Industrial Relations Commission New South Wales Medium Neutral Citation: Inspector Dall v Ullrich Aluminium Pty Ltd [2011] NSWIRComm 156 Hearing dates: 14 October 2011 Decision date: 25 November 2011 Jurisdiction: Industrial Court of NSW Before: Boland J, President Decision: Matter No IRC 689 of 2010 (1) The defendant is found guilty of the offence charged under s 8(1) of the Occupational Health and Safety Act 2000. (2) The defendant is fined an amount of $350,000 with a moiety to the prosecutor. (3) The defendant shall pay the costs of the prosecutor as agreed or assessed. Matter No IRC 690 of 2010 (1) The defendant is found guilty of the offence charged under s 8(2) of the Occupational Health and Safety Act 2000. (2) The defendant is fined an amount of $250,000 with a moiety to the prosecutor. (3) The defendant shall pay the costs of the prosecutor as agreed or assessed. Catchwords: OCCUPATIONAL HEALTH AND SAFETY - Prosecutions under ss 8(1) and 8(2) of Occupational Health and Safety Act 2000 - Guilty plea - Sentencing - Death of worker - Second worker placed at risk - In 2007 worker crushed by falling cases of aluminium product stored on warehouse racks - In 1996 a stack of unrestrained cases of aluminium extrusions at the defendant's warehouse collapsed, striking and fatally injuring an employee of the defendant - Objective and subjective considerations - Totality - Victim impact statement - Penalties imposed - Costs Legislation Cited: Crimes (Sentencing Procedure) Act 1999 Industrial Relations Act 1996 Occupational Health and Safety Act 1983 Occupational Health and Safety Act 2000 Occupational Health and Safety Regulation 2001 Cases Cited: Cahill v State of NSW (Department of Community Services) (No 4) [2008] NSWIRComm 201; (2008) 182 IR 231 Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 Department of Mineral Resources of NSW (McKensey) v Kembla Coal & Coke Pty Ltd (1999) 92 IR 8 Fisher v Samaras Industries Pty Limited (1996) 82 IR 384 Inspector Elizabeth Benbow v Planada Holdings Pty Ltd [2001] NSWIRComm 275 Inspector Hinton v Waterway Constructions Maintenance Pty Ltd [2011] NSWIRComm 132 Inspector Lancaster v M L Colturi Sawmills Pty Ltd [2011] NSWIRComm 47 Inspector Kent v Duct Master Pty Ltd [2009] NSWIRComm 143 Inspector Williams v H P Woods (Holding) Pty Ltd [2011] NSWIRComm 114 Johnson v The Queen [2004] HCA 15; (2004) 205 ALR 346 Mill v The Queen [1988] HCA 70; (1988) 166 CLR 59 Morrison v Powercoal Pty Ltd (No 3) [2005] NSWIRComm 61; (2005) 147 IR 117 Postiglione v The Queen [1997] HCA 26; (1997) 189 CLR 295 Riley v Australian Grader Hire Pty Ltd [2001] NSWIRComm 31; (2001) 103 IR 143 WorkCover Authority of NSW v ACI Operations Pty Ltd [1994] NSWIRComm 167 WorkCover Authority of NSW (Insp Ch'ng) v Ullrich Aluminium Pty Ltd t/as Ullrich Noyes Metals [1998] NSWIRComm 668 WorkCover Authority of New South Wales (Inspector Mulder) v Arbor Products International (Australia) Pty Ltd [2001] NSWIRComm 50; (2001) 105 IR 81 WorkCover Authority of New South Wales (Inspector Twynam-Perkins) v Maine Lighting Pty Ltd (1995) 100 IR 248 Texts Cited: Principles of Sentencing (2nd ed, 1979), DA Thomas Category: Principal judgment Parties: Inspector Michael Dall (Prosecutor) Ullrich Aluminium Pty Ltd (Defendant) Representation: Mr M Cahill of counsel (Prosecutor) Mr P Ginters of counsel (Defendant) WorkCover Authority of New South Wales (Prosecutor) Moray & Agnew, Lawyers (Defendant) File Number(s): IRC 689 of 2010 IRC 690 of 2010 Judgment 1These matters concern two prosecutions of Ullrich Aluminium Pty Ltd ("the defendant") by Inspector Michael Dall of the WorkCover Authority of New South Wales for contravention of s 8(1) and s 8(2) of the Occupational Health and Safety Act 2000. 2The prosecutions arise out of an incident that occurred on 3 September 2007 at the defendant's premises at 6 Steel River Boulevard, Mayfield West. At that address the defendant operated and controlled a warehouse ("the Warehouse"). The defendant employed Mr Troy Murrell-Voigtlander (also known as Troy Murrell) as a storeman. Working at the Warehouse on 3 September 2007 was Mr Chris Crawford, a storeman employed by a labour hire company known as Select Industrial. 3The defendant stored large quantities of aluminium product in the Warehouse and, in particular, stored "cases" of aluminium product stacked in various "bulk storage racks" located throughout the Warehouse at the Mayfield site. Cases stored on a rack known as WB03 were approximately 4 metres in length, 300-400mm in width and 200-300mm in depth. The cases variously weighed 66-331kg and were stacked to a height of 2.6 metres. 4Mr Crawford and Mr Murrell were using a crane to reposition cases of aluminium product within rack WB03 for the purpose of obtaining access to particular cases located within the rack. Mr Murrell entered into the rack between stacks of cases to retrieve a sling attached to the crane. As he did so, several cases toppled onto Mr Murrell trapping him and causing fatal crush injuries. 5The amended application for order in Matter No IRC 689 of 2010 alleged that the defendant failed to: [E]nsure the health, safety and welfare at work of all its employees, and in particular, Troy Murrell-Voigtlander (also known as 'Troy Murrell') contrary to section 8(1) of the Occupational Health and Safety Act, 2000 (NSW). 6Thereafter the Application sets out the particulars: Particulars of the Defendant's Acts and Omissions and of the Risk 1. At all material times the defendant was an employer. 2. At all material times the defendant employed Troy Murrell-Voigtlander ("Mr Murrell"). 3. At all material times the defendant operated and controlled a warehouse located at 6 Steel River Boulevard, Mayfield West in the State of NSW ('the Mayfield site'). 4. The defendant stored large quantities of aluminium product in the warehouse and in particular, stored "cases" of aluminium product stacked in various "bulk storage racks" located throughout the warehouse at the Mayfield site. 5. The packing on the "cases" of the aluminium product consisted of wooden boards, 55mm wide by 11mm thick, forming a rectangular border around cardboard, with the product inside the cases secured with 19mm steel banding. 6. The "cases" of the aluminium product varied in length and configuration depending on the product but, most commonly the cases stored in the "bulk storage racks" were approximately 4 metres in length and 300 to 400mm wide and varying depths, generally between about 200 to 300mm. 7. In addition to whole "cases", open "cases" from which product had been extracted were also stored in the "bulk storage racks". 8. Each of the components used by the defendant to make up "bulk storage racks" at the Mayfield site, including the "bulk storage rack" identified by the defendant as "WB03", consisted of: a base made from a piece of steel channel, inverted in a "U" position, and measuring approximately 150mm x 75mm x 2.710m long which lay on the floor of the warehouse unsecured; and two yellow 100mm in diameter cylindrical steel bollards, 2.600m in length, welded to the top of each end of the steel channel. Two of these components were used to make up each of the "bulk storage racks" within the warehouse. 9. Each "bulk storage rack" was designed to accommodate five rows of cases across the base and then stacked to the height of the end bollards (i.e. 2.6 metres high). 10. The "bulk storage racks" did not incorporate vertical bollards, or any other vertical means of support and/or segregation, between the stacks of cases within each rack. The Risk 11. At all material times, employees of the defendant who worked in the bulk storage areas of the warehouse, in particular, Mr Troy Murrell, were at risk of being struck, trapped and/or crushed by falling cases of aluminium product. Particulars of the Acts and/or Omissions of the Defendant: Plant 12. The defendant should have ensured but, failed to ensure that plant, namely the "bulk storage racks" provided for use by employees at work at the Mayfield site were safe and without risk to health when properly used in that: (i) The defendant should have provided but, failed to provide "bulk storage racks" for the storage of "cases" of aluminium product which incorporated vertical bollards and/or such other means of support and/or segregation between stacks of cases within each of the "bulk storage racks" designed to prevent the collapse of product, within each bulk storage rack, of the "cases" of aluminium product; (ii) The defendant should have undertaken but, failed to undertake a site specific risk assessment with respect to the design of the bulk storage racks which included an assessment of the risks associated with the stacking of "cases" of aluminium product within subject racks. System of Work 13. The defendant should have provided and maintained but, failed to provide and maintain a safe system of work at the Mayfield site in relation to the stacking, rigging, lifting and movement of "cases" of aluminium products into and/or out and/or within the subject bulk storage racks in that: (i) The defendant required its employees, including Troy Murrell, to use an overhead crane, in combination with slings, to rig, lift and move cases of aluminium product into and/or out of its bulk storage racks and also to move cases of aluminium products within the confines of its bulk storage racks; and (ii) As a consequence of the design of the slings provided by the defendant for use in the movement of cases of aluminium product into and/or out of the bulk storage racks and within the confines of those racks, from time to time the slings came to rest within the confines of the racks. (iii) The defendant should have provided and maintained but, did not provide and maintain a safe system of work for the recovery of the slings used to rig the cases to the overhead travelling cranes (used to move the cases into, out of and within the bulk storage racks) when those slings came to rest within the confines of a bulk storage rack, in particular, the defendant should have ensured but failed to ensure that the defendant's employees did not enter into the subject rack to retrieve the slings. (iv) The defendant should have ensured that the design of the slings used to rig, lift and move the cases of aluminium product in combination with the overhead crane was such that the slings would not come to rest within the confines of the bulk storage racks. (v) The defendant should have provided but, failed to provide its employees, including Mr Murrell-, with a written work method statement, or safe operating procedure, with respect to the rigging, lifting