Labour Co-operative Limited v WorkCover Authority of New South Wales

APPELLANT The Hon. Dr J J Macken of counsel Solicitor: Mr H Macken Beston Macken McManis LEGAL REPRESENTATIVES: RESPONDENT Mr P M Skinner of counsel Solicitor: Mr G Phillips Carroll & O'Dea

JUDGMENT: - 18 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION

CORAM: Wright J, President Walton J, Vice-Present Boland J Friday14 March, 2003

LABOUR CO-OPERATIVE LIMITED v WORKCOVER AUTHORITY OF NEW SOUTH WALES (INSPECTOR STEVEN ROBINS)

Appeal by Labour Co-operative Limited against judgments of Justice Hungerford given on 20 September 2001 and 10 January 2002 in Matter Number IRC 2974 of 2000 JUDGMENT OF THE COURT [2003] NSWIRComm 51 1 These proceedings involve an appeal by Labour Co-operative Limited against two judgments of Hungerford J: WorkCover Authority of New South Wales (Inspector Robins) v Labour Co-operative Limited (No.1) (2001) 108 IR 283; WorkCover Authority of New South Wales (Inspector Robins) v Labour Co-operative Limited (No.2) (2001) 110 IR 229. The appeal is brought pursuant to s 5AA of the Criminal Appeal Act 1912 as applied by s 196 of the Industrial Relations Act 1996. The judgments were given in the one proceeding and were, respectively, the judgment dealing with the guilt of the appellant and that dealing with sentence.

2 The proceedings concerned a prosecution of the appellant under s 15(1) of the Occupational Health and Safety Act 1983. It was alleged at first instance that: The Defendant, Labour Co-operative Limited, being an employer on 1 July 1998 at the CSR Limited trading as CSR Timber Products premises at Masonite Road, Raymond Terrace in the State of New South Wales did fail to ensure the health, safety and welfare at work of all of its employees and, in particular, Ms Julie Anne Lister, in that: (a) it failed to provide such information, instruction and training to Julie Anne Lister so as to enable Lister to carry out her duties at CSR safely and without risk to her health which included spotting up the wet lap on Press 4 in the Boardmaking Area of the premises. The information, instruction or training provided to Lister with regards to the safe system of work relating to the operations in the Boardmaking Area was insufficient in that the training provided by the Defendant did not highlight the hazards of presses and/or automated mobile plant. (b) it failed to supervise Lister so as to ensure that Lister was only carrying out duties that she was qualified to perform and not required to carry out duties which were hazardous, without adequate training and supervision, given that Lister had had no previous experience operating heavy machinery and had no qualifications related to the operation of plant. (c) it failed to ensure that Lister was provided with adequate supervision and training by CSR whilst she was at its premises in that it failed to assess the effectiveness of the training or supervision provided by CSR to Lister.

3 In the proceedings the defendant pleaded not guilty. However, as Hungerford J recorded in the first judgment (at par [4]): The defendant indicated there was no issue raised by it concerning the circumstances of the accident and the injuries occasioned thereby to Ms Lister. Indeed, at the commencement of the hearing counsel conceded as being established all of the essential elements for a s 15(1) offence, other than that the defendant was the relevant employer of Ms Lister and, even if it were, the circumstances were such that it could not have done anything to prevent the accident occurring. Counsel emphasised, as he said, that "the substantial issue is that she isn't an employee of Labour Co-operative". Thus, three issues emerged for determination: first, the status of the defendant as the employer; second, the causal connection of the defendant with the alleged detriments to safety; and, third, the defence available under s 53 of the Occupational Health and Safety Act . 4 In relation to the first issue, Hungerford J found (at par [36]): That the defendant was the employer of Ms Lister at all relevant times, including when she was subject to the detriment to her safety on 1 July 1998 and sustained injuries as alleged in the prosecutor's summons.

