Industrial Relations Commission New South Wales Medium Neutral Citation: Inspector Hinton v Mono Constructions Pty Ltd [2011] NSWIRComm 148 Hearing dates: 11 July 2011 Decision date: 09 November 2011 Jurisdiction: Industrial Court of NSW Before: Marks J Decision: 1. The defendant, Mono Constructions Pty Ltd, is found guilty of the offence with which it is charged and convicted accordingly. 2. A monetary penalty of $85,000 is imposed on Mono Constructions Pty Ltd with a moiety to the prosecutor. 3. The defendant is to pay the costs of the prosecutor in an amount assessed in default of agreement. Catchwords: OCCUPATIONAL HEALTH AND SAFETY - breach of s 8(2) of the Occupational Health and Safety Act 2000 - early guilty plea - appropriate penalty - obvious risk - inadequate safety procedures - general and specific deterrence - commitment to occupational health and safety obligations - cooperation with the WorkCover Authority - remorse and contrition - no prior convictions - penalty imposed Legislation Cited: Occupational Health and Safety Act 2000 - s 8(2) Category: Principal judgment Parties: Inspector Jamie Hinton of WorkCover Authority of New South Wales (prosecutor) Mono Constructions Pty Ltd (defendant) Representation: Mr P Ginters of counsel (prosecutor) Mr R Reitano of counsel (defendant) DLA Phillips Fox (prosecutor) Takchi & Associates (defendant) File Number(s): IRC 1390 of 2010 Judgment 1The prosecutor, Inspector Jamie Hinton of the WorkCover Authority of New South Wales, has charged the defendant, Mono Constructions Pty Ltd, with a breach of s 8(2) of the Occupational Health and Safety Act 2000 ("the Act"). The defendant has pleaded guilty to the charge and this judgment is concerned only with the question of penalty. Section 8(2) is in the following terms: 8 Duties of employers ... (2) Others at workplace An employer must, so far as is reasonably practicable, ensure that people (other than the employees of the employer) are not exposed to risks to their health or safety arising from the conduct of the employer's undertaking while they are at the employer's place of work. 2The charge brought against the defendant arises out of an incident that occurred at a construction site at Kingsgrove, New South Wales, on 1 December 2008. The defendant was charged that being an employer it FAILED TO by its acts or omissions as particularised below, ensure that persons other than Mono Constructions' employees, in particular, Sabahattin Secim and Nevzat Tekman, were not exposed to risks to their health or safety arising from the conduct of Mono Constructions' undertaking while they were at Mono Constructions' place of work, contrary to section 8(2) of the Act. 3The particulars of the charge are as follows: (a) The 'work' referred to in these particulars refers to the work of laying bricks and blocks at the site, in particular, bricking up the opening/access way in the wall between units 8 and 9 at the site including but not limited to incidental tasks such as cleaning the wall or knocking out any temporary wooden lintel(s). (b) The 'risk' referred to in these particulars and in the charge is the risk of Sabahattin Secim and Nevzat Tekman falling from height to the ground. (c) Mono Constructions did not ensure that: (i) a fall arrest device, such as a harness or similar device, that was capable of preventing the risk was provided and used by Sabahattin Secim and Nevzat Tekman whilst they were undertaking the work; (ii) a scaffold or elevated work platform, or similar equipment, with hand rails or other forms of physical barriers that were capable of preventing the risk was provided, positioned and used in units 8 and 9 at the site so that Sabahattin Secim and Nevzat Tekman could work from them whilst they were undertaking the work; (iii) handrails or other forms of physical barriers that were capable of preventing the risk were provided, positioned and used on the walkway/accessway between units 8 and 9 of the site; and/or (iv) there was guarding or physical barriers for a penetration on the upper level between units 8 and 9, so as to ensure Sabahattin Secim and Nevzat Tekman were not exposed to risks to their health or safety while they were at Mono Constructions' place of work. (d) Mono Constructions did not provide any adequate supervision to Sabahattin Secim and Nevzat Tekman such as by having a supervisor monitor the work to ensure they: (i) were using a harness or similar fall arrest device that was capable of preventing the risk; (ii) worked from a scaffold, elevated work platform, or similar equipment, with hand rails or other forms of physical barriers that were capable of preventing the risk, positioned in units 8 and 9 at the site, whilst they were undertaking the work; (iii) did not use a walkway/accessway between units 8 and 9 of the site that did not have handrails or other forms of physical barriers that were capable of preventing the risk; and/or (iv) did