Industrial Court of New South Wales CITATION: Inspector Hayes v Santos and Lorenzo (No 2) [2009] NSWIRComm 208 Inspector Peter Hayes (Prosecutor) PARTIES: Jose Luis Santos (Defendant in IRC2008/654) Jaime Lorenzo (Defendant in IRC2008/656) FILE NUMBER(S): IRC 654 and 656 of 2008 CORAM: Boland J President OCCUPATIONAL HEALTH AND SAFETY – sentencing – steel fabrication industry – prosecutions under section 26(1) of the Occupational Health and Safety Act 2000 – directors found guilty – sentencing considerations – objective seriousness – known risk – pre-existing system of work – general and specific deterrence – mitigating factors – assistance to victim – application of contrition and remorse in not guilty plea – remedial measures – penalties imposed – costs and moiety to prosecutor. CATCHWORDS: SENTENCING – occupational health and safety – steel fabrication industry – prosecutions under section 26(1) of the Occupational Health and Safety Act 2000 – directors found guilty – sentencing considerations – objective seriousness – known risk – pre-existing system of work – general and specific deterrence – mitigating factors – assistance to victim – application of contrition and remorse in not guilty plea – remedial measures – penalties imposed – costs and moiety to prosecutor. LEGISLATION CITED: Crimes (Sentencing Procedure) Act 1999 Occupational Health and Safety Act 2000 Alcatel Australia Limited v WorkCover Authority of New South Wales (Inspector Clyant) (1996) 70 IR 99 Cahill v State of New South Wales (Department of Community Services) (No 4) [2008] NSWIRComm 201; (2008) 182 IR 231 Cameron v The Queen [2002] HCA 6; (2002) 209 CLR 339 Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 Corinthian Industries (Sydney) Pty Ltd v WorkCover Authority of New South Wales (Inspector Wilson) [2000] NSWIRComm 46; (2000) 99 IR 159 Department of Mineral Resources (McKensey) v Kembla Coal & Coke Pty Ltd (1999) 92 IR 8 Inspector Barry Childs v Kirk Group Holdings Pty Limited [2005] NSWIRComm 1; (2005) 137 IR 462 Inspector Hayes v Santos and Lorenzo [2009] NSWIRComm 163 Inspector John Mulder v Michelle Pontone [2005] NSWIRComm 432 Inspector Ken Kumar v David Aylmer Ritchie [2006] NSWIRComm 384 Inspector Patton v Western Freight Management Pty Ltd (No 2) [2009] NSWIRComm 124 Inspector Stephen Campbell v James Gordon Hitchcock [2005] NSWIRComm 34; (2005) 139 IR 439 Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 CASES CITED: Maddaford v CSR Limited and Mulgoa Quarries Pty Ltd [2004] NSWIRComm 337 Markarian v R [2005] HCA 25; (2005) 228 CLR 357 Morrison v Coal Operations Australia Ltd (No 2) [2005] NSWIRComm 96; (2005) 141 IR 465 O'Sullivan v The Crown in the Right of the State of New South Wales (Department of Education and Training) [2003] NSWIRComm 303; (2003) 128 IR 158 Page v Walco Hoist Rentals Pty Limited (No 2) [2000] NSWIRComm 39; (2000) 99 IR 163 Rodney Morrison v Hunter Quarries Pty Limited [2009] NSWIRComm 179 Siganto v The Queen (1998) 194 CLR 656 Warman International Ltd v WorkCover Authority of New South Wales (1998) 80 IR 326 WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Ltd [2000] NSWIRComm 1123; (2000) 95 IR 383 WorkCover Authority of New South Wales (Inspector Farrell) v MIM Transport Pty Ltd [2002] NSWIRComm 58; (2002) 112 IR 81 WorkCover Authority of New South Wales (Inspector Glass) v ACI Operations Pty Limited, (Schmidt J, 25 February 1994, unreported) WorkCover Authority of NSW (Inspector Lyons) v Warman International Ltd [2001] NSWIRComm 62; (2001) 105 IR 236 WorkCover Authority of New South Wales (Inspector Mulder) v Yass Shire Council [2000] NSWIRComm 57; (2000) 99 IR 284 WorkCover Authority of NSW (Inspector Penfold) v Fernz Construction Materials Ltd (1999) 91 IR 119 HEARING DATES: 13 November 2009 DATE OF JUDGMENT: 7 December 2009 Mr D Chin of counsel (Prosecutor) WorkCovery Authority of New South Wales LEGAL REPRESENTATIVES: Mr M Moir of counsel (Defendants) K P O'Donnell & Associates, Solicitors JUDGMENT: INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: BOLAND J, President Monday 7 December 2009 Matter No IRC 654 of 2008 INSPECTOR PETER HAYES v JOSE LUIS SANTOS Prosecution under section 8(1) by virtue of section 26(1) of the Occupational Health and Safety Act 2000 Matter No IRC 656 of 2008 INSPECTOR PETER HAYES v JAIME LORENZO Prosecution under section 8(1) by virtue of section 26(1) of the Occupational Health and Safety Act 2000 JUDGMENT [2009] NSWIRComm 208 1 On 1 October 2009, judgment was given in Inspector Hayes v Santos and Lorenzo [2009] NSWIRComm 163 ('Santos' or 'liability judgment'), in which Jose Luis Santos and Jaime Lorenzo ('the defendants') were found guilty of offences under s 8(1) of the Occupational Health and Safety Act 2000 ('the Act'), by virtue of s 26(1) of the Act. The defendants were the directors of the company S & L Steel (NSW) Pty Ltd ('S & L'), which conducted a business of fabricating structural steel. Charges brought against S & L were withdrawn by the prosecution following the winding up of the company in February 2007. 2 The incident from which these matters arose was outlined in the liability judgment at [9]-[29]: [9] Mr Hair's duty statement required him to assist in carrying out work in 'grinding, drilling, punching and cleaning', as well as to carry out other duties as required. Mr Hair explained in his evidence that initially he had been performing sandblasting work at S&L, and that it was not until later in his employment that he assisted in lifting tasks using mobile cranes. Nevertheless, it is clear that Mr Hair had assisted in lifting and move steel plates using mobile cranes on a frequent basis prior to 20 May 2006. Mr Hair was not, however, a qualified dogman, that is someone who was qualified to 'sling a load' or to perform lifting tasks unsupervised. In addition, the evidence revealed that prior to his employment with S&L, he had only performed limited work in assisting mobile cranes, and had not lifted steel plates. [10] On Saturday 20 May 2006, the day of the incident, there were two supervisors on duty at the premises, Mr Jung and Mr Bloom. Mr Hair was due to commence work at 6.00am, but arrived at the Glendenning Rd premises at approximately 6.45am. By the time of Mr Hair's arrival, Mr Bloom had already allocated tasks to the other employees, and directed Mr Hair to assist Mr Alvarez with loading steel plates onto a truck. In his evidence, Mr Bloom stated that he knew that Mr Hair did not have a dogging certificate, but maintained that the direction for Mr Hair to assist Mr Alvarez in loading the truck was nothing unusual or abnormal, and that Mr Hair had lifted steel plates before. (It was Mr Hair's recollection, however, that it had been Mr Jung who had told him to assist Mr Alvarez, as the task was urgent. Mr Jung denied this and maintained that he never said anything more than 'good morning' to Mr Hair). [11] Mr Alvarez was employed in the position of Crane Driver - Leading Hand/ Materials Handling - Yard. Mr Alvarez's duty statement indicated that his duties included receiving incoming goods and storing them correctly and safely, delivering fabricated steel for painting, and loading of trucks for dispatch according to priorities determined by the workshop foreman. The evidence revealed that at the time of the incident Mr Alvarez held a crane ticket, but did not have a dogging certificate. However, Mr Alvarez was Mr Hair's immediate supervisor for the task of loading the truck and, according to Mr Lorenzo and the company policy, it was Mr Alvarez who had responsibility for ensuring that the load was safe. [12] In accordance with Mr Bloom's direction, Mr Hair went to assist Mr Alvarez. Mr Hair stated that the only discussion that he and Mr Alvarez had was that Mr Alvarez informed Mr Hair that 'the trailer had to be loaded and had to be out that day'. [13] The specific task that was to be performed required Mr Alvarez and Mr Hair to access a steel plate underneath a pile of steel plates (the steel plate in question measured approximately 5.48 metres long by 2.26 metres wide by 12 millimetres thick). It was, therefore, necessary for them to move the top plate in order to be able to move one of the plates underneath. Mr Hair and Mr Alvarez both agreed that the two of them did not have a discussion as to how to lift the plate. [14] It is necessary at this juncture to explain some of the relevant equipment utilised in lifting tasks and referred to throughout proceedings. First, there were plate clamps, also referred to as plate dogs, shoe clamps and lifting grabs. These are clamps that are secured onto a steel plate in order to lift and move the plate. There were two types of plate clamps, one type for vertical lifting and the second type for horizontal lifting. For example, if the steel plates were stacked on top of one another in a pile, horizontal clamps would be required, whilst if the plates were stored vertically, in a rack for example, vertical clamps were required. The steel plates that were being moved by Mr Hair and Mr Alvarez on the day of the incident were stacked in a pile and, accordingly, the workmen performed a horizontal lift. According to the WorkCover Authority's 'Dogging Guide 2003' - 6th Edition, which was tendered in proceedings, the procedure for lifting horizontally was as follows: Lifting horizontally. It is recommended that a minimum of four plate clamps and a spreader beam are used for lifting steel plate horizontally. For horizontal lifts use appropriate plate clamps. Use a spreader beam for long thin plates to prevent dangerous flapping, sagging and vibration. [15] In addition, hooks were also available to lift steel plates, although significantly both the dogging guide, and the company manual containing safety procedures, safety instructions and environmental management procedures provided that hooks were only to be used to perform a lift where there were lifting holes in the plate. Accordingly, where