Industrial Relations Commission New South Wales Medium Neutral Citation: Inspector Estreich v Cement Australia (Kandos) Pty Limited (ACN 004 158 972) [2013] NSWIRComm 65 Hearing dates: 06/03/2013 Decision date: 09 August 2013 Before: Backman J Decision: In IRC No 1491 of 2011, the Court makes the following orders: (1) Cement Australia (Kandos) Pty Limited is convicted of the offence and fined $100,000 with a moiety to the prosecutor; (2) the defendant is to pay the costs and disbursements of the prosecutor in the agreed amount of $100,000. In IRC No. 1494 of 2011, the Court makes the following orders: (1) Cement Australia Pty Limited is convicted of the offence and fined $90,000 with a moiety to the prosecutor; (2) the defendant is to pay the costs and disbursements of the prosecutor in the agreed amount of $100,000. IRC No. 1495 of 2011 is stood over for a directions hearing at 9.30am on Friday, 9 August 2013. Catchwords: OCCUPATIONAL HEALTH AND SAFETY - Occupational Health and Safety Act 2000 ("the Act") - pleas of guilty to offences under s 10(2) and s 8(1) of the Act - worker fatally injured while undertaking an inspection of a component part of a cement processing plant at premises at Kandos - omissions on part of both defendants to install fixed guarding - other acts and omissions alleged - objective factors considered - subjective factors considered - respective roles of defendants in the circumstances of the offences considered - Victim Impact Statement - Orders Legislation Cited: Occupational Health and Safety Act 2000 Cases Cited: Inspector Hughes v Advanced Metal Door Frames Pty Ltd [2013] NSWIRComm 2 Category: Principal judgment Parties: Inspector Pamela Estreich (Prosecutor) Cement Australia (Kandos) Pty Limited (ACN 004 158 972) (First defendant) Cement Australia Pty Limited (ACN 104 053 474) (Second defendant) Representation: Mr C Magee, of counsel (Prosecutor) WorkCover Authority of New South Wales (Prosecutor) Norton Rose Fulbright (First and Second Defendants) File Number(s): IRC 1491 of 2011 IRC 1494 of 2011 Judgment 1Cement Australia Pty Limited (CAPL) has pleaded guilty to an offence under s 10(2) of the Occupational Health and Safety Act 2000 (the Act). The offence and accompanying particulars are set out in an amended application for order which was filed on 29 January 2013. 2Cement Australia (Kandos) Pty Limited (CA Kandos) was charged under s 8(2) and in the alternative under s 10(2) of the Act. The charge in the alternative was not pursued by the prosecution and an application for its withdrawal was granted. With regard to the remaining charge under s 8(2), the prosecution informed the Court that it could not be satisfied beyond reasonable doubt that the prosecution could prove one of the legal elements of the offence, namely, that Colin David Fuller was a person "other than an employee" of CA Kandos whom CA Kandos had failed to ensure was not exposed to risks to his health and safety. An application was made by the prosecution under s 30 of the Act, which was not opposed by CA Kandos, that the Court could be satisfied in the alternative that CA Kandos had contravened s 8(1) of the Act. Section 30 provides: If in proceedings against a person for an offence against a provision of section 8 or 9 the court is not satisfied that the person contravened that provision but is satisfied that the act or omission concerned constituted a contravention of another provision of section 8 or 9, the court may convict the person of an offence against that other provision. 3It was an agreed fact between the parties that CA Kandos was the employer of Mr Fuller at the date of the incident, the subject of the alleged contravention. Following the tender of evidence, I reviewed the material relied upon in relation to this matter and I advised the parties that I was satisfied, in accordance with the requirements under s 30 of the Act, that the acts or omissions alleged against CA Kandos in the s 8(2) charge constituted a contravention of s 8(1) of the Act. Following that advice, CA Kandos pleaded guilty to an offence under s 8(1) of the Act. The plea of guilty encompassed the "acts and omissions" alleged against CA Kandos in the s 8(2) charge. 4The charges against both defendants concern the same underlying factual circumstances which occurred prior to and at the time of the incident. The relevant facts may be drawn from the Agreed Statement of Facts, a document tendered by the prosecutor in both sets of sentence proceedings. 5Both defendants are part of a trading group, the Cement Australia Group (the CA Group). The group is engaged in the mining, processing, manufacturing, sale, supply and distribution of cementitious products, including limestone, clay and raw materials through its various subsidiaries. CA Kandos is the owner of premises at Kandos, at which is located a cement processing plant (the plant) also owned by CA Kandos. At about 10.20pm on 13 September 2009, Mr Fuller suffered fatal injuries when he was crushed between two hydraulic rams that constituted a component part of the plant at the premises, known as the C2 Reciprocating feeder. 6CAPL is the manager of CA Kandos pursuant to a Management Agreement. Through its role as manager of CA Kandos, CAPL had, to a relevant extent, control of the plant and equipment at the premises. This control was exercised through its: a. authority to authorise and approve capital expenditure in relation to plant and equipment at the Site; b. development of the Cement Australia Group safety management system applicable at the Site; c. the undertaking or engagement of others to undertake audits of the plant and equipment at the Site. 7As at 13 September 2009, CA Kandos employed about 80 employees at the premises. Mr Fuller had been working at the premises while employed by another business entity, Skilled Engineering, from about 7 February 2008. He commenced full-time employment with CA Kandos as a Day Process Operator at the premises on 4 August 2008. Sam Vellenoweth was the Operations Manager of the processing plant. Brett Morgan was the Production Performance Manager. Phillip Jackson and Jeffrey Rogers were each employed by CA Kandos at the premises as Central Control Operators (CCOs). Their role was to monitor the plant operations from a Central Control Office at the premises via various monitoring equipment which included videos and computer screens. Mr Jackson was on duty on the evening of 13 September 2009 and was responsible for part of the plant known as the Raw Materials Preparation Area. Mr Rogers was also on duty at that time, but was primarily responsible for part of the plant known as the Production Area. Grant Keech was employed by CA Kandos as a Central Control Assistant (CCA) at the premises. On the evening of 13 September 2009, Mr Fuller was on duty performing the role of a CCA, principally in respect of the Raw Materials Preparation Area. Mr Keech was also on duty as a CCA, but was performing those duties primarily in respect of the Production Area. 8The role of a CCA contemplated assisting the CCOs to maintain the safe and efficient operation of the plant. CCAs worked in three main sections of the plant, namely, the: a. Raw Materials Section; b. Kiln Section; c. Cement Production Section. 