Inspector Milligan v Transfield Pty Limited; Inspector Milligan v Worley Limited

PROSECUTOR: Mr P.M. Skinner of counsel Mr G. Henderson Phillips Fox, Solicitors

LEGAL REPRESENTATIVES: DEFENDANTS: Mr S. B. Benson of counsel for Transfield Pty Ltd Mr G. Phillips, Carroll & O'Dea, Solicitors Ms P.E. McDonald of counsel for Worley Ltd Ms S. Reid, Baker & McKenzie, Solicitors

JUDGMENT: - 18 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: KAVANAGH J Date : Monday 17 June 2002

IRC5054 of 2001 INSPECTOR ROY MILLIGAN v TRANSFIELD PTY LIMITED Prosecution under s16(1) of the Occupational Health and Safety Act 1983 IRC5056 of 2001 INSPECTOR ROY MILLIGAN v WORLEY LIMITED Prosecution under s16(1) of the Occupational Health and Safety Act 1983

1 These two prosecutions are brought by Inspector Roy Milligan of the WorkCover Authority of New South Wales against parties involved in a Joint Venture. The prosecutions issued under s16(1) of the Occupational Health and Safety Act 1983 are pleaded against each defendant and arise out of the same incident.

2 It is alleged against both defendants, as employers, they breached s16(1) of the Occupational Health and Safety Act on: . . . 30 July 1999 at the 132KV/11KV switchyard located at BOC Gases Australia Limited, Five Islands Road, Cringila in the State of New South Wales in that (the defendants) failed to ensure that persons not in (the defendants) employment were not exposed to risks to their health and safety arising from the conduct of its undertaking while they were at its place of work, in particular Mark Pinney, Mark Hurt and Theo Phanis.

3 The Prosecution provided the following particulars of the defendants' breach: a) Failed to provide or maintain a safe system of work on or around the live 11 KV cables.