there were no lifting holes, the company manual required that appropriate clamps were to be used. [16] The accounts given by Mr Hair and Mr Alvarez in their evidence in the proceedings as to what occurred at the time of the incident, differed. Mr Hair stated that the first step he took to prepare for the lift was to go to the front of the crane to look for the lifting shoes. The company practice had been to have a minimum of two plate clamps located in a basket attached to the crane and according to evidence of employees, there were almost always two clamps on the crane. In addition, the evidence revealed that at the time of the incident, there were approximately 20 clamps located on the premises, specifically in the workshop and storeroom. [17] However, Mr Hair's evidence was that on 20 May 2006, when he went to get the clamps from the front of the crane, there were none in the basket on the crane. Mr Hair then turned to walk towards the storeroom to look for a pair of lifting shoes. However, Mr Hair stated that Mr Alvarez told him to 'just use the hooks, as they were just moving the top sheet to get to the one below'. [18] Both Mr Hair and Mr Alvarez agreed the hooks were already attached to the chain of the crane on the day of the incident. However, Mr Alvarez denied instructing Mr Hair to use the hooks. [19] Mr Alvarez agreed that after Mr Hair arrived, he had informed Mr Hair that they needed to access one of the sheets in the pile of steel plates, in order for it to be loaded onto the truck. He maintained, however, that it was not an urgent task, as the truck was to go out first thing Monday morning. According to Mr Alvarez, the men had used 'some wedges' to create sufficient space between the top sheet and the next sheet below. They then put pieces of wood in the space created by the wedges, in order to lift the plate a little. Mr Alvarez stated that Mr Hair used the hooks to perform the lift. It was Mr Alvarez's evidence that he and Mr Hair had not had any discussion about the use of hooks, nor had he instructed Mr Hair not to go to the storeroom and to just use the hooks. Both men agreed that it was Mr Hair who had placed the hooks on the steel plate. [20] Mr Hair explained that after Mr Alvarez told him to use the hooks, Mr Hair made a rough estimate of the centre of the sheet and placed the hooks on that location on each side of the sheet in order to ensure that the sheet lifted evenly. Mr Alvarez agreed that he saw Mr Hair place the hooks in the middle of the sheet, and that in his opinion that had been the correct location for the hooks to be placed. [21] The two men 'were both in agreement to lift' and they began to lift. Mr Alvarez explained that they both looked at each other and knew they were ready to begin lifting. There was, however, no verbal communication or signal. [22] Mr Hair explained in his oral evidence what happened next: Q. What happened next? A. It's come up unevenly and I've called out to Freddy to put it back down and I've tried to balance it out with my body weight and at the same time I'm calling out for him to put it down and when it's got too heavy for me to hold I've turned to run and it's fallen and hit me. Q. In which direction did you turn to run? A. Towards the trailer. Q. Was that away from or towards the plate? A. Away. ... Q. When the plate became unstable on 20 May you said you called out to Mr Alvarez? A. Yes. Q. What did you say? A. "Down", repeatedly "down". Q. What happened after you did that? A. After I repeatedly saying "down", he kept lifting and I couldn't hold it any longer and I've let go of the plates, turned around to run away from it and the accident has happened. Q. When you were struck by the steel plate how did you fall? A. Face down. Q. What happened to your consciousness after you fell? A. I lost consciousness, I don't know how long. [23] Mr Alvarez denied hearing Mr Hair yell out to put the load down or that he continued to lift despite Mr Hair's calls. It was Mr Alvarez's evidence that when the hooks began to slide, Mr Hair, in his attempt to run away, had run underneath the steel plate. Mr Alvarez explained that Mr Hair had run in that direction as, at the time of the incident Mr Hair was located between the crane and the plate, and had been unable to run away from the plate, as the crane was behind him. It was Mr Alvarez's opinion, that if Mr Hair had not tried to run he would not have been injured. [24] The evidence revealed that it was company policy for employees not to stand between the crane and a plate when they were assisting in a lift. Further, Mr Boardman's expert report, which is addressed later in the judgment, identified that the Australian Standard for Mobile Cranes Safe Use - AS2550.5 (2002), 6.8.1 provided that: where possible, persons assisting the crane operator shall not be located between the suspended load and the crane and they shall be visible to the crane operator. [25] Mr Hair was not questioned in respect of this Australian Standard, and there was no evidence that he was aware of the Standard. However, Mr Hair did know, prior to 20 May 2006, not to stand between the load and the jib of the crane, as it was dangerous to do so. Mr Hair denied, however, that he was standing in that location on 20 May 2006. Mr Hair recalled that when the lift had commenced he had been standing with the plate in front of him, the factory building was on his right hand side and the crane was on the other side of the plate. [26] Following the incident, Mr Palmos was the first to arrive at the scene. Mr Palmos gave evidence that he was 70 to 100 metres away from where the incident occurred, but that when he had heard the noise he went over to see what happened. [27] Mr Alvarez then obtained a clamp from the equipment tray at the front of the crane, and Mr Alvarez and Mr Palmos lifted the sheet off Mr Hair. Mr Palmos explained that he was certain that he had seen more than one plate clamp on the crane on the day of the incident, however the two men had only used one to remove the sheet from Mr Hair. [28] Mr Hair was subsequently conveyed to Nepean Hospital by Ambulance, where he was treated for his injuries. [29] Following the incident, the company conducted its own investigation into the incident and concluded that the cause of the incident had been the use of hooks to lift the plate and by Mr Hair standing between the plate and the crane. 3 The particulars for both offences were in the same terms, in that S & L had failed to: (a) ensure compliance with, or adequately enforce, a system of work for lifting and moving steel plates prior to and on 20 May 2006 that was safe and without risks to the health and safety of its employees; (b) conduct any, or any adequate, risk assessment as was necessary to ensure the health, safety and welfare of its employees whilst lifting and moving steel plates; (c) provide any, or any adequate, information to its employees, and in particular Mr Hair, as was necessary to ensure Mr Hair's health and safety at work whilst lifting and moving steel plates; (d) provide any, or any adequate, instructions and training to its employees, and in particular Mr Hair, as was necessary to ensure Mr Hair's health and safety at work whilst lifting and moving steel plates; (e) provide any, or adequate, supervision to its employees, and in particular Mr Hair and Mr Alvarez, as was necessary to ensure Mr Hair's health and safety at work whilst lifting and moving steel plates. 4 The defendants pleaded not guilty to the charges, relying on the defence of due diligence in s 26(1)(b) of the Act. The defence was not made out and each defendant was found guilty of the charge on 1 October 2009. Particulars (a), (c), (d) and (e) were made out. 5 The prosecution and defence filed written submissions in Court, adduced further evidence and made oral submissions during the hearing on 13 November 2009 regarding the sentencing of the defendants. This judgment concerns the sentences to be imposed on each of the defendants. 6 The relevant principles that this Court is to consider in sentencing under the Act were set out in Morrison v Coal Operations Australia Ltd (No 2) [2005] NSWIRComm 96; (2005) 141 IR 465 at [8]-[16]. OBJECTIVE FACTORS 7 The primary consideration in determining the sentences in these proceedings 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 at 475. Mr D Chin, counsel for the prosecution, submitted that the Court should impose 'substantial penalties in these prosecutions', given the nature and quality of the offences in that they involved a reasonably foreseeable risk flowing from an inherently dangerous risk, the failure of the defendants to take appropriate measures, the gravity and potential risk to the safety of Mr Hair and the need for general and specific deterrence. The risk and degree of foreseeability of risk 8 Mr Chin directed the Court to the 'nature and quality of the offences in so far as they involve a reasonably foreseeable risk applying from an inherently dangerous task': … the foreseeability of the risk of Mr Hair adopting that otherwise prohibited action is compounded by the fact that Mr Hair was essentially thrust into an area of working in which he only had very limited experience. … The foreseeability of the risk … proceeds expressly from your Honour's judgment. At para 81 your Honour found that the insufficient number of plate clamps that were present on the crane on the day made it foreseeable that the employees might take the expedient course, that is the course of completing a lift with the use of open hooks in the absence of readily accessible and sufficient plate clamps kept with and on the mobile crane itself. ... compounding that foreseeability your Honour found that it was verbally reiterated of the need to use clamps by the defendants at tool box meetings and in my submission, that means that the defendants actually foresaw the risk of departure from the written policy. If that were not the case there would have been no need for repeated verbal reminders at tool box meetings. Moreover … the risk of employees taking shortcuts was confirmed in the evidence as having been in the mind of the defendants, Mr Lorenzo in particular. 