9The duties of a CCA included: a. performing pre-start checks on plant and equipment; b. monitoring of plant, equipment and systems; c. monitoring of product quality; d. performing front line maintenance to plant, equipment and systems; e. performing house keeping duties. 10Details of the plant, including a description of its component parts and its operation, are set out in the Agreed Facts, extracted below: The Raw materials Preparation Area included an area called the Stone Tunnels. This was located in the North East corner of the site. The Stone Tunnels contained plant and equipment, in particular two reciprocating feeder and conveyor belt systems, known as conveyor belt two ("C2") and conveyor belt three ("C3"), ""the CS & C3 Reciprocating feeders"). The length of each of the C2 & C3 Reciprocating feeders was approximately 60 metres. At each side of the conveyors were passageways approximately 1.5 metres wide. The height of the Stone tunnels from the floor to the ceiling was approximately 2.3 metres and each tunnel had an approximate width of 4.5 metres. Electric lights were installed at intervals along the tunnel. However, the lighting levels in the Stone tunnels were poor. The C2 & C3 Reciprocating feeders were part of the process whereby raw materials, predominantly crushed limestone, were transported from the crusher to the production area of the plant. The C2 & C3 Reciprocating feeders are fixed items of plant made up of hoppers, feeder frames and hydraulic rams. Each feeder was attached to the ceiling of the tunnels. The hopper or chute is a shaft that channels the limestone onto the conveyor. The C2 & C3 Reciprocating feeders also had banks of hydraulically operated feeders which transported the limestone from the hoppers above onto the conveyor system. The feeders were moved by sets of hydraulic rams. The hydraulic ram system consisted of several plant components including feeder frames (also known as retractable hoppers), which were bolted to a plate that is attached to a plate by pivot pin. The feeder frames comprised of a steel frame that had a mesh base. The purpose of this feeder frame is to act as a "shaker" that slides back and forth producing friction in the hopper to cause the limestone to fall down into the conveyor below. Each conveyor was divided into three banks, with five stone feeders above each bank. The design of the banks meant that at points along the C2 & C3 Reciprocating feeders the rear of the hydraulic rams of one set of feeder frames was horizontally opposed to the rear of another set of feeder frames. The hydraulic rams were approximately 125 mm in diameter laying horizontally in line with the conveyor at a height of approximately 1.5 m and facing inwards towards each other. Each ram was mounted at the outer end to a substantial welded lug on upright fixed girders that ran from the floor to the ceiling. The inner ends, i.e. the pistons of each ram, were mounted to separate heavy steel frames that sat above and across the conveyor. Directly opposite on the far side of the conveyor was an identical set of opposed hydraulic rams connected in the same way to the two steel frames. Each steel frame of the feeders was supported on a solid steel wheels that sat on the metal work at the sides of the conveyor, similar to a flattened rail car sitting on tracks. The steel wheels allowed fore and aft movement of the steel frames of the feeders as the hydraulic rams advanced and retracted. Between the two steel frames of the feeders, at a height of about 1.5 m was a parallel gap of approximately 120 mm. The frame at either side of the gap was made of steel which lay across the width of the conveyor, extending beyond the framework of the conveyor at each side by approximately 250 mm. During the operation of the C2 conveyor the hydraulic rams moved the frames of the feeders towards and apart from each other. Each stroke of the rams took approximately 2 seconds and moved the frames approximately 200 mm. At the end of each stroke, there was a pause of approximate (sic) 15 seconds before the ram moved the frame in the opposite direction. The feeders did not move together and apart at the same time. When one bank moved, the other remained stationary. This produced a pattern of movement that resulted in various gaps between the two feeders of approximately 445 mm when fully opened and 85 mm at the closest position. The Australian Standard - Safety of Machinery Part 1803 & Part 1101 outlines the minimum distance for crushing zones where an arm is expected should be 120 millimetres, and where a body is expected, it should be 500 millimetres. As at 13 September 2009, the C2 Reciprocating feeder and conveyor system was not fully guarded along its length. It did have some guarding in place at some of the potential nip or crush points, for example, there was guarding on the wheels of the feeder frames and on the head and tail drums of the conveyor belts. However, there was an absence of guarding along the C2 Reciprocating feeder and conveyor system at the banks of feeders at the point where the rear of hydraulic rams of one set of feeder frames was horizontally opposed to the rear of another set of feeder frames. The Australian Standard - Conveyors - Safety requirements AS1755-2000 requires that guards be installed to prevent access to danger zones in or around a conveyor system in which a person is subject to a risk to health or safety. Below the frame of the conveyor, on each side, there was a lanyard cable that ran the length of the conveyor at a height of approximately 1100 mm. Its purpose was to electrically isolate the C2 feeder and conveyor when it was pulled. It was designed and functioned to immediately stop all associated machinery including the conveyor belt, the feeder, and the hydraulic rams. Directly below the lanyard, running along the frame of the conveyor at a height of approximately 400 mm above the ground was a hydraulic line, which consisted of a steel pipe about 25 mm in diameter. In or about 2007, CA Kandos put forward a capital expenditure request for the upgrade of the C2 Reciprocating feeder and conveyor system. The capital expenditure request was considered and approved by the CA Group Chief Financial Officer, Greg Blackford and the CA Group Chief Executive Officer, Mr Leon in mid 2008. The C2 Reciprocating feeder and conveyor systems were re-built in mid 2008. The specifications prepared by the Cement Australia Group for the work to be undertaken on the C2 Reciprocating feeders did not specify the installation of fixed guarding which complied with the Australian Standards on guarding at all crush zones and danger zones and in particular between the hydraulic rams of the feeder frames. However, the 'Invitation to Tender' document prepared by the CA Group for the re-build of the C2 Reciprocating feeders under the heading "Safety Standards states that "Relevant Australian Standards and codes of practice shall be complied with". In failing to install a guard at the crushing zone of the C2 conveyor where the hydraulic rams moved the frames of the feeders towards and apart from each other, the defendants failed to comply with the requirements of Australian Standard - Safety of Machinery Part 1803 & Part 1101 and Australian Standard - Conveyors - Safety requirements AS1755-2000. 