5 In relation to the second issue, his Honour was satisfied (at par [49]): That risks to the safety of Ms Lister existed on 1 July 1998 when she was working in the Boardmaking Area at the Raymond Terrace premises of CSR Timber Products as alleged in the summons. Those risks, which resulted in her sustaining injuries, were within the responsibility of the defendant to ensure against and it is no answer, in my view, for the defendant to say it relied upon CSR Timber Products to safely train and supervise Ms Lister. The duty of care in this respect under s 15(1) of the Occupational Health and Safety Act is non-delegable and it is properly the responsibility of the employer, the defendant here, to have so intervened in its relationship with CSR Timber Products to obviate the identified detriments to safety. Its failure to do so makes out the offence.

6 As to the third issue, Hungerford J found the defendant had failed to make out a defence under s 53. His Honour consequently found the offence proven.

7 In Labour Co-operative (No.2) Hungerford J made the following orders: 1. The defendant is found guilty of the offence as charged and a conviction against it is entered accordingly. 2. The defendant is fined an amount of $90,000, with a moiety to the prosecutor. 3. The defendant is to pay the prosecutor's costs of the proceedings assessed in the sum of $10,000. 8 The question raised by the appeal as stated in the notice of appeal, was:

Whether Julie Anne Lister was an employee of Labour Co-operative Limited on 1 July 1998 when she sustained injuries at the premises of CSR Timber Products at Masonite Road, Raymond Terrace in the State of New South Wales.

9 The grounds of appeal however also raised a further issue as to whether his Honour "erred in the severity of the fine levied against the appellant".

10 The Hon Dr J J Macken of counsel for the appellant made his submissions under four headings: 1. As a matter of acknowledged contract Julie Lister was not an employee of the Labour Co-operative Limited. 2. As a matter of implied contract Julie Lister was not an employee of the Labour Co-operative Limited. 3. Even if Julie Lister could be construed to have been an employee of the Labour Co-operative Limited at the time of the accident s 53 provides a sufficient defence to the charge to prevent the conviction of the Labour Co-operative. 4. The penalty imposed on the Labour Co-operative Limited was manifestly too high in the special circumstances of the relationship between Julie Lister and the Labour Co-operative Limited. 11 Mr P M Skinner of counsel for the respondent disputed each of the four submissions by counsel for the appellant.

12 We find it convenient to address the issues raised on appeal according to the four headings used by Dr Macken. Thus the first issue is whether "as a matter of acknowledged contract" Julie Lister was an employee of the appellant. In this connection the appellant contended that the oral evidence of the witnesses, all of whom were called by the prosecution, was to the effect that Ms Lister was not an employee of the appellant at the relevant time. Further, it was contended that Hungerford J gave too much weight to administrative arrangements and paperwork that described Ms Lister as an employee of the appellant to the extent that he allowed it to override the more cogent oral evidence in the proceedings.

13 Dr Macken also submitted that his Honour did not give due weight to the administrative documents of the appellant that defined Ms Lister as being sent to the Co-operative by CSR Limited "for training". It was submitted for the appellant as a matter of law (see especially Hollis v Vabu Pty Ltd t/as Crisis Couriers (2001) 207 CLR 21) Ms Lister was an employee of CSR Timber Products at the relevant time and not an employee of the appellant. Finally, on this first issue, it was submitted that the prosecutor had failed to prove beyond reasonable doubt that the appellant was the employer of Ms Lister on the relevant date.

14 The evidence before Hungerford J indicated that Ms Lister was looking for full time permanent work and mentioned this to a friend, Mr Berrigan, who worked at CSR Timber Products. Mr Berrigan spoke to Mr Randall at CSR Timber Products about Ms Lister being interested in work. Mr Randall, the production manager, was responsible for recruiting labour. Mr Randall provided Ms Lister's name to work teams within the factory for the purpose of discovering whether they were agreeable to Ms Lister joining one of their teams. Apparently, the members of the work teams, using their local knowledge, have the right to determine whether they will work with a candidate for employment.

