Australia: Safety breach proper grounds for termination

Last Updated: 6 June 2011
Article by Emma Reilly

Mr Wayne Chadwick v Woodside Energy Limited [2011] FWA 2890 (12 May 2011)

Strict adherence to safety rules required, even in context of 15 year employee with good record

The applicant was a 50 year old Maintenance Technician at the Karratha Gas Plant and had been employed for about 15 years. His remuneration package was over $220,000 per annum when his employment was terminated. He also had the substantial benefit of an employee share plan.

The applicant's employment with Woodside was terminated for breaching the Integrated Safe System of Work ('ISSoW'). The purpose of the ISSoW is to create a safe working environment by providing management control over potentially hazardous activities.  

A 'permit to work system' is one of the safety management controls used in hazardous environments such as the gas plant in question. Different permits are issued to different levels of authority. A permit is always supported by a Hazard Identification Risk Assessment ('HIRA'). Permits are issued and signed off electronically. However, they are printed off and provided to the person who is going to perform the work. The printed permit is provided to the Performing Authority. The Performing Authority provides the printed permit to the persons responsible for the area where the work is to be performed (the Area Authority) who will sign the printed permit (this is referred to as wet signing). Under the ISSoW, maintenance employees are not authorised to issue permits. The Issuing Authority must do this. The Area Authority is accountable for a particular area of the plant (e.g. Storage and Loading). The Area Authority will inspect the equipment and site before any work commences under a permit issued by an Issuing Authority. Permits are valid for seven days.  

The Permit System forms part of Woodside's 'Golden Safety Rules'.  

A Permit to Work was issued on Monday 24 January 2011. It was a Hot Work Permit that expired on Monday 31 January 2011, at 12.48pm (the First Permit). Hot Work is work which involves a potential source of ignition. The applicant was named as the Performing Authority.  

A condition on the First Permit was for there to be liaison with the Control Room Panel Operator to ensure that the work could be performed safely. It is clear that under that condition that the work was not permitted to commence until that liaison had occurred. As the work was to continue beyond one day, and thus required a break in the activity, the permit was suspended each day at the end of the work that was subject to the permit being performed. The requirements of the ISSoW are that work could not restart until the status of the permit changed from 'suspended' to 'issued'.  

The work involved was to investigate / repair an Enraf level gauge fault on LNG Tank 3. The applicant worked subject to the first permit on Monday 24 and Tuesday 25 January 2011. Another maintenance technician worked with him. At the conclusion of work on both of those days the First Permit was suspended. On 31 January 2011 at about 9.50am the applicant and his colleague arrived at the Worksite. They realised they did not have with them a copy of a permit and knew that the Permit Hut was closed and would not open until after midday. They did not contact the Area Authority to obtain permission prior to commencing work and did not liaise with the panel operator in accordance with the First Permit. The work was performed until 12.30pm when the applicant went to the Permit Hut to get the First Permit. The applicant states that they then found out that the permit needed re-authorising by the Site Controller and RPE (Responsible Person Electrical) because the seven day period of the First Permit had expired. A permit was issued shortly afterwards and had no changes to any conditions or requirements. Work continued under the Second Permit.

The applicant's employment was ultimately terminated for breaching the Golden Safety Rules in working without the permit on 31 January 2011.

The applicant accepted that working without the permit was a breach of an important part of the process for creating a safe working environment.

However, he had no intention of breaching the Golden Safety Rules. He forgot about picking up the First Permit because he had spent the morning trying to track down spare parts so that he could fix the fault on the level gauge. The applicant asserts that he continued working on the Enraf fault under the terms of the existing Permit (meaning the First Permit), on the basis that he had previously worked on the same piece of equipment under the same permit, and knew the conditions of it. He also asserted that he and his colleague decided not to contact the Panel Operator because they believed there would be no impact for the Operator from the work being conducted.

The applicant submitted that there was no valid reason for his termination and that it was harsh, unjust and unreasonable. The applicant also claimed that the procedures that Woodside undertook in investigating and discussing the conduct with the applicant were unfair.

The employer submitted in response that non-compliance with the rules relating to permits was not tolerated. Woodside's approach is that compliance with the rules cannot be compromised regardless of the consequences for efficiency and productivity.

Deputy President McCarthy accepted that the applicant initially forgot to get the permit. However, when he started work he knew he did not have it, and so should not have been performing the work. This breach with knowledge was considered a valid reason for termination. It was held that the applicant was notified of the reason for his termination of employment, he was given an opportunity to respond and he was allowed to have a support person present.

The consequences of the termination were taken into account. It was noted that the effect of losing not just the level of income but a range of benefits of working with Woodside in the capacity the applicant was working was substantial. However, when balanced with the gravity of the misconduct, the termination was not considered harsh, unjust or unreasonable so as to give rise to a remedy for the applicant. His application was dismissed.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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