not work next to an unguarded penetration on the upper level between units 8 and 9, so as to ensure Sabahattin Secim and Nevzat Tekman were not exposed to risks to their health or safety while they were at Mono Constructions' place of work. (e) Mono Constructions did not ensure that Sabahattin Secim and Nevzat Tekman were provided with any adequate induction at the site at which Mono Constructions or someone on its behalf explained to Sabahattin Secim and Nevzat Tekman that they were not permitted to be working at height unless: (i) they used a harness or similar fall arrest device that was capable of preventing the risk; (ii) they worked from a scaffold, elevated work platform, or similar equipment, with hand rails or other forms of physical barriers that were capable of preventing the risk, positioned in units 8 and 9 at the site, whilst they were undertaking the work; (iii) handrails or other forms of physical barriers that were capable of preventing the risk were provided, positioned and used on the walkway/accessway between units 8 and 9 of the site; and/or (iv) there was guarding or physical barriers for a penetration on the upper level between units 8 and 9, so as to ensure Sabahattin Secim and Nevzat Tekman were not exposed to risks to their health or safety while they were at Mono Constructions' place of work. (f) Mono Constructions did not ensure that a Safe Work Method Statement was provided by all its subcontractors, in particular, Tekman Group [ACN 132 759 794] and Tekman Industries Pty Ltd [ACN 114 020 905], before they commenced work at the site so as to ensure Sabahattin Secim and Nevzat Tekman were not exposed to risks to their health or safety while they were at Mono Constructions' place of work. (g) Mono Constructions did not ensure that a risk assessment or an adequate risk assessment was conducted for the work that identified the risk at the site and the means by which it could be controlled, such as: (i) using a fall arrest device, such as a harness or similar device, whilst working at height; (ii) working from a scaffold, elevated work platform or similar equipment, with hand rails or other forms of physical barriers that were capable of preventing the risk, positioned in units 8 and 9 at the site; (iii) ensuring that handrails or other forms of physical barriers that were capable of preventing the risk were provided, positioned and used on the walkway/accessway between units 8 and 9 of the site; and/or (iv) by providing guarding or physical barriers for a penetration on the upper level between units 8 and 9, so as to ensure Sabahattin Secim and Nevzat Tekman were not exposed to risks to their health or safety while they were at Mono Constructions' place of work. As a result of Mono Constructions' acts and omissions, Sabahattin Secim and Nevzat Tekman were exposed to the risk at the site. Sabahattin Secim's injury was a manifestation of that risk. 4Documentary evidence was tendered in the proceedings by the prosecutor consisting of an agreed statement of facts and some photographs. 5For the defendant there was tendered into evidence an affidavit of Joseph Moujalli, its sole director and secretary and some documentation which evidenced the occupational health and safety procedures and protocols used by the defendant prior to the incident. Mr Moujalli gave oral evidence. 6The agreed statement of facts is in the following terms: 1. The prosecutor is an Inspector duly appointed under Division 1 of Part 5 of the Occupational Health and Safety Act 2000 ("the Act") and empowered under Section 106(1)(c) of the said Act to institute proceedings in the within matter. 2. The prosecution relates to an incident at 324 William Street, Kingsgrove, New South Wales ("the site") on 1 December 2008. 3. At all material times Joseph Moujalli was a director, and Christopher Moujalli and Peter Moujalli were persons concerned in the management, of Mono Constructions Pty Ltd (ACN 107 404 679) ("Mono Constructions"). Background 4. On 1 December 2008, Mr Sabahattin Secim, a 64-year-old labourer/bricklayer employed by Tekman Group Pty Ltd [ACN 132 759 794] ("Tekman Group"), and Mr Nevzat Tekman, a labourer/bricklayer employed by Tekman Group, were exposed to risks of falls from heights while performing work at the site. 5. Mr Secim and Mr Nevzat Tekman were bricking up void in the wall between units 8 and 9 which involved working at a height of approximately 2.77 - 3.02 metres without adequate fall protection. They arrived at the site at approximately 7:00am. 6. At approximately 2:00pm, Mr Secim fell approximately 3m through the void whilst trying to either clean some excess mud off a brick wall or knock out a temporary wooden lintel. 7. As a result of the incident, Mr Secim suffered serious injuries including a shattered knee cap, open knee wound (which became infected as a result), broken left wrist and fractured C1 and C2 vertebrae (requiring the wearing of a halo brace). 