1 On 12 September 2008 the Court found the defendant, The Royal Automobile Club of Australia Incorporating the Imperial Services Club Ltd ("RAC") guilty of a breach of s 8(1) of the Occupational Health and Safety Act 2000 (Inspector John Sibilant v The Royal Automobile Club of Australia Incorporating the Imperial Services Club Ltd (No 2) [2008] NSWIRComm 167). The prosecution arose from the circumstances surrounding the electrocution of the defendant's maintenance manger, Mr Jeffrey Leisemann, while performing work on an air conditional unit.
2 In reaching the decision that there had been a breach of s 8(1) of the Act, the Court held that all of the particulars alleged by the prosecutor had been established. Those particulars were as follows:
(a) a failure to carry out and implement an adequate risk assessment for work on air conditioning units, particularly the task of adjusting thermostats on the air conditioning units;
(b) a failure to ensure suitably trained and qualified personnel carried out all tasks involving electrical work, including work on air conditioning units;
(c) a failure to adequately inspect, or ensure that an adequate inspection was undertaken of the electrical circuits so that its employees were not exposed to the risk arising from live electrical circuits;
(d) a failure to ensure that the electrical supply to air conditioning units was isolated before any work was performed on them;
(e) a failure to ensure that electrical test equipment was suitable and in working order when being used;
(f) a failure to provide adequate information, instruction, training and supervision.
3 This judgment deals with the evidence and submissions on sentence and should be read in conjunction with the judgment delivered on 12 September 2008. In this part of the case the prosecutor tendered a record of prior convictions which verified that the defendant had no prior convictions. The prosecutor also handed up two Victim Impact Statements, one made by Mr Leisemann's de facto partner, Ms Nora Bradbury, and the other made by his daughter, Ms Joanne Leisemann. Having convicted the defendant, those statements were received by the Court with Ms Bradbury exercising her right to read her statement to the Court.
4 In the defendant's case affidavits from Gavin Gregory Creighton Thomas, President of the Club, and Mr Peter Mollan, Chief Executive Officer of the Club were formally read. Mr Thomas noted that his affidavit had been authorised by the Board of Directors. The Club had been formed in 1903 and details were provided regarding the history of the Club and its membership. Mr Thomas referred in some detail to the objects of the Club noting that its founders conceived it as a "protection association" for motorists. When the Club commenced operation and in its early years there were approximately 70 staff comprising housekeepers, bar staff, waiting staff, reception staff, cleaners, maintenance staff and office staff. Over the years the Club had changed its emphasis and now operated as a business persons' club currently employing approximately 48 staff as waiting staff, housekeeping staff, reception staff, garage attendants and maintenance staff.
5 In relation to the Clubhouse situation in Macquarie Street, Mr Thomas stated that it was comprised of seven levels consisting of valet car parking, gymnasium, various function rooms, bar areas, dining room, accommodation and administration. The maintenance workshop was situated on the roof level (on Level 8) where the main plant for the Club was situated including its boilers and air conditioning units. The Club had 2,800 members and provided 29 rooms for accommodation for those members.
6 In relation to maintenance staff, the defendant now employed two full-time maintenance staff and one casual. The maintenance manager was responsible for the supervision of the overall maintenance of the Club and was also responsible for the supervision of the garage staff, housekeeping staff and kitchen staff. The other full-time maintenance employee worked under the maintenance manager carrying out minor repairs around the Club such as touching up damaged paint and matters not requiring the attendance of an expert contractor. This employee had completed a course in tagging and testing electrical appliances and also assisted the housekeeping staff. The maintenance staff were supervised by the Chief Executive Officer who conducted regular meetings with them. There had always been a separate maintenance division since the Club commenced operating from its present premises with approximately the same number of staff.