15 The work teams agreed to Ms Lister joining the workforce at the factory. Mr Randall said in his evidence he rang Ms Lister and informed her to go to the Labour Co-operative and register with them. She would then be put through an induction program by the Co-operative and notified by Mr Randall "when to come to the factory for training." Mr Randall said that when Ms Lister was told this "she was grateful."

16 Dr Macken referred in particular to the evidence of Mr Dodd, the appellant's marketing manager, Mr Couper, the appellant's marketing representative as well as Mr Randall. Mr Dodd gave evidence that Labour Co-operative draws its labour from two sources, the first being the unemployed person who may walk in off the street looking for work and the second being "when an employer sends to the Labour Co-operative for training existing employees at that plant". However, Mr Dodd said in his evidence that he regarded Ms Lister as an employee of Labour Co-operative "but we were asked again by CSR to make sure that she went through these things (induction and safety training) because that is the way they wanted to work for them." Mr Dodd said that regardless from which source labour comes to the appellant they are treated in the same way, that is, they sign the same documentation, they are "paid the same way" and the Co-operative carries workers' compensation insurance covering both classes of labour.

17 Mr Couper said in his evidence that when he was conducting induction training for Ms Lister he was "giving an induction to an employee of CSR". However, as Hungerford J observed, in conducting the induction Mr Couper agreed this was his sole concern and he had no supervision over the documents signed by Ms Lister for the defendant including an employment registration form.

18 Mr Randall said in his evidence that the "preferable method of recruitment by CSR" was having a person referred to the company, the employee was then vetted by the work teams and if found acceptable, sent to Labour Co-operative for training. Dr Macken submitted that this evidence of Mr Randall was "conclusive" and "supported the evidence of Mr Dodd and Mr Couper" that Ms Lister was an employee of CSR Timber Products.

19 As Hungerford J observed in his judgment in Labour Co-operative No. 1 at par [27]: It was essentially on that evidence of Mr Randall that Mr Macken based his fundamental submission to the effect that once the work team at CSR Timber Products approved Ms Lister working as one of its members, with Mr Randall then saying she could work at the premises and she expressed gratitude, then, as Mr Macken said, there was thereby created "a concluded contract of employment ... an offer and an acceptance ... a legal arrangement between CSR and Julie Lister ... she was an employee by every rule of law before she went to the Co-op".

20 In relation to the question of whether there was a legal relationship between Ms Lister and CSR Timber Products, Hungerford J came to the conclusion there was no such relationship. At best, his Honour considered, there was an invitation to treat extended to Ms Lister by CSR Timber Products for Ms Lister "to register with the defendant as an employee thereof in which case it would be prepared to train her as a member of the work team pursuant to the arrangement CSR Timber Products had with the defendant to supply casual labour from time-to-time." His Honour said at par [28]: [I]f the defendant had not been prepared to "register" or "enrol" Ms Lister then any arrangement as between her and CSR Timber Products in the form stated could not have been effected. In any event, the matters discussed between Mr Randall and Ms Lister in terms of the creation of a legally enforceable contract, as Mr Macken suggested occurred, simply did not exist - there was no mention of the wage rate to be paid, work to be performed (other than training), hours of work or conditions of employment generally; indeed, the omission of such matters, important as they are to the creation of a true legal relationship of employment as the consideration for any offer and acceptance, are to be understood in light of the evidence of Mr Couper who inducted Ms Lister on 15 June 1998 into the CSR Timber Products work environment by reference to the booklet but with the deletion therefrom of those important indicia of employment "because they were irrelevant".

