Industrial Court of New South Wales CITATION: Inspector Julie Townsend v Austruc Constructions Limited [2007] NSWIRComm 321 PROSECUTOR: Inspector Julie Townsend PARTIES: DEFENDANT: Austruc Constructions Limited FILE NUMBER(S): IRC 3244 of 2006 CORAM: Backman J LEGISLATION CITED: Crimes (Sentencing Procedure) Act 1999 Occupational Health and Safety Act 2000 Maddaford v CSR and Mulgoa Quarries Pty Limited [2004] NSWIRComm 337 Morrison v Powercoal Pty Limited (2003) 130 IR 364 CASES CITED: R v Thompson; R v Houlton (2000) 49 NSWLR 383 Winchester (1992) 58 ACrimR 345 WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Limited and Anor (2000) 95 IR 383 HEARING DATES: 7 August 2007 DATE OF JUDGMENT: 28 December 2007 PROSECUTOR: Ms L M McManus of counsel WorkCover Authority (Mr G Spain) LEGAL REPRESENTATIVES: DEFENDANT: Mr A C Casselden of counsel Sparke Helmore Lawyers (Ms R Parmegiani) JUDGMENT: - 9 - INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: BACKMAN J Friday, 28 December 2007 Matter No IRC 3244 of 2006 INSPECTOR JULIE TOWNSEND v AUSTRUC CONSTRUCTIONS LIMITED Prosecution under s 8(1) of the Occupational Health & Safety Act 2000 JUDGMENT [2007] NSWIRComm 321 1 The defendant, Austruc Constructions Limited, has pleaded guilty to an offence under s8(1) of the Occupational Health & Safety Act 2000 (the Act). The offence arises out of an incident on 11 October 2004 when Jeronimo Do Carmo Goncalves, a labourer employed by the defendant, fell 2.5 metres into a void at the Granville Swimming Centre which was being redeveloped at the time. 2 Mr Goncalves sustained a spinal injury as a result of the fall and was admitted to hospital where he was diagnosed with a 50 per cent wedge compression fracture of the vertebrae. He returned to work some ten months after the accident. 3 At the time of the incident, Mr Goncalves was working with a leading hand, Geoffrey Seaton, cleaning up formwork debris in order to make the area safe for a tiler who was to commence tiling a pool. It was Mr Goncalves' first day at the centre. He was given a site induction by Mr Seaton. During the induction Mr Seaton indicated generally the location of balance tanks and the voids to those balance tanks which had been covered with loose, unsecured formwork plywood. According to Mr Goncalves, Mr Seaton did not inform him about the existence and location of the voids to the balance tanks under the loose plywood. He said he did not know they were there. 4 In about March 2004 the defendant was awarded a contract to redevelop the existing swimming centre at Granville. The work was to include the refurbishment of an existing change building, the construction of a new office block, and the construction of three new swimming pools, general site work and landscaping. By 11 October 2004, the day of the incident, a 50 metre swimming pool, a 25 metre swimming pool and a leisure pool had been constructed at the centre. Four balance tanks, which were empty concrete boxes, were located at the end of the 25 metre pool. Their purpose was to allow filtration and to maintain the water tanks to the swimming pools. A wire mesh safety barrier which was 900 mm high was located around the perimeter of the 25 metre pool and the balance tanks. 5 In early September 2004 formwork plywood had been placed loosely and unsecured over the voids of the balance tanks. This measure was intended to reduce the risk perceived to arise from the installation of purpose built cast iron lids which had been initially constructed to cover the voids. During redevelopment of the centre, however, regular access was needed to the balance tanks for cleaning and maintenance. The lids were heavy and thought to constitute a manual handling risk. According to the site manager, William Spicer, the unsecured formwork plywood was intended to prevent damage to the finished surface of the pool deck surrounding the area where the balance tanks were located. 6 At the time of Mr Goncalves' accident, additional formwork (stripped plywood) which had been stripped by a subcontractor, Alite Formwork Constructions, had been placed on top of the loose formwork plywood covering the voids of the balance tanks. There was no means of differentiating between the stripped plywood and the formwork plywood. Nor had the stripped plywood been properly or tidily stacked. The defendant's site manager and the project manager were responsible for site safety inspections. Daily site safety inspection sheets included a checklist item headed, "Penetrations Covered." The completed site sheet covering the period during which the incident occurred discloses that no entries were recorded against that item. 7 About two days before the incident, Mr Seaton raised safety concerns with Mr Spicer and Gareth Goronwy, the sub-foreman, about the unsecured plywood over the voids. No action was taken to secure the plywood but a fence was erected as a safety barrier around the 25 metre pool and balance tanks. This measure did nothing to ensure the safety of Messrs Seaton and Goncalves who had to work inside the safety fence in order to clean up the debris. 8 According to the agreed statement of facts tendered during these proceedings, other site personnel were aware of the location of the voids. They had been on site when the voids were created following a concrete pour. In contrast, Mr Goncalves had not been to the centre prior to 11 October 2004. 