9 The risks in the present matter were: (i) employees would use open hooks to lift a plate, in a situation where the Dogging Guide and company policy specifically prohibited such use; (ii) in the absence of plate clamps being immediately at hand, employees would be tempted to use hooks rather than walk to find and retrieve suitable clamps; (iii) in the absence of adequate information, instructions and training, employees not qualified to do so would perform dogging work; and (iv) in the absence of adequate supervision, employees would employ unsafe methods in performing the task assigned to them on 20 May 2006. 10 In Santos the Court made findings relevant to the objective seriousness of the offence: [64] The system of work adopted by S&L proscribed the use of hooks for lifting steel plates unless there were lifting holes. If hooks could not be used to lift the plate it must follow they could not be used to move the plate. It must also follow that it having been established that hooks were used to lift steel plate on 20 May 2006, S&L failed to ensure compliance with its system of work for the lifting of steel plates. [65] The question remains, however, whether S&L failed to ensure compliance with a system of work for lifting and moving steel plates ' that was safe and without risks to the health and safety of its employees '. In their evidence both Mr Lorenzo and Mr Santos conceded that lifting plates with open hooks to any height was contrary to S&L's policy and that it was unsafe; Mr Santos agreed it was 'dangerous'. S&L's policy regarding the lifting of steel plates using open hooks was a recognition of the risk associated with doing so. The recommendation in the Dogging Guide that a minimum of four plate clamps and a spreader beam should be used for lifting steel plate horizontally was an indication of the care to be taken in using proper equipment in order to avoid or minimise risk. The injuries sustained by Mr Hair were a manifestation of the risk of using open hooks. … [82] In these circumstances, S&L's failure to ensure sufficient and suitable clamps were available on the crane and not in the storeroom or workshop on 20 May 2006 constituted a system of work that was attended by risk. This compounds the earlier failure found to have occurred, namely, the failure to ensure open hooks were not used to lift steel plates. … [130] S&L was obliged to provide such information, instruction and training as was necessary to ensure that employees and, in particular Mr Hair, were able to carry out the work of lifting and moving steel plates without risk to their health and safety. Whilst information, instruction and training was provided in relation to the use of clamps, I agree with the prosecutor that Mr Hair received inadequate information, instruction and training about the use of open hooks such that the state of that information, instruction and training did not ensure that Mr Hair understood there was an absolute prohibition on the use of hooks when lifting and moving steel plates. [131] The evidence established that: Mr Hair was given very limited instruction on assisting mobile cranes and dogging work at his induction, which did not extend to S&L's own eight-step lifting procedure contained in the written procedures; Mr Hair had not seen S&L's Safety Instruction 17.1 as at 20 May 2006; whilst Mr Hair received limited information and instruction, apart from Mr Francisco witnessing Mr Hair slinging a load at the time of his induction (about which there was no detail), Mr Hair did not receive any training by qualified personnel in the sense of a demonstration of the method or technique for moving and lifting steel plates using a mobile crane; Mr Hair had used open hooks to lift steel plates prior to 20 May 2006; Mr Alvarez had advised Mr Hair to use open hooks on 20 May 2006 and Mr Hair did not question that advice; and Mr Hair was expressly instructed by his supervisor how to use open hooks to lift plates for the purpose of attaching clamps. I also find that based on his advice to Mr Hair to use the hooks, Mr Alvarez received inadequate instruction and training about the use of open hooks. … [150] It follows that the task of lifting the steel plate using the mobile crane on 20 May 2006 was undertaken in the absence of a person certified as being competent to perform dogging work. Prima facie, that constitutes evidence of inadequate supervision necessary to ensure Mr Hair's health and safety at work whilst lifting and moving steel plates. [151] There was evidence that Mr Alvarez was Mr Hair's supervisor in performing the lifting task. It was contended that Mr Alvarez was a person with a crane certificate and of considerable experience in the use of the mobile crane for lifting steel plates. But it was Mr Alvarez who advised Mr Hair to use the hooks that were on the crane to carry out the lift. One could hardly regard that as indicative of adequate supervision, given the risk that it created for Mr Hair. [152] I find that S&L failed to provide adequate supervision to its employees and, in particular Mr Hair and Mr Alvarez, as was necessary to ensure Mr Hair's health and safety at work whilst lifting and moving steel plates. Particular (e) is made out. … [179] For all their commendable commitment to safety, their comprehensive policies and their reiteration of the prohibition on the use of hooks to lift steel plates, a flaw in the defendants' approach was to rely on supervisors who were not qualified to perform dogging work or to give instructions in relation to the carrying out of such work. It was very clearly the case that reliance was placed on Mr Alvarez to supervise and give instructions to Mr Hair but the defendants failed to ensure that Mr Alvarez was qualified to do so. [180] The defendants believed that Mr Alvarez and Mr Bloom held dogging certificate qualifications. That is what their records showed. The defendants' system of recording important qualifications was obviously defective; one would not have thought such a qualification would be recorded unless the actual certificate had been sighted. Given the close oversight by the defendants of all occupational health and safety matters, one would expect they would have ensured a proper system of checking qualifications, especially where the qualifications had implications for safety. … [188] The defendants may not have been aware of the use of open hooks. However, they were unable to show that they had adopted a process of review and auditing that might enable them to ensure supervisors and managers were acting in compliance with S&L's written policy regarding the prohibition of using steel hooks to lift steel plates in the circumstances that occurred on 26 May 2006. The defendants placed much emphasis on the fact that they had written policies regarding the prohibition on open hooks, that they reiterated this policy regularly at tool box meetings and even advised individual employees not to use open hooks. The defendants obviously considered this to be an important safety issue. That being so, one would expect some form of auditing, even by way of casual inquiry, to ensure supervisors and managers were complying with the policy. But there was none. 11 The prosecution submitted that the risk to the safety of Mr Hair was reasonably foreseeable and, indeed, foreseen, thereby escalating the objective seriousness of the offence: … the defendants clearly recognised the need to reiterate the prohibition against using open hooks in an attempt (albeit inadequate) to address the risk of employees departing from that practice. Accordingly it is open to the Court to conclude that the risk to the safety of Mr Hair at the site was actually foreseen by the defendants on 20 May 2006, and this increases the overall seriousness of the offence: Axer Pty Ltd v Environmental Protection Authority (unreported, NSW Court of Criminal Appeal, 22 November 1993) at [8]; WorkCover Authority (Insp Lyons) v Warman International Limited (2001) 105 IR 236 at [72], per Walton J. In addition, over his 49 years experience in industry Mr Lorenzo was aware that there was a risk of employees working too quickly, taking shortcuts and making mistakes resulting in accidents, including in relation to employees trying to cut corners by completing a lift with the use of open hooks if the plate was already suspended in the air with the hooks. The foreseeability of the risk was compounded by Hair being thrust into an area of work (assisting mobile cranes) in which he had only limited prior experience, and the failure of Mr Lorenzo to enquire about the nature or extent of such prior experience. However, despite requiring a relevantly inexperienced employee to perform work that entailed a danger of which the defendants were acutely aware, the defendants failed to: - ensure that the necessary horizontal plate clamps were available on the mobile crane which gave rise to the reasonably foreseeable prospect of employees taking the expedient course of using open hooks to lift steel plates, which was the course adopted by Hair and Alvarez when Hair's initial intention to find clamps in the storeroom was abandoned; - have an accurate system of recording important qualifications held by the supervisors on which they relied to ensure compliance with the prohibition against using open hooks, with the result that the defendants relied on relevantly unqualified personnel to supervise Hair, particularly Alvarez and Bloom; and - adopt a process of review and auditing that might have enabled them to ensure that their unqualified supervisors were ensuring compliance, and were themselves complying, with the prohibition against using open hooks. The resultant use of