Workplace health and safety has always been a concern of owners in the construction industry, especially in light of strict legislation across Canada. In 2012, we have seen a number of significant penalties resulting from an infraction of health and safety regulations, a workplace accident or a fatality on the construction site. It has become abundantly clear that owners are ultimately responsible for workplace safety on their work sites. It continues to be difficult – but not impossible – to mount a defence where an infraction has been noted or an injury has occurred.
Two recent cases emphasize the importance of the
owner's role in monitoring health and safety on the work site
and establishing policies and procedures geared towards a safe work
The first, R v Metron Construction Corporation, 2012 ONCJ 506 ("Metron"), demonstrates that a corporation can be criminally responsible for the actions of an independent contractor on the work site. The lesson is to choose your site supervisor carefully, and to ensure he/she is working within established safety guidelines.
The second, Guild Contracting Specialties (2005) Inc. v. Nova Scotia Occupational Health and Safety Appeal Panel, 2012 NSCA 94 ("Guild"), demonstrates that the due diligence defence is alive and well and that the regulatory bodies established through occupational health and safety legislation cannot create process or procedures that limit the owner's ability to put such a defence forward. However, to take advantage of the due diligence defence, the owner must be able to demonstrate an active effort to participate in health and safety on the work site, by ensuring that all representatives of the company are following legislation, implementing safety policies and developing clear preventative measures to avoid accident or injury.
Overview of health and safety penalties
In most provinces legislation provides for three types of penalties:
- administrative penalties under occupational health and safety legislation: generally imposed where there has been a minor injury or a noted infraction, these penalties range between $250 and $4,000 per infraction in Atlantic Canada.
- penalties for committing a statutory offence: these "quasi-criminal" charges proceed through the courts, and it is the court that decides the fine and other consequences. Each of the Atlantic provinces caps the fine at $250,000 for each offence. However, additional fines can be imposed for each day that the offence continues. The courts are also given discretion to impose "creative" penalties, such as additional fines for health and safety education or a requirement to publish all facts of the accident. In rare cases, an individual who has committed an offence can be imprisoned.
- criminal negligence: these charges proceed under the federal
Criminal Code, and are exceedingly rare despite amendments in 2004
that made it easier to charge a corporation with criminal
negligence. To succeed the Crown must prove:
- the conduct of a "representative", acting within the scope of their authority, showed wanton and reckless disregard for the lives or the safety of others; and
- a "senior officer" departed markedly from the
reasonable standard of care expected to prevent
Where criminal negligence is proven, the court sets the fine or other penalty, with reference to a number of factors set out in the Criminal Code to account for when sentencing an organization, including:
- any advantage realized by the organization as a result of the offence;
- the duration and complexity of the offence;
- the degree of planning involved in carrying out the offence;
- whether the organization attempted to conceal its assets to encourage a lower penalty;
- the impact the sentence would have on the economic viability of the corporation and the continued employment of its employees;
- the cost of investigation;
- other regulatory penalties that have been imposed on the organization; and
- whether the organization or any of its representatives have been convicted of a similar offence or previously sanctioned under provincial legislation for similar conduct.
Overview of defences
- Due diligence: it is open to the owner to argue that it made every effort to prevent every infraction and to prevent harm. If the owner can demonstrate such due diligence, there has been no violation of any statute and the criminal charges or administrative sanctions should be dropped. To succeed in this defence, the owner must demonstrate it took all reasonable steps to ensure a healthy and safe worksite.
- Reasonable care: where an owner has been charged with criminal negligence, it is also open to the owner to prove that there was not wanton or reckless disregard for the lives or safety of other persons on the part of any of its representatives. Effectively, if the owner can show there was no intent to violate legislation or cause harm, the criminal negligence charges will not succeed. Note, this defence is not available for statutory offences or administrative penalties, as there is no requirement to prove intent for owners to be penalized.
Metron- owner criminally liable for actions of supervisor
This summer, the Ontario Court of Justice
reviewed the tragic circumstances that resulted in the death of
construction workers on Christmas Eve, 2009. At the end of the work
day, the site supervisor and five of his workers climbed onto a
swing stage to travel back to the ground. Shortly afterwards the
platform collapsed. Five men fell 14 floors to the ground. Four of
them died as a result of their injuries and a fifth suffered
serious injury. The sixth person had properly attached himself to a
safety line and was prevented from falling – he was,
The investigation into the incident revealed three serious safety hazards that resulted in this tragedy:
- The swing stage used was not up to code. Although appearing new, it had no serial number or other identifier as required by health and safety legislation and by industry practice. It arrived without a manual, instructions or other product information or design drawings, which are specifically required under legislation. Testing of the swing stage revealed that it hadn't been properly constructed and was not safe to transport six workers.