4 Both defendants entered a plea of guilty to the charge.

5 An Agreed Statement of Facts, in similar terms against both defendants, was tendered which relevantly reads as follows: 3. At all material times Manbead Pty Limited (ACN 068 376 590) was an incorporated company with its registered office located at David Carvona & Associates, Suite 2, 61 Princess Highway, Fairy Meadow in the State of New South Wales. 4. The First Defendant Transfield Pty Limited (ACN 000 854 688) is and was an incorporated company with its registered office located at 30 Alfred Street, Milsons Point, Sydney in the State of New South Wales. 5. At all material times the Second Defendant, Worley Limited (ACN 001 279 812) was an incorporated company with its registered office located at Level 7, 116 Miller Street, North Sydney in the State of New South Wales. 6. At all material times Manbead Pty Limited:- (a) Contracted with the First and Second Defendants to supply labour at the site. (b) Employed Mark Pinney, Mart Hurt and Theo Phanis ("the employees") as labourers at the site. 7. At all material times the First Defendant:- (a) Entered into a joint venture with the Second Defendant. (b) Pursuant to such joint venture, contracted with BOC Gases Australia Limited to construct a new plan at the site. (c) Was an employer. (d) Pursuant to such joint venture, contracted with Interpad Pty Ltd ACN 002 405 932 for the provision to it for the services of Mr Joe Luczycki as supervisor at the site. 8. At all material times the Second Defendant:- (a) Entered into a joint venture with the First Defendant. (b) Pursuant to such joint venture, contracted with BOC Gases Australia Limited to construct a new plan at the site. (c) Was an employer. (d) Contracted with Interpad Pty Ltd ACN 002 405 932 for the provision to it for the services of Mr Joe Luczycki as supervisor at the site. 9. On 29 July 1999 the employees of Manbead Pty Ltd were engaged by the First and Second Defendants to excavate above and around the 11KV cables at the site so as to expose the cables. 10. Two trenches were excavated by the employees both parallel to each other in the north-south plane within the site to expose the live 11,000 volt power cables following removal of the northern chain wire fence of that switchyard. 11. A jackhammer was used to free the heavy clay soil from within the trenches which covered the power cables. Shovels were used to remove the soil. Protective concrete tiles were below the clay soil immediately above the power cables. There were nine 11 KV power cables in the western side trench. Three cables were laid within a sand/cement mortar mix; one cable centrally located above, two in a triangular position approximately 13 mm separating the cables within the sand/cement mortar mix. 12. A crowbar had been used by the employees to dig the trenches and was left in the western trench on the completion of work. In the eastern trench the power cables were laid in sand whilst in the western trench the power cables were laid in a sand/cement mortar mix. 13. On 30 July 1999, Joe Luczycki signed for the work permit and had supervised the sign on of each of the employees nominated on the permit. The work of exposing power cables from the mortar mix continued on the morning of 30 July 1999. Theo Phanis was working in the eastern trench. Mark Pinney and Mark Hurt were both working in the western trench. Mark Pinney was at the northern end while Mark Hurt was at the southern end of the trench. 14. Verbal instruction was given to the employees by Joe Luczycki to use a hammer and cold chisel to remove the cement and mortar from around the live power cables. A crowbar was left leaning against the eastern side of the western trench where Pinney was working. It had been left in that position on the previous day, 29 July 1999. 15. On 30 July 1999 at approximately 7.30am Mark Pinney caused an impact to one of the three 11,000 volt power cables creating an earth fault when using the crowbar to excavate at the site. Two of those cables were totally disintegrated for a distance of about 150 millimetres. The third cable sustained damage by arcing with a scoop formation of the copper wires of that cable disintegrating and a portion of the outer insulation cover was removed. The impact caused a loud explosion and cloud of smoke. Mark Pinney was in close proximity to the explosion and was assisted from the site to the first aid station by Peter Horrell, a BOC Gases Australia Limited employee. 16. As a result of the accident, Mark Pinney sustained shock and two small burns to each side of his base near the base of his armpits. He was transferred from the first aid station at the site to the Wollongong District Hospital for treatment and monitoring. The safety vest he was wearing caught alight and was discarded at the site. 17. On 30 July 1999 the Prosecutor attended at the site and observed as follows: (a) At the Reactor Area of the 132KV/11KV switchyard, 132KV overhead transmission cables feeding into an enclosed yard fenced with steel posts and cyclone wire mesh. Secured to that fence were signs with the word DANGER in white on a red background and the words HIGH VOLTAGE in black letters on a white background. On the north eastern corner of that enclosed yard was a gable roofed shed approximately 3 metres square. At the north eastern corner of that fence was a hinged gate manufactured of steel pipe and steel cyclone mesh. That gate was secured in an open position in the north-south plan and parallel with the fence adjacent to the shed. Secured to the upper part of that gate was an Electrical Access Permit No. 1808 on A4 paper enclosed in a clear plastic envelope. Permit 1808 had been issued by BOC personnel. Located to the east of that hinged gate post was another hinged gate post supporting a similar gate which was in an open position facing in the north easterly plane. (b) On the eastern side of the fenced 132KV infeed yard was a semi-enclosed yard known as the 132KV 11KV switchyard where Transformer and reactors were located. On the western side of the switchyard at the edge of the dividing fence of the 132KV infeed yard there was an excavated trench running parallel with the fence from the normal closed gate position at the northern end running south for 4270 mm where it made a 90 degree turn to the east. The trench was 1200 mm wide x 1000 mm deep. (c) On the bottom on that trench was a crowbar 30 mm diameter x 1550 mm long with a chisel shaped and 33 mm wide with a heel at the other end 35 mm wide. That crowbar had a smooth steel face on each side of the chisel face being devoid of rust whereas the shaft of that bar was of a rusty appearance. The face of the chisel closest to the ground had a fresh copper mark across the flat. The upper flat face of the chisel portion of that crowbar had a discolouration consistent with the arcing of a copper cable. The crowbar was lying at an angle of about 45 degrees to the lay of the trench. The chisel point of the bar was against the vertical face of a bench on the eastern side of the trench. The heel of that bar was on the western side of the trench. Approximately 15cm west of the chisel point of the bar was a round hole with three 11,000-volt cables, which had been subjected to extreme arcing which had vaporised those cables. The arcing had left a tell tale colouring of bronze appearance of the surrounding cement and sand mortar mix that those three cables had been laid in. (d) At the corner of the trench where it made a 90-degree turn from north-south to east-west on the north eastern corner was a shovel, 4lb hammer and steel cold chisel. (e) Lying on the western upper edge of the trench were four orange/red coloured electrical cables. Lying in the southern side of the trench that ran east west were nine new 11,000 volt-cables. At the eastern end of that trench was a sheet of timber particle board used as a traffic way. (f) At the northern end of the 132KV/11KV switchyard steel posts had been placed which supported a width of two red and one white banded plastic para webbing fencing which was attached to the steel gate post of the 132KV infeed yard. (g) On the eastern side of the north-south trench where the arcing of the 11,000 volt cables had occurred there was a stack of fourteen concrete tiles. To the east of that stack of concrete tiles there was a second trench also running north-south in that trench was a 2lb bull peined hammer.