open hooks and risk of injury to Hair was therefore readily foreseeable because of the reasonable foreseeability of employees (particularly one with the limited relevant experience of Hair) taking an expedient course, and of unqualified supervisors issuing wrong instructions and providing inadequate supervision. (emphasis in original) 12 Mr M Moir, counsel for the defendants, submitted that the 'defendants accept that the relevant risk was known and was reasonable foreseeable'. The seriousness of the offence is augmented when the risks were foreseeable and, in this case, foreseen: O'Sullivan v The Crown in the Right of the State of New South Wales (Department of Education and Training) [2003] NSWIRComm 303; (2003) 128 IR 158, Warman International Ltd v WorkCover Authority of New South Wales (1998) 80 IR 326, Cahill v State of New South Wales (Department of Community Services) (No 4) [2008] NSWIRComm 201; (2008) 182 IR 231. Remedial steps 13 In considering the seriousness of the offence, the Court accepts the existence of simple and straightforward remedial steps that could have been taken by the defendants' company. The prosecution relied on WorkCover Authority of New South Wales (Inspector Glass) v ACI Operations Pty Limited, (Schmidt J, 25 February 1994, unreported) at 12 in this respect. Mr Chin submitted the following: There are a number of simple steps that could have been taken, which either singly or in combination would have eliminated or reduced the risk of Hair suffering injury from the collapse of a steel plate during the process of lifting the plate by a mobile crane on 20 May 2006, such as: (i) undertaking some form of reviewing or auditing, even by way of casual inquiry, to ensure that supervisors and managers were complying with S & L's policy (his honour found that ' there was none '); (ii) maintaining an accurate record of supervisors' qualifications to ensure their capacity to properly instruct and supervise Hair in dogging work, such as by sighting an actual dogging certificate; (iii) requiring both vertical-lift and (a minimum of four) horizontal-lift plate clamps to be available on the mobile crane; (iv) informing themselves of the circumstances in which an employee is required to hold a dogging certificate, which was apparent from the terms of the WorkCover publication entitled 'NSW Certificates of Competency: Information on National Dogging Certificates'; and (v) prohibiting Hair from undertaking the subject work on 20 May 2009 until he had obtained a dogging certificate. (emphasis in original) 14 Mr Chin made the following submission regarding the issue of the dogging certificate: The fourth step your Honour would be to have informed themselves or at least made steps to ensure and settle the true position as to when a dogging certificate is or is not required. True it is as my learned friend will submit … that so far as authority is concerned this case has clarified the position and the nature of dogging work and when a certificate is required, but in my submission the defendants need not have waited for an authority of this court. The answer … is readily apparent from the WorkCover publication which is the document entitled New South Wales Certificates of Competency on national dogging certificate. Your Honour dealt with the evidence of the defendants' expert in adhering to the basic components of that document and in my submission, the circumstances in which a dogging certificate was required, that is when an employee was exercising judgment in relation to one of the positions, one of which was assessing the centre of balance of the plate, the document spoke for itself and had the defendants made inquiries of the criteria applicable to the requirements for dogging certificates, their misapprehension that one is not required when the dogman is in full view of a crane so when the lift is only a simple lift and not a complex lift it would have been disabused and had they done that they could have prohibited Mr Hair from undertaking that work on the day until and unless he had obtained a dogman's certificate. Can I add another remedial step … which does not appear in the written submissions and that is a step of requiring a qualified third person to supervise lifts in which Mr Hair was engaged, particularly given his lack of experience and inadequate training. There is no suggestion that measure was in any way prohibitive, too costly, too inconvenient or otherwise impracticable. 15 The availability of simple and straightforward remedial steps identified by the prosecutor is a factor influencing the objective seriousness of the offences. Systems of work in place 16 The defendants submitted that relevant to the assessment of the objective seriousness of the offences were the systems of work S & L had in place and implemented prior to the incident: Rodney Morrison v Hunter Quarries Pty Limited [2009] NSWIRComm 179 at [276]. 17 In Santos, the Court found that the directors had expended considerable resources and time in endeavouring to adhere to the obligations imposed on them under the Act: see, for example, [84]-[86] in relation to an adequate risk assessment and [174] in relation to Mr Hair's understanding of safe practices. The Court found at [166]-[167]: [166] … There is no doubt that the defendants took the issue of safety seriously. As their counsel submitted, the defendants took an active role in the development of site safety policies and procedures and took an active role in the development of the site safety committee. They developed a system of work for the lifting and moving of steel plates prior to the accident and were obviously acutely aware of the danger of using open hooks, having proscribed their use unless their were lifting holes. [167] The defendants' commitment to safety was exemplified by the regular, monthly tool box meetings, especially in relation to the use of the mobile crane for lifting purposes. The meetings were a forum for raising and discussing occupational health and safety and production issues, and in addition to Mr Lorenzo, Mr Palejko and Mr Jung, were attended by supervisors and workshop personnel. Mr Santos had initially attended the meetings, but over the years his attendance at the meetings was on a more infrequent basis. This was primarily due to Mr Lorenzo having responsibility for the fabrication/production side of the business, whilst Mr Santos was involved in the administrative aspect of the business. 18 The defendants submitted that there were a number of findings in Santos relevant to an assessment of the degree to which they were complicit in the breaches. Those findings were as follows: (a) Mr Hair had assisted in lifting and moving steel plate using mobile cranes on a frequent basis prior to 20 May 2006 (at [9]); (b) Mr Hair recalled that Mr Lorenzo had told him (probably at tool box meetings) 'to always secure load, not to stand in between load and jib of the mobile crane, it can cause accident, always use the right clamp to pick up' (at [174]); (c) in enforcing the company's lifting policy, Mr Santos had had discussions with personnel on the need to use plate clamps (at [175]-[176]); (d) Mr Hair was familiar with the company's policy, prior to 20 May 2006, not to stand between the load and the jib of the crane, as it was dangerous to do so (at [25]); (e) the defendants actively reiterated the company's prohibition on the use of hooks in lifting steel plates, through the regular tool box meetings involving Mr Hair, Mr Alvarez and the other employees engaged in the company's workshop (at [167]-[172] and [179]); (f) the Court observed at [97]: 'It cannot be doubted that Mr Hair received information, instruction and training in respect of lifting and moving steel plate'; and (g) there is no doubt that the defendants took the issue of safety seriously, through their 'close oversight' of all occupational health and safety matters and their comprehensive policies, especially in relation to the use of mobile crane for lifting purposes (at [166], [167] and [180]). 19 It is evident that the defendants took their duties under the Act seriously. The Court accepts that the defendants took an active role in relation to occupational health and safety, held frequent and thorough tool box meetings, had developed a system of work for the lifting and moving of steel plates (aspects of which were both adequate and inadequate), had a practice of conducting regular risk assessments, utilised an experienced consultant in formulating and updating their systems and were acutely aware of the dangers associated with the use of open hooks. 20 Walton J, Vice-President considered the relevance of pre-existing systems of work to assessing the objective seriousness of an offence in Department of Mineral Resources (McKensey) v Kembla Coal & Coke Pty Ltd (1999) 92 IR 8 at 25: The existence of settled safety procedures and instructions is a factor which may mitigate the seriousness of the offence: see Warman at 342; WorkCover Authority of NSW (Inspector Riley) v Broken Hill Pty Co Ltd (1998) 83 IR 427 at 429. I accept the water trap system established by the defendant does represent a factor mitigating the seriousness of the offence. The cause of the turning off of the tap or valve operating the water trap is unknown and cannot reasonably be attributed to any specific failing on the part of the defendant. 21 His Honour found that '[t]he cause of the turning off of the tap or valve operating the water trap is unknown and cannot reasonably be attributed to any specific failing on the part of the defendant'. The same cannot be said of the present circumstances, where the Court found deficiencies in the systems of work prior to 20 May 2006. Nevertheless, the existence of systems of work that deal with known risks in a workplace is a factor considered by this Court when assessing the objective seriousness of an offence (see, for example, Inspector John Mulder v Michelle Pontone [2005] NSWIRComm 432; Morrison v Hunter Quarries Pty Limited). 