E C Throsby Pty Ltd (ECT) has pleaded guilty to an offence that being a person who had a health and safety duty pursuant to section 19(1) Work Health and Safety Act 2011 (the Act), it failed to comply with that duty and thereby exposed Chan Chun Pang to a risk of death or serious injury contrary to section 32 of the Act.
Mondex Group Pty Ltd (Mondex) has pleaded guilty to an offence that being a person who had a health and safety duty pursuant to section 19(1) of the Act) it failed to comply with that duty and thereby exposed Chan Chun Pang to a risk of death or serious injury contrary to section 32 of the Act.
The maximum penalty for each offence is a fine of $1.5 million.
[2]
Facts
The parties presented 2 Agreed Statements of Facts that can be summarised as follows.
ECT operated a meat processing facility at Whittingham, employing 62 people and engaging 176 workers through labour-hire companies. About 22 of the labour-hire workers were provided by Mondex.
Mr Pang was a 22 year old student from Hong Kong on a 417 visa that permitted him to work. He was employed by Mondex and worked as a night cleaner at the facility, commencing on February 2014. His usual work hours were 11.00pm to 7.30am the following day.
The majority of the plant at the facility was owned by ECT. Beak & Johnston Pty Ltd (B&J) conducted a business supplying retail meat products. B&J entered into an agreement with ECT to provide it with uncooked mince for sausage production. For that purpose it provided ECT with plant to be used exclusively for that purpose, including a Thompson Mixer Mincer model number 4300-M-10 (the mincer).
The mincer was located in the boning room at the facility. Mr Pang was required to clean the mincer approximately twice per week, on the night of the day it was used.
The mincer was approximately 1,800mm high and positioned on a stand about 500mm high. Tubs or "dollies" of meat were raised on a hoist and tipped into the mixing bowl of the mincer while the lid was raised. Inside the bowl was a paddle that rotated to push the meat towards the screw that ground the meat. The ground meat was fed out through a chute at one end of the mincer.
The mincer had a proximity switch installed in the lid, so that when the lid was open the mincer would not operate (the proximity switch).
Mr Pang had been trained in the procedure to clean the mincer by ECT's cleaning supervisor, Colin Long. The procedure required Mr Pang to remove the screw of the mincer. Then, Mr Pang could open the lid of the mincer and to hose out the mixing bowl and then scrub the mixing bowl and the paddle. While the lid was raised Mr Pang could only rotate the paddle if he leaned over and held down a button next to the outlet chute.
The cleaners had been issued with a basic work instruction for the cleaning of the mincer dated 17 February 2014. That work instruction had not been translated.
In or about June 2014 ECT requested B&J to provide it with equipment that would double its production of mince. On 21 October 2014 representatives from B&J attended the facility to discuss increasing production and improving efficiency. One option suggested by B&J was to disable the proximity switch to allow the mincer to operate continuously during production, ie even when the lid was raised.
A qualified electrician employed by ECT was instructed by an engineer to disable the proximity switch. The electrician expressed his concern to his supervisor, another engineer, about by-passing the safety features of the mincer. The engineers believed that disabling the proximity switch would pose a minimal risk to workers during production because workers did not need to access the top of the machine. ECT conducted a risk assessment for the operation of the mincer. In disabling the proximity switch, ECT did not consider the operation manual for the mincer. The risk posed to the cleaners was not considered.
Following the disablement of the proximity switch, Mr Pang was advised by Mr Long that the mincer would operate with the lid open and that he needed to exercise caution and to keep his arms clear when cleaning the mincer. Mr Long instructed Mr Pang to stop the paddle by using the emergency stop button near the chute of the mincer and to scrub the mixing bowl and the paddle with a device known as a "doodlebug". A doodlebug was a stick about 1600mm long with a scrubbing pad attached to the end of it.
ECT did not consult with, or notify Mondex about the modification to the mincer. Mondex did not have a system in place to require ECT to tell it about modifications to machinery, including the mincer that could have impacted the safety of Mondex's employees.
At about 11.15pm on 6 November 2014, Mr Pang was cleaning the mincer with the lid open and the paddle rotating. His left arm came in contact with the rotating paddle causing him injury. He suffered a laceration to the left hand/forearm, a severed tendon in his forearm and a compound fracture of his left distal radius and ulna. Mr Pang was taken to hospital by ambulance. Mr Pang has been certified as fit to return to his pre-injury duties.