7 In relation to occupational health and safety, the defendant had adopted a safety policy in 2000 and that document was before the Court. Mr Thomas stated that the defendant was committed to conducting its affairs in compliance with occupational health and safety laws and over time had refined its safety policy to meet its obligations. In November 2005 the then Chief Executive Officer directed a revision of the Occupational Health and Safety policy and a copy of that revised policy was before the Court. Mr Thomas understood that the safety policy was revised by management in March each year and the Chief Executive Officer held regular meetings with the occupational health and safety manager who historically had been the maintenance manager. In those meetings they discussed safety issues and reviewed the policy for improvement, making amendments as required. The occupational health and safety committee met monthly and comprised of the maintenance manager, one of the maintenance staff, the Chief Executive Officer's secretary and representatives from the cleaning staff, housekeeping staff and kitchen staff. Minutes of those meetings were kept and all new employees were required to undertake an induction, being given written material including the Occupational Health and Safety policy. After reading the material, new staff were asked to sign an acknowledgement that they had read and understood the material. The material provided on induction was also before the Court.
8 The Board of Directors received written reports from the Chief Executive Officer in relation to occupational health and safety at its monthly meetings. Occupational health and safety issues were dealt with at the managerial level but the management kept the Board informed of all safety matters. Staff were sent for occupational health and safety training and that had been a policy at their Club for many years prior to the incident involving Mr Leisemann. Mr Leisemann had also attended an external occupational health and safety training session. Where a safety issue was identified and required addressing, funds were allocated immediately from the budget to meet that purpose. The Club spared no expense in relation to the safety of its staff, its members and its visitors.
9 Mr Thomas stated that all staff had been made more aware of the importance of occupational health and safety by the maintenance manager and the Chief Executive Officer following Mr Leisemann's death. Staff were encouraged to attend safety training courses held externally and were constantly reminded of safety matters and safety issues and these matters were addressed at monthly meetings. Staff were encouraged to raise any safety issue of concern to them. Mr Thomas had directed a search of the defendant's records but they disclosed no prior offences or breaches of occupational health and safety laws.
10 Since the death of Mr Leisemann, circuit breakers had been installed throughout the Club and information sheets identifying the location of electricity supply circuits to various parts of the building had been compiled. Training and briefing had been given to staff by the occupational health and safety officer or by the attendance of staff at external occupational health and safety courses. Under the safety system adopted by the defendant, there was a section dealing with hazard identification and that material was placed before the Court.
11 In relation to this incident, Mr Thomas noted that the Board deeply regretted the death of any person and in particular the death of Mr Leisemann in October 2004. The Board had assisted Mr Leisemann's partner by paying for all his funeral expenses and members of the Board attended the funeral and expressed their sorrow and deep regret to Mr Leisemann's partner for what had happened. A member of the Board attended everyday at the Coronial Inquest to inform the Board of any matter that could prevent such an incident from occurring again. Each and every member of the Board was very sorry for the death of Mr Leisemann. The Board was "very conscious" of its occupational health and safety obligations and ensured by direction that the staff were fully aware of their occupational health and safety responsibilities and this consciousness had been heightened as a result of this tragic accident involving Mr Leisemann.
12 Mr Mollan had been the defendant's Chief Executive Officer since May 2008. In that capacity he supervised and controlled all employees of the Club. He said he was aware of the circumstances of Mr Leisemann's death. Mr Mollan met with the maintenance manager on a fortnightly basis and in the course of such meetings, the maintenance manager outlined all projects that he and his staff were to undertake during the following fortnight. Mr Mollan said it was expressly stated and reinforced that all electrical plumbing and gas services work was to be out-sourced to the Club's contractors and was not to be carried out by any person within the maintenance staff and this applied also to the air conditioning systems. Maintenance staff continued to clean and replace air filters within the air conditioning system but perform no other task in relation to the air conditioning system. Mr Mollan attended meetings of the occupational health and safety committee on a monthly basis and he noted that minutes of the meetings were kept by the defendant. All employees were given written copies of the defendant's occupational health and safety policies and gave a written acknowledgement on receipt of those policies. As Chief Executive Officer he continued to monitor the hazard identification and recording system and risk management register within the Club.
13 Mr Mollan was cross-examined. He said that he had spoken to the maintenance manager and had been assured that there was no risk in relation to the work now being performed on air conditioning units. Mr Mollan was unaware whether there was a written risk assessment of this work or what risks, if any, had been identified but said that in relation to electrical matters, the staff were not to perform any work and it was all to be left to the specialist contractor. The staff were required to turn off the electricty when work was to be performed elsewhere in the Club but Mr Mollan was unaware of the procedure undertaken when the maintenance staff changed the filters in the air conditioning units. There were improvements and upgrading undertaken of the air conditioning system and contractors were undertaking preventative maintenance, including installation of circuit breakers. Mr Burgess, a licensed electrician, was no longer employed on the maintenance staff.