22 I note Walton J, the Vice-President's observations in WorkCover Authority of New South Wales (Inspector Farrell) v MIM Transport Pty Ltd [2002] NSWIRComm 58; (2002) 112 IR 81 in relation to the inadequacies of systems of work in place at the time of the offence: [93] This is not a matter, however, where the defendant failed to have introduced any systems to regulate the use and security of forklifts. I consider the following matters (which concern systems introduced by the defendant) should be taken as reducing the defendant's culpability: 1. The defendant did have in place a policy which, by reference to the Australian Standard, required the removal of the key from the ignition when parked and left unattended; 2. The defendant did have in place policies which provided for the prevention of use of its forklift by persons unqualified and unauthorised to do so; 3. Some steps were taken at the workplace to secure the forklifts. The defendant had a manager who was a qualified forklift operator and responsible for carrying out its policies. Further practice existed at the defendant's premises whereby the forklift was secured in a locked shed when it was anticipated that it would not be required for use (both during and after ordinary working hours). [94] The existence of settled safety procedures and instructions is a factor which may mitigate the seriousness of the offence: Berrima Coal at [135]; Warman International Limited v WorkCover Authority of NSW (1998) 80 IR 326 at 342; WorkCover Authority of NSW (Inspector Riley) v Broken Hill Proprietary Company Limited (1998) 83 IR 427 at 429; and, Department of Mineral Resources of NSW (Inspector McKensey) v Kembla Coal and Coke Pty Ltd (1999) 92 IR 8 at 25. [95] However, it is clear that the defendant's systems were inadequate to control the use of forklifts so as to wholly prevent keys being left in the ignition of vehicles when unattended (and accessible out of a locked shed). [96] Firstly, whilst the defendant's policy did attempt to erect a system to secure the keys of the forklift when it was parked and unattended by reference to the Australian Standard, it failed to prohibit, specifically, any practice of leaving keys in the forklift when in use or anticipated for use and left unattended during ordinary working hours. This omission would be significantly less serious but for three considerations: ... [97] Secondly, and more significantly, there was a practice at the defendant's Sandgate depot that the forklift would, from time to time, be left unattended with the keys in situ when the forklift was in use (or anticipated for use). The existence of such a practice demonstrates a failure by the defendant to both enforce its policy and adequately supervise its operations (including the supervision of the activities of its Manager) . (emphasis added) 23 The Court accepts that the system of work in place at the time of the offence is evidence of the defendants' active and positive role in workplace safety. This is a factor that mitigates the objective seriousness of the offences. However, the inadequacies attending that system of work lessen its impact as a mitigating factor. Injury caused by the breach 24 Mr Hair was severely injured as a result of the defendants' breaches of the Act. Mr Hair was unable to attend a hearing date before this Court in February 2009 due to further surgery and hospitalisation resulting from his injury in May 2006. The prosecution outlined the injuries sustained by Mr Hair: Hair suffered severe fractures of the right femur and pelvis, lumbar ligament strains and ligament damage to the right knee. Hair received surgery to repair the fractures on 20 May 2006, including the insertion of screws in his femur. He was in Nepean hospital from 20 May 2006 until 14 July 2006. Hair subsequently underwent an arthroscopy of the right knee on 15 January 2007 and continued to suffer painful symptoms for some months after the incident. Hair underwent surgery as recently as 12 February 2009 (which resulted in complications requiring further surgery) for the purpose of removing a growth on the femur that he broke during in the incident on 20 May 2006. 25 The damage or injury resulting from the breach did not, of itself, demonstrate the seriousness of the breach. However, the gravity of Mr Hair's injuries are the manifestation of the seriousness of the risk caused by the defendants' failures: Maddaford v CSR Limited and Mulgoa Quarries Pty Ltd [2004] NSWIRComm 337 at [17]-[18], Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 at [94] and [95], Lawrenson Diecasting Pty Limited at 476; WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Ltd [2000] NSWIRComm 1123; (2000) 95 IR 383 at 90-91; and Page v Walco Hoist Rentals Pty Limited (No 2) [2000] NSWIRComm 39; (2000) 99 IR 163 at 22. 26 The prosecution submitted that 'the fact that the incident resulted in serious injuries to Hair is relevant as an aggravating factor to be taken into account in determining the appropriate sentences for the offences: s 21A(2)(g) Crimes (Sentencing Procedure) Act 1999'. I propose to have regard to this aggravating factor in imposing sentences on the defendants. Maximum penalty 27 Both parties acknowledged the maximum penalty is $55,000 for a first offence, as provided for in s 12(d) of the Act. Consideration of the maximum penalty is essential in sentencing the defendants and will influence the Court's quantification of penalties: Markarian v R [2005] HCA 25; (2005) 228 CLR 357: [30] Legislatures do not enact maximum available sentences as mere formalities. Judges need sentencing yardsticks. It is well accepted that the maximum sentence available may in some cases be a matter of great relevance. In their book Sentencing , Stockdale and Devlin paras 1.16–1.18. observe that: A maximum sentence fixed by Parliament may have little relevance in a given case, either because it was fixed at a very high level in the last century … or because it has more recently been set at a high catch-all level … At other times the maximum may be highly relevant and sometimes may create real difficulties … A change in a maximum sentence by Parliament will sometimes be helpful [where it is thought that the Parliament regarded the previous penalties as inadequate]. [31] It follows that careful attention to maximum penalties will almost always be required, first because the legislature has legislated for them; secondly, because they invite comparison between the worst possible case and the case before the court at the time; and thirdly, because in that regard they do provide, taken and balanced with all of the other relevant factors, a yardstick. ... 28 Counsel for the prosecution directed the Court to Wright J, the President's comments in Page v Walco Hoist Rentals (No 2) at [23]: [23] ... The maximum penalty available for an offence reflects the "public expression" by parliament of the seriousness of the offence; a large penalty indicates the gravity of the offence as perceived by the community. The task of the Court is thus to assess the relative seriousness of the offender's particular offence in relation to a worst case for which the maximum penalty is provided. Having determined the relative seriousness of the offence, the penalty to be imposed is that which approximately correlates upon the penalty scale of penalty set by the legislature from zero to the maximum: Camilleri's Stock Feeds Pty Limited v Environment Protection Authority (1993) 32 NSWLR 683 at 698 - 699; Nesmat Pty Limited v WorkCover Authority (NSW) (1998) 87 IR 312 at 321; and Albury City Council at 407 - 408. ... Deterrence 29 The prosecution submitted that the Court should consider the need for general and specific deterrence in sentencing the defendants. In this respect, counsel relied on Capral at 81: It follows that both aspects of deterrence [specific and general] are matters which should normally be given weight of some substance in the sentencing process; and although there may be exceptional cases (see, for example, WorkCover Authority (NSW) (Inspector Page) v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39 at 40-43) we would expect such cases to be very rare, and where the relevant circumstances were held by the sentencing judge to be established, the judge must indicate with some precision the circumstances which had led to the exceptional course being adopted. … Even where an offender demonstrates good character or a commitment to rehabilitation, the court may be obliged to have regard to the need for general deterrence: see R v Thompson (1975) 11 SASR 217 at 222. This is particularly so where the offence in question is prevalent in society and represents a serious threat to the community. The need for general deterrence in relation to serious offences under the Act is undeniable." 30 S & L was wound up in early 2007, and the defendants now conduct their steel fabrication business under the auspices of S & L Steel Fabrication Pty Ltd. Given their continued work and directorship in the steel fabrication industry, the prosecution submitted that the penalties should 'reflect the need to deter them – and other such directors – from excessive and unjustified reliance upon unqualified supervisors and managers in instructing and supervising employees in undertaking inherently dangerous tasks'. 31 Mr Chin submitted the following concerning the defendants' current business: Your Honour visited those premises and what is apparent from the view that was conducted in connection with these proceedings and also is reflected in exhibit 20 which is the aide memoir and that view, the undertaking conducted by both the defendants at the same premises has in important ways indeed expanded since the accident took place and if your Honour observed a new blasting chamber structure which was not in place at the time of the accident and also several overhead cranes for the movement of large structural steel items which also was not present at the time of the accident. Your Honour is dealing with a continuation of essentially the same business but also one that has increased in scale. 