[3]
ECT's case on sentence
ECT relied on an affidavit of Edward Sparke Charles Throsby, the sole director and shareholder of the offender, sworn 3 April 2018. Mr Throsby was present in Court and not required for cross-examination. His evidence can be summarised as follows.
Mr Throsby's family has been operating abattoirs since 1951. In 1990 Mr Throsby's father decided to build the facility which is a state of the art 'hot boning' facility. Hot boning is the process of slaughtering the animal and processing the meat within the period of one day, before chilling the meat. Efficiency is paramount to the hot boning process in order to prevent the growth of bacteria. The temperature of the meat is continuously monitored to ensure that the conditions required for the proliferation of bacteria are minimised. The process reduces energy and capital costs and reduces processing time.
The facility has been operating since 2000. ECT purchases livestock and sells the processed product. About 98% of the product is exported. The facility is halal accredited and operated in accordance with a management system known as hazard analysis critical control point (HACCP). As an exporter the facility is required to have 3 officers from the Department of Agriculture and Water Resources on site for each production shift, to monitor compliance with the appropriate legislation. The facility is also audited for compliance on a 3 monthly basis.
ECT supplies to international corporations that require them to hold Aus-Meat accreditation and British Retail Consortium (BRC) certification which are global food safety initiatives. ECT currently holds the highest level of Aus-Meat accreditation which is reviewed every 6 months.
ECT and related companies employ or engage about 260 people. It employs a number of unskilled youth in an area with high rates of youth unemployment. The bulk of people working at the facility reside locally. ECT has long term experienced employees in the major management positions. Mr Long has been the cleaning supervisor at the facility since 2002. The injury to Mr Pang was the only serious injury to have been sustained in that period.
ECT has had a Work Health and Safety Committee in operation since 2000. The WHS Committee meets monthly and it includes 6 employee representatives that are elected by their peers.
ECT arranges for regular chemical safety training for cleaners that includes updating the material safety data sheet register. It engages external training providers to train employees on the safe use of forklifts. ECT is a member of the Australian Meat Industry Council (AMIC) and receives regular updates in relation to work health and safety issues. ECT has also arranged for management personnel to attend a 3 day national work health and safety conference organised by AMIC. ECT subscribes to an occupational health and safety publication which is regularly updated. The WHS Committee has attended a 5 day training course on work health and safety.
At the time of the incident Mr Pang was one of 11 cleaners of whom 4 were from a non-English speaking background.
From January 2009 ECT has invested approximately $13.8 million to improve the plant at the facility to improve efficiency and to decrease the exposure of workers to fatigue and injury. ECT is taking steps to eliminate about 95% of manual handling of product at the facility.
ECT's current WHS budget is $321,206 per annum.
ECT used Mondex to supply 417 visa workers when it could not source local workers. Since May 2011, ECT has trained and employed 400 employees on 417 visas, including 50 cleaners. Mr Pang's injury was the only time lost injury in that period. ECT treats its foreign workers no differently and includes them in all staff events and benefits.
Mondex showed videos of the work to potential workers to show them the tasks they will perform. Mondex is provided with ECT's protocols that are translated by it into the native language of the new worker. All of the labour hire workers on the slaughter floor or in the boning room had translated work instructions. It was an oversight that the cleaners did not have translated work instructions at the time of the incident.
Mr Pang was inducted by the Human Resources Manager on 17 February 2014. He was provided with an Employee Induction Manual that was in English and Mandarin. During the induction he was taken through the procedures and asked if he understood each section. He was then given the Standard Operating Procedures (SOPs) for the cleaning tasks. These instructions were in English. Mr Pang then signed an acknowledgment of the induction process. Mr Pang was then introduced to Mr Long for task-specific on the job training. Mr Long demonstrated the processes including the task of cleaning the mincer.
Mr Throsby had always communicated with Mr Pang in English and formed the view that he could communicate well in English.
In 2018 ECT has changed the way that it employs foreign workers. It now pays Mondex an introduction fee and the workers are employed by a related company. This was intended to make the pay rates and terms of employment consistent for all employees. Mondex sends a representative who speaks the native language of the worker to assist in the induction process. All documents are translated by Mondex. The Human Resources Manager goes through the induction process with the translator, if required. The workers are then shown a translated slide show presentation about WHS issues. The workers are then introduced to supervisors for on the job training. No Mondex introduced employee is permitted to work until they have received translated work instructions, on the job training and they have been assessed as competent for the task.