11Details of the incident which resulted in the death of Mr Fuller are also set out in the Agreed Facts, extracted below: Colin Fuller commenced work at approximately 7:30 pm on 13 September 2009. He was due to undertake an afternoon shift that commenced at 8.00 pm. As at 13 September 2009, there was no direct supervisor on Site to whom Mr Fuller reported during the afternoon and night shifts on weekends. On 13 September 2009, at approximately 9:50 pm Phillip Jackson, CCO noticed on monitoring equipment located in the Central Control Room that the normal grade hopper level was low on the C3 Reciprocating Feeder. In the Central Control room there was a silent visual alarm system to draw the attention of the Central Control Operators that there would be a feeder not feeding correctly. This alarm did not specifically indicate the cause of the problem or whether it was caused by a blockage in the system. Accordingly, a visual inspection was required to identify the specific problem. Part of the role of a CCA was to undertake such a visual inspection to identify the cause of the problem and, where safe and appropriate, to rectify the problem. Shortly after 9:50 pm on 13 September 2009, Mr Jackson contacted Mr Fuller by two-way radio. Up to that time Mr Fuller had been performing his rostered duties, and checking on the raw mill throats. Mr Jackson then instructed Mr Fuller to do an inspection of the feed line on the C3 Reciprocating Feeder. Mr Fuller subsequently attended at the C3 Reciprocating Feeder in the Stone Tunnels and located feeders where a shear pin had broken. Mr Fuller was working alone whilst undertaking the task. Mr Fuller then radioed the Central Control Room to deselect the C3 Reciprocating Feeder so he could safely replace the broken shear pin. Mr Jackson deselected the C3 Reciprocating Feeder at approximately 9.55 pm then notified Mr Fuller who then commenced work replacing the broken shear pin. After a short period of time Mr Fuller then radioed Mr Jackson informing Mr Jackson that the problem had been rectified. The C3 Reciprocating Feeder was put back into service at approximately 10:09 pm. Mr Jackson then radioed Mr Fuller and informed Mr Fuller that numerous hoppers in the C2 Reciprocating Feeder in the Stone Tunnels were not feeding. Mr Jackson then directed Mr Fuller to undertake a visual inspection of the feed lines of the C2 Reciprocating Feeder in the Stone Tunnels to identify the problem. Mr Fuller was working alone whilst undertaking this task. There was no further communication between Mr Fuller and Mr Jackson. At approximately 10:12 pm Mr Jackson saw that the system was flashing indicating that lanyard one (1) of the C2 Reciprocating Feeder in the Stone Tunnels had been isolated. Ordinarily, the isolation of a lanyard would be followed by radio communication from the CCA who tripped the lanyard advising the Central Control Operator of the reason for the stoppage. However, the Central Control room did not receive any communication from Mr Fuller or any other CCA regarding the reason for the stoppage. After waiting a few minutes Mr Jackson attempted to radio Mr Fuller two (2) or three (3) times to ask if Mr Fuller had tripped the lanyard. However, Mr Jackson was unsuccessful in his attempts to contact Mr Fuller. At approximately 10.42 pm the Central Control Operator gave the system a reset. The operator turned off the C3 Reciprocating Feeder. At approximately 10.43 pm the C2 Reciprocating Feeder was selected not to run by the Central Control Operator. The C3 Reciprocating Feeder was also selected not to run by the Central Control Operator. At approximately 10.50 pm the C2 Reciprocating Feeder was isolated. At approximately 10.50 pm the Central Control Operator gave the system a reset. The C2 conveyor belt was still isolated at the whole current isolator (WCI). At approximately 10.50 pm the Central Control Operator attempted to start the C2 Reciprocating Feeder to prove isolation. At approximately 10.51 pm the Central Control Operator acknowledged the whole current isolator (WCI) alarm. Mr Jackson then decided to go down and physically check on Mr Fuller and the tripped lanyard. Mr Jackson then proceeded to the Stone Tunnels and entered the tunnels. Mr Jackson then proceeded down the length of the C2 conveyor and discovered Mr Fuller crushed between two hydraulic rams. Mr Fuller was crushed at the point of the middle of his chest and back with his arm reaching up into the front bin. Mr Jackson checked Mr Fuller's pulse and found he didn't have one, and immediately radioed for emergency services. An ambulance arrived a short time after and Mr Fuller was pronounced dead at the scene. Mr Fuller was subsequently removed by emergency service personnel from the C2 Feeder. An inspection of the site shortly after the Incident discovered a hammer just under Mr Fuller's right hand along with a large piece of cementitious material under the chute next to Mr Fuller. It is possible that while inspecting the C2 Feeder and conveyors equipment, Mr Fuller may have identified that this large piece of cementitious material was causing a blockage in a hopper which fed the C2 conveyor. The cementitious material appears to have been causing a blockage of the Feeder. The hammer was located in the vicinity of the cementitious blockage in the feeder. This hammer may have been used by Mr Fuller to attempt to strike the cementitious material to free up the blockage. It also appears that Mr Fuller may have decided to attempt to remove the blockage manually using the hammer while the plant was still operating and was not isolated from its energy source. This was contrary to the practice and procedures at the site at the time and with respect to which Mr Fuller had been trained and instructed, which required the plant to be isolated and locked out prior to any person accessing the plant. 77. It is not known exactly how Mr Fuller came to be in a position where his body was between the two hydraulic rams. It is possible that, in order to access the area where the large piece of cementitious which was causing a blockage was located, Mr Fuller may have climbed onto the hydraulic lines that ran along the side of the conveyor system. This would have required him to manoeuvre himself over the safety lanyard. Blockages were common occurrences on the C2 and C3 Feeders and Conveyors. The blockages were usually caused by wet clay that settled down into the feeder, which then built up and formed a blockage. Typically, blockages were left in situ until the C2 and C3 conveyor belts and hydraulics were isolated and dozers were brought into the stone sheds located above the feeders to dig and break up the blockage out from above. It is not apparent as to why Mr Fuller would attempt to clear a blockage on the C2 feeder without isolating the machinery first as it was not in accordance with the existing procedure at the Kandos Plant. Mr Edward Norris, a Fitter employed by CA Kandos, stated that it was a common practice to stand on the hydraulic lines of