and/or movement of "cases" of aluminium product into and/or out of and/or within the bulk storage racks at the Mayfield site that: (a) described how the work was to be carried out, step by step; (b) identified the work activities assessed as having risks; (c) identified the subject safety risks; and (d) described the control measures that were to be applied to the subject work activities to control the identified risks, including but not limited to the control measures to be applied for the purpose of controlling and/or minimising the risk of workers being struck by and/or crushed by "cases" of aluminium product whilst the employees were engaged in the tasks of rigging, lifting and moving product in to and/or out of and/or within the bulk storage racks at the Mayfield site. Risk Assessment 14. The defendant failed to adequately address the risk associated [sic] the storage of "cases" of aluminium product in the bulk storage racks at Mayfield, including the risk associated with a collapse of "cases" of aluminium product within the confines of those racks in that: (i) The defendant failed to undertake a specific formal risk assessment at the Mayfield site with respect to the risks identified in the internal memorandum dated 6 October 2006, from Phillip Wareham, entitled "Bulk Safety Storage" which assessment should have been undertaken following the distribution of Mr Wareham's memorandum dated 6 October 2006; (ii) The defendant failed to adequately consult with its employees at the Mayfield site, including Mr Murrell-Voigtlander, regarding the risk associated collapses of "cases" of aluminium product within the bulk storage racks at the site; (iii) The defendant should have ensured that the matters raised in Mr Wareham's memorandum dated 6 October 2006 were brought to the attention of the Occupational Health and Safety Committee at the Mayfield site and to employees involved in the handling, rigging, lifting, movement and stacking of "cases" of aluminium product in to and/or out of and/or within the bulk storage racks at the Mayfield site. Information and Training 15. The defendant should have provided but, failed to provide its employees, in particular, Mr Murrell with such information and/or training as was necessary to ensure its employee's health and safety at work, and in particular the health and safety of Mr Murrell, in that: (i) The defendant, at all material times, required or permitted Mr Murrell to operate its pendant operated Demag overhead travelling crane, identified as "crane 3" for the purpose of lifting, moving and stacking "cases" of aluminium product in to and/or out of and/or within the bulk storage racks at the Mayfield site. (ii) The defendant should have provided but, failed to provide Mr Murrell with adequate training and information with respect to the safe use and operation of the subject crane to lift, move and/or stack "cases" of aluminium product in that the defendant failed to provide Mr Murrell with adequate information and/or training with respect to the recovery of the slings used in conjunction with the overhead crane to lift, move and/or stack "cases' of aluminium product when, from time to time, the subject slings would come to rest within the confines of the bulk storage racks at the Mayfield site. As a result of the defendant's failures and omissions, Troy Murrell was placed at risk of serious injury or death, and was fatally injured. 7The amended application for order in Matter No IRC 690 of 2010 alleged that the defendant failed to: Ensure that persons other than its employees, in particular Chris Crawford, were not exposed to risks to their health or safety arising from the conduct of its undertaking while they were at its place of work contrary to section 8(2) of the Occupational Health and Safety Act, 2000 (NSW). 8The particulars of the charge were in similar terms to those in Matter No 689/10 relating to Mr Murrell except, of course, they referred to Mr Crawford, who was working under the supervision of Mr Murrell. Mr Crawford was not injured. 9The defendant pleaded guilty to the amended charges. Agreed Statement of Facts 10The prosecutor tendered an Agreed Statement of Facts. The Statement indicated that the defendant, trading as "Ullrich Aluminium", operated a trans-Tasman aluminium manufacturing and distribution business with over 47 branches in both New Zealand and Australia, with branches located in all Australian States and Territories. 11The defendant employed William Duncan to manage the Warehouse and also employed two supervisors Peter Inskip (Warehouse Manager) and John Wilmott (Assistant Warehouse Manager) at the Warehouse, together with approximately 10 staff, both employees and contract labour, retained to carry out day to day operations within the Warehouse. 12Mr Murrell had been employed as a storeman for about seven to eight months. Mr Murrell's duties included picking and packing aluminium products for orders. This work involved the use of the defendant's Demag crane in the movement of crates of aluminium product into, out of and within bulk storage racks. Mr Murrell had previous experience as a storesperson prior to his employment with the defendant. 13Mr Murrell was considered by the defendant to be experienced in his field of work and he was utilised by the defendant to train and supervise new storemen, both employees and labour hire workers, when they commenced work at the Warehouse. The training which the defendant utilised Mr Murrell to provide to new storemen included the defendant's stock handling practices, the use of the defendant's overhead cranes and the movement of stock into, out of and within the bulk storage racks in the Warehouse using the defendant's overhead cranes. Some employees, who had been trained by Mr Murrell, when spoken to after the incident, stated Mr Murrell had instructed them that it was not safe to enter into bulk storage racks and walk between stacks of cases; and also, that they were not to do so. Prior to the incident Mr Wilmott had instructed some Warehouse staff not to enter into the bulk storage racks. 14Mr Murrell was a member of the defendant's safety committee and he was undergoing safety committee and consultation training at the time of the incident. 15Mr Crawford was assigned by Select Industrial to work as a storeman at the defendant's Warehouse. Mr Crawford had commenced work at the Warehouse three days prior to the incident. On the day of the incident, Mr Crawford had been assigned to assist Mr Murrell in "picking and packing" orders. 16Mr Crawford said in his interview with the WorkCover Authority concerning the incident that immediately prior to the cases falling on Mr Murrell he (Mr Crawford) and Mr Murrell had a conversation in which Mr Murrell told Mr Crawford to act safely. When Mr Murrell entered the rack, Mr Crawford said to Mr Murrell " I wouldn't be standing there if I was you". 17The cases of aluminium product were described earlier. The bulk storage racks in which the cases were stacked were described in the Agreed Statement in the following terms: The components used by the defendant to make up "bulk storage racks" at the Warehouse, including the "bulk storage rack" identified by the defendant as "WB03", consisted of: a base made from a piece of steel channel, inverted in a "U" position, and measuring approximately 150mm x 75mm x 2.710m long which lay on the floor of the Warehouse unsecured; and two yellow 100mm in diameter cylindrical steel bollards, 2.600m in length, welded to the top of each end of the steel channel. Two of these components were used to make up each of the "bulk storage racks" within the Warehouse. Each "bulk storage rack" was designed to accommodate five rows of cases across the base and then stacked to the height of the end bollards (i.e. 2.6 metres high). The "bulk storage racks" did not incorporate vertical bollards, or any other vertical means of support and/or segregation, between the stacks of cases contained within each rack. To remove or store the "bulk" aluminium product contained in the Bulk Storage Racks, workers, including Mr Murrell, utilised a pendant controlled electric overhead travelling "Demag" crane with fibre slings that were slung around each end of the cases of Aluminium product. Once the slings were in place around each end of a case, the crane was used to lift and move the case to the desired position. Bulk Storage Rack WB03 was located on the south western side of the Warehouse. At the time of the investigation of the incident involving Troy Murrell Bulk Storage Rack WB03 contained approximately thirty-six cases of aluminium product. At the time of the incident, generally, the cases stored in WB03 were approximately 4.000m in length, 300mm to 400mm in width and 200 - 300mm in depth. Some the cases differed in length; or were otherwise differently configured. At the time of the incident, each of the cases stored in WB03 displayed weights ranging between 66kg to 331kg, with the disparity of weight per case due to difference in length and configuration of their contents. Horizontally, WB03 contained five stacks of the cases described above. At the time of the investigation, vertically, each of the "outside" stacks [i.e. the 'eastern' and 'western' stacks] consisted of seven or eight of these cases of different depth. The three middle stacks had collapsed progressively towards the western end of WB03. In the immediate lead up to the incident Mr Murrell and Mr Crawford moved pallets from stacks in the middle of WBO3 and placed those pallets onto other, adjacent, stacks within the same rack. In the immediate aftermath of the incident, in an attempt to free Mr Murrell from the collapsed cases members of the Warehouse staff moved cases within WB03. 