21 It is clear from Hungerford J's judgment that he took into account all of the relevant evidence regarding the relationship between Ms Lister and CSR Timber Products and we can see no error in his Honour's finding that there was no legal relationship with that company. As his Honour observed, in determining whether there was any contractual relationship between Ms Lister and CSR Timber Products it is necessary to look at the whole of the relationship. This is what Hungerford J did. The fact that Messrs Dodd, Couper and Randall may have expressed opinions supporting the notion that Ms Lister was an employee of CSR cannot of themselves be taken as determinative of the true nature of the relationship. In any event, the opinions expressed seem to us to have been somewhat ambiguous.

22 Dr Macken's second main contention was that as a matter of implied contract Julie Lister was not an employee of the Labour Co-operative Limited. This essentially goes to the common law control test for determining whether an employment relationship exists: see Stevens v Brodribb Sawmilling Co. (1986) 160 CLR 16; Hollis v Vabu Pty Ltd; Drake Personnel Ltd (t/as Drake Industrial) v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 432 and Swift Placements Pty Ltd v WorkCover Authority of New South Wales (Inspector May) (2000) 96 IR 69.

23 In support of his contention that CSR Timber Products was the employer of Ms Lister, Dr Macken referred to and described what he contended was "the continuous, dominant and detailed control of Julie Lister" by CSR Timber Products at the time of the accident. It was submitted that: [T]he total control over Julie Lister in the manner in which she was to perform her work, the type of work within the team she was to perform during each shift as she was moved through her team training, and the place at which she was to perform her work, would constitute a sufficient degree of "control" within the legal sense to make her an employee of CSR Timber Products.

24 As to the asserted contrary indicia such as the fact that the appellant paid Ms Lister's wages and various other documentation, Dr Macken submitted that the appellant used the same administrative arrangements for payment and paperwork description of both classes of Co-operative worker (i.e., its own "employees" and persons sent to the Co-operative by outside firms for training and induction) as a matter of convenience and should not be regarded as contrary indicia.

25 In Labour Co-operative No. 1 Hungerford J said: 33 Once it be accepted, as I have found, that there was no legal relationship between CSR Timber Products and Ms Lister then the reliance by Mr Macken on the degree of alleged control over her work by CSR Timber Products fades into insignificance. It was not suggested by counsel that she was not employed by someone, only that she was not employed by the defendant but by CSR Timber Products - there was no other entity available for consideration on the facts and it was not said she was an independent contractor but only that the prosecutor had the onus according to the criminal standard to establish the existence of a contract of employment.

26 Relying on the statement by Mason J in Stevens v Brodribb Sawmilling at 24, Hungerford J adopted the view that "the existence of control, whilst significant, is not the sole criterion by which to gauge whether a relationship is one of employment ... " His Honour also considered the reasoning in Swift Placements at 96 IR at 100-101 as "apt to apply to support Ms Lister being an employee of the defendant whereby it provided her services for reward to CSR Timber Products and during such work she did not become the employee of CSR Timber Products."

27 Hungerford J also found that: ... at the particular time of the detriment to safety on 1 July 1998, notwithstanding the control then exercised by CSR Timber Products over the work (and training) of Ms Lister, that there was no transfer of her employment from the defendant at the particular time or for the particular purpose.

28 In Swift Placements the Full Bench considered a situation where there was an agreement between the appellant and Warman International Limited whereby the appellant would provide the services of persons, on a temporary staffing basis as required, to Warman in consideration of Warman paying a fee to the appellant. Mr Terkes was the person so supplied. He suffered an injury whilst working at Warman's Artarmon plant and Louise May, as an inspector of the WorkCover Authority of New South Wales, initiated prosecutions against the appellant for three breaches of s.15(1) of the Occupational Health and Safety Act 1983. The Full Bench said: 66 We have said earlier that an element involved in an employment relationship was that the performance of the work concerned must be for the benefit of the employer. Here, of course, the work performed by Mr. Terkes at Warman's Artarmon factory was subject to regular on-the-job control by Warman as to the work to be performed and how that should be achieved. Indeed, it was that aspect which was at the core of Mr. Macken's case that the control and direction over Mr. Terkes was exercised by Warman so that it was the true employer of him and that was so because the work was for Warman as part of its manufacturing process. As much as that may be, we do not consider mere on-the-job direction of a person necessarily makes that person the employee of the person directing. 67 In this case, having in mind the way in which we have formulated the contract between the appellant and Warman, the services of Mr. Terkes were provided to Warman by the appellant in return for a fee and in respect of which it was for the purposes of the appellant's business as a provider of labour.