the C2 Feeder to look at the feeders and check them while the C2 Reciprocating Feeders and conveyor systems were still operating. He believed that was what Mr Fuller was doing at the time of the incident. Mr Norris had last worked in the stone tunnels approximately 2 years preceding this incident, but had not worked in there subsequently. The stone tunnel re-build was in mid 2008. Mr Morgan, a Production Performance Manager employed by CA Kandos, stated that approximately 2.5 years prior to the Incident he had identified and reported the specific risk of a 'potential pinch point' for a hand or arm where the feeders move backwards and forwards. Mr Morgan had noted that there 'is a small area that closes up and leaves a small gap'. He also stated that he verbally reported the issue to the Production Manager approximately 2.5 years prior to the Incident. In response Mr Morgan put yellow safety tape around the feeders and informed the teams working in the area of this hazard. However, no guarding was installed by CA Kandos or CAPL as the areas on the C2 Reciprocating feeder and conveyor system where the risk had been identified. The charges 12Both charges describe the risk to safety to Mr Fuller as the risk of crush injuries to parts of his body from the crush points between unguarded moving parts of the plant while undertaking, "the Task". the task referred to in the description of the risk is particularised in the charges in relation to Mr Fuller as, the performance of duties of a CCA including, "undertaking the accessing, inspection, identification and rectification of faults including blockages in plant systems, including the plant at the raw materials processing area of the premises". It will be recalled from the extracted parts of the Agreed Facts that shortly before the incident Mr Jackson directed Mr Fuller to undertake a visual inspection of the feed lines of the C2 Reciprocating Feeder in the stone tunnels in order to identify a problem that had arisen in relation to the operation of the Feeder. 13Similar "acts and omissions" are alleged against each defendant in the charges in relation to the failure to ensure that the plant was safe. The charge against CAPL particularises these similar acts and omissions as follows: The defendant failed to ensure that the Plant was safe and without risks to health, in that the defendant failed to take the following measures: a. the installation of fixed guarding which complied with the Australian Standards on guarding at all crush points located in the Stone Tunnels of the Raw materials processing area of the premises and in particular between the hydraulic rams of the feeder frames on the Plant; b. undertaken an audit of the guarding of the Plant at the premises to ensure that guarding was installed at all crush points. 14Additional acts and omissions are alleged against CA Kandos. These are extracted below: The defendant failed to provide a safe system of work and working environment to persons who were not its employees and in particular Colin David Fuller, for undertaking the task at the premises, in that it failed to take the following measures: a. provide an adequate system to control and record access to the entry to Stone Tunnels; b. provide a system of locked gates and an entry procedure for access to the Stone Tunnels; c. provide a task specific Safe Work Method Statement or Job Safety and Environment Analysis which addressed the following matters: i. that all work undertaken on the plant in the Stone Tunnels must be in work teams of two or more people; ii. that a centralised system for access to the keys to the Stone Tunnel with a register be kept; iii. detailed the specific steps required to isolate the feeders and hydraulics of the plant; iv. detailed the specific steps required for removing guards on the plant; v. detailed the procedures required to be undertaken to remove blockages in the plant; vi. detailed the procedures for working on the plant when energised, including the requirement to obtain a permit to work, the completion of a risk assessment and the appointment of a safety observer; vii. the requirement to undertake a work site risk assessment for the task; viii. the requirement to prepare a work site risk assessment control plan; d. have in place a system of competency assessment for all persons who were not employees, including Colin David Fuller, who were required to perform work involving the accessing the Stone Tunnels and undertaking the task on the plant. The defendant failed to provide adequate supervision to persons who were not its employees and in particular Colin David Fuller, whilst he was undertaking the task at the premises, in that it failed to take the following measures: a. provide direct supervision of Colin David Fuller by an appropriately trained person whilst he was undertaking the task on afternoon and/or nights shifts; b. supervise Colin David Fuller to ensure that he complied with the measures identified in the Isolation and Lockout Procedure document and the Energised Plant Work Procedure document prior to commencing work on the task; c. supervise Colin David Fuller to ensure that he did not attempt to clear blockages in the plant whilst the plant was operating and was not de-energised, isolated and locked out; d. supervise Colin David Fuller to ensure that he completed a work site risk assessment for the task and control plan prior to his commencing work on the task on the plant; The defendant failed to provide adequate instruction to persons who were not its employees and in particular Colin David Fuller, whilst he was undertaking the task at the premises, in that it failed to take the following measures: a. instruct Colin David Fuller that he was not to undertake the task of clearing blockages in the plant whilst the plant was operating and was not de-energised, isolated and locked out; b. instruct Colin David Fuller that he was not to stand or climb onto the structure of the plant whilst the plant was operating to undertake the task of clearing blockages in the plant. Objective factors 15The systems in place at the time of the offences for the operation of the plant were comprehensive, although defective in a number of respects, a matter conceded on behalf of the defendants. The systems have been set out in detail in the Agreed Facts, as well as in an affidavit of Alan David Michener, the General Manager for Safety Health & Environment in the CA Group. It is not necessary for present purposes to set out the very informative and lengthy account given by Mr Michener concerning the safety systems in operation at the premises before and at the time of the incident. It is sufficient to refer to some of the more relevant aspects of those systems. Much of the material deposed to by Mr Michener has been set out in the Agreed Facts. Both documents focussed on the CA Group's integrated occupational health and safety management system, known as the Safety, Health Environment and Quality (SHEQ) Management System. This system was applicable to the operations conducted by CA Kandos at the premises and extended to the operations of the plant at those premises. The SHEQ Management System included a SHEQ Standard 