18The Agreed Statement described the incident on 3 September 2007 in the following terms: At approximately 12.30pm, Monday 3 September, Mr Murrell was working with Mr Crawford. Mr Murrell and Mr Crawford were using the defendant's Demag crane to reposition 'cases' of aluminium product (shower screen sections) within Bulk Storage Rack WB03 for the purpose of obtaining access to particular cases of aluminium product located within that rack, the contents of those cases being required to fill orders that Mr Murrell and Mr Crawford were in the process of "picking and packing". Prior to the subject incident, Mr Murrell and Mr Crawford used the Demag crane to re-stack cases within WB03, removing cases from the 2 stacks adjacent to the western-most stack within WB03 onto the other 2 stacks within WB03 to the east. Immediately prior to the incident, with the Demag crane located above WB03, Mr Crawford was detaching the slings from one of the cases located within WB03. Mr Crawford climbed up one of the stacks to detach that sling. Mr Murrell then entered about 2 metres [about halfway] into the gap that had been created in WB03 between the stacks to retrieve the other sling attached to the crane, as that sling was apparently hanging from the crane hook, in the middle of the cases, about halfway into WB03. Whilst Mr Murrell was retrieving the sling, Mr Crawford and Mr Murrell exchanged words to the effect set out at paragraph [16] above. As Mr Crawford and Mr Murrell were speaking, several cases toppled onto Mr Murrell, trapping him and causing fatal crush injuries: a. the cases were stacked five or six high and five cases wide before they moved; b. some of the cases were damaged so that the stacks were described by Mr Crawford "dodgy", "unstable, "a bit unstable" and "didn't look safe"; c. Mr Murrell was about 2 metres into the rack [i.e. approximately halfway into WB03] with his left shoulder against the western-most stack of cases in that rack; d. one of the cases that toppled over onto Mr Murrell hit him in the chest and chin area, pinning him in a vertical position against the western-most stack; e. whilst trapped in this position Mr Murrell had raised his right arm parallel to his head to try and protect himself from the falling cases; and f. approximately eight to ten cases were pinned down on Mr Murrell like a 'domino effect'. Mr Crawford then alerted other staff that Mr Murrell was trapped in WB03. Once other staff were alerted, Mr Crawford was aided in removing the cases off Mr Murrell by the following staff: Glen Cocking (truck driver), Michael Bourke (storeman), Lee Boulton (machine operator), Dale Marko (storeman truck driver) and Peter Hopkins (sales representative). Mr Inskip was holding up Mr Murrell's head. Approximately six to seven cases were manually lifted off Mr Murrell, whilst the remainder of the cases were pushed off him. Once Mr Murrell was released from WB03, Mr Murrell was placed in a recovery position pending the arrival of Ambulance officers. Whilst in the recovery position Mr Murrell's vital signs were monitored, however, he did not respond to verbal prompts and no pulse could be found. 19The Agreed Statement addressed the defendant's failures. It was agreed that: At the time of the incident there was a risk that instability within a stack could result in cases collapsing within the confines of the bulk storage racks because the bulk storage racks used at the Warehouse did not incorporate bollards, or any other means of segregating, individual stacks of cases within a bulk storage rack. Prior to the incident, the defendant was aware of the risk of stack instability and collapse. On 27 June 2006, Dale Hutton, the Health & Safety Coordinator of the Ullrich Aluminium group based in Hamilton, New Zealand, informed WorkCover that the Ullrich Aluminium group was undertaking a review of racking at all of the defendant's branches. On 6 October, 2006, Phillip Wareham issued an Ullrich Aluminium Memorandum entitled "Bulk Storage Safety" in the following terms: "In some of my recent visits to branches I have noticed a few examples of what I consider to be unsafe bulk storage cases. A few basic points to keep in mind. 1. The steel "goalpost" dividers/stabilisers should be made from 100mm by 40mm square or round tube and a max of 2.5 meter (sic) high (see attached diagram) 2. These should be bolted to the concrete floor 3. Cases should not be stacked higher than the "goalpost" 4. Cases should be stacked as vertically as possible avoiding dangerous leans If your branch is not complying with the above, please rectify ASAP, or if you have any issues or concerns re the above or any related matters please contact me. The safety of our people is worth more than the time or a few extra dollars we may need to pay. Best Regards PAW" The defendant was aware prior to the incident that there had been collapses of cases of product within the bulk storage racks at the warehouse, albeit these prior incidents did not result in any injury. Prior to the subject incident, an alternative racking system was being trialled in the defendant's South Australian warehouse which obviated the risk of stacks collapsing by providing for the bulk storage of cases of aluminium extrusions in single stacks, isolated by bollards. In the period since the incident, the defendant has developed and installed a new racking system at the Warehouse. The new racking system incorporates bollards that separate each stack of cases and hence, eliminates the risk of stacks of cases collapsing with the racking system. The investigation of the incident revealed that, prior to and at the time of the incident, the defendant did not have in place any formal, documented Job Safety Analysis (JSA), or Safe Work Method Statement (SWMS), with respect to the bulk storage and/or handling of cases of aluminium extrusions at the subject Warehouse; including the movement of cases into and/or out of bulk storage; and the transfer of cases within the bulk storage racks. Prior to the incident, the defendant relied upon informal and undocumented "on the job" training with respect to the manner in which the bulk storage of cases of aluminium extrusions was performed within the Warehouse. The informal work practices that were in place prior to the incident included a direction that workers were not to enter within the confines of the bulk storage racks. The informal work practices that were in use prior to and at the time of the incident included, at times, the use of a piece of timber with a nail in one end to hook and retrieve the sling. The informal work practices made no other provision for the recovery of the slings used to connect the cases to the overhead travelling cranes, used to move the cases into, out of and within the bulk storage racks, when those slings came to rest within the confines of a bulk storage rack. Prior to the incident although provided with informal, oral warnings from the defendant not to walk between stacks of cases in the racks, from time to time, workers entered the racks, between rows of cases, to retrieve slings that came to rest within the confines of a bulk storage rack or, alternatively, individual workers developed ad hoc responses such as leaning into the racks from the side, or using a nail attached to a long piece of wood to hook the sling and pull out it [sic] to the edge of the rack. Prior to the incident, Warehouse management was aware that the slings used in conjunction with the overhead travelling cranes to move the cases into, out of and within the bulk storage racks, from time to time came to rest within the racks and that, from time to time, workers entered into the racks to recover the slings. Prior to the incident, the defendant took no steps to put in place any formal controls on entering or leaning into the racks and to provide a safe means of retrieving the slings if and when they came to rest within the confines of a bulk storage rack. Subsequent to the incident the defendant developed a documented system of work regarding the task of removing stock from the racks. The documented work system addresses the risk of slings coming to rest within the confines of a bulk storage rack and included the provision of a hook to enable staff to recover slings without having to enter within the confines of the bulk storage racks. Prior to and at the time of the incident some workers in the Warehouse who used the overhead cranes in the course of their employment, including Mr Murrell, did not receive formal, documented training in the use of the overhead cranes; nor were there any formal systems of work in place to ensure that Mr Murrell, and Mr Crawford were competent in the use of the overhead cranes. Other workers, who operated the overhead crane at the Warehouse, had been assessed and recorded by the defendant as competent. There was no requirement for operators of the overhead crane at the Warehouse to be assessed and certified under the Occupational Health and Safety Regulation, 2001 (NSW). Prior to the incident, the defendant did not audit the task of operating the overhead crane. Workers who operated machinery requiring formal certification, such as forklifts, were appropriately trained and certified. After the incident, the defendant introduced formal documented, skills-based competency training for all workers required to use the overhead cranes in the course of their employment. This training is provided by an appropriately qualified third party trainer and upon successful completion of the training, the third party trainer undertakes a competency based assessment and certification of the subject trainees. Subsequent to the incident, the defendant developed a documented procedure (dated 21 September 2007) for the task of removing stock from racks. Prior to and on 21 February 1996 the defendant occupied and controlled a warehouse located on premises known as 32 Victoria Street, Smithfield in the State of New South Wales. On 21 February 1996, a stack of unrestrained "cases" of aluminium extrusions at the defendant's Smithfield warehouse collapsed, striking and fatally injuring an employee of the defendant, Darren Gascoigne, whilst he was in the course of picking and packing stock in proximity to the subject stack of cases. Following the above incident, as part of the defendant's response to it and, more particularly, in response to Prohibition Notices issued by Inspector James Ch'ng, the defendant designed and introduced the style of bulk racks which were in use at the Mayfield branch at the time of the incident leading to the death of Mr Murrell. The racks in use at the time of the incident were originally constructed for use in warehouse premises at Cardiff. Those racks were then transferred to the Mayfield site when the defendant moved its operations from the warehouse at Cardiff to the Warehouse at Mayfield. Prior to the incident leading to the death of Mr Murrell, there had been no formal risk assessment conducted relating to the use of the bulk racking system at the Warehouse. In particular, the defendant had not adequately assessed the risks associated with the use of the overhead cranes and sling system in association with the racks, such that inadequate consideration had been given to the risks associated with the slings coming to rest and/or being caught within the confines of this style of rack. Prior to the incident, the defendant had undertaken a review of the racking system in place in its Adelaide warehouse and, as noted above, a different system, in