8. Albatross Property Group Pty Ltd and Chevron Holdings (NSW) Pty Ltd owned the site and contracted Mono Constructions as the principal contractor to build residential and commercial units at the site ("the project"). 9. Mono Constructions is a construction company and undertakes the business of residential and commercial construction. 10. The construction work for the project was valued at in excess of $250,000. 11. During the course of the construction work for the project access ways (voids) were left in the units being constructed to allow easier access for persons and materials from one part of the site to another. 12. Mono Constructions engaged the following persons (amongst others): (a) Joseph Moujalli is the sole Director of Mono Constructions. Joseph Moujalli's role was mainly administrative and included paying bills, obtaining and providing quotes, doing pay roll and typing minutes. Joseph Moujalli attended sites if required and did labouring if Mono Constructions was short of labour. Joseph Moujalli visited the site on average once every two to three weeks. Sometimes, Joseph Moujalli would be at the site for two days and did not go back for at least two to three months. (b) Christopher Moujalli, employed as a General/Business Manager. Christopher Moujalli commenced employment in 2003. Christopher Moujalli's role included the general overlooking of the business, contract administration, tendering and negotiating with clients and contractors. Christopher Moujalli had the authority to make final decisions, including decisions on occupational health and safety issues and to approve the finance for those decisions. Christopher Moujalli is the brother of Joseph Moujalli. Christopher Moujalli is also an "owner" of Mono Constructions. Christopher Moujalli was previously the sole director of Mono Constructions up until 1 January 2008 (before the incident). (c) Peter Moujalli, employed as a Project Manager. Peter Moujalli commenced employment in or about 2005. Peter Moujalli's role included the day to day managing and supervising of the employees and contractors on site and also had the authority to make decisions relating to occupational health and safety. Peter Moujalli is also the brother of Joseph and Christopher Moujalli. (d) Peter Khamis, employed as a Site Supervisor. Mr Khamis' role included the day to day running of the site, coordinating and supervising trades and coordinating with the project manager. (e) John Merhi, employed as a Leading Hand. Mr Merhi's role included supervising labourers and assisting the foreman with general cleaning, inductions and sometimes paperwork. 13. Joseph Moujalli, Christopher Moujalli and Peter Moujalli were jointly responsible for decision making. The Site Supervisor was responsible for occupational health and safety issues and Peter Moujalli and Christopher Moujalli also identified safety issues and would instruct the Site Supervisor on the course of action if required. 14. Mono Constructions' site specific health and safety management plan for the site allocated responsibilities to Christopher Moujalli, Peter Moujalli and the 'Safety Co-Ordinator' was Peter Moujalli. 15. Mono Constructions subcontracted Tekman Industries Pty Ltd [ACN 114 020 905] ("Tekman Industries") to do brick and block work for the project at the site. This contract is in writing. 16. Tekman Industries was a brick laying company and was established on 28 April 2005. On 24 October 2008, notification of the appointment of a Liquidator of Tekman Industries was made. On 24 January 2010, Tekman Industries was deregistered. Mr Hasan Tekman was the sole Director of Tekman Industries ("Mr H Tekman"). 17. Tekman Group [ACN 132 759 794] ("Tekman Group") is also a brick laying company and was established on 15 August 2008. Mrs Yuming Li, the wife of Mr Hasan Tekman, is the sole Director of Tekman Group. Mrs Li has very little involvement in the running of Tekman Group and handed complete control of Tekman Group to Mr Hasan Tekman. Mrs Li completes some administration work as instructed by Mr Hasan Tekman, such as paying telephone bills. Other than that, Mrs Li stays at home to care for their children. 18. Tekman Industries completed most of the bricking work on the project except bricking up the access ways between the units. 19. After Tekman Industries was placed under external administration, Tekman Group Pty Ltd took over the contract of Tekman Industries to complete the bricking work, that is, to brick up the access ways at the site. 20. Mr Secim was employed by Tekman Group to do "labouring, carrying bricks, preparing the cement" on the day of the incident. 21. Mr Secim was previously employed by Tekman Industries "on and off for about a year" and had "worked on the same site about 5-6 times before". Mr Secim had previously worked for Mr Tekman in the same building for 3 days in May 2008 and 2 days in July 2008 and was paid by Mr Tekman in cash. 22. Mr Secim has been in the bricklaying industry as a labourer for twenty years. 