2006. According to Mr Michener, the SHEQ Standard at the time of the incident contained a section on isolation and lock out procedures, which outlined the following requirements: (1) that damaging energies on all plant are reduced to a "zero energy" state and locked out before the plant is worked on; (2) no person is allowed to work on, around or enter equipment unless the damaging energies have been isolated and they have applied their personal lock and tag in accordance with site work instructions; (3) all fixed and mobile plant are provided with suitable methods for isolating and locking out damaging energy; (4) procedures are developed and implemented to ensure that unsafe plant and equipment is identified and withdrawn from service using appropriate methods of isolation, safety tag and lockout; (5) an isolation and lockout work instruction is developed and implemented for each item of plant and a permit system for high risk plant is developed and implemented; (6) in the event that equipment must be operating while specific operational or maintenance tasks are carried out, then these tasks are only carried out in accordance with documented work instructions; (7) isolation points and main zones of isolation are identified (for example, switchboards); and (8) responsibility is allocated for the verification that plant and equipment is safe before being returned to service. 16According to the Agreed Facts, the requirements set out in the SHEQ standard were specifically tailored to the operations at the premises. A document entitled Lockout Procedure KA-SP-003 Revision dated 9 November 2005 incorporated a procedure which required workers at the premises to isolate machinery that could endanger safety before any work was undertaken on that machinery. The procedure provided that before work was commenced, a worker was to: (i) ensure the appropriate energy isolator was in the off position; (ii) apply his or her danger tag and lock the isolator using the Safety Lock out lock in the location provided; and (iii) verify that the isolation was effective by attempting a local start and contacting Central Control to attempt a remote start (unless the work procedure indicated that was only a local control and not a remote start on the particular equipment). 17It is significant that Mr Fuller had been trained in the isolation and lock out procedure. This training took place on 15 February 2008 while Mr Fuller was an employee of Skilled Engineering. The training included a site-specific induction, as well as ongoing training involving the assessment and competency of CCAs working in the raw materials preparation area. The Agreed Facts sets out the main components of the training received by Mr Fuller in relation to his work at the premises: ... Mr Fuller was given an individual presentation involving instruction, demonstration and supervised practice, and was provided with copies of numerous manuals, booklets and documentation about working on the Site. This training included training in the OHS requirements for the raw material preparation area, including identifying the key steps necessary for the safety of personnel working on any hazardous equipment, and the procedures and precautions to be taken when clearing blockages from chutes and feed systems. The training also included an assessment. The results of Mr Fuller's assessment indicate that Mr Fuller knew where the lanyard and emergency stops were at the Kandos Site and knew how to use them. Over the period 29 and 30 July 2008, Mr Fuller (when an employee of CA Kandos), participated in and completed a structured competency-based training program and assessment for CCAs working in the Raw Materials Preparation Area. Upon completion of the training provided to CCAs working in the Raw Materials Preparation Area, CCAs are expected to be able to identify procedures and precautions to be taken when clearing blockages from chutes and feed systems. The duties of CCAs working in the Raw Materials Preparation Area at the Site included a requirement to enter the Stone Tunnels. It included a requirement to inspect plant such as the C2 & C3 Feeders while they were still operating. The Job description document for a CCA working in the Raw Materials section of the plant required CCAs to undertake tasks including plant inspection in the stone tunnel, including assessing the safety of guarding and clearing blockages on C2 & C3 Feed Systems. It also required a CCA to 'ensure that all guards are in place and secure' and 'strict adherence to isolation procedures'. 18According to Mr Michener's unchallenged account: If the Isolation and Lockout Procedure, as described above and as Mr Fuller had been trained in, had been followed by Mr Fuller, the Incident would never have occurred. This is because Mr Fuller would have turned the energy isolator on the C2 Reciprocating Feeder and Conveyor into the off position, applied his lock tag to the isolator and verified with a Central Control Operator that the isolation was effective before attempting to clear the blockage in the C2 Reciprocating Feeder chute. 19The Agreed Facts also postulate that Mr Fuller, while inspecting the C2 Reciprocating Feeder, may have attempted to remove the blockage while the plant was still operating, that is, not isolated from its energy source. It was an Agreed Fact that the failure to isolate the plant from its energy source was contrary to the practices and procedures at the premises in relation to which Mr Fuller had been trained and instructed. It was also an Agreed Fact that blockages on the C2 and C3 Reciprocating Feeder were common occurrences and were left in situ until the conveyor belts and hydraulics were isolated. 20It is of course not necessary to attempt to ascertain why Mr Fuller did not undertake the proper isolation procedure in which he had been trained, nor is it possible to do so. However, on behalf of the defendants, it was submitted that Mr Fuller's conduct in failing to isolate the machinery, contrary to existing practices, was a factor which operated to mitigate the objective seriousness of the offences. Submissions were also made on behalf of the defendants on this issue concerning the position in which Mr Fuller was ultimately found which was said to have been preceded by a number of complicated manoeuvres which included stepping over a lanyard and moving the hydraulic arms, said, in turn, to constitute conduct which militated against a finding that the risk to Mr Fuller's safety was reasonably foreseeable. 