32 The defendants similarly referred to Capral in conceding that general and specific deterrence be applied to the present case. Counsel directed the Court to [76] and [77] in particular: [76] ... the attitude of a defendant to questions of workplace safety and any steps taken to improve safety following an accident may be relevant to specific deterrence. Here the objective is to deter the particular offender from repeating the offence. ... [77] In sentencing, a court may disregard the element of specific deterrence if satisfied that the risk of re-offending is low or non-existent. The court may form such a view as a result of the rehabilitation of the offender: R v Corner (Court of Criminal Appeal, 19 December 1997, unreported) or because the offender will not have the opportunity to commit a similar offence in the future: R v Macdonell (Court of Criminal Appeal, 8 December 1995, unreported). However, we think it unlikely that the weight to be attached to specific deterrence could be reduced to zero in case of offences under the Act. It least where the offender continues to be an employer, risks to the safety of its employees or contractors may exist or be possible. Breaches of the duties imposed by the Act may occur both by commission and omission. Employers are required to maintain constant vigilance and take all practicable precautions to ensure safety in the workplace. They must adopt an approach to safety which is pro-active and not merely reactive: WorkCover Authority of New South Wales (Inspector Egan) v Atco Controls Pty Ltd (1998) 82 IR 80 at 85. In view of the scope of these obligations, 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. This is particularly so where the offender conducts a large enterprise which involves inherent risks to safety: see WorkCover Authority of New South Wales (Inspector Glass) v Kellogg (Aust) Pty Ltd [2000] NSWIRComm 53 at [46]. 33 In acknowledging the relevance of specific deterrence to the present circumstances, Mr Moir submitted that the Court should 'take into account in the defendants' favour their impressive commitment to safety, exemplified by the significant steps undertaken in the systems of safety at S & L prior to the accident, and the measures introduced since the accident, particularly with respect to enhanced training'. 34 Counsel for the defendants further acknowledged the relevant application of general deterrence. However, counsel submitted that the Court should be minded to consider a distinct feature of the liability judgment in that it dealt with the issue of dogging certificates and their regulatory requirements more comprehensively than any other previous decisions in this jurisdiction: The liability judgment is the first decision known at least to the defendants which deals in a comprehensive manner with the requirements under the Regulations relating to dogging work (see liability judgment at [98]-[126], [132]-[135]). The findings of the Court will undoubtedly provide some guidance to employers in NSW as to the application of these Regulations to dogging work performed by employees. In this regard, the Court's decision is likely to compel attention to this important safety issue, notwithstanding the imposition of any monetary penalty relating to this issue. 35 In considering the need for general deterrence, I note Walton J, the Vice-President's reasoning in Inspector Stephen Campbell v James Gordon Hitchcock [2005] NSWIRComm 34; (2005) 139 IR 439: [28] …there is one other significant factor going to the question of the objective seriousness which will influence the assessment of penalty in this matter: general deterrence. The principles relating to general deterrence set out in WorkCover Authority of New South Wales (Inspector Farrell) v Schrader (2002) 112 IR 284 at [69] - [70], referred to recently with approval by the Full Bench in Maddaford v Coleman at [80], emphasise the more severe punishment which attends general deterrence, should it feature in sentencing: [80] The Court in WorkCover Authority v Schrader held at [69]-[70]: The purpose of the Act is well known and often referred to in judgments of this Court. In my view, it is important, when considering notions of general deterrence, that the Court be cognisant of the fact that the Act is for the benefit of the public generally and particularly employees at work. The goal is the prevention, deterrence and punishment of breaches of health and safety requirements. The notion of general deterrence is well understood. However, in my view, and in accordance with what was stated by the Full Court in Capral Aluminium (at [72] - [74]), in cases such as this, it should be reiterated that "one of the main purposes of punishment, ... is to protect the public from the commission of such crimes by making it clear to the offender and to other persons with similar impulses that, if they yield to them, they will meet with severe punishment" (emphasis added): R v Rushby [1977] 1 NSWLR 594 at 597 per Street CJ citing R. v Radich [1954] NZLR 86 at 87 (adopted by this Court in Capral Aluminium at [72]). Further, I would note that it has been described as "the fundamental duty of this Court" to ensure that any penalty imposed is severe enough to "compel attention to occupational health and safety issues so that persons are not exposed to risks to their health and safety at the workplace": Fisher v Samaras Industries Pty Limited (1996) 82 IR 384 at 388 adopted in Capral Aluminium (at [74]). See also the Full Bench decisions in Inspector Ian Lancaster v Burnshaw Constructions Pty Ltd [2002] NSWIRComm 319. 36 The Court accepts the prosecution's submission that the need for specific deterrence is necessitated by the defendants' continuing and expanding business in steel fabrication. The need for general deterrence is also of utmost important in the present circumstances, given the inherent dangers associated in an industry where large, heavy plates are moved by employees, and where it is imperative that the employer ensures there is no misunderstanding between the crane driver and the dogman about their respective roles and responsibilities. 37 I accept the defendants' submission that the liability judgment in this matter will provide some clarity where hitherto there may have been confusion regarding dogman's certificates. However, it remains that this is an industry wherein there are inherent dangers, and the Court's duty is to 'compel attention to occupational health and safety issues so that persons are not exposed to risks to their health and safety at the workplace'. 38 Further, the liability judgment stated at [187]-[188]: [187] It was submitted for the defendants that no person ever raised this issue with the defendants; they were not aware of any practice of open hooks being used to lift steel plates. It was submitted it is not surprising, therefore, that neither of the defendants thought to raise an issue with any of the supervisors that they did not know to exist. [188] The defendants may not have been aware of the use of open hooks. However, they were unable to show that they had adopted a process of review and auditing that might enable them to ensure supervisors and managers were acting in compliance with S&L's written policy regarding the prohibition of using steel hooks to lift steel plates in the circumstances that occurred on 26 May 2006. The defendants placed much emphasis on the fact that they had written policies regarding the prohibition on open hooks, that they reiterated this policy regularly at tool box meetings and even advised individual employees not to use open hooks. The defendants obviously considered this to be an important safety issue. That being so, one would expect some form of auditing, even by way of casual inquiry, to ensure supervisors and managers were complying with the policy. But there was none. 39 The Court's findings highlight the dangers associated with managerial or supervisory persons implementing safe practices and procedures, but failing to follow up with an appropriate form of review or audit to ensure their instructions are properly carried out. It is appropriate that any penalty be fixed so that it acts to deter employers generally from committing similar failures to ensure safety. 40 The prosecution submitted that no distinction be made between the respective roles of the defendants in sentencing: The defendants' culpability must be assessed in discrete terms having regard to their role in the management of S & L in the context of the objective nature and gravity of the offence as identified in relation to the company. In this regard, both defendants were responsible for, and intimately involved in, the development and implementation of occupational health and safety policies and practices at the relevant premises. In particular: They were the sole directors of S&L; According to S&L's organization chart applicable as at 20 May 2006, Lorenzo was responsible for "Workshop/Site Personnel" and Santos was responsible as "Facilitator – QMS, OHS and EMS": S&L Organisation Chart; Lorenzo and Santos approved S&L's safety policies on the advice of an external consultant … They reviewed and verified S&L's OH&S Procedures manual; Santos had the primary role in preparing S&L's written occupational health and safety policies, including for lifting and moving loads; and Lorenzo personally attended tool box meetings with workshop personnel during which he gave instructions about lifting and the use of clamps; and Santos had also initially attended the tool box meetings but on a less frequent basis over the years. 