in an amount assessed by the Court in default of agreement. 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.