21I find myself unable to agree with this second set of submissions. As I understood those submissions, they were partly based on a construction of the relevant Australia Standards which according to the defendants only required guarding at a particular point of a machine if there was an expectation that a particular body part, such as an arm, could access, or enter, a "crushing zone". According to the Agreed Facts, the Australian Standards outline a minimum distance for crushing zones, "where an arm is expected 120 millimetres, and where a body is expected, 500 millimetres". At the time of the incident, the C2 Reciprocating Feeder did not comply with the provisions of the Australian Standards because the pattern of movement between the feeders resulted in gaps between the two feeders of approximately 445 mm when fully opened and 85 mm at the closest position, and, those gaps were not guarded. Moreover, the defendants had earlier been informed (by Mr Morgan) of the risk of a potential pinch point for a hand or arm where the feeders moved backwards and forwards. A measure effected at that time was to place yellow safety tape around the feeders and inform the teams working in the area of the hazard. Sometime in 2007, CA Kandos put in a request for an upgrade of the C2 Reciprocating Feeder and conveyor system. The request was approved and a re-build took place in mid-2008. According to the Agreed Facts, however, the specifications prepared by the CA Group for the work did not specify the installation of fixed guarding which complied with the Australian Standards, in particular, in relation to guarding at all crush zones between the hydraulic rams of the feeder frame, although a further document prepared for the re-build by the CA Group did state that the Australian Standards "... shall be complied with". Nevertheless, at the time of the re-build no guarding was installed at the crushing zone of the C2 Conveyor where the hydraulic rams moved the frames of the feeders, which was contrary to the requirements set out in the Australian Standards. It may be concluded from these matters that the absence of guarding at this location gave rise to a risk to the safety of Mr Fuller which was reasonably foreseeable and was in fact known to the defendants. 22Mr Fuller's conduct in departing from the isolation and lockout procedure in which he had been trained is another matter. This conduct falls to be assessed in the context of what can be described as an otherwise safe system with regard to isolation and lockout procedures, which were implemented and enforced by CA Kandos at the premises in relation to the operation of the plant. Mr Fuller's conduct therefore, confined to the particular circumstances I have outlined above, operates to mitigate the objective seriousness of both offences. In coming to this conclusion, I bear in mind the submissions made on behalf of the defendants that Mr Fuller was considered a valued employee. It was not suggested by the defendants that his conduct in any way was otherwise inappropriate. 23Another feature of the CA Groups' safety systems which applied at the premises at the time of the incident was the requirement to undertake an audit of machine guarding of the C2 and C3 Reciprocating Feeders and Conveyor systems. It was an Agreed Fact, however, that neither CAPL, nor CA Kandos, undertook an audit of the machine guarding of this particular component of the plant in the period 19 September 2007 to 13 September 2009. An internal audit of the isolation and lockout system in relation to the plant was conducted in August 2009. The plant received a 100 per cent compliance rating in relation to the isolation and lockout system as a result of that audit. 24Other site-specific procedures (in addition to the isolation and lockout procedure mentioned above) in force at the premises prior to the incident are set out in detail in the Agreed Facts and in Mr Michener's affidavit. For convenience, these are summarised below: (i) a procedure for working with energised plant that required a risk assessment to be undertaken before commencing work and a "permit for work" form to be completed; (ii) a Working Alone Policy which required that communication lines be maintained with persons working alone; (iii) a site management form to drive safety improvements and ensure safety standards were met; (iv) the employment of a Site Safety Health and Environment (SHE) Manager; (v) an OHS Committee which met on a monthly basis; (vi) training regimes in accordance with the SHEQ standard; (vii) fixed plant and guarding procedures which were ongoing and which involved the expenditure of $410,474.00 on guarding improvements in the period from 2003 to 2009; (ix) sanctions for non-conformance with the OHS procedures, including termination of employment. 25These systems were in operation at the premises at the time of the incident and were largely effective in addressing safety issues. This finding operates in favour of the defendants and mitigates the objective seriousness of the offences. There were, however, a number of deficiencies (in addition to those earlier adverted to), some of which are worthy of mention here: (i) no system was developed at the premises by CA Kandos to ensure that if Mr Fuller was going to work on the C2 Reciprocating Feeder (as he was directed to do) he would not commence the work without isolating and locking out the plant and without the knowledge of the CCO; (ii) neither defendant had developed a Safe Work Method Statement (SWMS) or JSEA for the performance of work on the C2 and C3 Reciprocating Feeders which addressed matters such as working on the plant in the stone tunnels with at least a team of two people; (iii) CA Kandos did not allocate a supervisor to provide direct or regular supervision of Mr Fuller while he was undertaking work on the plant on weekend night shifts. 26The seriousness of the risk to Mr Fuller's safety can be said to have manifested itself in the fatal injuries received by Mr Fuller. Moreover, measures for obviating or eliminating the risk were readily available. These measures are evident from the steps taken by the CA Group following the incident. They have been helpfully summarised by the prosecution in submissions, reproduced below: In December 2009, the CA Group upgraded the guarding on the C2 and C3 Reciprocating Feeders and conveyors in the Stone Tunnels to ensure compliance with the Australian Standards on Guarding. This included guarding being installed along the full length of the C2 and C3 Reciprocating Feeders and conveyors, which included guarding of the crush zones between the hydraulic rams of the feeders. The CA Group also conducted a guarding audit to identify potential guarding hazards at the Site. The CA Group also took steps to implement measures in relation to systems of work for safe accessing and working on C2 and C3 Feeders in the Stone Tunnels. In particular it introduced an interim procedure for safe accessing and working on C2 and C3 in the Stone Tunnels and Belts and prepared a document entitled "Procedure for Safe Accessing of C2 and C3 Stone Feeders and Belts", KA-SW-160. The interim procedure for safe accessing and working on C2 and C3 Feeders in the Stone Tunnels includes the following requirements: (i) all work undertaken in the C2 or C3 area must be in work teams of two or more people; (ii) a centralised system for access to the keys to the Stone Tunnel with a register kept; (iii) details of the specific steps required to isolate the feeders and hydraulics; (iv) details of the specific steps required for removing guards; (v) procedures for working on energised Plant, including the requirement to obtain a permit to work, the completion of a risk assessment and the appointment of a safety observer; Further, the CA Group took measures to implement a system of competency assessment for all operators who were required to perform work involving the accessing of the Stone Tunnels and working on the C2 and C3 Feeders. The CA Group also implemented measures to address the failures relating to access and egress to the Stone Tunnels. This included that access and exit to the Stone Tunnels and C2 and C3 was gated and required a key to enter. The key had to be obtained from the Central Control Room and signed out on a register. Access to the Stone Tunnels was also limited to no fewer than two people, and these people must have been appropriately trained. New procedures were developed for isolation and lock out specific to C2 and he associated machinery. These include: (i) a procedure for the replacement of shear pins that expressly requires isolation before attempting to replace a shear pin; and (ii) a procedure for the removal of blockages in the C2 and C3 in the Stone Tunnels. 