which individual stacks of cases were segregated by bollards or staunchions had been developed and installed in the Adelaide warehouse. Prosecutor's evidence 20In addition to tendering the Agreed Statement of facts, the prosecutor tendered a number of other documents that included the following: (a) A factual inspection report prepared by Inspector Dall and dated 24 January 2008. (b) Eighteen photographs of the incident site taken by Inspector Dall on 3 September 2007. (c) Memorandum of Phillip Wareham dated 6 October 2006 to various Ullrich personnel regarding unsafe bulk storage of cases and reminding personnel, inter alia, that "Cases should be stacked as vertical as possible avoiding dangerous leans". (d) Various emails sent and received by Ullrich personnel. (e) Photograph of new racking system at Adelaide warehouse. (f) Prior conviction statement showing one prior conviction of defendant. (g) Documents relating to prior conviction of defendant. (h) Letter from Ernest Ullrich to WorkCover Authority dated 1 June 1996 regarding steps taken to improve stacking. Evidence for the defendant 21The defendant's evidence consisted of four affidavits, two from Gilbert William Ullrich, company director and chief executive officer of the defendant, and two from Lynn Robert Hart, Group Occupational Health and Safety Supervisor for the Australian branches of the defendant. Mr Ullrich was required for cross-examination; Mr Hart was not. 22In his primary affidavit Mr Ullrich deposed to the following matters that I consider relevant or that expand on matters dealt with in the Agreed Statement: Ullrich is a manufacturer and supplier of aluminium products in Australia, New Zealand and other markets. It conducts wholesale, retail and warehousing operations in 47 branches across Australia and New Zealand including in Newcastle. Ullrich commenced its business in Australia in 1988 when it opened a sales branch in the western Sydney suburb of Smithfield. Ullrich employs 300 people in Australia and a further 400 people in New Zealand. Ullrich operates a warehouse facility at Mayfield, a suburb of Newcastle where it employs up to 20 people from time to time. In September 2007 Ullrich employed 10 people at the Newcastle branch. Troy Murrell was employed in the role of storeman and packer at the Newcastle branch on 17 January 2007. That role entailed using cranes and forklifts to receive inward goods, place those goods in storage and later remove those goods from storage to meet client orders. As at September 2007 Ullrich did not have in place any JSA or written safe system of work statement covering the removal of aluminium product from storage racks. Nor was there in place any formal procedure to ensure that the staff were competent to operate the crane. The training process was "on the job". The Warehouse as at September 2007 The crates of product were stored between the bollards in stacks. The product was contained in cases made up with a wooden base board with cleats and covered in cardboard. The lengths of aluminium ranged from 1.190 to 7.4 metres in length. The dimensions of the cases varied greatly depending upon the dimensions of the product they housed. There was no formal system in place within the Warehouse to remove a sling or the pendant control in the event that it became caught or fowled within the storage racks. As a practical, albeit informal, solution the workforce had devised a hook using a piece of timber with an attached piece of bent steel which was used to retrieve the sling/pendant control. The workforce were regularly informed never to enter into the bollards for any reason. However, I accept that this instruction was not written down and the process for enforcing this advice was nowhere near as rigorous as it should have been. Upheaval in the Warehouse Prior to September 2007 Between December 2006 and July 2007 a number of key personnel resigned from Ullrich's Newcastle branch as did the chief operating officer from the Australian head quarters located in Sydney. Those individuals who resigned took up positions with a rival company in the Hunter region. Among the staff who resigned were the Warehouse manager, a sales representative, the debtors/creditors clerk, all of the purchasing staff, a stores person and a truck driver. The chief operating officer who resigned took a head role in establishing a competing business in Newcastle. One of the consequences of the loss of staff was that the Warehouse was overstocked. This occurred for two reasons, firstly there was a drop in sales and secondly I believe that immediately prior to resigning some of the staff deliberately overstocked the Warehouse in what I considered to be a form commercial sabotage. Another consequence was that it left the Warehouse in a vacuum in terms of the skill base of the remaining workforce. To cope with the staff shortage Ullrich was forced to make increased use of labour hire resources. Safety Management Prior to September 2007 In the period leading up to September 2007 Bill Duncan had taken steps to create a safety committee at the Warehouse. To that end 5 employees, including Troy Murrell, had been sent to external safety committee training. Unfortunately, prior to the incident Troy Murrell had not completed his training due to missing the last day as a result of illness. Prior to the incident toolbox meetings at the Warehouse were held on an irregular basis. There was a policy within the company prior to the upheaval that I have referred to above to conduct safety meetings at the Warehouse. I understand that that policy was not adhered to following the Warehouse upheaval in late 2006 and early 2007. In November 2006 Dale Hutton, the Health & Safety Coordinator for Ullrich, made a presentation to Australian branch managers of Ullrich concerning health and safety. Alternate Racking Systems At the time of the incident it is my belief, based on my extensive experience in the industry and having inspected the operations of many companies within the industry, that the bulk storage racks in place at the Warehouse reflected that which was common throughout the industry at the time. However in 2007, Ullrich was developing a racking system that provided for the bulk storage of cases of aluminium extrusions in single stacks, isolated by bollards between stacks of cases of product with a view to eliminating a risk of stock collapses within the bulk storage racks. Such a system was under trial in the company's Adelaide warehouse. Even though a racking system with bollards was being trialled at the Adelaide warehouse, such a racking system had not been "rolled out" to Ullrich's other facilities such as the Newcastle Warehouse as I recall that there was a concern about the suitability of the particular racking system being trialled at the Adelaide warehouse for use in conjunction with the demag crane at the Warehouse due to the height of the bollards. Following the incident involving Mr Murrell a racking system with internal bollards was designed and installed at the Warehouse. The design criteria for the new racking system was intended to meet the following criteria: 1. safety; 2. accessibility (ease and efficiency of operation) and 3. maximising available storage area. Safety Management Since September 2007 In the aftermath of the incident in September 2007 I employed a senior OH&S professional to oversee, review and where necessary implement new processes insofar as the health and safety aspects of the Ullrich interests in Australia are concerned. There began a lengthy and difficult process in locating a suitably qualified and available individual. In November 2009 I employed Lynn Hart to perform that role. During the process of interviews I interviewed approximately 12 candidates before offering Lynn Hart the job. Many of the candidates came from a mining background and lacked the relevant manufacturing based expertise, especially in handling hot metal. In the immediate aftermath of the incident Ulrich [sic] took the following initiatives at the Warehouse: Regular toolbox meetings were instigated. The Warehouse staff were trained in crane competency. The Warehouse staff have received fire and emergency training. JSA and work method statements have been drafted in respect of each position in the warehouse. An improved procedure was formulated, including the development of a kit, for the induction of all new workers at the Warehouse. The cleaning hours were changed so that the cleaning staff were not at the Warehouse unsupervised. New Bulk Racking System Following the incident Ullrich took steps to completely redesign and reinstall the racking systems in place in the Newcastle Warehouse and make changes across its facilities in Australia. In October 2007 Ullrich procured from EMA Consulting Engineers Pty Ltd an engineering report relating to the design and installation of a new racking system at the Warehouse. The pendant controller for the crane at the Warehouse has also been replaced by a remote control system to remove the risk associated with removing the pendant from within the bulk racks. I am unsure of and have been unable to identify the cost of this. In total, Ullrich has spent close to $1 million installing new racks around its branches to prevent a situation such as that which occurred in September 2007 ever happening again. This has included a significant re-racking and upgrading of the Newcastle Warehouse. The welfare of staff is at the forefront of Ullrich's considerations and it continues look out for the need to upgrade facilities and processes where necessary to address this. Previous Incident in 1996 On 22 December 1998 Ullrich trading as Ullrich Noyes Metals was convicted of offences arising out of the death of Darren Gascoigne at its Smithfield plant in western Sydney on 21 February 1996. Although I was not involved in the Australian operations of Ullrich at that time, I take this opportunity to express, both on my own behalf and on behalf of Ullrich, our continuing remorse and sadness at the loss of Mr Gascoigne's life. I make the observation that a significant factor in that incident related to the method of packaging aluminium at the time of the accident. I note also that changes to aluminium packaging were introduced as a result of Ullrich's response to the accident. I refer in those regards to pages 10 and 11 of the Court's decision in IRC 7320 of 1997. Ullrich's Response to the Death of Troy Murrell Following the death of Troy Murrell I sent a letter to his parents and family on behalf of the company and as an expression of my own sadness and remorse at the tragic loss of Troy's life. The warehouse manager, Bill Duncan, made a eulogy at the funeral service for Troy Murrell. Ullrich paid funeral expenses and medical expenses. On behalf of the company I wish to express its acceptance and responsibility for the tragic loss of Mr Murrell's life, and for the risk that Mr Crawford was exposed to. On behalf of the company I would also like to express its sincere regret and remorse for the incident and the consequences that it has had for Mr Murrell's family. 