Australia: Employers face hefty penalties for not removing known health and safety risks

Last Updated: 15 April 2014
Article by Michael Selinger and Mark Khunnithi
Most Read Contributor in Australia, September 2016

A recent decision has highlighted the dire consequences of employers failing to be proactive in detecting and removing known risks to health and safety.

In the case, employee Mr Bakerov died as the result of a work related accident at a sewerage treatment plant, presumed to have slipped through a dislodged steel slatted grate in the walkway and drowned.

Similar walkways at the plant had been reported as problematic as far back as 2008, the Melbourne County Court heard, with reports at the time recognising that the consequences of the dislodged grates included serious injury or fatality due to drowning.

Although the specific problems were remedied, similar occurrences were reported throughout 2010. In particular, one report noted that a possible cause of the dislodgement was the aerated foam from the channel pushing up on the grates.

While various investigations into the accident could not specifically point to the way in which Mr Bakerov happened to drown in the channel, it was accepted that he must have fallen through a dislodged slatted grate.

The Decision

The company pleaded guilty to one charge of failing to keep its workplace safe and without risks to health pursuant to s21 of the Occupational Health and Safety Act 2004 (Vic). Accordingly it was left to the Judge to determine the appropriate sentence. The Company faced a potential fine of up to 9000 penalty units which is currently $1,099,260.

After reviewing comparable cases and weighing up any mitigating factors, the Judge ordered the defendant to pay a fine of $400,000 which would have been $500,000 but for the guilty plea. Moreover the judgment noted that at the time of Mr Bakerov's death there were extensive health and safety procedures already in place and as such specific deterrence (that is, the component of a penalty designed to focus the attention specifically on the company not to reoffend) played only a modest role in the Judge's reasoning.

The Court was particularly concerned by the following:

  • The fact that there had been a number of reports concerning the grates which had gone unheeded. While some of the reports related to checked-shaped grates (as opposed to the offending slatted grates), the Judge found that these reports should have brought to the mind of the health and safety supervisors that a similar occurrence could happen with the slatted grates.
  • The consequences of a failure to take adequate steps were dire. The Judge outlined that a guide for sentencing was to look at the 'foreseeable potential consequence' of a failure to take steps. Before forming the view that the penalty should have been $400,000, the Judge reviewed three other similar cases:
  1. Director of Public Prosecutions v Amcor Packaging Australia Pty Ltd [2005] VSCA 219

A fine of $180,000 (maximum penalty: $250,000) was imposed after a man was crushed by rollers in a paper manufacturing plant. There had been no safety procedures or safeguards at the time despite two previous incidents.

  1. Director of Public Prosecutions v Nationwide Towing & Transport Pty Ltd [2011] VSCA 291

The court imposed an aggregate penalty of $450,000 for two charges (maximum penalty: $966,000) after a man was killed whilst loading an excavator onto a trailer which did not have the appropriate surface. There had been previous incidents after which the company had resolved but failed to fix the issue with the surface. Moreover, there had been neither safety instruction given to the man nor any risk assessment conducted.

  1. Director of Public Prosecutions v Coates Hire Operations Pty Ltd [2012] VSCA 131

The Court of Appeal set aside a fine of $250,000 imposed by the sentencing judge, and substituted a fine of $500,000 (maximum penalty: $966,000). The victim was an employee of a contracting company who was not made aware of the loading procedures for a truck (a winch was required).

Lessons for Employers

This case highlights the critical importance of employers being proactive in detecting and removing risks to health and safety. It also emphasises the importance of spreading information through out an organisation about a risk to health and safety which may occur in a similar situation but one which has not been expressly reviewed, in this case the different types of grates. It is also a clear example of a Court being prepared to impose a very significant penalty for a breach of the safety laws in circumstances where the business should have addressed known dangers to which its employees were exposed.

DPP v Melbourne Water Corporation [2014] VCC

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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Michael Selinger
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