27The Court agrees with the prosecution's submission that had the defendants implemented these measures prior to the incident, it would have eliminated, or at least, controlled the risk to the safety of persons, in particular, Mr Fuller, who were required to perform work in the tunnels on the C2 Reciprocating Feeder. 28The factors outlined above gave rise to a grave risk to Mr Fuller's safety. At the time of the accident, Mr Fuller was working alone and unsupervised on a piece of machinery which was unguarded thereby facilitating access to its dangerous moving parts. Maximum penalty 29Neither defendant has prior convictions. They both face a maximum penalty of $550,000. Deterrence 30With regard to the principle of general deterrence, I adopt and apply my remarks in Inspector Hughes v Advanced Metal Door Frames Pty Ltd [2013] NSWIRComm 2 at [42] and [43]: [42] The dangers posed by unguarded machines have been the subject of frequent comment in this jurisdiction. Indeed, the number of times defendants have been prosecuted in this jurisdiction for breaches of safety legislation arising from failures to ensure machines are not left in an unguarded state are so numerous that general deterrence must assume particular significance. Accordingly, this Court endorses and adopts the comments made by a Full Bench in Inspector Lai v Rexma Pty Ltd and Another [2008] NSWIRComm 78; (2008) 172 IR 210 at [9]: The need for the application of the principle of deterrence in the sentencing process cannot be underestimated here. The offences reveal yet another serious incident involving unguarded machinery where the risk to safety, although obvious, was ignored. We adopt the observations of Walton J, Vice-President, in WorkCover Authority of New South Wales (Inspector Ankucic) v Crown in the Right of the State of New South Wales (Department of Education and Training) (2002) 112 IR 1 concerning the importance of the principle when considering the objective seriousness of offences involving unguarded machinery: [41] . . . It scarcely needs to be said that the presence of unguarded machinery constitutes one of the most pernicious and infamous dangers to the health and safety of persons in the workplace. It is this very type of danger that prompted persistent and ongoing legislative attempts by governments to compel the correction of such obvious and serious faults in the systems and plant employed in the operations of employers: see WorkCover Authority (NSW) v Waugh (1995) 59 IR 89 at 100 and Department of Mineral Resources (NSW) (Chief Inspector Terry) v A M Hoipo & Sons Pty Ltd (1999) 99 IR 137 at par 53. [42] The dangers presented by an unguarded saw are well known and management at all levels should be vigilant to ensure that unguarded machinery is not used . . . [43] Given the prevalence of offences involving accidents and injuries arising from the use of unguarded machinery, it is of the utmost importance that businesses using dangerous machinery should be made aware that the failure to address the risks posed by the use of such machinery will result in serious penalties. 31According to the Agreed Facts, the CA Group resolved on 5 July 2011 to close the plant at the premises. Shortly after the main operating units at the premises ceased operation, the employees of CA Kandos were reduced, on a staggered basis, throughout the remaining months of 2011. The current situation is that the remaining employees at the premises are limited to those attending from time to time to assist with post-closure activities. Based on these matters, a small component of the penalty to be imposed against CA Kandos is warranted as reflective of the need to apply the principle of specific deterrence. 32CAPL, however, continues to operate in the industry, which necessitates the application of the principle. The impact of this on penalty, however, will be moderated having regard to its attitude to questions of workplace safety and the steps taken by it (and by CA Kandos) following the incident to address the risks to safety. 33The prosecution submitted that the offences against both defendants fall into the "high range of seriousness". Given the comprehensive and impressive systems of safety in force at the premises, as well as the other matters accepted by the Court as mitigating the otherwise objective seriousness of the offences, I do not agree with the submission. Based on all the factors outlined above, however, both offences constitute serious breaches of the Act. Subjective factors 34Neither defendant is adversely recorded and is therefore entitled to leniency normally extended to first time offenders. 35Although the defendants initially entered pleas of not guilty to the charges, CAPL entered a plea of guilty to a charge which had undergone significant amendments and CA Kandos consented to the application of s 30 of the Act which will result in a conviction for a different offence. The prosecution took the view that both defendants entered their pleas of guilty at an early stage, taking into account the matters mentioned above. I propose therefore to award a discount of 25 per cent reflecting the utilitarian benefit derived from the pleas of guilty. 36The prosecution conceded that both defendants had expressed contrition and accepted responsibility for their respective roles in the circumstances of the offences. These matters are demonstrated by the post-incident remedial measures implemented at the premises, and in the personal expressions of remorse expressed on their behalf. 37The post-incident measures implemented at the premises were both extensive and effective. I have earlier set out some of the more significant steps taken. I take them into account, together with the additional steps relied upon by Mr Michener in his affidavit, in mitigation of the penalties to be imposed. 