29 The Full Bench in Swift Placements held, in effect, that Mr Terkes was an employee of the appellant which provided his services to Warman for a fee. In those circumstances, it could not be said as a matter of law that Mr Terkes was an employee of Warman or that there was any transfer of employment from Swift Placements to Warman merely because at the time of the injury to Mr Terkes he was being directed by Warman.

30 We agree with Hungerford J that the application of Swift Placements to the circumstances before him was apt. We can see no error of principle or law in his Honour's treatment of the role of the common law control test or his finding that the appellant was the employer of Ms Lister at all relevant times.

31 The appellant's third contention was that even if Ms Lister could be construed to have been an employee of the Labour Co-operative Limited at the time of the accident, s 53 of the Occupational Health and Safety Act provides a sufficient defence to the charge to prevent the conviction of the Labour Co-operative.

32 Dr Macken submitted that both s 53(a) and 53(b) provided the appellant with a defence because: · The evidence of witnesses from both CSR Timber Products and the appellant make clear there was no practical way for officers of the appellant to attend at the employment of Julie Lister and, when there, to be able to supervise or even witness the place of work within the team to which she was from time to time allocated.

· The accident itself only occurred because the transfer of Ms Lister within the team was from a task which she was competent to safely perform to one which was beyond her capacity to safely perform. The training given to Ms Lister was at a level directed by CSR Timber Products and enough for her to safely perform the task she was given. The Labour Co-operative Limited had neither the knowledge of the later transfer nor the power to prevent the transfer to the task at which she was injured.

· The suggestion that the cause of the accident was the employment of casuals on the relevant tasks. This is a matter wholly and properly within the decision of CSR Timber Products. The appellant could not determine the employment policy of the company. In any event the employment of Ms Lister was as a permanent employee and not as a casual.

33 Hungerford J found that it was reasonably practicable for the appellant to have ensured against the risks to safety by "adopting a positive and pro-active approach with CSR Timber Products to require steps be put in place to avoid the risks as a condition of it making available services to Ms Lister." Further, his Honour found that: Although, of course, CSR Timber Products had the control of the premises at Raymond Terrace and in a physical sense was the entity to make any changes, nevertheless the defendant in relation to the risks here as to instruction, training and supervision had a very real measure of control to ensure such matters were adequate and so as not to create a risk to safety - that measure of control was simply a refusal to supply its employees to CSR Timber Products until appropriate and sufficient measures to ensure safety were implemented. As the majority observed in Drake Industrial v Ch'ng (90 IR at p 456), "... a labour hire company is required by the OH&S Act to take positive steps to ensure that the premises to which its employees are sent to work do not present risks to health and safety. ... to ensure that its employees are not instructed to, and do not, carry out work in a manner which is unsafe". Hungerford J found that the appellant failed to make out a defence under s 53.

34 We consider the appellant's submissions regarding the defence available under s 53 of the Act overlook the reasoning of the judge at first instance. Even if it could be said it was not reasonably practicable for officers of the appellant to be on CSR's premises supervising Ms Lister and that the appellant had neither the knowledge of Ms Lister's transfer to other tasks nor the power to prevent the transfer to the task at which she was injured, his Honour's point was that pro-active steps were available to the appellant to avoid the risks. That is, it was open to the appellant, in conjunction with CSR Timber Products, to ensure that there were proper measures in place to avoid risks to health and safety. As to the question of control by the appellant over the causes, his Honour said that it was simply a matter of the appellant refusing to supply its employees to CSR Timber Products "until appropriate and sufficient measures to ensure safety were implemented."