6 Mr P.M. Skinner, of counsel, appeared for the Prosecutor. Mr S.B. Benson, of counsel, appeared the defendant Transfield Pty Limited and Ms P.E. McDonald, of counsel, appeared for the defendant Worley Limited.

7 The prosecution against both defendants relied upon the Agreed Statement of Facts and associated photographs of the site of the incident. It also tendered the industrial record of both companies.

8 The defendant, Transfield Pty Limited, relied upon an affidavit of Mr Michael Ward, Manager, Business, Strategy, Engineering and Construction. Mr Ward attached to his affidavit a Strategic Alliance Agreement between BOC Gases Australia Ltd and the Transfield Worley Joint Venture. Also relied upon was an Energy Australia document, the defined Work Method Statement, Site Safety Committee Minutes, a Site Safety Corrective Action Report and a Toolbox Meeting Record. An affidavit and oral evidence was also received from Mr Steven Michael Sasse, General Manager, Human Resources and Industrial Relations of Transfield. Transfield and Worley relied on the Energy Australia guide for Working on Underground Cables.

9 The defendant, Worley Limited, relied upon an affidavit of John Michael Grill, Director and Chief Executive of Worley and the Worley Health, Safety and Environment Management Standards. Various Contractor Safety Awards were tendered. Mr Grill also gave oral evidence. Worley also relied, in its evidentiary case, on the affidavit and oral evidence of Mr M. Ward.

10 Transfield and Worley, the defendants, entered into a Joint Venture entitled the Transfield Worley Joint Venture known as the TWJV. The TWJV was not incorporated as a separate joint venture company. The Joint Venture entered into a Strategic Alliance Agreement with various companies on major industrial sites to provide planning and construction services for heavy industry projects. It contracted its services to industries such as the Oil and Gas industries, Chemical and Mineral industries, to Pipelines and Terminals, to the Power industry, the Refining and Petro-chemical industries and the Water and Waste Water industries. Worley provided the design service for the performance of the contract through employees such as engineers, drafters and planners and Transfield provided the labouring capacity to implement the contracted work.

11 TWJV entered into such an Alliance Agreement with a company called BOC Gases Australia Ltd. The project to be constructed under the Strategic Alliance Agreement was at BOC's Port Kembla site. It required the Joint Venture to design, procure, construct and pre-commission a new air separation plant on the site of an existing but old air separation facility. In preparation for the construction, the main electrical power supply lines required substantial modification including reconfiguring and the replacement of some existing buried power cables.

12 Evidence revealed there was significant discussion between the parties and BOC as to the detailed nature of the work and the safety requirements for the task. Mr Joe Luczycki was the supervisor for the task. He was contracted through Interpad Pty Ltd to the Joint Venture to work as the Supervisor at the site. The job required the digging away at, and the exposition of, buried cables. They were buried in a composite ground mixture of soil, sand and cement. This made the ground very hard and required some heavy digging. Mr Luczycki had attended a three day course called "Safe Working with High Voltage Systems". He discussed with Energy Australia, I accept, during the course of the preparation, the best method for work on the excavation of the cables. A Work Method Statement was then produced.