38Other subjective factors (which pertain generally to the CA Group) are outlined by Mr Michener in his affidavit and will also be taken into account in the defendants' favour. These include (extracted from Mr Michener's affidavit): Community Involvement CA's two major plants - Gladstone, Queensland and Railton, Tasmania - are based in regional areas, in which CA employees from a significant presence in those local regions. It is important to CA that it maintains a strong relationship with these communities and helps to foster, not only the local economy, but also community development. This is achieved through active community liaison groups, donations to local emergency services, assistance in times of need such as floods, community grants, educational scholarships, animal release programs and apprenticeships. CA has donated approximately $177,000 to the Railton community over the past five (5) years and donates approximately $30,000 annually to the Gladstone community in various sponsorship programmes. From a national perspective, CA has maintained a strong relationship with Habitat for Humanity Australia for over five years. During that time, CA has provided financial, product-in-kind and labour support in building homes for people in need. A true copy of the Mission Statement for Habitat for Humanity Australia is exhibited behind tab 53 of Exhibit ADM1. Safety Awards CA Awards an annual "Outstanding Safety Commitment" award in its "Awards for Excellence" programme which aims to recognise exceptional OHS performance by employees in line with CA's values. The "Outstanding Safety Commitment" award recognises outstanding commitment to the safety of CA personnel demonstrated through a range of initiatives, including: (1) safety leadership; (2) providing the workplace with skills and knowledge to carry out their duties safely; (3) responding to incidentals and near misses in a proactive and positive manner; (4) giving feedback for both positive and "at risk" behaviours; (5) engaging the workforce in the identification, assessment and control of hazards in the workplace; and (6) actively and willingly participating in safety committees and the review of safety controls. As an example, in 2011, the Supply Chain team received the award for their innovative change to road transport pre-start check processes. By implementing a system whereby employees used a trolley to carry materials around that could access hard-to-reach parts of vehicle engines, rather than requiring employees to work at height, they removed risks of slips, trips and falls associated with the pre-start checks. This was part of a project called "Safer on the Ground". WorkCover Queensland was so impressed with this procedure they asked CA to work with them to roll-out the initiative state-wide. Diversity in the workplace CA has a focus on promoting diversity within its operations. CA has a strong commitment for championing equal opportunity for women at all levels in the business, in an industry typically dominated by men. A true copy of CA's 'Diversity and You' manual, dated July 2011, is exhibited behind tab 54 at Exhibit ADM1. CA also has an Indigenous Employment Strategy (IES) that aims to create employment and training opportunities for Aboriginal and Torres Strait Islander people across CA sites and offices nationally. A true copy of CA's IES "Partnering for Indigenous Success" brochure is exhibited behind tab 55 at Exhibit ADM1. 39Both defendants also co-operated with WorkCover during its investigations into the incident. Respective culpabilities 40It was submitted on behalf of the defendants that CAPL was less culpable than CA Kandos in the circumstances which gave rise to the offences. This was said to be because CAPL's role was limited to that of manager of the CA Group and its functions, which were to put in place systems, relevantly, in relation to isolation procedures and guarding. The implementation of those systems at the premises was the responsibility of CA Kandos. This characterisation of the respective roles of the defendants was disputed by the prosecution, which contended that CAPL authorised and approved the re-build of the plant in 2007, a relevant factor which resulted in the absence of guarding at the time of the incident. In addition, the prosecution contended that the requirement to undertake and engage auditors was the responsibility of CAPL, another significant factor relevant to the assessment of CAPL's culpability. The prosecution submitted that the culpability of each defendant should more accurately be characterised as equal. 41At the risk of unnecessary repetition, the Agreed Facts record that CAPL managed the CA Group's Safety Management System (SHEQ) which included the application of that system to the premises owned and operated by CA Kandos. It was also an Agreed Fact that both defendants failed to install guarding at the areas on the C2 Reciprocating Feeder and Conveyor system after the risk had been identified; and, that neither defendant had undertaken an audit of machine guarding on that particular component of the plant in the period 19 September 2007 to 13 September 2009. It was also an Agreed Fact that neither defendant had developed a SWMS or JSEA for the performance of work on the C2 and C3 Reciprocating Feeders and Conveyors prior to the incident. These matters, at first glance, might facilitate a conclusion consistent with the prosecution's submissions. However, it seems to me that there are several features which distinguish the role of CA Kandos from that of CAPL and which compel the conclusion that the role of CA Kandos in the circumstances of the incident is reflective of more culpable conduct. CA Kandos was the employer of Mr Fuller with direct responsibility for his safety. It was also the owner of the premises and the plant which was housed there. The charge against CA Kandos particularises a number of additional acts and omissions alleged to have constituted failures to ensure Mr Fuller's safety. These acts and omissions are absent from the charge against CAPL. They include matters concerning failures to provide a safe system of work at the premises and failures to provide adequate supervision and instruction. These additional matters, in my view, elevate the culpability of CA Kandos to a higher level than that of CAPL. Victim Impact Statement 42During the sentence proceedings, a letter written by Mr Fuller's mother, Colleen Fuller, was handed to the Court. The letter attests to the dreadful sense of loss and grief suffered by Mrs Fuller and Mr Fuller's siblings. The Court expresses its deepest sympathy to the family for their loss. It was not a matter of dispute between the parties, however, that the accepted law on the admission of a victim impact statement permits the Court to acknowledge the statement and make appropriate comment, but not to take it into account as part of the material relevant to the penalties to be imposed. Orders 43In IRC No 1491 of 2011, the Court makes the following orders: (1) Cement Australia (Kandos) Pty Limited is convicted of the offence and fined $100,000 with a moiety to the prosecutor; (2) the defendant is to pay the costs and disbursements of the prosecutor in the agreed amount of $100,000. 44In IRC No. 1494 of 2011, the Court makes the following orders: (1) Cement Australia Pty Limited is convicted of the offence and fined $90,000 with a moiety to the prosecutor; (2) the defendant is to pay the costs and disbursements of the prosecutor in the agreed amount of $100,000. 45IRC No. 1495 of 2011 is stood over for a directions hearing at 9.30am on Friday, 9 August 2013. * * * * * * 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 August 2013