23In his supplementary affidavit, Mr Ullrich clarified a number of matters referred to in his primary affidavit, including the following: At paragraph 11 of the Earlier Affidavit I state that workers were regularly informed never to enter the bollards for any reason. I accept however that prior to the incident Ullrich did not have any formal documented Job Safety Analysis or Safe Work Method Statement with respect to the bulk storage and/or handling of cases of aluminium product at the Warehouse. As a consequence, workers at the Warehouse developed informal practices to recover slings in circumstances where they came to rest within the bollards. I also accept and acknowledge having read records of interview in this matter that, unfortunately and ultimately tragically, from time to time workers did enter the bollards. Since the incident a Safe Work Method Statement for the task of "Lifting Packs with Overhead Bridge and Gantry Crane" has been developed. It makes clear that "[u]nder no circumstances" are workers to step into any area where packing could topple over. A long handled hook pole has been developed for use to recover slings. 24Ullrich Aluminium Pty Limited has employed Mr Hart as Group Occupational Health and Safety Supervisor since 16 November 2009. He has extensive qualifications and experience in occupational health and safety. Mr Hart deposed he had carried out an audit of the available records for Ullrich's employees that were employed at or around September 2007 and provided a summary of the personnel records of Mr Murrell and 10 employees with roles similar to Mr Murrell. 25In relation to Mr Murrell the audit revealed he had a prior knowledge of occupational health and safety requirements within warehouse operations and had approximately three years experience in warehouse/store person roles. In Mr Murrell's previous position with Ryco Hydraulics from 2005 to 2006, he worked as a storeman, was familiar with using a forklift, equipment maintenance and stock take - which was similar to the requirements of his role with Ullrich. The resume also indicates Mr Murrell had received an OHS Certificate in 2003 and had a forklift licence. 26The audit also revealed the following: It appeared there was an induction process for new employees at UIlrich as set out in the Employee Induction Manual. It appeared Ullrich retained Employee Training Records which specified employee training was being undertaken. It appeared Ullrich undertook a yearly skills assessment of its individual workers. It appeared that Ullrich undertook in-house training and external training for their employees. It appeared Ullrich had an Incident Management Reporting System in place during September 2007. 27Mr Hart drafted a table of actions undertaken by Ullrich just prior to and directly after 3 September 2007 to address occupation health and safety and risk management in the workplace. The table was in evidence. In addition to the above actions, since 3 September 2007, Ullrich has implemented the following Safe Work Method Statements as follows: (i) Safe Work Method Statement - Housekeeping dated 14 November 2007; and (ii) Safe Work Method Statement - Loading/unloading Bulk Racks (Version 3) dated 14 November 2007; and (iii) Safe Work Method Statement - Loading/unloading Bulk Racks (Version 4) dated 14 November 2007. 28Mr Hart prepared an Occupational, Health and Safety Management System Overview for Ullrich. The plan was in evidence. Mr Hart also prepared an updated Occupational, Health and Safety Plan for Ullrich for the period from January 2010 to December 2014. The Plan was in evidence. 29Mr Hart prepared a table of safety activities carried out by Ullrich from 16 November 2009 to 26 September 2011 and an Operational Risk Management Index of Procedures for Ullrich both of which were in evidence. 30Mr Hart referred to Ullrich's extrusion plant operations at Kurri Kurri. He stated: Since commencing operations, the Extrusion Plant has experienced only minor incidents resulting in lost time. Those incidents have been investigated by WorkCover NSW and resulted in no notices being issued under the Occupational Health Safety Act (NSW) by WorkCover NSW. As at today the Extrusion Plant has operated for 220 continuous days without a lost time incident. Prior to the current period we have achieved a period of 277 days without a lost time incident. 31In his supplementary affidavit, Mr Hart stated: I commenced employment with Ullrich on about 16 November 2009. As such, to the extent that I have sought to provide an account of the safety and training regime that applied to employees of Ullrich prior to and post the incident in September 2007 (up until the time I commenced employment with Ullrich), I have done so not based on personal experience at that time but on the basis of my review of records held by Ullrich. Verdict 32Having regard to the charges in this matter, the particulars of the offences, the agreed statement of facts and the evidence tendered in the proceedings, I accept the pleas of guilty by the defendant and will enter verdicts accordingly. Consideration Objective seriousness of offences 33The charges in these matters allege that the defendant failed to ensure against the risk of personnel, in particular Mr Murrell and Mr Crawford, being struck, trapped and/or crushed by falling cases of aluminium product. It was alleged that the defendant's failures were: a failure to ensure that the plant, namely, the "bulk storage racks" were safe; that the defendant failed to provide and maintain a safe system of work at the Mayfield site in relation to the stacking, rigging, lifting and movement of "cases" of aluminium products into and/or out of and/or within the subject bulk storage racks; that the defendant failed to adequately address the risk associated with the storage of "cases" of aluminium product in the bulk storage racks at Mayfield, including the risk associated with a collapse of "cases" of aluminium product within the confines of those racks; and that the defendant failed to provide its employees, in particular, Mr Murrell and Mr Crawford with such information and/or training as was necessary to ensure the health and safety of personnel. 34The bulk storage racks were apparently installed following an incident in 1996 when a stack of unrestrained "cases" of aluminium extrusions at the defendant's Smithfield warehouse collapsed, striking and fatally injuring an employee of the defendant, Darren Gascoigne, whilst he was in the course of picking and packing stock in proximity to the subject stack of cases. As a consequence of this incident the defendant was prosecuted under the Occupational Health and Safety Act 1983 for contravention of s 15(1). The defendant incurred a penalty of $50,000 ( WorkCover Authority of NSW (Insp Ch'ng) v Ullrich Aluminium Pty Ltd t/as Ullrich Noyes Metals [1998] NSWIRComm 668. Kavanagh J described what occurred at [4] of her Honour's judgment: [T]he deceased worker was in the process of preparing an order and placing items on a trolley. This activity took place approximately 1.5 metres from a stack of crates containing aluminium parts which were placed in two rows against the western wall of the factory. The back row of the aluminium crates stacked against the wall was approximately 2.75 metres high and the front row was stacked 1.5 metres high. Each crate contained aluminium extrusions of varying shapes and sizes. Each crate varied in weight from between 100 to 300 kilograms and was approximately 5 metres to 7.5 metres in length. The deceased had placed the trolley near the said two rows of stacked crates, when a crate became dislodged. According to Mr Noble, when he saw the stack start to fall, he called out to the deceased worker "Get out of the way quick". However, before the deceased could move out of the way, two of the crates fell against the trolley knocking both the deceased and the trolley over. According to Mr Noble the stack which fell had been standing for about a year. Over that period further crates had been added to the stack as items were used. The last time that new stock had been placed on the said rows of crates was approximately one week prior to the accident. The new stock was placed on existing stacks with the use of a forklift. 35The bulk storage racks, described earlier, could accommodate five rows of cases across the base and then stacked to the height of the end bollards that is, 2.6 metres high. In the process of selecting certain cases from the rack known as WB03 Mr Murrell and Mr Crawford used a pendant controlled electric overhead travelling "Demag" crane with fibre slings to move other cases out of the way. As it was stated in the Agreed Facts: Mr Murrell and Mr Crawford moved pallets from stacks in the middle of WBO3 and placed those pallets onto other, adjacent, stacks within the same rack. In the immediate aftermath of the incident, in an attempt to free Mr Murrell from the collapsed cases members of the Warehouse staff moved cases within WB03. 36Mr Murrell then entered about two metres into the gap that had been created in WB03 between the stacks to retrieve a sling attached to the crane, as that sling was apparently hanging from the crane hook, in the middle of the cases, about halfway into WB03. Mr Crawford described the cases as "dodgy", "unstable, "a bit unstable" and "didn't look safe". One of the cases of aluminium product that toppled over onto Mr Murrell hit him in the chest and chin area, pinning him in a vertical position against the western-most stack. Approximately a further eight to ten cases pinned down Mr Murrell. 37It seems to me there is little difference in terms of risk between stacks of cases up against a wall and a stack up against vertical bollards or stanchions if the stack of cases is unstable and capable of falling on a person in the vicinity. The defendant knew from what occurred in 1996 that a person could be killed if an unstable stack fell on them. Even though the cases were subsequently stacked in bulk storage racks that did not eliminate the risk as the death of Mr Murrell demonstrated. 