35 We do not consider Hungerford J erred in his finding that the appellant failed to make out a defence under s 53.

36 The appellant's final contention was that the penalty imposed on it was manifestly too high in the special circumstances of the relationship between Julie Lister and the appellant. In this regard Dr Macken submitted:

· The appellant is a non-profit-making collective of workers established by the trade union movement in Newcastle to provide work for the unemployed, to encourage the preference for permanent rather than casual work and to provide a source of safety training for members of the Labour Co-operative Limited and generally for workers in Newcastle whether a Labour Co-operative member or not. · Such characteristics do not absolve the appellant from compliance with the Occupational Health and Safety Act but rather imposes beyond the strict obligations under the statute. The judgement at first instance does not credit the appellant with having gone beyond the usual obligations in complying with the law and with maintaining the well being of Ms Lister.

· The principle of deterrence should have been applied differently when fixing a penalty in the case of a non-profit making body which exists for the purpose of propagating the safe working of workers in various industries.

· The penalty is too high given the evidence that the appellant has never had a charge levelled against it since its inception in 1986 and since that time has been involved in supervising workers performing millions of man hours of work in varied and dangerous industries.

· The penalty does not reflect the fact that he appellant has been entrusted by WorkCover to carry out its own safety training and remains after this accident as an accredited training organisation by WorkCover.

· The appellant having appointed a further officer as a risk manager and having had its premiums reduced as a result of its safety record should have received some better consideration for this fact.

· As a result of the judgment having found the appellant to be the employer of Ms Lister this fact will add further to the costs of the accident to the appellant.

· The judgment fails to take into account the fact that any penalty will have to be paid from the limited funds available from the Management Fee charged to employers and will therefore reduce the amount available to be spent on the occupational health and safety training of members of the appellant and workers in general.

· Should any penalty have to be imposed the appellant seeks to argue again that no penalty should be imposed in the public interest. This is because some encouragement should be given to an organisation committed to the occupational health and safety of workers generally. 37 In Labour Co-operative (No.2) Hungerford J adverted to all of the pertinent subjective considerations raised in the appellants' submissions in the appeal on penalty. It could not be said his Honour did not give consideration to such matters. At par [21] of his judgment his Honour said: The clear thrust of Mr Macken's submission was that it was really unnecessary to impose any fine, or if so then only in a nominal amount, on the defendant because of its approach to occupational health and safety in the workplace, its demonstrated record in that respect and, most importantly, its nature as a non-profit labour co-operative in the Newcastle area concerned as a community based organisation with the training of workers and their placement in jobs. On that basis, as I understood Mr Macken's submission, it was suggested this was an appropriate case to exclude consideration of general deterrence in the assessment of any fine to be awarded.

38 At par [26] of his judgment Hungerford J said: 26 I accept Mr Macken's submission as to the nature of the business in which the defendant is engaged and its established philosophy as a non-profit organisation in the supply of labour to industry in the Newcastle area but based very much on community considerations in endeavouring to place persons in work. Paramount also in this consideration must be its most satisfactory industrial safety record as demonstrated by the lack of prior convictions and the regular consultation it has with inspectors of the WorkCover Authority as to appropriate safety practices. Indeed, Mr Skinner acknowledged as much. I have in mind too the substantial reduction in the defendant's workers' compensation premiums over the last four years following the appointment of the Risk Manager and, as GIO as its insurer commented, where the premiums were reduced "due to the implementation of good Risk Management and Safety Procedures". The defendant's concern for the welfare of Ms Lister after her injuries weighs also in its favour. I propose to allow a discount of 10 per cent to the penalty otherwise considered appropriate in recognition of those subjective features. In the result, I assess an appropriate fine against the defendant for the present offence to be an amount of $90,000. The prosecutor is to have a moiety of the fine.