41 The defendants made no submission as to their relative culpabilities, however, it was submitted, and I accept, that their culpability was less than that of S & L: … the roles of Mr Lorenzo and Mr Santos in the offences were less serious than that of the company, in that the managers and supervisors on which the defendants substantially relied to supervise Mr Hair did not adequately enforce the prohibition on the use of hooks (see WorkCover Authority of New South Wales (Inspector Page) v Walco Hoist Rentals Pty Limited and Another (No 2) (2000) 99 IR 163 at [38]-[39] which held that the culpability of an individual defendant could not be greater than that of the corporation, and where the individual defendant was not the alter ego of the corporation, then his or her culpability may be less). 42 When one has regard to the nature and quality of the offences, that the risk to health and safety was known to the defendants, that there were simple, straightforward steps available to avoid the risk, that the employee suffered serious injuries as a consequences of the failure to ensure safety and that the offences require the Court to impose a penalty that has regard to the need for both general and specific deterrence, the objective seriousness of the offences place them in the mid-range. However, particular regard has to be paid to the genuine and longstanding efforts made by the defendants to achieve a safe working environment and, notwithstanding the flaws in the system of work that applied at the premises, the defendants are entitled to have those efforts taken into account in mitigation. 43 The defendants were quite dedicated to workplace safety and took a direct, hands-on role in formulating their company's policy in that respect and seeing to it the policy was implemented. Notwithstanding their dedication, however, the system of work was flawed and the instruction, supervision and training were inadequate such that an employee was grievously injured. 44 The circumstances of these prosecutions should be regarded by employers as a salutary reminder of the high responsibility directors and managers have under the Occupational Health and Safety Act to ensure the safety of persons in their workplaces. SUBJECTIVE FACTORS Prior record and co-operation with prosecuting authority 45 It is common ground that the defendants have no relevant prior convictions. The defendants submitted that they should be entitled to leniency afforded to first time offenders: s 21A(3)(e) of the Crimes (Sentencing Procedure) Act 1999. The leniency granted to first time offenders is a factor that the Court will take into consideration when determining the penalty for these offences. 46 Also common ground was the defendants' cooperation with the prosecuting authority. Counsel for the defendants directed the Court to several authorities in submitting that it be a factor in mitigation: Inspector Ken Kumar v David Aylmer Ritchie [2006] NSWIRComm 384 at [20]; Alcatel Australia Limited v WorkCover Authority of New South Wales (Inspector Clyant) (1996) 70 IR 99 at 106-107 and WorkCover Authority of NSW (Inspector Penfold) v Fernz Construction Materials Ltd (1999) 91 IR 119. The Court will take into account the defendants' assistance and co-operation with WorkCover as a mitigating factor in determination of the penalty. Contrition and remorse/Assistance to the victim 47 The Court's consideration of a defendant's expression of contrition and remorse is directed by the Crimes (Sentencing Procedure) Act 1999. Section 21A(3)(i) provides: (3) The mitigating factors to be taken into account in determining the appropriate sentence for an offence are as follows: … (i) the remorse shown by the offender for the offence, but only if: (i) the offender has provided evidence that he or she has accepted responsibility for his or her actions, and (ii) the offender has acknowledged any injury, loss or damage caused by his or her actions or made reparation for such injury, loss or damage (or both) 48 Mr Moir submitted that the defendants' assistance to the victim or the victim's family be considered as a factor demonstrating contrition and remorse, relying on Inspector Patton v Western Freight Management Pty Ltd (No 2) [2009] NSWIRComm 124 at [78] and WorkCover Authority of New South Wales (Inspector Mulder) v Yass Shire Council [2000] NSWIRComm 57; (2000) 99 IR 284 at [35]. The defendants tendered evidence outlining the various ways in which they provided assistance to the victim. Such assistance included: (i) regular visits to Mr Hair during his hospitalisation; (ii) payment of some medical expenses incurred during his hospitalisation and treatment together with additional entertainment expenses (eg. TV hire); (iii) payment of wages during the period of hospitalisation and recovery, and additional payments to make up the shortfall between his usual wage and workers insurance payments; (iv) financial assistance to Mr Hair's mother for her travel expenses to and from, and parking fees at, the hospital; (v) a one-off payment of approximately $1,000 to assist Mr Hair when his insurance payments were delayed; and (vi) the creation of a position in the stores area at the defendants' business to accommodate Mr Hair's ability to perform selected duties, the provision of an ergonomic chair, payment of course fees to increase Mr Hair's skills base, encouragement to undertake further training in skills to broaden his skills base. 49 Mr Moir further submitted: Notwithstanding their plea of not guilty in these proceedings, it is evident that the defendants through their actions toward Mr Hair and his family have adopted a compassionate approach in the circumstances, and have extended their deepest sympathies for the injuries he sustained. It is also relevant to note that each of the defendants made concessions in their evidence about the practice of using open hooks to lift steel plate. They both conceded that lifting plates with open hooks to any height was contrary to S & L's policy and that it was unsafe. Indeed, Mr Santos agreed that it was "dangerous" (see liability judgment at [65]). 50 Inspector Patton v Western Freight Management Pty Ltd (No 2) reiterated the principle that assistance to a victim and their family can be considered a factor demonstrating contrition and remorse (at [78]), notwithstanding the presence of a not guilty plea. Wright J, President, discussed the complexity of such an issue in WorkCover Authority of New South Wales (Inspector Mulder) v Yass Shire Council: [35] It is also entitled to rely significantly upon its demonstrated contrition referred to in the evidence of Mr Chapman as to the assistance provided to the injured worker subsequent to the accident. Although some commentators have pointed out that it is impossible for a judge accurately to estimate the sincerity of remorse or contrition (Ashworth, Sentencing and Criminal Justice, London, 1994 at 130, as cited by Mack and Anleu, Pleading Guilty: Issues and Practices Australian Institute of Judicial Administration, 1995 at 161), experience in occupational health and safety matters indicates that in many cases it is possible for an employer charged under the Act to provide tangible confirmation of contrition by support and assistance rendered to injured employees or to the families of victims of fatal accidents (see, for example, Page v Walco Hoist Rentals Pty Ltd (No.2) at 43; WorkCover Authority of New South Wales (Inspector Tyler) v Abigroup Contractors Pty Ltd [2000] NSWIRComm 40 at 29; and Corinthian Industries (Sydney) Pty Limited v WorkCover Authority of New South Wales (Inspector Wilson) [2000] NSWIRComm 46 at 17. That is the case here. 51 Mr Moir also relied on the authority of Corinthian Industries (Sydney) Pty Ltd v WorkCover Authority of New South Wales (Inspector Wilson) [2000] NSWIRComm 46; (2000) 99 IR 159 in submitting that the assistance provided to a victim, or the victim's family following an incident, is a relevant factor in mitigation. That decision was an appeal from a Magistrate's sentence which was held by the Full Court to be inappropriate and excessive. The Court agreed with the Magistrate that the offence was a serious one, highlighting the need for both general and specific deterrence, the employers' obligation to seek out detriments to safety and remedy them, the risk of injury was foreseeable and capable of simple remedy and the injury suffered by the victim was serious. In considering the quantification of the penalty, the Full Bench went on to say: [16] However, we are concerned that there are some factors relating to the objective seriousness of the offence which have not been sufficiently taken into account by the industrial magistrate. Perhaps more significantly, there are quite significant subjective features in this matter which appear to have not been taken into account or sufficiently taken into account. [17] We do not consider that the history of good industrial citizenship of the appellant, having regard to its prior record and the long period of operation of its business, was sufficiently taken into account. We also refer to the careful and compassionate steps taken by the appellant as to the welfare, rehabilitation and continuing employment of the injured worker. The reason we have made specific reference to that latter matter is that it does not seem to have been often referred to in other judgments in this area. We have accordingly reached the conclusion that in all the circumstances of this case the penalty was inappropriate and excessive. 52 The authorities confirm the defendants' submission that the existence of active and tangible support provided to the victim and/or their family is an indicator of the sincerity of a claim for mitigation due to contrition and remorse. 