The maximum penalty for a company found to have recklessly
endangered a person in a workplace under the Victorian
Occupational Health and Safety Act 2004 (OHS Act) has been
doubled to more than $3 million.
The Treasury and Finance Legislation Amendment Bill
2016 (Treasury and Finance Bill) was passed with bi-partisan
support by the Victorian Parliament on 23 May 2016, and brings
Victorian maximum penalties into line with most other states,
territories and the Commonwealth where the corresponding maximum
penalty is already $3 million. The only jurisdiction with a
significantly lower penalty is now Western Australia, where maximum
penalties have been a major stumbling block in that State's
long delay in introducing the harmonised work, health and safety
Regardless of whether this change impacts general sentencing
practices under the OHS Act, it is now clear that significantly
higher penalties are available to courts for the most serious
breaches of the OHS Act. This increase serves as a timely reminder
for employers with Victorian operations to ensure their safety
systems are up to the standards expected by the OHS Act.
The Treasury and Finance Bill also demonstrates Parliament's
clear intention to reinforce the seriousness and additional
culpability associated with the reckless endangerment offence, when
compared with other offences under the OHS Act. Previously, a
company found guilty of the offence of recklessly endangering a
person was exposed to the same maximum penalty as for any other
breach of the OHS Act duty provisions—currently approximately
$1.3 million. However, reckless endangerment is the most serious
offence created by the OHS Act and the offence is likely to apply
to only a very small number of circumstances. To be found guilty,
the prosecution must prove that the person or company intended to
commit the relevant conduct and that a reasonable person in the
circumstances would have realised that the conduct would have
placed another person in danger.
The Treasury and Finance Bill does not have retrospective
application, meaning the increased maximum will only apply to
offences committed after the bill receives Royal Assent.
The Victorian prosecution of Orbit Drilling Pty Ltd in DPP v
Orbit Drilling Pty Ltd  VCC 417 is one of the few
examples of a successful prosecution under this offence. In this
decision, the company and its director were found guilty and
respectively fined $750,000 and $120,000 after a young and
inexperienced employee was directed to drive an overloaded and
poorly maintained truck with known brake defects down a steep
slope. The employee lost control, crashed and suffered fatal
injuries. Both the County Court of Victoria and the Court of Appeal
raised concerns about the appropriateness and adequacy of the
available maximum penalty in this case.
The OHS Act already makes the seriousness of this offence clear
to individuals, where the maximum available penalty is different to
the other duty provisions, and enables the court to impose up to
five years of imprisonment and/or a significant fine.
Other jurisdictions where a similar maximum penalty for reckless
endangerment has been in place since 2012 or 2013 will serve as a
useful point of reference when it comes to the likely penalties
that may be imposed in Victoria, although no successful prosecution
has been finalised under such provisions. Prosecutions for similar
offences are currently underway concerning a safety inspections
company and an engineer in South Australia, and a concreting
company and one of its engineers in the ACT.
It remains to be seen what effect, if any, this penalty increase
will have on general sentencing practices under the OHS Act.
Arguably, companies found guilty of breaching the primary duty
offences in the OHS Act may have higher sentences imposed, given
this more serious offence will now be outside of the available
sentencing range for primary duty offences.
Note: The Treasury and Finance Bill also makes other minor
changes regarding registered training organisations under the OHS
Act and amends Victorian workers' compensation legislation to
ensure workers receiving statutory maximum payments do not receive
lower payments as a result of negative wage growth.
explanatory memorandum to the Treasury and Finance Bill is
available to be viewed on the Victorian Legislation website.
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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