38A properly conducted risk assessment, indeed, a brief consideration with a view to eliminating risk, would have revealed that storage in a rack of the type represented by WB03 would not eliminate the risk of a stack of cases falling on personnel. The defendant had an obligation following the 1996 incident to do what was reasonably practicable to eliminate the risk. It did not do so. The fact that the bulk storage racks may have represented some sort of "industry standard" provides no defence in circumstances where the employer has an absolute duty to ensure safety. 39Prior to the incident, even apart from its tragic experience in 1996, the defendant was aware that there had been collapses of cases of product within the bulk storage racks at the Warehouse, albeit these prior incidents did not result in any injury. Mr Wareham in his memo of 6 October 2006 had warned of the danger of collapse and recommended certain action be taken against that possibility. This is significant: it was not a question of whether it was reasonably foreseeable that persons might be placed at risk of falling cases of product. If it had been the defendant's culpability would be greater than it otherwise would be. But in this case the defendant knew precisely of the risk, having experienced the death of an employee in 1996 arising from the very same risk that is the subject of the present charges. 40It was at all material times clearly reasonably practicable to provide bulk storage racks for the storage of cases of aluminium product which incorporated vertical bollards and/or such other means of support and/or segregation between stacks of cases within each of the bulk storage racks designed to prevent the collapse of product, within each bulk storage rack, of the cases of aluminium product. By July 2007 new racking had been introduced for the bulk storage of cases of aluminium product at the defendant's Adelaide warehouse that utilised vertical bollards or stanchions between individual stacks of cases to maintain stability and prevent stacks from collapsing. Why it took over ten years for this new racking system to make an appearance in the defendant's warehousing operations was not adequately explained. But I note that the new racking system was installed at the Warehouse within a relatively short time of the incident on 3 September 2007. 41The system of work utilised by the defendant in relation to stacking, rigging, lifting and movement of cases of aluminium products into and/or out of and/or within the subject bulk storage racks was unsafe. From time to time the slings from the crane came to rest within the confines of the racks. 42The defendant relied upon informal and undocumented "on the job" training with respect to the manner in which the bulk storage of cases of aluminium extrusions was performed within the Warehouse. The informal work practices that were in place prior to the incident included a direction that workers were not to enter within the confines of the bulk storage racks. 43Prior to the incident, although provided with informal, oral warnings from the defendant not to walk between stacks of cases in the racks, from time to time workers entered the racks, between rows of cases, to retrieve slings that came to rest within the confines of a bulk storage rack or, alternatively, individual workers developed ad hoc responses such as leaning into the racks from the side, or using a nail attached to a long piece of wood to hook the sling and pull it out to the edge of the rack. 44Prior to the incident, Warehouse management was aware that the slings used in conjunction with the overhead travelling cranes to move the cases into, out of and within the bulk storage racks, from time to time came to rest within the racks and that, from time to time, workers entered into the racks to recover the slings. 45Prior to the incident, the defendant took no steps to put in place any formal controls on entering or leaning into the racks and to provide a safe means of retrieving the slings if and when they came to rest within the confines of a bulk storage rack. Subsequent to the incident the defendant developed a documented system of work regarding the task of removing stock from the racks. The documented work system addressed the risk of slings coming to rest within the confines of a bulk storage rack and included the provision of a hook to enable staff to recover slings without having to enter within the confines of the bulk storage racks. 46The prosecutor conceded that the defendant warned its employees not to enter the bulk storage racks and that Mr Murrell was aware of the risk of doing so. Indeed, Mr Murrell had warned Mr Crawford and others of the risk and had warned Mr Crawford and others not to enter into the racks. However, the prosecutor submitted it is trite law that the Act is "designed to protect against human errors including inadvertence, inattention, haste and even foolish disregard of personal safety as well as the foreseeable technical risks in industry": per Bauer J in WorkCover Authority of New South Wales (Inspector Twynam-Perkins) v Maine Lighting Pty Ltd (1995) 100 IR 248 at 257. See also WorkCover Authority of New South Wales (Inspector Mulder) v Arbor Products International (Australia) Pty Ltd [2001] NSWIRComm 50; (2001) 105 IR 81 at 99. 47It was further submitted for the prosecutor: Further, in light of the failure of the defendant to devise, provide and enforce the use of either a sling designed so as to ensure that the sling did not come to rest within the confines of a rack, or some safe means of recovering a sling when it did come to rest within the confines of a rack, it is submitted that the fact Mr Murrell stepped into the rack to recover a sling from where it had come to rest is not a matter which should be seen by the Court, with respect, to mitigate to any significant degree the culpability of the defendant. Rather, the prosecutor submits, with respect, that in the absence of any meaningful response by the defendant to the fact that its slings came to rest, from time to time, within the confines of the defendant's racks, should be seen to [sic] further evidence [sic] the lack of a diligent and proactive response to safety. It is submitted that, without more, the general, informal warning(s) given to workers in the face of a known and serious risk to safety - even one that was known to the worker - was in all the circumstances of this case an entirely inadequate and unsatisfactory response. See, for example: Gardner Bros Pty v McAuliffe (1986) 15 IR 477 at 479 48The fact that the defendant knew of the risk of entering a rack and had warned personnel not to enter into the racks must be a mitigating consideration. In that respect, the error or negligence of an employee may reflect on the degree of culpability of the employer for the purposes of sentencing: Riley v Australian Grader Hire Pty Ltd [2001] NSWIRComm 31; (2001) 103 IR 143 at [15]. 49However, I agree with the prosecutor that the fact the defendant had issued an informal warning to employees and by that means Mr Murrell was aware of the risk, an informal warning was a most inadequate means of ensuring employees and others did not enter the racks. The defendant knew that slings did come to rest from time to time within the racks and it knew that personnel were entering the racks to retrieve the slings. In circumstances where the defendant knew death could result from exposure to the risk of falling cases of product it was imperative that the defendant had in place a system of work that was designed to achieve all that was reasonably practicable to ensure personnel did not enter the racks. An informal warning fell well short of that requirement. 50At the very least the defendant should have provided personnel with a written work method statement, or safe operating procedure, with respect to the rigging, lifting and/or movement of "cases" of aluminium product into and/or out of and/or within the bulk storage racks at the Mayfield site that: (a) described how the work was to be carried out, step by step; (b) identified the work activities assessed as having risks; (c) identified the subject safety risks; and (d) described the control measures that were to be applied to the subject work activities to control the identified risks, including but not limited to the control measures to be applied for the purpose of controlling and/or minimising the risk of workers being struck by and/or crushed by "cases" of aluminium product whilst the employees were engaged in the tasks of rigging, lifting and moving product in to and/or out of and/or within the bulk storage racks at the Mayfield site. 51In relation to information and training some workers in the Warehouse who used the overhead cranes in the course of their employment, including Mr Murrell, did not receive formal, documented training in the use of the overhead cranes; nor were there any formal systems of work in place to ensure that Mr Murrell, and Mr Crawford were competent in the use of the overhead cranes. There was no requirement for operators of the overhead crane at the Warehouse to be assessed and certified under the Occupational Health and Safety Regulation 2001. Prior to the incident, the defendant did not audit the task of operating the overhead crane. 52The defendant should have provided, but failed to provide, Mr Murrell with adequate training and information with respect to the safe use and operation of the subject crane to lift, move and/or stack cases of aluminium product. It is noted that after the incident, the defendant introduced formal documented, skills-based competency training for all workers required to use the overhead cranes in the course of their employment. This training is provided by an appropriately qualified third party trainer and upon successful completion of the training, the third party trainer undertakes a competency based assessment and certification of the subject trainees. It is also noted that subsequent to the incident, the defendant developed a documented procedure for the task of removing stock from racks. 