9 During the site specific induction given to Mr Goncalves, Mr Seaton says that he informed Mr Goncalves of the existence of the balance tanks and that they were covered by plywood. He says he also advised Mr Goncalves of the approximate depths of the balance tanks (2.5 metres). In what purports to be an extract from an interview of Mr Seaton, set out in the agreed statement of facts, Mr Seaton says in relation to the site induction: I showed him (Mr Goncalves) the locations [of the voids to the balance tanks] but not from a close up point, it was from the, where the induction takes place..." "So it was pointed out ... the area where the balance tanks were and that there is in fact three of them and the fourth one is offset which is also in a, it was in another area anyway, and ... was also pointed out to him where we were intending to put the rainwater tanks, which again will pose a risk and, but not, like I said, not close up and pointing at the hole, it was just a general indication of that, that area there that's barricaded off, that's ... where the balance tanks are." 10 During the sentence proceedings the defendant relied on an affidavit of its managing director, Samuel John Catalano, sworn on 6 August 2007. The affidavit sets out in detail the defendant's general commitment to occupational health and safety issues, prior to the offence. The number of safety measures outlined by Mr Catalano in his affidavit which were in place prior to the offence, attest to an impressive system of work directed to ensuring the safety of workers. It is convenient at this point to nominate some of those measures by way of illustration. 11 The defendant held, and continues to hold, formal management meetings every three weeks at which safety issues appeared on the agenda. Specific safety issues routinely discussed at these meetings included the daily safety inspection sheets, work method statements, responsibility for safety checks and accounts and proposals to improve the existing safety systems. The defendant's board also met twice yearly during which safety matters were also discussed. The defendant also provided training to its workers at its sites. All workers received general induction training provided by an accredited WorkCover approved trainer prior to working on a construction site. Site supervisors were required to conduct the site specific induction training. After an induction had been performed the trainer completed a register which was periodically checked by project managers to ensure that it was complete and up to date. Other safety training which was provided and funded by the defendant included first aid training; audit project OHS&R management systems; OHS consultation training; and instruction on how to write safe work method statements. A training register was kept up to date by Ken Ware, the defendant's general manager. 12 In about 1995 Mr Ware finished the first version of a safety manual for the defendant, entitled "Occupational Health and Safety Rehabilitation Management Manual for Austruc Constructions Limited". Presently the Manual is referred to by the defendant as the "Project Management System". It includes policy statements and operating procedures as well as various specific manuals such as the OHS&R Manual. According to Mr Catalano this manual constitutes a key part of the defendant's project management system. Some examples of the policies and procedures set out in the manual include: Workplace and Process Control (which includes information on risk identification, assessment and management); Site Safety Rules; Inspection and Testing; Control of OHS&R Issues(for example, management and control of materials, plant, equipment, work practices, work environment and access and egress); Corrective Action; Training; and OHS&R Records and Documentation. 13 Another important element of the defendant's project management system requires all project managers to complete, implement and maintain a site specific management plan, prior to the commencement of a particular project. This plan must include information on safety issues including risk management, OHS training, incident management, site safety risks and work method statements. At the commencement of every project a risk assessment is carried out by the project manager and site supervisor. During the lifetime of a particular project the risk assessments are reviewed and adjusted if necessary. Site safety rules cover such items as compulsory wearing of PPE; how floor openings are to be secured; and, requirements in relation to induction and safety training. A copy of the site safety rules is disseminated to all workers at a particular site or made available in central locations such as the site office and lunch room. These rules are reveiwed by Mr Catalano and Mr Ware prior to the commencement of each project. All work method statements address such items as a description of the work to be done; a step-by-step sequence of activities and tasks involved in doing the work; the potential hazards and risks associated with each step of the work; and, the safety controls that will be put in place to minimise the risks. The daily site inspection sheets are used to monitor the defendant's OHS&R system in relation to its implementation at a particular site. 14 In about August 2006, the defendant's project management system received certification by the International Standards Certifications Pty Ltd for its quality management system. In October 2005 the project management system was accredited by the Department of Public Works as adequately achieving the requirements of its OHS management system guidelines. 