13 In the preparation of the Work Method Statement, reliance was placed upon the Energy Australia document entitled "Guide to Working on Underground Cables": "Section 13 Excavation in the Vicinity of Live Cables. ... 13.2.2 Verifying Cable Locations . . . cables known to be close to the proposed excavation should be exposed by hand excavation to verify their location. Before excavating parallel to existing cables, they should be uncovered by hand at bends and every 10-15 metres, as well as at joints.

"Hand excavation" means using shovels, picks, mattocks, crow-bars etc. Note that even these must be used very carefully when close to live cables. . . . 13.4 Excavating Concrete Encased Conduits . . . If possible, hand tools such as a hammer and chisel should be used. However, if the conduits have been encased in full-strength concrete, it will almost certainly be necessary to use powered tools such as jackhammers.

If the cables cannot be de-energised while the work is carried out (or even better, temporarily removed) hand tools should be used if possible, at least until enough of an opening has been made in the conduit to allow a protective (steel) sleeve to be slid into the conduit along the cable.

14 Using these principles as defined by Energy Australia, the work "Method Statement For Reactor Installation Work in the 132kV Switchyard" was then devised. It stated at "4.0 Work prior to shutdown" 4.1 Expose existing cables closest to the proposed reactors by manual excavation to determine exact location of the cables. Cable route is to be clearly marked.

15 Mr Luczycki instructed the three labourers to dig and expose the cables. The three labourers/tradesman's assistants had been brought onto the site by the Joint Venture through an arrangement with a labour hire firm called Manbead Pty Ltd. They worked under Mr Luczycki's supervision. He instructed them they were to use a hammer and chisel to excavate the material adjacent to the cable. A crowbar was on the site. Mr Luczycki was aware, and I accept he warned the three labourers, the cables were still energised. Mr Pinney in the performance of the work used a crowbar. With it he struck a cable causing an earth fault. Photographic evidence tendered reveals, lying in the cable trench were mallets and a crow bar. The photographs also reveal evidence of an electrical explosion and singeing around the metal crow bar.

16 Mr Ward, the Manager, Business, Strategy, Engineering and Construction of Transfield, at the time the Alliance Manager of the Joint Venture, opined Mr Pinney was holding the crow bar that pierced one of the cables. The Agreed Statement of Facts stated (at paragraph 15): . . . Mark Pinney caused an impact to one of the three 11,000 volt power cables creating an earth fault when using the crowbar to excavate at the site. Two of those cables were totally disintegrated for a distance of about 150 millimetres. The third cable sustained damage by arcing with a scoop formation of the copper wires of that cable disintegrating and a portion of the outer insulation cover was removed. The impact caused a loud explosion and cloud of smoke. . . .

All three persons were exposed to injury. Mr Pinney was the worker who sustained bodily injury and burns under both arms.

17 An assessment of the objective seriousness of this offence requires a determination of a number of factors viewed objectively. As was held in Lawrenson Diecasting Pty Limited v WorkCover Authority of New South Wales (Insp James Swee Ch'ng) (1999) 90 IR 464 (at 474): . . . in our view, it is important to reiterate that the primary factor to be considered when a judicial officer is determining the appropriate sentence to impose is the objective seriousness of the offence charged. In the case of prosecutions under the OH&S Act, this proposition has often been expressed by saying that the "true measure of penalty lies in the nature and quality of the offence".

The Full Bench further commented (at 476): . . . the proper approach is to first consider the gravity of the offence viewed objectively.

18 The breach alleged the defendants did not provide a safe system of work at its place of work. The defendants, in the design of the system of work adopted for the task of exposing the banks of electrical cables, accepted the premise, while acknowledging risk, labourers could work around and over charged electrical cables. Yet the evidence also revealed, a few days later, the circuits were to be disconnected for some weeks.

19 The defendants had sought advice from Energy Australia before designing its work method. Energy Australia works on cables which supply power to a large number of areas and to commercial, industrial and, particularly, domestic premises. I accept in some circumstances it may be difficult to isolate electricity supply. However, this power supply could be isolated. There was no evidence either defendant gave any consideration to the disconnection of the energised cables prior to the labourers beginning this work. There was evidence the major task would involve a long period of disconnection. Evidence suggested there would have been an extra day of downtime through the disconnection for this work. The economic effect of a disconnection of the electrical supply to this industry site measured against the risk to the safety of workers was given no consideration when the system of work was devised.