23. Mr Nevzat Tekman had been employed with "Tekman Company" as a labourer/bricklayer for 6 years. Mr Tekman was employed by Tekman Group on the day of the incident. The incident 24. When Mr Secim and Nevzat Tekman were at the site on 1 December 2008, Mr Peter Khamis, Site Supervisor employed by Mono Constructions, instructed Mr Nevzat Tekman to brick up the opening/access way in the wall between units 8 and 9. This task involved working at a height of approximately 2.77 - 3.02 metres. There were unsecured planks (without handrails) which formed a walkway running perpendicular across the void between the floor above units 8 and 9. There was scaffolding in unit 8, which had been placed perpendicular to the planks. There was no scaffolding in unit 9. 25. Mr Khamis told Mr Nevzat Tekman that before they were to start, they were to remove the planks and slide the scaffold located in unit 8 across to the right so that they would have a safe working platform to work from. Mr Khamis then left Mr Nevzat Tekman and Mr Secim to do the job. Mr Secim's fall occurred about 20 minutes to half an hour later. 26. Mr Secim and Mr Nevzat Tekman could speak English but had limited English language skills and required interpreters when interviewed. It is not clear whether Mr Secim received or understood Mr Khamis' instructions to remove the planks, however, he did not remove the planks. 27. Mr Khamis thought the walkway had handrails but did not check this prior to instructing Mr Secim and Mr Nevzat Tekman to perform the task. 28. The system of work, even if the planks had been removed, was unsafe because the scaffold did not have adequate handrails and there was a risk of the workers falling from the scaffold into unit 9. The workers were also able to access the floor of the next level above units 8 and 9, and when working from this level the void constituted an unguarded penetration. 29. Neither Mono Constructions nor Tekman Group undertook a documented risk assessment for the work to be completed by Mr Secim and Mr Nevzat Tekman on 1 December 2008. 30. Neither Mr Secim nor Mr Nevzat Tekman received an adequate induction at the site which explained to them that they were not to work at height without adequate fall protection or next to unguarded penetrations. 31. Mr Nevzat Tekman and Mr Secim were not provided with safety harnesses or other fall protection devices when they were undertaking the bricking up work. 32. Mr Khamis did not monitor the work performed by Mr Secim and Mr Nevzat Tekman to ensure that any instructions he had issued were carried out. 33. Mr Secim and Mr Nevzat Tekman did not slide the scaffold across and stood on the part of the planks that were in unit 9 to brick in the opening/access way in the wall. Immediately prior to the incident, Mr Nevzat Tekman was standing on the floor of the level above units 8 and 9 and Mr Secim was standing next Nevzat Tekman either adjacent to the unguarded penetration or on the walkway planks. 34. It is unclear as to whether Mr Secim wanted to clean some excess mud off the bricks or knock out the temporary timber lintels. Prior to Mr Secim's fall he and Mr Nevzat Tekman were cleaning bricks or knocking out a temporary timber lintel with a hammer and that he took over this task from Mr Nevzat Tekman when he got tired. Mr Nevzat Tekman told Mr Secim not to worry about cleaning the bricks as he would do it later. 35. Prior to his fall, Mr Secim swung at either a piece of excess mud or a timber lintel and lost his balance and fell through the access way into the ground in unit 9. 36. Mr Khamis heard someone screaming and ran into unit 9 to find Mr Secim on the ground. Mr Khamis immediately called for an ambulance and asked what had happened. 37. The ambulance subsequently arrived and took Mr Secim to hospital. The NSW Police also attended the site. 38. After Mr Secim fell, "Hasan", a contractor from NSW Formwork, advised him that before the incident, Mr Secim had dropped a tool down to the level below where Hasan was working. Mr Secim allegedly apologised and said that he was feeling a bit dizzy as he was on medication. Mr Secim denied that this was the case. Systems of work prior to incident 39. In relation to Mono Constructions: (a) Mono Constructions did not obtain a Safe Work Method Statement from either Tekman Industries or Tekman Group prior to them commencing work on the site. There was no Safe Work Method Statement prepared for the task of bricking up the void that Mr Secim and Mr Nevzat Tekman were performing on the day of the incident. (b) Mono Constructions did not have or follow an adequate, safe system in place for working at heights or guarding penetrations at the site. (c) Mono Constructions' safe work method statement for working at heights was not discussed with subcontractors either when they were inducted onto, or after they started work at