- Only two lifelines were available for the swing stage. The normal practice on site was for only two workers to be on the swing stage at any time. It was inexcusable for the supervisor to allow six people to use the swing stage simultaneously without appropriate lifelines.
- Drug use: a toxicological analysis determined that three of the employees had marijuana in their systems.
Metron plead guilty to the criminal negligence
charges, acknowledging that the site supervisor was directing the
workforce and that he permitted the three infractions. Metron
proposed a fine of $100,000 on the grounds that the "real
responsibility" for the accident lay with the faulty swing
stage. The Crown proposed a fine of $1 million, noting the serious
infractions and the tragic consequences of those infractions.
The court settled on a fine of $200,000 plus a victim fine surcharge of $30,000 noting that the fine represents three times the net earnings of Metron in its last profitable year.
Owners should note that Joel Swartz, the president and sole director of Metron, also entered a guilty plea to several quasi-criminal charges under Ontario's Occupational Health & Safety Act. His fines and surcharges totalled $112,500.
In both the criminal and quasi-criminal charges, all parties agreed that it was the conduct of the site supervisor that directly resulted in the accident. The site supervisor was not an employee of Metron, but was an independent contractor that Metron had contracted with to oversee the work on the site. Nevertheless, it was agreed that he was both a representative and senior officer of Metron. Since there was a guilty plea there was not legal analysis, leaving open two possible arguments in defence:
- It is arguable that an independent contractor is not a "senior officer" of a corporation. If this argument is accepted and it can be shown that all senior officers demonstrated reasonable care, a defence may be possible in a similar situation.
- There is a technical argument that suggests section 22.2 of the Criminal Code sets out a two part test that requires first, wanton and reckless disregard for safety by the representative, and, second, that a senior officer departed markedly from the reasonable standard of care. The technical argument is that this involves an action by two people – first a representative, then a senior officer – and not an action by a single supervisor fulfilling both roles.
Whether either argument could be successful is a question for a future case. Note, however, that Metron is only the second case to proceed under the Criminal Code's new negligence provisions and may create a precedent that is difficult to depart from.
Guild: defence of due diligence still strong
In September 2012, the Nova Scotia Court of
Appeal released a decision concluding that there is no reason that
the labour board considering an appeal of an administrative penalty
under Nova Scotia's Occupational Health and Safety Act
("OHSA") should be limited to considering the
amount of the penalty. The court reasoned that by limiting an
appeal to the amount of the fine where a compliance order
hadn't been appealed, the panel had effectively prevented
employers from raising a due diligence defence, which is not
"justifiable or permissible under the legislation as it
In Guild, the employer was charged with failing to have an appropriate eyewash available on site. A compliance order was issued and Guild complied with the order, obtaining an eyewash station that could flush the eye for 15 minutes per the compliance order's requirements. Compliance orders are a direction to the employer to take an action that will bring the employer into compliance with occupational health and safety legislation and/or create a more safe work environment. They generally provide a strict time limit for compliance.
Guild filed a compliance notice advising that they had complied with the compliance order. It was more than two months later before an administrative penalty was issued.
Guild appealed the administrative penalty under section 11 of the Occupational Health and Safety Administrative Penalty Regulations.
Guild put forward the due diligence defence that, although they did not have an eyewash station that could clean the eye within 15 minutes at the time that their site was inspected, it was not needed at that time because there were no dangerous substances on-site that would require that level of eye washing. Guild submitted that the eye-wash station on-site was compliant with the OHSA and its regulations when no hazardous substances were on-site.
Guild's argument was not considered and the panel deciding the case stated that it wouldn't consider the validity, appropriateness or necessity of the underlying compliance orders during an administrative penalty appeal. The only issue the panel was willing to consider was whether the amount of the penalty was appropriate.
The director submitted to the Court of Appeal that if an appellant chooses not to appeal a compliance order, then the finding in the compliance order that there has been a contravention of the OHSA or its regulations becomes final and binding and there is no further avenue of appeal.
Justice Farrar concluded that:
The court's language is strong. Justice Farrar says that the panel's reasons for its position are "non-existent". Their conclusion could not fall "within the realm of any reasonable outcome" and there is nothing in the OHSA or its regulations that suggest it is correct for the panel to effectively eliminate the due diligence defence at the appeal of administrative penalty stage.
What this means for you
The Guild case shows that the defence of due diligence is available to owners. To exercise this defence, you must be able to prove that you took every reasonable step to ensure compliance with occupational health and safety legislation and to ensure a safe and hazard-free workplace. With that in mind, owners may want to review their procedures for supervising work sites and have contractors sign off on specific policies or procedures for ensuring a safe work site. Given the Metron case, there is a very real risk that in the future owners will be held responsible for the actions of any subcontractors or independent contractors that they work with and may want to have a better understanding of the safety records and practices of those subcontractors to better protect themselves against the possibility of health and safety violations on their work sites.
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.