53 However, for the prosecutor, Mr Chin submitted: This also brings me to the issue of the defendants' conduct post the incident. The defendants will rely on evidence about assistance which they gave Mr Hair after the accident and I do not wish to denigrate that evidence. There is no doubt that assistance was given to Mr Hair but it cannot be said in my submission, that the defendants' only concern was concern of a compassionate nature of Mr Hair's well being. The evidence disclosed that very soon after Mr Hair was discharged from intensive care while he was still in hospital a part of the internal investigation conducted by the company, Mr Hair was visited by an administrative officer from the company and asked to sign a statement with which he did not agree. Your Honour will see that evidence in [a] record of interview of Mr Hair … after Mr Hair is released from intensive care whilst he was still recuperating in hospital from these serious injuries he is approached by Ms Simpson who asked him if he knew he should have used clamps and not have been between the jib of the crane or the plate and asserted in a statement which he provided to him that he ran underneath the plank which he did not agree with and he did not sign the statement. There was also a concern to exonerate themselves in my submission, but arising from that evidence and the evidence of assistance is tempered, if I may put it in that sense to that accident. 54 It may be seen the prosecutor's reservations regarding the defendant's expression of remorse and contrition were based on the fact that the defendants arranged for a statement releasing the defendants and their company of responsibility for the incident to be handed to Mr Hair a couple of days after his initial admission to hospital. Mr Chin submitted that this action was indicative of the defendants' refusal to recognise culpability, together with their plea of not guilty. Mr Chin stated that he did not intend to disparage the defendants' otherwise supportive and helpful actions as outlined by counsel for the defendants. I have taken into account the prosecutor's reservations. 55 Another matter to be taken into account in considering remorse and contrition is that the defendants pleaded not guilty. The authorities make it clear that the defendants will not be penalised for having pleaded not guilty to the charges against them: Siganto v The Queen (1998) 194 CLR 656. In the joint judgment of Gaudron, Gummow and Callinan JJ in Cameron v The Queen [2002] HCA 6; (2002) 209 CLR 339, their Honours stated (at [11] - [14]): [11] It is well established that the fact that an accused person has pleaded guilty is a matter properly to be taken into account in mitigation of his or her sentence. In Siganto v The Queen (1998) 194 CLR 656 at 663-664, it was said: a plea of guilty is ordinarily a matter to be taken into account in mitigation; first, because it is usually evidence of some remorse on the part of the offender, and second, on the pragmatic ground that the community is spared the expense of a contested trial. The extent of the mitigation may vary depending on the circumstances of the case. It should at once be noted that remorse is not necessarily the only subjective matter revealed by a plea of guilty. The plea may also indicate acceptance of responsibility and a willingness to facilitate the course of justice. [12] Although a plea of guilty may be taken into account in mitigation, a convicted person may not be penalised for having insisted on his or her right to trial ( Siganto v The Queen (1998) 194 CLR 656 at 663 [22] per Gleeson CJ, Gummow, Hayne and Callinan JJ. See also R v Gray [1977] VR 225 at 231). The distinction between allowing a reduction for a plea of guilty and not penalising a convicted person for not pleading guilty is not without its subtleties, but it is, nonetheless, a real distinction, albeit one the rationale for which may need some refinement in expression if the distinction is to be seen as non-discriminatory. [13] It is difficult to see that a person who has exercised his or her right to trial is not being discriminated against by reason of his or her exercising that right if, in otherwise comparable circumstances, another's plea of guilty results in a reduction of the sentence that would otherwise have been imposed on the pragmatic and objective ground that the plea has saved the community the expense of a trial. However, the same is not true if the plea is seen, subjectively, as the willingness of the offender to facilitate the course of justice. [14] Reconciliation of the requirement that a person not be penalised for pleading not guilty with the rule that a plea of guilty may be taken into account in mitigation requires that the rationale for that rule, so far as it depends on factors other than remorse and acceptance of responsibility, be expressed in terms of willingness to facilitate the course of justice and not on the basis that the plea has saved the community the expense of a contested hearing. 56 The circumstances in which a defendant who has pleaded not guilty, has been convicted of an offence, and who is relying on a mitigating factor of expression of contrition and remorse, was discussed by Walton J, Vice-President in Inspector Barry Childs v Kirk Group Holdings Pty Limited [2005] NSWIRComm 1; (2005) 137 IR 462. In that case, the prosecution submitted that the 'absolute sign of contrition is a guilty plea, which was missing in the present matters'. His Honour stated at [54]-[55]: [54] … However, a defendant may not be penalised for the absence of a guilty plea. A majority of the High Court in Cameron v The Queen (2002) 209 CLR 339 considered the implications for sentencing where a plea of not guilty is entered (at [12] per Gaudron , Gummow and Callinan JJ): Although a plea of guilty may be taken into account in mitigation, a convicted person may not be penalised for having insisted on his or her right to trial. The distinction between allowing a reduction for a plea of guilty and not penalising a convicted person for not pleading guilty is not without its subtleties, but it is, nonetheless, a real distinction, albeit one the rationale for which may need some refinement in expression if the distinction is to be seen as non-discriminatory. [55] I am satisfied that Mr Kirk (and therefore the Company) are entitled to a degree of leniency, flowing in part from their expressed remorse (and contrition) and because of the adverse effects already being felt by the defendants arising out of or relating to the accident which gave rise to the offences. 57 Given the terms of 23A(3)(i) of the Crimes (Sentencing Procedure) Act and the steps taken by the defendants to provide assistance to Mr Hair following the incident I, too, am satisfied that the defendants are entitled to a degree of leniency. However, I must add that the attempt to have Mr Hair release the defendants and their company of responsibility for the incident has diminished the full value of the mitigating effect of what might otherwise have been available for remorse or contrition. Remedial measures 58 The defendants submitted the following in relation to remedial measures taken by them after 20 May 2006: Following the accident the company, identified the need for more training of employees in safe lifting procedures (see S & L investigation report dated 22 June 2006). Under the direction of the defendants, the company reinforced its instructions to employees regarding the safe lifting of steel plates, and arranged for employees to undertake further training and assessment with respect to dogging work (see tool box meeting and training records post-20 May 2006). The company also introduced a more formal system of daily safety checks for the 6 tonne mobile crane immediately after the accident … 59 The defendants adduced evidence at the substantive and sentencing hearings describing the various remedial measures taken by them following the incident. A bundle of documents provided to the Court at the sentencing hearing contained evidence of: (i) records of tool box meetings stressing the importance of safety, communication, assistance with a team, the correct use of clamps and information outlining the new and readily available clamps; (ii) an internal investigation initiated by the defendants and carried out by an independent contractor to ascertain the circumstances of the incident; (iii) a training course conducted by a WorkCover accredited assessor for all employees regarding the 'safe handling of the mobile crane, dogging, lifting of loads etc'; and (iv) dogging training and assessment conducted by a WorkCover accredited trainer and assessor for select employees. 60 The Court accepts that the defendants took appropriate measures in an effort to avoid a recurrence of the incident, a factor which will go to mitigating the offence: WorkCover Authority of NSW (Inspector Lyons) v Warman International Ltd [2001] NSWIRComm 62; (2001) 105 IR 236. 61 The objective features of this case are of primary significance in sentencing (Lawrenson Diecasting). The Court has carefully considered the objective seriousness of the charges, and taken into account the strong subjective factors in assessing penalty. 62 There is no proper basis upon which to differentiate between the two defendants in terms of penalty. I consider the appropriate penalty for each defendant to be $12,000. 63 The prosecutor seeks a moiety of the penalties for WorkCover Authority of New South Wales, together with the costs associated with the liability and sentencing hearings. ORDERS 64 The Court makes the following orders: (1) The defendants in Matter Nos IRC 654 and 656 of 2008 are each convicted of the offence of contravening s 8(1) of the Occupational Health and Safety Act 2000 by virtue of s 26(1) of that Act. (2) In Matter No IRC 654 of 2008 the defendant is fined an amount of $12,000 with a moiety to the prosecutor. (3) In Matter No IRC 656 of 2008 the defendant is fined an amount of $12,000 with a moiety to the prosecutor. (4) The defendants shall jointly and severally pay the prosecutor's costs of the proceedings as agreed or in default of agreement, as assessed. _____________________ 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.