14 In order to clarify the system of risk assessment and the manner in which the air conditioning filters were now changed, the defendant called the current maintenance manager Mr Sadimoen to give oral evidence. He had been the maintenance manager for the last four years and had 25 years' experience in industry, holding a Clerk of Works certificate. In relation to the air conditioning work there was a maintenance team of two people who cleaned the filters on the air conditioners with the remaining work undertaken each month by contractors. Ten of the twenty-nine rooms at the Club had been fitted with isolation switches or circuit breakers and the remaining 19 rooms would have such equipment fitted over time. When work was being performed on the air conditioning units, electrical isolation was effected from the plant room. The work was performed by the team of two working together and where there was a circuit breaker installed that circuit breaker was engaged before any work was commenced. Each member of the team had been supplied with a "tester screwdriver" that showed if live electricity was present. The tester was used to ensure that the circuit breaker had been effective in isolating the power to the air conditioning units. The system of isolation and use of the tester had been introduced four years ago when Mr Sadimoen took up the position as maintenance manager.
15 In cross-examination, Mr Sadimoen confirmed the method of adjusting the thermostats stating that, if there was any problem encountered when cleaning the filters or adjusting them, they were to call the contractors and the maintenance staff did nothing regarding electrical problems. In relation to the tester, the electrical contractor had instructed Mr Sadimoen in its use and every six months the contractor was asked to check the two testers used by the Club. He confirmed that there was no document prepared setting out the risk of changing filters but noted that there was no power available to the units when this task was performed. The system of power isolation had been introduced when Mr Sadimoen had been appointed four years earlier. Now there was one central thermostat in one room and there were individual thermostats in ten rooms. Individual thermostats were being introduced in stages and when they were introduced, the temperature would not be adjusted from level 8. In the process of this upgrade it had been discovered that some of the thermostats had not been working.
DELIBERATION
16 The defendant accepted that this was a serious offence but again pressed that a mitigating factor was that it was an open inference that Mr Leisemann had gone to work with instruments and apparatus that suggested he was going to perform electrical work contrary to the defendant's directions. It was submitted in relation to foreseeability that an employer could be forgiven for thinking that work would be done in a certain way and in accordance with its directions and that employees would not do something fraught with danger. The Court and its predecessors, however, have long accepted that the duty of employers is to protect against human errors including inadvertence, inattention, haste and even foolish disregard of personal safety as well as the foreseeable technical risks in the industry (per Bauer J in WorkCover Authority of NSW (Inspector Twynam-Perkins v Maine Lighting (1995) 100 IR 258 at 257). In the present case, the direction to Mr Leisemann occurred at a job interview and was not reinforced to the maintenance team by the defendant. Senior counsel for the defendant readily accepted that the submissions on penalty were not to be taken as cavilling with the facts found by the Court in determining the guilt of the defendant.
17 In this case each of the particulars have been established against the defendant: there was a failure to carry out and implement an adequate risk assessment for work on air conditioning units, particularly relating to the adjustment of thermostats; a failure to ensure suitably trained and qualified personnel carried out all tasks involving electrical work including on air conditioning units; a failure to adequately inspect or ensure that an adequate inspection was undertaken of the electrical circuits so that employees were not exposed to risk arising from live electrical circuits; a failure to ensure that the electrical supply to air conditioning units was isolated before any work was performed on them; a failure to ensure that the electrical test equipment was suitable and in working order before being used; and, a failure to provide adequate information, instruction, training and supervision. The prosecutor submitted that the objective seriousness of the offence was generally to be determined by reference to facts such as the maximum penalty prescribed for the offence (here $550,000), the nature and seriousness of the offence having regard to considerations of knowledge, identification of the risk and of its foreseeability, the availability of remedial steps and the capacity to eliminate the risk in terms of costs and ease of implementation, and, the likely consequence as distinct from the actual consequences flowing from the commission of the offence. There is force in the prosecutor's submission that by failing to conduct a risk assessment, the defendant was inadequately informed as to the nature of the work being performed in adjusting the air conditioning units and therefore did not fully understand the extent of the risk of electrocution while performing this task. Once the task was totally understood then the defendant would have been better informed about the risk of electrocution and was in a position then to the take the simple steps that ultimately were taken by way of isolation procedures that would render the task safe. Having regard to the several matters referred to in the particulars that have been found against the defendant in the context of the risk of electrocution, then the defendant's breach is to be properly considered as a serious breach of the Act.