20 Further a major energy supplier's acceptance work can be conducted around live power lines, and an energy supply should not be interrupted, is an assumption which should be challenged and not unreservedly adopted by industry. Work around energised electrical cables always provides a risk to an employee's safety. Each such risk should be independently assessed and positive consideration given to the disconnection of the energy supply line.

21 Occupational Health and Safety audits and the design of specific work methods must be directed to eliminating risks to safety. A work method should not be designed around what has become an industry-accepted premise energy supply should not be interrupted. The common assumption in industry which accepts the premise services cannot be disconnected should be challenged. The court accepts the effect of disconnection must be considered. However, as an example, the construction industry has recently absorbed significant costs as it has addressed what was identified as a generally poor industrial safety record on construction sites. It addressed the issues with a review of safety standards. The standards now applied to construction sites acknowledge the need for the provision of scaffold, ladders, safety harnesses and downtime in inclement weather, etc. These steps significantly reduce any risk to an employee's safety on a construction site.

22 So too there must be a re-assessment of accepted norms in the performance of work around service lines. The acceptance by industry the uninterrupted supply of energy is sacrosanct and energy services should not be interrupted to perform maintenance tasks is to be challenged. Certainly industries working on or around an electricity supply should not rely on advice from the suppliers of energy as to safe working methods. Employees should not be required to work around live supply lines where inevitably they could suffer a serious risk to their health and safety. Alternative work methods must be considered.

23 This prosecution reveals, while the employees were warned the cables were live, they were required to dig and work on and around them. That the employees were supplied with metal implements created a further risk. As can be expected with cables laid years ago the placement of the cables is often difficult to identify. Such was the circumstance of this breach. Comprehensive information as to the unreliability of the placement of old underground cables, should be given to employees required to perform this type of task.

24 There must be developed a set of standards applicable to this type of work. Such standards need to identify the type of service, the expected placement of the service cables and the status of the service, that is, whether it is energised or disconnected. A number of questions must be asked: do the energy services as identified on the worksite in the performance of the task provide a risk to safety? If so, a further question must be posed: can the service be disconnected to eliminate the risk? If a positive decision is made not to disconnect a service, when acknowledging it provides a risk to safety, then what procedures can be put in place firstly to identify the risks. The use of appropriate markings must be determined. Such markings must become identifiable within industry generally. The expected direction of the cables/lines should be marked out on the worksite. Only then can the work method be properly devised. Proper implements and equipment for the task must be determined. Each employee must be fully equipped with both the knowledge of the risks and the skills to work around such a recognised hazard.

25 Significant documentation was placed before the court, in three volumes, which was identified as the General Occupational Health and Safety Management Plan designed specifically for the work on the Air Separation Plant at Port Kembla. It is a composite document enjoined by Transfield and Worley. The evidence revealed there was a significant endeavour by the Joint Venture to design a general plan for safety on the site and there was superimposed onto the general safety policy a specific work method devised for the task. Much energy had been expended in the design of the plan for safety on site. Reliance was placed on advice from an energy supplier. However, the incident occurred because the work method put in place for the performance of this task was faulty. Labourers were required to dig around high voltage cables their direction not properly identified and using available implements some of which could conduct electricity.

26 In an objective assessment of the gravity of this offence, the Court also takes note there were a number of positive steps taken by the defendants when the system of work was designed. The system of work adopted by the defendants and followed by the employees, however, was unsafe. This must be perceived as a serious breach of the Act.

27 A number of subjective matters have been placed before the Court in its consideration as to penalty. In Lawrenson Diecasting Pty Limited v WorkCover Authority of New South Wales (Insp James Swee Ch'ng) (1999) 90 IR 464 the Full Bench said (at 474): It has been observed on a number of occasions that subjective factors which mitigate the seriousness of the offence or exculpate the accused must be secondary to consideration of the nature and quality of the offence.

The Full Bench cited (at 474) with approval, the passage in the judgment of Fisher CJ in Haynes v James Glass and Aluminium Pty Limited (unreported, CT91/772-775, 20 May 1994) where his Honour said: . . . While previous good industrial citizenship and the absence of prior convictions are proper considerations, their importance lies well behind the two primary aspects of the matter, namely the nature and quality of the offence and the clear policy of the Act in relation to the establishment of safe standards and the protection of the workforce.