Since 2000, ECT has arranged for a medical practitioner to attend the facility to review work plans and to treat employees at their request.
When a piece of machinery is installed or modified a risk assessment is performed and if it is assessed as high risk a work instruction is developed. Workers are assessed as to their competency for a task and they sign a record to indicate that they have been trained on the work instruction.
The mincer was delivered to the facility on 9 October 2010. A risk assessment was performed and a work instruction developed and implemented. The mincer could not keep up with production. As a consequence the meat was waiting to be processed and there was an increased risk of the proliferation of bacteria that would have made the meat unfit for consumption. B&J were invited to participate in the process of increasing the mincer's efficiency and it was decided to disable the proximity switch. This was considered not to present any risk to staff during production because the process for loading the mincer was automated, however no risk assessment was undertaken for the cleaning of the mincer.
The decision to disable the proximity switch was a bad one. The modification was made approximately 2 weeks before the incident. Mr Pang was instructed to clean the mincer with the doodlebug in order to keep his arms clear of the paddle.
After the incident the proximity switch was reconnected. On 8 November 2014 a risk assessment for the cleaning process of the mincer was undertaken. Following a management meeting it was decided to, manufacture a purpose built step for cleaning the mincer, to issue a notice to maintenance staff not to modify equipment, to update the work instruction for cleaning the mincer and arrange for it to be translated and to ensure that all work instructions in the future were translated. All cleaning work instructions were subsequently translated, the cleaners were trained and assessed as competent and a record made of that training. ECT has also employed a full-time trainer to train workers on processes at the facility. ECT has informed all staff of the incident and how it occurred and that it considered the incident to be very serious.
ECT's workers compensation history demonstrates that it has had very few claims in the last 5 years and that it has maintained an average below that of the industry since 2011. Mr Throsby expressed regret for the incident.
The mincer was returned to B&J on 12 August 2015, without further incident.
[4]
Mondex's case on sentence
Mondex relied on an affidavit of Xiaonan Chen, the Human Resources Manager of the offender, sworn 9 April 2018. Ms Chen was present in Court and not required for cross-examination. Her evidence can be summarised as follows.
In 2014 Mondex had 122 employees on labour hire placement in 5 work places, including 22 workers at ECT's facility. Mondex had entered into an agreement with ECT to supply labour in February 2014.
Before supplying workers representatives from Mondex visited ECT on 6 January 2014 to inspect the work place and to conduct an onsite risk assessment. Mondex had an onsite manager at ECT to facilitate communication and to provide for the welfare of its workers, including their health and safety. Ms Chen was in close contact with the site manager, who prepared a weekly report covering work health and safety and any other concerns.
Each new employee was provided with an Induction Book that was translated. The Book was reviewed each year in July.
Mr Pang completed an application form. Part of the reason for this was to assess his proficiency in English. Mr Pang's English was assessed as competent.
Mr Pang was taken through an induction by Mondex on 13 February 2014 and he signed a record of completing that induction. Mr Pang was assessed and trained at ECT on 24 February 2014 and a copy of that assessment was forwarded to Mondex.
After the incident, Mondex became aware that the mincer had been modified. ECT did not notify Mondex's onsite manager or the Sydney office of its intention to do so. Mondex accepts that better systems should have been in place to require ECT to notify it of any proposed changes to equipment that might affect the health and safety of Mondex's employees, so that Mondex could assess the impact of the changes and take steps to ensure the safety of its workers.
On hearing of Mr Pang's injury, Mondex conducted an investigation. It found that Mr Pang had been inadequately retrained on how to clean the modified mincer. The new operating procedure was obtained from ECT and translated. Mondex then conducted a risk assessment based on the new procedure and the work instruction.
Mondex is very sorry for what happened to Mr Pang and accepted responsibility for its failure to ensure the communication systems were stringent enough. Ms Chen expressed that the company feels very bad about what happened to Mr Pang and has tried to take steps to ensure that a similar event cannot happen in the future.
Mondex has sent a representative to inspect the facility several times after the incident and has conducted a number of risk assessments.