53The defendant failed to carry out any formal risk assessment relating to the use of the bulk racking system at the Warehouse. In my opinion, this contributed significantly to the presence of the risk. A formal risk assessment would have revealed the obvious danger of unstable stacks collapsing and would have revealed that from time to time slings came to rest inside the racks. It would have been a small step in the assessment process to work out the possibility of workers going inside the rack to recover the sling and place themselves at risk, with the potential result being another death. Death a manifestation of seriousness 54Mr Murrell's death is a manifestation of the seriousness of the risk to his safety, which was the risk of being struck, trapped and/or crushed by falling cases of aluminium product. Section 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 applies as an aggravating factor to be taken into account in determining penalty. Steps available to avoid risk 55The existence of simple and straightforward remedial steps that could have been taken by the defendant to avoid the risk to safety are relevant in assessing the seriousness of the offence: Department of Mineral Resources of NSW (McKensey) v Kembla Coal & Coke Pty Ltd (1999) 92 IR 8 at 27; WorkCover Authority of NSW v ACI Operations Pty Ltd [1994] NSWIRComm 167; Inspector Elizabeth Benbow v Planada Holdings Pty Ltd [2001] NSWIRComm 275. In the aftermath of the incident the defendant took steps to redesign and reinstall the racking system at the Warehouse as well as make changes to the racking systems it used throughout its Australian operations These changes involved expenditure of close to $1 million to have a new racking system designed (by engineers), and installed, to prevent a reoccurrence of the incident. 56Whilst the design and installation of a new racking system might not fall into the category of "simple and straightforward" (although separating stacks of cases using steel bollards does not appear to be a complex concept), other remedial steps were simple and straightforward including: the provision of information and training; the provision and maintenance of a safe system of work for the recovery of the slings so that personnel did not enter into the rack to retrieve the slings; and the provision of a written work method statement, or safe operating procedure, with respect to the rigging, lifting and/or movement of "cases" of aluminium product into and/or out of and/or within the bulk storage racks at the Warehouse. Factors mitigating seriousness 57The defendant submitted there were a number of mitigating factors the Court should take into account in assessing the objective seriousness of the offences. I have already referred to one of those, namely, that the defendant knew of the risk and had warned personnel not to enter into the racks. Other factors identified by the defendant were that: (a) Mr Murrell had been employed by Ullrich Aluminium as a storeman for approximately 7 to 8 months prior to the incident on 3 September 2007. Mr Murrell's duties included picking and packing aluminium products. This involved use of Ullrich Aluminium's Demag crane. (b) Prior to his employment with Ullrich Aluminium Mr Murrell had had experience as a storesperson. (c) Prior to the incident Mr Murrell was considered by Ullrich Aluminium to be experienced in his field of work. To this end, Mr Murrell was utilised by Ullrich Aluminium to train and supervise new storemen, both employees and labour hire workers, when they commenced work at the Ullrich Aluminium Warehouse. (d) The training provided by Mr Murrell included training in relation to Ullrich Aluminium's stock handling practices, the use of overhead cranes and the movement of stock into, out of and within the bulk storage racks using overhead cranes. (e) Mr Murrell was a member of the Ullrich Aluminium safety committee and was at the time of the incident undergoing safety committee and consultation training. 58I accept these are matters to be taken into account in assessing the objective seriousness of the offences here under consideration. I also accept the defendant's submission that it was not completely unresponsive to the risk. At the time of the incident the defendant was trialling an alternative bulk racking system at its South Australian warehouse. This alternative racking system obviated the risk of stack collapses by providing for the bulk storage of cases of aluminium extrusions in single stacks, isolated by bollards. The defendant had not "rolled out" this alternative racking system to the Mayfield Warehouse as it had concerns about the system's suitability for use in conjunction with the Demag crane at the Warehouse due to the height of the bollards. On the other hand, I note that the defendant had informed WorkCover in June 2006 that it was undertaking a review of racking at all of its branches and the new racking was installed in Adelaide by July 2007. Whilst there may have been concerns about the Adelaide system being suitable for the Mayfield Warehouse, it does not seem to me the defendant was in any particular hurry to deal with Mayfield. An engineering firm was not commissioned to design a racking system for Mayfield until after the incident and then it took only six weeks for an engineering firm to come up with a suitable design for the Warehouse. 59The defendant also requested the Court to have regard to the fact that in the period from December 2006 to July 2007 its Warehouse was in a state of dislocation arising from the resignation of a number of key employees and what it believed to be commercial sabotage. This dislocation, it was said, created a vacuum in terms of the skills base of the remaining staff at the Mayfield Warehouse, which led to an increased use of labour hire staff. In the circumstances, I do not regard the dislocation as being particularly relevant. The foundations of the risk would have been there regardless of dislocation and Mr Murrell who was directing Mr Crawford knew of the risk, yet because of the defendant's inadequate measures to ensure against the risk, Mr Murrell died. Deterrence 60The prosecutor submitted there needed to be a significant component of both general and specific deterrence in the penalties to be imposed by the Court. It was submitted in relation to specific deterrence the steps taken after the event by the defendant should not be assessed as significantly mitigating the defendant's culpability and that there was a significant overlap between the present case and the previous 1998 conviction. 61The defendant submitted that insofar as specific deterrence was concerned the evidence demonstrated the significant steps it had taken to improve safety. Having regard to such matters the Court's fine would only incorporate a low to modest amount for specific deterrence ( Inspector Williams v H P Woods (Holding) Pty Ltd [2011] NSWIRComm 114 at [48]; Inspector Hinton v Waterway Constructions Maintenance Pty Ltd [2011] NSWIRComm 132 at [38]-[39]). 62In relation to deterrence, the Court is to be guided by the Full Bench decision in Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610. The risk involves personnel being struck, trapped and/or crushed by falling material and such risks are not uncommon in industry. An appropriate level of penalty that has regard to the need for general deterrence will compel attention to such risks: see Fisher v Samaras Industries Pty Limited (1996) 82 IR 384 at 388. The penalty should reflect a significant element for general deterrence. 63In relation to specific deterrence, the objective is to deter the particular offender from repeating the offence. The propensity to re-offend must be considered when determining the weight, if any, to be attached to specific deterrence: Capral at [76]. 64The defendant has undertaken commendable steps to ensure there is no recurrence of the contraventions that brought it before this Court. That suggests the chances of the defendant committing the offence again are considerably diminished. However, the defendant was convicted and fined in 1998 for an offence committed in very similar circumstances to the present offences and the measures implemented by the defendant to ensure the risk did not arise again were inadequate as these current proceedings demonstrate. That is a factor I have had regard to in determining what element there should be in the penalty for specific deterrence. 65Moreover, the defendant continues to be an employer. Other risks to the safety of its employees or contractors may continue to exist or be possible. Employers are required to maintain constant vigilance and take all practicable precautions to ensure safety in the workplace. I find it necessary, in fixing the level of penalty, to have regard to the need to encourage a sufficient level of diligence by the defendant in the future: Capral at [77]. Prior conviction - maximum penalty 66The defendant has a prior conviction and therefore faces a maximum penalty of $825,000 for each offence. Subjective Factors 67In relation to subjective considerations, the steps taken by the defendant following the incident are relevant factors in mitigation. I accept the defendant's submission that since the incident it has worked diligently to improve its overall safety performance and has introduced a number of safety initiatives. These include: the employment of a senior occupational health and safety supervisor (Mr Hart); the development and installation of a new bulk racking system; the reinstatement of tool box meetings; the implementation of safe work method statements addressing inter alia the loading and unloading of bulk racks using an Overhead Bridge and Gantry Crane; the preparation of an Ullrich Aluminium Group Occupational Health and Safety Management System Overview; the development of an Ullrich Aluminium Occupational Health and Safety Plan; and the preparation of an Ullrich Aluminium Operational Risk Management Index of Procedures. 68In respect of the defendant's plea of guilty, the prosecutor submitted that the plea carries with it some utilitarian benefit the value of which the Court may reflect by granting to the defendant a discount. However, it was submitted it could not be said that the defendant sought to enter a plea at the earliest possible opportunity. In this regard, the prosecutor noted, in particular, the delays in the plea and sentencing process brought about as a consequence of a Reference sought by the defendant. Reliance was placed on Inspector Kent v Duct Master Pty Ltd [2009] NSWIRComm 143 at [30]-[42]. 69In October 2010, at the request of the defendant, Staff J referred questions of law to the Full Bench of the Industrial Court pursuant to s 196 of the Industrial Relations Act 1996. The principal question on the Reference concerned the time within which, for the purposes of s 107 of the OHS Act, the subject proceedings could be properly commenced. The reference was listed for hearing before the Full Bench on 4 April 2011. 70However, in late March 2011 the defendant sought "revocation" of the Reference and, by consent, the relevant orders revoking the Reference were made in chambers on or about 30 March 2011. The defendant entered its pleas of guilty in relation to the Amended Applications for Order when the matters were before the Court on 1 June 2011. 