15 In relation to the centre at Granville, which was being redeveloped on the day of the offence, Ken McCurrach was the project manager. Prior to work commencing at the centre, Mr McCurrach produced a project plan which included site induction procedures, work method statements and risk assessments. Mr Catalano says that he was informed by both Mr McCurrach and Mr Spicer that the risk assessment conducted at the centre had identified the penetrations (the voids) beside the 25 metre pool as a hazard. 16 In order to control this hazard Mr McCurrach and Mr Spicer decided that plywood covers should be placed over the penetrations. This particular method was chosen apparently because they did not want to use the metal lids which were heavy, (requiring four men to lift), and, the lids would need to be moved on a regular basis because of regular access needed to the balance tanks. In addition, Messrs McCurrach and Spicer formed the view that drilling into the concrete around the penetrations in order to fix covers over the holes was not acceptable because it would damage the formwork. This in turn would not be acceptable to the defendant's clients and would necessitate replacing all the formed concrete around the voids. 17 In addition to using the plywood to cover the penetrations it was decided that all workers should be warned during their site inductions to be aware of the penetrations and to be careful while moving about the area. During the period when the centre was being redeveloped, Mr Catalano says that he received progress reports about 4 to 5 times a week. All the workers at the centre received site specific induction training. A register of safety inductions annexed to Mr Catalano's affidavit reveals that on 11 October 2004, Mr Goncalves was issued with PPE; and that he had read and signed the work statement; and, taken part in the induction. 18 These measures are both comprehensive and extensive and show that the defendant had invested considerable resources in developing and implementing a system designed to ensure the safety of workers at its various construction sites. The extent and scale of the measures in place operate to mitigate the otherwise objective seriousness of the offence to which I will now come in more detail. 19 The offence with which the defendant has been charged alleges that it failed to provide adequate instruction and information to Mr Goncalves in relation to risks arising from working in the vicinity of the unsecured loose plywood covers over the voids. The safety system in place at the centre at the time of the offence had assessed the risks associated with working near the voids and implemented measures to minimise the risks, namely covering the voids with the loose plywood, erecting a safety fence and generally warning the workers to be careful while working near the voids during site inductions. Unfortunately, for Mr Goncalves it would appear that at best, and adopting Mr Seaton's version of events, the location of the voids was disclosed to Mr Goncalves only in a general fashion. Safety concerns in relation to the voids had been raised by Mr Seaton about 2 days before the accident. Nor was the safety fence of any assistance to Mr Goncalves, or to Mr Seaton, since the nature of the work undertaken by both men necessitated working within the safety fence near the voids. The measures taken to cover the voids were inadequate. The plywood was loose and unsecured and therefore easily dislodged or removed. The risks to safety were exacerbated by the additional debris over the voids, namely the stripped plywood, thereby making the location of the voids even more obscure. These failings taken together expose a number of deficiencies in the defendant's system of safety, particularly insofar as it extended to measures taken to protect Mr Goncalves. 20 In these circumstances the risk to Mr Goncalves' safety was both known and obvious. This renders the offence a serious breach of the Act. 21 The concrete voids were some 900 mm in diameter. Mr Goncalves fell 2.5 metres into one of the voids. A fall by a worker into one of the voids was likely to cause serious injuries. The serious injuries suffered by Mr Goncalves constitute a manifestation of the risk to safety caused by the failures to ensure adequate control measures to prevent such falls and to provide adequate instructions in relation to the loose unsecured plywood covering the voids. These matters trigger the application of the well-known principle that although the fact of injury alone does not dictate the seriousness of the offence, it may indicate, as it does here, that the breach of the Act had every prospect of serious consequences: Maddaford v CSR and Mulgoa Quarries Pty Limited [2004] NSWIRComm 337 at [17] [18] [23]; WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Limited and Anor (2000) 95 IR 383 at [428]; Morrison v Powercoal Pty Limited (2003) 130 IR 364 at [32]. 