Mondex supported Mr Pang following his injury by waiving half of his rent and keeping in close contact with him. Mr Pang has the employment of Mondex.
Mondex has reviewed its practices with all other host employers and has encouraged more detailed discussions on plant and any changes that may pose a risk to safety. It has introduced more regular toolbox talks to discuss these matters and it visits host employer sites more often.
Since February 2018 Mondex operates as a referral agent for ECT and the workers are employed directly by a related company to ECT at the facility.
Mondex also tendered 2 references from other host employers who operate abattoirs. The referees describe Mondex as safety conscious, proactively involved in training and as being in daily contact with their onsite managers.
[5]
Consideration
I have had regard to the objects of the Act set out in section 3 and the purposes of sentencing set out in section 3A Crimes (Sentencing Procedure) Act 1999.
[6]
EC Throsby Pty Ltd
The risk to the health and safety to the cleaners was obvious. The risk was identified in the operator's manual and in the signage on the mincer. ECT took steps minimise the risk, but this was a case where the risk had been eliminated through the design of the mincer. By disabling the proximity switch ECT created the risk. The risk to the health and safety of the cleaners was not assessed by the engineers or senior management.
The instructions provided to Mr Pang by Mr Long after the modification of the mincer were inadequate. The procedure relied on behavioural controls. There was no written procedure for the task and it had not been translated for the workers of a non-English speaking background.
The risk was one of serious injury. The depth of the mixing bowl and the fact that the screw was removed during the cleaning process eliminated the risk of a worker coming in contact with the knives of the mincer. The risk was of having a hand or arm trapped by the paddles.
ECT knew that the modification of the mincer posed a risk to workers. This was stated in the operator's manual for the mincer and the subject of the electrician's warning when he was instructed to disable the proximity switch.
The likelihood of the risk coming home was significant. The mincer was modified a short time before the incident and the mincer was only cleaned a few times in that period.
The injuries suffered by Mr Pang were serious but at the lower end of the scale. Mr Pang recovered to the extent that he could resume his pre-injury duties.
The modification of the mincer was intended to increase output. Whilst there were benefits to ECT flowing from the increased output, I accept that the modification was necessary to increase efficiency of production and reduce the risk of bacterial growth.
The steps required to be taken to eliminate the risk were simple and could be achieved at insignificant cost to ECT.
The offence is approaching the mid-range of objective seriousness.
[7]
Mondex Group Pty Ltd
The presence of the risk was less obvious to Mondex. Clearly, Mr Pang was told about the modification to the mincer but that was not passed on to the onsite manager or back to the head office. At the times when Mondex had inspected the facility the mincer did not pose a risk to the Mondex workers.
The reasonably practicable step that could have been taken by Mondex was to require ECT to consult with it before making decisions that could adversely affect the health and safety of the Mondex workers. Mondex had a presence at the facility capable of bringing about a higher level of communication.
Once notified Mondex, could have required a detailed work instruction for the cleaning of the mincer that it could have translated into the workers' native languages.
Mondex had not reviewed the work instruction for cleaning the mincer prior to the incident. The work instruction was brief and did not focus on the safety precautions for the task, but the design of the mincer removed the risk of injury. Mondex was not given the opportunity to consider the training provided to Mr Pang by Mr Long after the proximity switch was disabled.
The offence is in the low range of objective seriousness.
[8]
Deterrence
General deterrence
The penalty imposed in relation to the offences must provide for general deterrence. Persons conducting a business or undertaking (PCBUs) must take the obligations imposed by the Act very seriously. The community is entitled to expect that both small and large PCBUs will comply with safety requirements. General deterrence is a significant factor when safety obligations are breached: Bulga Underground Operations Pty Ltd v Nash [2016] NSWCCA 37 at [180].
[9]
Specific deterrence - EC Throsby Pty Ltd
There is some need for specific deterrence because the offender continues to operate in an industry that presents significant risks to the health and safety of its workers. However, the need for specific deterrence is reduced. Prior to the incident the offender had in place significant systems to provide for the health and safety of persons engaged at the facility. It has taken significant steps after the incident to improve its safety systems. The offender is also undertaking a significant upgrade of its processes to automate many of the processes that would involve a risk of injury to its workers.