As to the Prosecution against Transfield Pty Limited in matter No 5054 of 2001 28 In Inspector Olive v Transfield Pty Limited [2001] NSWIRComm295 [at 19] the court referred to Transfield's corporate activities in an assessment of the company's corporate character. The court in this prosecution takes into account the significant contribution the company makes to the community through its support of a multitude of community activities. In Inspector Olive v Transfield, the court held: 19 The corporate character/reputation of the company is relevant to a consideration as to mitigation of penalty (see full discussion of the nature of character and reputation evidence in Melbourne v The Queen 198 CLR 1; WorkCover Authority of NSW (Insp Dubois) v Transfield Pty Limited (unreported, IRC6985 of 1999, 8 November 2000; WorkCover Authority of New South Wales (Inspector Ankucic) v McDonalds Australia Limited & Anor (2000) 95 IR 383; WorkCover Authority of New South Wales (Inspector Mauger) v Ridge Consolidated Pty Ltd [2000] NSWIRComm15 (published 8 March 2001); WorkCover Authority of New South Wales (Inspector Farrell) v Forgacs Shipyard Pty Ltd [2000] NSWIRComm227 (published 12 October 2001); see also discussion referred to in WorkCover Authority of NSW (Insp Hopkins) v Profab Industries Pty Ltd (No. 2) (2000) 101 IR 92). 20. . . . 21. Evidence of the good character of a director, being a director who is the controlling mind of the corporation, is admissible as relevant to the likelihood that the company, through the director, made proper admissions and in assessing the credibility of the commitment to safety offered by the director. It can also be relevant to an assessment of the corporate character of the defendant company (see WorkCover Authority of NSW v CT Plumbing Pty Ltd (unreported decision of Fisher P, CT522 of 1991, 16 December 1991)). However, excessive weight cannot be given to the character of such a witness "whose circumstances appear to have been adopted as co-extensive with the circumstances of the defendant company" (see Insp Hannah v Wonar Pty Ltd (unreported, Fisher CJ, Glynn and Cullen JJ, CT90/1214, 30 June 1992).

29 I find the defendant is a corporation with a fine reputation within the community. However, the industrial record of a company also becomes part of the assessment of the character of a company. In Inspector Olive v Transfield, this court was forced to make comment while the company proffered and the court accepted the defendant's commitment to safe working [at 27]: . . . the industrial record of recent breaches of the Act, the nature of which indicates a gravity to each offence, reveals the need for a much more rigorous implementation of this company's adopted standards for safe working. The recent industrial record is of concern. 30 Since this view was expressed by the Court, Peterson J in WorkCover Authority of NSW (Insp Vierow) v Transfield Pty Ltd [2002] NSWIRComm 77 (published 19 April 2002) assessed two further prosecutions against Transfield in which, after consideration of issues as to mitigation, penalties of $96,000 and $72,000 were given. In Inspector Vierow v Transfield, Peterson J relied upon the view of the Court in Inspector Olive v Transfield [at 27]: The court's consideration related to deterrence therefore brings to the fore for examination the industrial record of the company. Transfield in its operations has been charged with 23 breaches . . . In WorkCover Authority of NSW (Insp McMartin) v Transfield Pty Ltd t/as Transfield Maintenance (No 2) [2001] NSWIRComm 289 (published 14 November 2001) Hungerford J noted [at 36]: . . . the prior convictions of the defendant, particularly the two most recent instances where (the defendant) was subject to fines of $70,000 and $130,000, must be viewed as somewhat negative factors. His Honour then convicted the defendant of two further breaches of the Act each attracting a penalty of $80,000 although it is noted they arose from the same incident and his Honour determined an overall penalty of $160,000 after applying the principles of parity and totality and allowing for a discount for the utilitarian value of pleas. Both parties have revealed three further breaches of the Act are before the court for consideration as to penalty.