71The discount of 25 per cent should, in the majority of cases, be reserved for those cases where the timing of the plea provides the greatest utilitarian value: Duct Master at [36]. It could not be said that the timing of the pleas in these proceedings provided the greatest utilitarian value given the interlocutory application and its revocation by the defendant. The Court intends to apply a discount of 15 per cent. 72It was submitted by the prosecutor in relation to remorse and contrition that before the Court may take "remorse" into account there must be evidence before the Court that is capable of satisfying each limb of s 21A(3)(i) of the Crimes (Sentencing Procedure) Act 1999 and the Court needs to be satisfied that the remorse so demonstrated is genuine. Section 21A(3)(i) provides that "remorse" may be taken into account as a mitigating fact if and 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). 73The prosecutor noted that there was some evidence, which if accepted, demonstrated an expression of remorse made on behalf of the defendant by Mr Gilbert Ullrich. However, the prosecutor observed that the tenor of the evidence appeared to be more in the nature of "[a] simple expression of contrition and remorse" by a senior executive. In this respect reference was made to Cahill v State of NSW (Department of Community Services) (No 4) [2008] NSWIRComm 201; (2008) 182 IR 231 at [62] where it was observed: [62] A simple expression of contrition or remorse by a representative of a corporate offender, no matter how senior the representative, is not enough to enable the Court to find that the offender is remorseful: As Cummins J said in DPP v Esso Australia Pty Ltd [2001] VSC 263; (2001) 124 A Crim R 200, "personal expressions of remorse need to be translated into reality". See also see Regina v Heip Tan Nguyen [2004] NSWCCA 438 per Bell J ( Hidden and James JJ agreeing) at [21]. There must be "evidence that the offender has accepted responsibility for its actions and also that the offender has acknowledged any injury, loss or damage caused by its actions or that it has made reparation for such injury, loss or damage (or both)". 74The defendant submitted it had demonstrated contrition and remorse as evidenced by its conduct following the incident (including the pleas of guilty) and the express statement of contrition and remorse in Mr Ullrich's affidavit, in his letter to Mr Murrell's family and in the terms of the eulogy delivered by Mr Duncan on behalf of the defendant. I am prepared to accept there was remorse demonstrated by the defendant. 75The prosecutor conceded, correctly, that the defendant co-operated in the investigation by WorkCover of the subject incident. 76In mitigation, I have also taken into account in its favour the defendant's commitment to workplace safety demonstrated by the post incident measures it took and by its record at the extrusion plant at Kurri Kurri: ( Morrison v Powercoal Pty Ltd (No 3) [2005] NSWIRComm 61; (2005) 147 IR 117 at [109]). Totality 77Given the two prosecutions of the defendant arising from the same incident, the question of totality arises. There is a very significant overlap between the two charges. Both Mr Murrell and Mr Crawford were subject to the same risk of being struck, trapped and/or crushed by falling cases of aluminium product. It so happened that Mr Murrell entered the rack and not Mr Crawford and was fatally injured. 78In considering totality, the court must look to the totality of the criminal behaviour and ask itself what is the appropriate sentence for all the offences : Mill v The Queen [1988] HCA 70; (1988) 166 CLR 59 at 63. The effect of the totality principle is to require a sentencer who has passed a series of sentences, each properly calculated in relation to the offence for which it is imposed and each properly made consecutive in accordance with the principles governing consecutive sentences, to review the aggregate sentence and consider whether the aggregate is "just and appropriate": Mill at 63 citing DA Thomas, Principles of Sentencing (2nd ed, 1979) 56-57; cited with approval in Johnson v The Queen [2004] HCA 15; (2004) 205 ALR 346 at [18]. 79It would clearly not be appropriate to fix a penalty in respect of the offence involving Mr Murrell and simply double it. That would be to impose a "crushing sentence" on the defendant, inconsistent with its prospects for rehabilitation. However, it would also not be appropriate to fix a penalty for the offence involving Mr Murrell and regard that as a "just and appropriate measure of the total criminality involved": Postiglione v The Queen [1997] HCA 26; (1997) 189 CLR 295 at 307-308 per McHugh J. To do so would pay no regard to the fact that the defendant had failed to ensure two persons, an employee and an employee of a labour hire firm, were not exposed to risk. The defendant had an obligation to ensure both persons were not exposed to risk and the penalty must reflect the seriousness of the defendant's failure in that respect. 80I have concluded that, having regard to the discount for the guilty plea, the two offences should attract a penalty of $450,000 in respect of Mr Murrell and $350,000 in respect of Mr Crawford. Having regard to the totality principle, a penalty of $600,000 appropriately reflects the total criminality involved. The penalty of $600,000 should be split as $350,000 in respect of the offence relating to Mr Murrell and $250,000 in respect of the offence relating to Mr Crawford. Victim impact statement 81The Court has received a victim impact statement of Mr Murrell's mother. The Court acknowledges receipt of the statement. Mrs Murrell, with the assistance of her husband, read the statement in court. 82Mrs Murrell said the hardest thing she has ever had to do was witness the death of her son. Mrs Murrell said the day following the accident she and her family were taken into a room "where the intensive care doctors told us there was no hope for recovery and recommend that we turn his life support off." Mrs Murrell was overcome with grief at her son's funeral and required assistance from family and friends. 83Mrs Murrell said she could not express in words how she felt, "the emotions that I go through each and every day. I can't explain in words the extent of my anger and sadness at what has happened to Troy. I can't bring him back, but I would give anything to be able to." 84Mrs Murrell said: To take life in the work force is unjustifiable. It is everyone's right to be safe at work. As mothers we do not expect our children to go to work and end up dead. It is our job to send our children to work and to expect them to come home safely. How many of our children have to pay the ultimate price because of unsafe workplaces? It takes little effort and money to keep our young safe. If they are taught right from the beginning things would not escalate. Safety is paramount; safety is the key to survival. 85Mrs Murrell described the effect the death of her son had on her family: Both Rob and I have suffered from deep depression and have wished that our lives were taken instead of our son, Troy. We are a broken family. We will never see Troy get married, have children or be able to share any of our special events, the birthdays, Christmases, Mothers' Day, Fathers' Day and the family gatherings are all denied to us, all the things that bring great joy to all of us. The grief for a mother is tenfold, a grief only a mother can feel, a grief that noone can comprehend unless they have lost a child. Carrying a child for nine months and delivering that child is one of the most precious moments in a mother's life; watching that child grow and caring for them. Watching Troy grow and develop into a beautiful young person was the reason for my existence. ... He also loved his two fathers, Rob and Gerry, and me, especially me, his mother. He loved Angela, his fiance, with all his heart, the love of his life. He and Angela were together for ten years. He had proposed to her just before the accident. How sorry I am Angela will not be my daughterinlaw. How sorry I am that there will never be any grandchildren. The deep brown eyes, the olive skin, the dark hair; I guess I will have to visualise, something I never thought I would have to do.... The saddest thing is the fact that I will never see the gentle kind and penetrating dark brown eyes of our son, Troy. These days all I have are pictures and stories from his friends. I treasure these things, but it is not the same as having Troy here. I cannot cuddle, kiss, or touch my son. I feel so empty inside. My heart has been broken and will never be able to be put back together again. ... Life will never be the same without a loved one that has been so tragically taken. We used to celebrate many family occasions together. We would have Christmases, birthdays, Mothers' Day, Fathers' Day, and would love to get together for great family barbecues. Since we have lost Troy, it has all completely stopped. I feel guilty to have any sense of enjoyment. I cannot bring myself to celebrate any holidays or share the joys we used to share as a family. We are shattered. We will never be the same again. 86There was no objection to the victim impact statement and no call to cross-examine the statement maker. I am unable to take into account the effect of Mr Murrell's death on his mother in determining penalty: see discussion in Inspector Lancaster v M L Colturi Sawmills Pty Ltd [2011] NSWIRComm 47 at [80]-[90]. 87I am effectively limited to acknowledging in this judgment the impact on Mrs Murrell of her son's death. It is obvious that Mrs Murrell and her family have suffered tremendous pain and grief at the loss of Troy Murrell. The Court extends its deepest sympathy. Orders 88The Court makes the following orders: Matter No IRC 689 of 2010 (1) The defendant is found guilty of the offence charged under s 8(1) of the Occupational Health and Safety Act 2000. (2) The defendant is fined an amount of $350,000 with a moiety to the prosecutor. (3) The defendant shall pay the costs of the prosecutor as agreed or assessed. Matter No IRC 690 of 2010 (1) The defendant is found guilty of the offence charged under s 8(2) of the Occupational Health and Safety Act 2000. (2) The defendant is fined an amount of $250,000 with a moiety to the prosecutor. (3) The defendant shall pay the costs of the prosecutor as agreed or 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. Decision last updated: 25 November 2011