[10]
Specific deterrence - Mondex Group Pty Ltd
There is some need for specific deterrence because the offender still enters into agreements to allow its employees to work for other PCBUs. However, the need for specific deterrence is significantly reduced. At the time of the incident the offender was operating as an exemplary model of a labour hire business. The offender was involved in training its employees on the host's work processes and it had a presence at ETC to monitor the health and safety of its employees. It ensured that its employees were inducted and that they received that training in their native language. The offender has taken steps to improve its systems and the levels of communication with host employers. The offender no longer provides workers to ECT on a labour hire basis, but operates as a referral service for workers who are employed directly by a company related to ECT.
Aggravating factors
The injury harm and loss caused by the offence was substantial: section 21A(2)(g) Crimes (Sentencing Procedure) Act 1999. In order for the aggravating factor to be established I must be satisfied beyond reasonable doubt that the harm was greater or more deleterious than may ordinarily be expected for the offence in question: R v Youkhana [2004] NSWCCA 412 at [26]. The offence does not require an injury to be sustained but only the creation of a risk. The injuries suffered by Mr Pang were serious. I am satisfied beyond reasonable doubt that the injury harm and loss caused by the offence was substantial.
Mitigating factors
The offenders do not have any previous convictions: section 21A(3)(e) Crimes (Sentencing Procedure) Act 1999. ETC was incorporated in 1993. The Throsby family have operated abattoirs since 1951. ETC has operated the facility since 2000. Mondex was incorporated in 2013.
ETC was a person of good character: section 21A(3)(f) Crimes (Sentencing Procedure) Act 1999. The evidence demonstrates that the offender had both before and after the incident a serious commitment to workplace safety. It does not have any prior convictions. The offender is also an exemplary corporate citizen by reference to its provision of employment in the local area of the facility. The evidence demonstrates an extraordinary commitment to the welfare of its workers.
The offenders have good prospects of rehabilitation: section 21A(3)(h) Crimes (Sentencing Procedure) Act 1999. Both offenders have taken considerable steps to improve their safety systems since the incident. I am satisfied that each is committed to ensuring the work health and safety of its workers.
The offender has demonstrated remorse: section 21A(3)(i) Crimes (Sentencing Procedure) Act 1999. ETC, has through Mr Throsby, accepted responsibility for its actions and expressed remorse. Mondex, has through Ms Chen, accepted responsibility for its actions and expressed remorse. I am satisfied on the balance of probabilities that each offender has expressed genuine contrition and remorse.
The offenders entered pleas of guilty: section 21A(3)(k) and section 22 Crimes (Sentencing Procedure) Act 1999. The offender is entitled to a discount on penalty that reflects the utilitarian value of that plea. The primary consideration in determining where in the range a particular case should fall is the timing of the plea, so that the earlier the plea the greater the discount: R v Thomson & Houlton (2000) 49 NSWLR 383 and R v Borkowski (2009) 195 A Crim R 1 at [32]. The plea also indicates remorse: Borkowski at [32]. The appropriate discount is 25%.
The offenders co-operated with the Safe Work investigation: section 21A(3)(m) Crimes (Sentencing Procedure) Act 1999.
[11]
Other matters
There are good reasons for imposing a different penalty on the offenders because the culpability of ECT is substantially greater than that of Mondex. Mondex did not know that the proximity switch had been disabled. It did not have control over ECT's processes or was not involved in the decision to disable the proximity switch or the act of disablement. Mr Pang was supervised and inadequately trained by Mr Long, an employee of ECT.
[12]
Penalty - EC Throsby Pty Ltd
EC Throsby Pty Ltd is convicted.
The appropriate fine is one of $120,000 that will be discounted by 25% to take into account the plea of guilty.
I impose a fine of $90,000.
I order that pursuant to section 122(2) Fines Act 1996 that 50% of the fine is to be paid to the prosecutor.
I order that the offender pay the prosecutors costs as agreed in the sum of $35,000.
[13]
Penalty - Mondex Group Pty Ltd
Mondex Group Pty Ltd is convicted.
The appropriate fine is one of $20,000 that will be discounted by 25% to take into account the plea of guilty.
I impose a fine of $15,000.
I order that pursuant to section 122(2) Fines Act 1996 that 50% of the fine is to be paid to the prosecutor.
I order that the offender pay the prosecutors costs as agreed in the sum of $33,800.
[14]
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Decision last updated: 23 April 2018