the site. (d) Prior to the incident on 1 December 2008 Mono Constructions had identified that it had a lack of occupational health and safety systems ("OH&S systems") in place. On 27 November 2008, Mono Constructions engaged Acumen Management Services Pty Ltd, OHS consultants, to develop its OH&S systems. However, the OH&S systems were not developed until after the incident. (e) Mono Constructions did not document or record all toolbox talks at the site. (f) Employees of Mono Constructions (other than Christopher and Peter Moujalli and Peter Khamis) and employees of entities subcontracted to do work by Mono Constructions were not present during Mono Constructions' toolbox talks. (g) Mono Constructions does not have a record of inducting Mr Tekman or Mr Nevzat Tekman into the site, although it had a record of inducting Mr Secim in May 2008. h) Mono Constructions did not undertake a documented, site specific, risk assessment for the site. (i) Mr Khamis did not supervise Mr Nevzat Tekman and Mr Secim to ensure that they moved the scaffold in Unit 8 and did not work on the concrete floor of the next level next to the unguarded penetration on the floor above units 8 and 9. 40. In relation to Tekman Group: (a) Tekman Group did not have a Safe Work Method Statement for the brick and block work at the site. Mr Secim had never seen a Safe Work Method Statement for the work at the site and was never involved in any toolbox talks. Mr Nevzat Tekman confirmed that no Safe Work Method Statements were completed and that he didn't know what a Safe Work Method Statement was. (b) Tekman Group did not conduct a risk assessment or a toolbox meeting for the brick and block work at the site. (c) Tekman Group does not have any training records for its employees. Mr Secim never received any training from Tekman Group or Tekman Industries. (d) Mr Nevzat Tekman does not have a trade certificate for bricklaying or a licence to erect scaffolding. Mr Nevzat Tekman was trained in bricklaying and erecting scaffolds by Mr Hasan Tekman. Mr Secim did not have a trade qualification for bricklaying but had a TAFE College Statement dated 5 September 1991 certifying that he had completed the requirements of the LMP - Handypersons Course at Randwick college of TAFE. (e) It was common practice for Mr Secim to work from heights without fall protection, and he was never provided with a harness nor had received training on how to use a harness from Tekman Group or Tekman Industries. (f) Tekman Group did not provide supervision at the site and relied on the supervision of Mono Construction. Mr Nevzat Tekman was not a supervisor although he was more experienced than Mr Secim. Systems of work after the incident 41. Mono Constructions made changes, including the following, after the incident: - Induction process is more thorough - Toolbox talks are now formalised - The accident and incident register is more thorough and detailed - A formal OH&S policy has been developed - Hazardous substance register has been developed - The development of an OH&S weekly report for each project - All risk assessments are now being recorded - All visitors and subcontractors sign into the site everyday - The is a site safety checklist that is completed every week - New set of site safety rules have been developed - All persons inducted onto the site have to complete a detailed form. - Audits are undertaken to ensure everyone has been inducted onto the site - A training register has been developed for all staff - Safe work method statements and test plans are now being used and imposed on sub-contractors. 42. Also after the incident, Mono Constructions: (a) put in place changes to its OH&S systems, which were developed by Acumen Management Services Pty Ltd. (b) conducted an investigation into the incident and erected scaffold on both sides of the void. (c) established a Safety Committee. 7As is clear from the agreed statement of facts, the incident occurred when Mr Secim, an employee of the subcontractor bricklayer, fell into a void. There was no evidence about the dimensions of the void. However, the parties proceeded on the basis that the Court could infer from photographic evidence that the void was about the same width as a staircase depicted in photographs that was installed after the incident and that became part of the completed structure. I infer on this basis that the void was sufficiently wide to allow a person to fall into it. 8Both Mr Tekman and Mr Secim had had some experience in building work. On the evidence, Mr Tekman was told by the defendant's supervisor on site that the scaffolding which had been located in the adjoining unit should be used in order to provide a working platform for Messrs Tekman and Secim to do the job. However, it is not clear whether and to what extent there was an understanding of the directions given by the supervisor, as is made clear in [26] of the agreed statement of facts. Furthermore, the scaffold if used would not have been entirely appropriate because of the lack of handrails. This situation was exacerbated by the admitted failure of the defendant to instruct Messrs Tekman and Secim to use some form of adequate fall protection if they were required to work at heights and there was insufficient guarding to preclude them from falling. As was admitted by the defendant, these circumstances were compounded further by the failure of the supervisor to ensure that his instructions were complied with and to carry out some degree of overall supervision of the way in which Messrs Tekman and Secim went about the work that he had directed them to perform. 