Having regard to the size and nature of the organisation, its large range of industrial activities and the heavy industrial nature of those activities, Bauer J in Inspector Jones v Transfield Construction (unreported decision, CT1217 of 1996, 28 November 1997 at 10) was able to comment "the record of the company in the past has to be viewed as a reasonable one" (see WorkCover Authority of NSW (Insp McMartin) v Transfield Pty Ltd t/as Transfield Maintenance (No 2) [2001] NSWIRComm289 [at 36]). The court cannot anymore endorse this comment. The community demands rigorous adherence to occupational health and safety standards from its employers. The legislature has expressly reflected the community's demand with the obligations it has imposed on employers through the Occupational Health and Safety Act, 1983. The company proffers, and the court accepts, this corporation's commitment to safe working. That commitment is reflected in a fully documented worksafe procedure. . . .

31 As a corporation Transfield had significant general safety policies and site specific work methods. In accordance with best business practice, it had in place a both general policy for identifying, training and supervising its employees in safety standards and a specific procedure for the design of the site safe work methods. Yet it carries, in recent times, a poor industrial record for site safety.

32 Evidence in this prosecution reveals the defendant Transfield has assessed this recent poor industrial record and, in an acknowledgement of its concern, early in 2002, it has reassessed all existing safety policies and procedures. In this examination, the pre-existing "Systems" approach through all written procedures were refined. Now layered onto the "Systems" approach is a "Behavioural" approach model. This adopted policy model specifically empowers supervisors, contractors and employees on site to be involved in the design of the work method. Further, employees are empowered to object when any risk to safety is perceived on site especially during the performance of the work. Perceived risks are held to be the responsibility of all employees. Employees are now retrained to understand this "Behavioural" approach requires input and responsibility from each employee on site. Records are now retained revealing "injury frequency rates". They are published within the company and used to encourage and acknowledge safety at work as an achievement.

33 The breaches of the Occupational Health and Safety Act 1983 now before the court were committed before Transfield introduced onto their "Systems model" for safe working this "Behavioural" layer. The court notes the corporation's awareness of and expressed concern for its recent industrial history. It accepts the introduction of the "Behavioural model" devolves responsibility for site safety and empowers all involved in the performance of the tasks. It accepts this positive approach is an acknowledgement of the concern expressed in relation to Transfield's recent industrial record. The court takes the revised work standards into account in a positive manner in considering the elements of general/specific deterrence which must be given weight by the court in mitigation of penalty (see Fisher v Samaras Industries Pty Limited (1996) 82 IR 384 at 388; Capral Aluminium Ltd v WorkCover Authority of NSW (Insp Mayo-Ramsay) (2000) 49 NSWLR 610; 99 IR 29).

34 Transfield faces a maximum penalty of $825,000 given its prior industrial record. As to the prosecution against Worley Limited in matter No 5056 of 2001 35 Mr John Michael Grill, Director and CEO of Worley Pty Limited since 1972, gave evidence on behalf of Worley Limited. Worley is a company which has been in existence for some thirty years and has no prior convictions recorded against it. Around Australia it employs some 2000 people and is a world wide operation. It employs engineers, draftspersons and other professionals who undertake the design work on these projects. Worley Limited adopted with Transfield a Site Safety Management Plan as a Joint Venturer on the Port Kembla contract. 36 Inside its operation the defendant has a healthy safety and environmental management system which incorporates within it, since 1991, a safety and risk management specialist group. In its thirty years of operation throughout Australia it has never been prosecuted or convicted of any offence under any occupational health and safety legislation.

37 Worley, through Mr Grill, in both affidavit form and by way of oral evidence, expressed its sincere contrition for the circumstances that led to the injuries suffered by Mr Mark Pinney on its work site. Mr Grill determined and spoke vehemently about his now recognised need to play a more productive role in the design of all Joint Venture work methods. He acknowledged, as Worley had been the provider of professional input into the venture it had tended to rely heavily on its construction partner to assess and design safe systems of work for construction tasks.