18 General deterrence will be a significant factor in setting the penalty. The facts of this case show that, what appears to be a relatively straightforward and uncomplicated task can have serious risks especially when the employer does not fully understand the nature of the tasks to be performed. In relation to specific deterrence, senior counsel for the defendant pointed to the steps taken to address the risk exposed by this accident, including the isolation procedures adopted and now available and the fact that all electrical work is performed by specialist contractors. The evidence discloses that, even where work is to be performed changing filters and adjusting the thermostat, the power is now isolated. In contrast to the maintenance team operating at the time of the accident, there is no licensed electrical now employed and a full-time maintenance team has been reduced to two staff with some casual assistance. Work on the adjustment of thermostats and changing filters is performed by the two-man team working together and by isolating the electricity supply and testing for its presence before commencing work. Having regard to the very long history of the defendant and the fact that this is a first offence, the evidence does support its submission that the defendant is unlikely to offend in this way again and that should be reflected in the element of specific deterrence that will go to make up the penalty imposed.
19 In relation to subjective factors, the defendant has been found guilty in contested proceedings and so is not able to avail itself of a discount for a plea: nevertheless, the defendant was entitled to contest the charge and its failure in that regard does not result in a higher penalty being imposed. The prosecutor readily accepted that there was co-operation by the defendant with WorkCover in the investigation of this matter and that there was also co-operation in the "orderly and expeditious conduct of the proceedings". The prosecution was not put to proof of many facts and the proceedings were concentrated only on those matters seriously in dispute. The prosecutor also accepted that the defendant did not turn "a blind eye" to occupational health and safety and that the evidence was that it invested in safety training and undertook other safety activities and made some effort in complying with its obligations. The defendant's contravention could not therefore be characterised as "blatant or wanton". It is also to be noted from the evidence that the defendant demonstrated contrition in paying for Mr Leisemann's funeral expenses and the Court accepts that the steps taken after the accident have adequately addressed the risk of electrocution when working on air conditioning units. Although the defendant maintains a small maintenance workforce, over the years it has employed a number of people in operating the Club and its facilities, including accommodation. Having operated as a Club for just over 100 years and employing a number of staff in what might be regarded as low risk employment, the record is nevertheless a very good safety record and the defendant is entitled to receive leniency because of its status as a first offender with that good safety record. The directors had also formally expressed their regret for the accident and the loss of Mr Leisemann's life.
20 As indicated earlier in this judgment, Victims Impact Statements were received from Mr Leisemann's partner and daughter. At the conclusion of submissions, the Court made the following statement:
I would say though before I adjourn, I am aware there are members of Mr Leisemann's family present in Court. Everybody here is aware I have received two victim impact statements, one from Mr Leisemann's de-facto partner, Nora Bradbury and one from his daughter, Joanne Leisemann. Ms Bradbury took the opportunity offered by the legislation to read her statement in Court. I must say I can conceive no harder task in these circumstances where there is a loss of a loved one, a husband, father and provider. The community too has lost a citizen and the employees of the Club have lost a fellow workmate. I am sure there are no words that are apt in these circumstances to ease your grief. Your loss is palpable. Nevertheless, the Court extends to you its condolences and sympathy.
ORDERS:
21 (i) the defendant is convicted of a breach of s 8 (1) of the Occupational
Health and Safety Act 2000 as particularised in Matter No IRC 1887 of 2007;
(ii) the defendant is fined the sum of $110,000 with half that sum to be paid to the prosecutor by way of moiety;
(iii) the defendant is to pay the costs of the prosecutor in the agreed sum of $37,000.