39 It is evident from his Honour's judgment in Labour Co-operative (No. 2) that he regarded the subjective matters relied upon by the appellant as subsidiary to the main consideration, that is, the nature and quality of the offence. As Hungerford J correctly observed at par [22]: the penalty must reflect the nature and quality of the particular offence in an objective sense with proper weight to subjective considerations in tempering any penalty but where such subjective considerations are necessarily subsidiary to the main considerations that determine the appropriate amount of punishment: see Warman International Ltd v WorkCover Authority of New South Wales (1998) 80 IR 326 at p 339; Dowling v Overtop Pty Ltd (1998) 86 IR 319 at p 333; and Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 at p 475.

40 In considering the nature and quality of the offence Hungerford J found at par [23] that: 23 The essential failure by the defendant here was its complete lack of attention to the instruction, training and supervisory needs of Ms Lister in being sent to the Raymond Terrace plant of CSR Timber Products to perform work in the operation of heavy machinery in the Boardmaking Area. The evidence made it plain, in my view, that the defendant was content to merely satisfy the call by CSR Timber Products for a labourer and, apart from providing induction to occupational health and safety measures in a general sense, left it entirely to CSR Timber Products to train and supervise Ms Lister in the performance of work which CSR Timber Products required to be done from time-to-time. In my view, that approach by the defendant was contrary to its responsibility for the workplace safety of its employee, Ms Lister, and represented a failure to meet its special responsibility as a labour hire company. As was observed in Drake Industrial (90 IR at p 456) by the majority of the Court, "... a labour hire company is required by the OH&S Act to take positive steps to ensure that the premises to which its employees are sent to work do not present risks to health and safety. ... to ensure that its employees are not instructed to, and do not, carry out work in a manner which is unsafe". That was the qualitative nature of the failure by the defendant in the present case. 41 Hungerford J also referred to the judgment of Kavanagh J as to the prosecution of CSR Timber Products concerning the incident involving Ms Lister in Robins v CSR Ltd t/as CSR Timber Products [2001] NSWIRComm 296. In that case her Honour imposed a fine of $150,000 after allowing a discount of 15 per cent for subjective features, including the utilitarian value of the guilty plea. Hungerford J noted the maximum penalty in that case was $825,000 by reason of CSR Timber Products having had prior convictions and where her Honour found that "CSR held full responsibility for the design of this work method and the machine's safety features".

42 Hungerford J observed that the relevance of the approach of Kavanagh J to the matter before his Honour arose from the comments of the Full Bench of the Court in Warman International Ltd v WorkCover Authority of New South Wales (1998) 80 IR 326 in relation to consistency in sentencing as between a labour hire company and its client for respective breaches of the Occupational Health and Safety Act under s 15 and s 16. In Warman their Honours said (80 IR at p 341): While the offences with which we are dealing under the OH&S Act do not involve the notion of co-offenders, the fact is that the same circumstances have given rise to prosecutions for offences under ss 15 and 16 of the OH&S Act of the direct employer, Drake Personnel Ltd t/as Drake Industrial which supplied the labour involved, and the defendant here who utilised that labour in relevant circumstances. While those defendants have been found guilty of different offences, nevertheless the factual circumstances giving rise to the charges justify an approach to sentencing which shows consistency and not disparity in punishment in the same way as discussed by Mason J in Lowe v The Queen (1984) 154 CLR 606 at pp 610-611. We take all of these factors into account in determining penalties for the six charges, ...

43 We consider that in arriving at his decision on penalty Hungerford J accorded proper weight to the objective and subjective features of the offence and to the principle of consistency. We do not consider the penalty imposed by his Honour was manifestly too high or that there is any basis to interfere with the penalty imposed having regard to the approach required in terms of appeals against sentence: for example, House v The King (1936) 55 CLR 499 at 504 - 505.

44 We make the following orders: 1. The appeal is dismissed. 2. The appellant shall pay the prosecutor's costs of the appeal as agreed or, failing agreement, as assessed.

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