22 General deterrence is also an important consideration in the circumstances. Accidents on construction sites occur frequently, and often with tragic results. There is a need for constant vigilance by employers in the construction industry in order to detect risks and implement adequate measures as soon as possible in order to minimise the risks, and where possible, eliminate them. These considerations, which attach to the necessity to deter further breaches of the Act by employers operating within the construction industry, will be reflected in the penalty imposed. 23 Specific deterrence is also relevant to this matter. Although the defendant had, at the time of the offence, an impressive and functioning system of safe working, the system had a number of deficiencies which combined to expose Mr Goncalves, in particular, to danger and a risk of serious injury. The defendant had also operated within the construction industry for some considerable time without being charged with a breach under the occupational health and safety legislation. At the time of the offence, the defendant was responsible for about ten separate projects, employed 33 people, and engaged about 350 to 500 sub-contractors. Nevertheless, it continues to operate within the industry, employing between 7 to 35 employees at any given time, as well as engaging sub-contractors. It conducts a significant enterprise in an industry which is known to involve work in hazardous environments thereby exposing workers to risks to their safety unless appropriate and adequate measures are taken to protect them. 24 After the incident, the defendant constructed a heavy timber frame over the access hatches to the balance tanks. Hinged lids were attached to the timber frame and the lids were locked. The balance tanks were also assessed as confined spaces and a safe work method statement developed on 26 October 2004 for working in the balance tanks. Persons wishing to access the hatches were required to undertake an induction for confined spaces and attend the site office in order to obtain the key to the locks on the lids. These measures have substantially reduced any attendant risks to safety to persons working in or in the vicinity of the voids. Viewed objectively, however, they indicate that measures were readily available to the defendant to remedy the deficiencies in the system. On the other hand, the measures are indicative of the defendant's willingness to implement effective solutions to ensure its workers can work safely without fear of injury at the site. These measures, at a subjective level, serve to mitigate the otherwise objective seriousness of the offence. 25 There is no issue between the parties that the defendant entered its plea of guilty at an early stage. The prosecutor contends that the utilitarian value of the plea should be at the higher end of the scale of discount on the basis that the plea was entered to the amended charge as soon as it was filed in Court. Applying the principles in R v Thompson; R v Houlton (2000) 49 NSWLR 383, I consider, in accepting the parties' contentions on the issue, that the appropriate discount for the utilitarian value of the plea should be 25 per cent. 26 The defendant is entitled, as a discrete matter from utilitarian considerations to leniency on the basis that its plea of guilty is an indication of contrition: Winchester (1992) 58 ACrimR 345 at 350. 27 The defendant is also entitled to leniency on the basis that it has no prior convictions. The defendant has also expressed regret that the incident occurred and has expressly accepted its responsibility for the incident. The defendant also co-operated with WorkCover in relation to the incident and subsequent investigations. It also provided assistance to Mr Goncalves, including financial assistance. The defendant has a good industrial record as evidenced by its lack of prior convictions in the context of a significant enterprise which it has conducted over a number of years, without incident. The defendant has also demonstrated its commitment to occupational health and safety by reason of its extensive safety policies and procedures which it has implemented competently and effectively over a number of years. Finally, the defendant may also be described as being of good corporate character by reason of its financial contributions to charitable institutions. All these subjective factors will be taken into account in the defendant's favour when assessing penalty. 28 In assessing penalty against the defendant, I have taken into account the objective seriousness of the offence, the subjective factors described above, and the absence of prior convictions. These factors have been considered by reference to the maximum penalty for the offence, namely, $550,000, and the Crimes (Sentencing Procedure) Act 1999, in particular s 21A. Orders 29 The Court makes the following orders: 1. The defendant, Austruc Constructions Limited, is convicted of the offence. 2. The defendant is fined $90,000 with a moiety to the prosecutor. 3. The defendant is to pay the costs of the prosecutor as agreed, or if agreement cannot be reached, leave is granted to approach the Court for final orders as to costs. _____________________ 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.