38 The defendant has now taken the following steps to ensure that the present incident is not repeated: it has upgraded its management system to comply with relevant Australian standards; it ensures those standards are transferred into all its Joint Venture undertakings and commits itself to an adherence to those standards. It has determined using Internet and intranet technology, lessons learnt as to safety standards are recorded, publicised and implemented. Senior management people have been retrained to the new standard adopted for site safety. 39 The court accepts the company has been the receiver of a significant number of awards for its site safety standards and notes the company acknowledges this incident reflects as a breach of its own commitment to safety. 40 The prosecutor in accordance with the Act submitted the maximum penalty for a breach of the Occupational Health and Safety Act 1983 by this defendant was $550,000 as it has no recorded convictions under the Act. As to Penalty 41 The court finds as, to the question of parity in penalty (see Warman Ltd v WorkCover Authority (1998) 80 IR 326 at 340-341), the Joint Venturers carry a similar liability for the charge brought against each defendant under the Occupational Health and Safety Act. They independently adopted the WorkSafe Plan. They, as Joint Venturers, both adopted the site specific work method. Both parties have acknowledged their joint responsibilities for the incident. I find each defendant was similarly responsible.

42 While Worley, in mitigation, has committed itself to a more significant involvement in site safety management, Transfield has developed an entirely new system overlaying its existing construction safety plan. I accept such revisions will be reflected in any further Joint Venture activities to assure safe working.

43 However, as was said by Deane J in Channon v The Queen (1978) 20 ALR 1 (at 18): In every case, there is but one ultimate question involved in the determination of sentence. That question is what is the appropriate punishment for the particular offence in the relevant circumstances.

44 The defendants further submit, in mitigation as to penalty, they entered an early plea of guilty to the charge. In the guideline judgment of R v Thompson; R v Houlton (1999-2000) 49 NSWLR 383; and (2000) 115 A Crim R 104, the Court of Criminal Appeal held the full benefit and discount for the utilitarian value of an early plea of guilty should be restricted to pleas entered at the earliest opportunity and should rarely be given after a matter has been set down for trial. In Cameron v The Queen [2002] HCA 6, the High Court, however, held when a defendant accepts responsibility for a crime and shows a willingness to facilitate the course of justice, the Court, in the assessment of the value of such a circumstance must consider, ". . . whether the plea was entered at the first reasonable opportunity". The effect of Cameron on the guideline judgment in Thompson was recently considered by the Court of Criminal Appeal in R v Sharma [2002] NSWCCA 142. The court held the reasoning in Cameron was not applicable in New South Wales because the common law principles therein enunciated have been modified by statute through s22 of the Crimes (Sentencing Procedure) Act 1999. The section renders it mandatory a sentencing judge in New South Wales take into account both "the fact" of the plea of guilty and "when" it was made. The Chief Justice in Sharma for the Court stated the statutory reference to "the fact" of the plea as the matter required to be considered, does not direct attention to the subjective intention of the person pleading guilty nor is the element of timing, reflected in the reference to "when" a plea was made, a reference only to subjective elements. Thus the Court must take the plea into account even if there is no subjective intention to "facilitate the administration of justice".

45 Both defendants submitted their pleas of guilty should be perceived by the court as early pleas such as to attract the benefit of the utilitarian value of an early plea in accordance with the guidelines in Thompson. I find from an examination of the court record each defendant entered a plea of guilty at the earliest possible opportunity. This is acknowledged by the prosecutor. Accordingly, I allow both defendants a discount of 25% for the utilitarian value of each plea.

46 In mitigation at to penalty the court notes the particular circumstances placed before it by each defendant and the difference between the industrial record of the defendants as to prior breaches of the Occupational Health and Safety Act 1983. The court accepts each defendant co-operated fully with the WorkCover Authority in its investigations.

47 I find the defendant Transfield Pty Limited guilty.

49 As to matter No IRC5054 of 2001, Inspector Roy Milligan v Transfield Pty Limited, the defendant is fined in the sum of $110,000 with a moiety to the WorkCover Authority.

50 As to matter No IRC5056 of 2001, Inspector Milligan v Worley Limited, the defendant is fined in the sum of $70,000 with a moiety to the WorkCover Authority.

51 I note the agreement between each defendant and the prosecution as to costs. I order Transfield Pty Limited to pay the sum of $7000 as agreed costs. I order Worley Limited to pay the sum of $7000 as agreed costs.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.