9I should add for completeness that, as is clear from the evidence, the defendant did have in place some extensive protocols and procedures prior to the incident including a requirement to ensure that height safety equipment was worn when persons were working above 1.8 metres and to ensure that persons performing that work maintained an awareness of their surroundings, and maintained "three limbs on the ladder, steps, rails at all times, secure harness attachments (where required) before commencing work." 10The starting point for the assessment of an appropriate penalty is a consideration of the objective seriousness of the offence. As is obvious, where persons are required to carry out work at heights in circumstances where there is an obvious risk that they might fall whilst performing that work, there are fundamental and essential steps that must be taken to ensure their safety. By its plea of guilty, the defendant conceded the particulars of the charge alleged against it and the significant factual matters to which I have briefly referred. They are set out more comprehensively in the agreed statement of facts. 11In assessing the objective seriousness of this offence I take into account, however, that this defendant did have in place before the incident a comprehensive regime of procedures and protocols to attempt to comply with its obligations under the Act. This is not the case of a defendant who recklessly or indifferently disregarded its obligations. It is certainly not a worst-case scenario. Nor, however, may this offence be characterised at the lower end of the range. The circumstances under which the work was being performed were inherently dangerous and the clearly foreseeable risk of injury should have been obvious to the defendant's personnel. 12Having regard to all of the relevant matters to which I have referred, I am of the opinion that the seriousness of this offence when viewed objectively should be characterised as representing mid-range. 13In assessing penalty, I shall also take into account the obvious deterrent effect that the imposition of a penalty will have generally within the construction industry, and the specific deterrent effect on this defendant, because it remains in business in the construction industry. In this latter regard, I am prepared to ameliorate the specific deterrent effect on this defendant because, on the evidence, since the incident the defendant has taken active and constructive steps to improve its commitment to occupational health and safety. 14There are a number of subjective matters that the Court is entitled to take into account when assessing penalty. Both the prosecutor and the defendant agreed that the Court would be entitled to take these matters into account to the fullest extent, and there is no controversy about the matters to which I shall now refer. The defendant pleaded guilty at the earliest appropriate opportunity, the defendant co-operated fully with the WorkCover Authority of New South Wales in and about its investigations of the incident, the defendant has expressed contrition and remorse for the incident and for the injuries sustained by Mr Secim. Since the incident, the defendant has enhanced its commitment to its occupational health and safety obligations and has a good safety record to date with no prior convictions. It commenced business in 2003. 15The prosecutor sought orders for a moiety and the payment of costs, which were not opposed by the defendant. 16The maximum penalty is $550,000. Having regard to all of the matters to which I have referred, including the objective seriousness of the offence, the need to accommodate the deterrence created by the imposition of a penalty and the subjective matters to which I have referred, I am of the opinion that an appropriate penalty is the sum of $85,000. Orders 17I make the following orders: 1. The defendant, Mono Constructions Pty Ltd, is found guilty of the offence with which it is charged and convicted accordingly. 2. I impose a monetary penalty of $85,000 on Mono Constructions Pty Ltd with a moiety to the prosecutor. 3. The defendant is to pay the costs of the prosecutor in an amount assessed in default of agreement. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 09 November 2011