SafeWork NSW v CCP Remedial Pty Ltd

SafeWork NSW v CCP Remedial Pty Ltd - [2021] NSWDC 86 - NSWDC 2021 case summary — Zoe

[3]

BACKGROUND

The defendant conducted a business or undertaking ('PCBU') which involved the provision of construction repair services to the insurance industry ('the business'). Mr Benjamin Pines ('Mr Pines') has been the Managing Director of the defendant for 11 years. He has 23 years' experience in the building and construction industry and holds technical building, construction and safety qualifications as referred to in [2] - [5] of Exhibit 1.
In July 2017, the defendant was engaged by Insurance Australia Group, specifically NRMA Insurance, to repair premises located at 6 Towri Close, St Ives in the State of New South Wales ('the premises'), being a split level residential brick home with a flat roof.
The defendant engaged Macfin Building Solutions Pty Ltd ('Macfin'), to undertake waterproofing work at the premises, in particular waterproofing work on the roof of the premises ('the work').
The work was high risk construction work in that it involved a risk of a person falling more than 2 metres.
The workers were Mark Dennis ('Mr Dennis'), Mr Peter Hubbard ('Mr Hubbard'), Mr David Palazzi ('Mr Palazzi') and Mr Mark Feilberg ('Mr Feilberg'). The work was performed on 24, 25 and 26 July 2017 ('the work dates').
Mr Palazzi was a subcontractor or contractor to the defendant carrying out labouring or carpentry services at the premises. Mr Feilberg was a subcontractor to the defendant and worked on 26 July 2017 assisting with the work.
Mr Dennis and Mr Hubbard were engaged, or caused to be engaged by the defendant, in that they were sub-subcontractor to, or casual employees of, Macfin. Mr Hubbard undertook work at the premises on 24, 25 and 26 of July 2017. Mr Dennis was carrying out labouring services at the premises on 26 July 2017.
The workers activities in carrying out the work were influenced by the defendant, in that the defendant: 1. Could determine when the work would commence at the premises; 2. Could, jointly with Macfin, determine the risks associated with the work; and 3. Was consulted by Macfin in relation to the work.

[11]

REGULATION AND GUIDANCE MATERIAL

Pursuant to s 78 of the Work Health and Safety Regulation 2017 (NSW) ('the Regulation'), PCBUs must manage, in accordance with Part 3.1, risks to health and safety associated with a fall by a person from one level or another that is reasonably likely to cause injury to the person or any other person.
Management of this risk by a PCBU in accordance with Part 3.1 of the Regulation includes requirements to: 1. Identify reasonably foreseeable hazards that could give rise to risks of health and safety (Regulation 34); 2. Eliminate the risk to health and safety so far as is reasonably practicable, and if not reasonably practicable to do so, minimise the risk so far as is reasonably practicable by implementing control measures in accordance with the hierarchy of risk control (Regulation 35 and 36); 3. Maintain the implemented control measure so that it remains effective (Regulation 37); and 4. Review and, if necessary, revise all risk control measures (Regulation 38).
The following codes of practice provided specific guidance to PCBUs in relation to managing the risk of falls from heights: 1. SafeWork Australia, Managing the Risk of Falls at the Workplace Code of Practice (April 2016) ('the SafeWork COP') applies to all workplaces where there is a risk of a fall by a person from one level to another that is reasonably likely to cause injury. Specifically, the code of practice provides: 'Protection of openings and holes Holes, penetrations and opening through which a person could fall should be made safe immediately after being formed. If a cover is used as a control measure, it must be made of a material that is strong enough to prevent persons or objects falling through and must be securely fixed to prevent any dislodgment or accidental removal.' 1. The WorkCover Preventing Falls in Housing Construction Code of Practice (July 2014) ('the WorkCover COP') provides practical guidance on how to eliminate, or if that is not possible, to minimise the risk of falls from height in housing construction. This WorkCover COP is approved under s 274 of the Act. Section 1 of the WorkCover COP states: 'Falls are a major cause of death and serious injury in Australian workplaces. Fall hazards are found when carrying out common tasks in the construction of a typical one or two storey house.'
Section 2.1 of the WorkCover COP provides guidance on various control measures in the hierarchy of risk control which are available to be implemented in order to provide adequate protection against the risk of falls, such as the installation of a fall prevention device like guardrails.
Section 3 of the WorkCover COP also provides the following guidance for void protection: 'Void Protection Where workers are working from trestles, ladders and mobile scaffolds on solid construction and they are located in close proximity to floor openings such as stairwells and partially completed floors, edge protection will not prevent a fall into the opening. The opening must be covered with covers designed to withstand likely impact and static loads and fixed to prevent any dislodgment or accidental removal.'
Section 4 of the WorkCover COP states that guardrails may be used to provide effective fall protection at openings in floor or roof structures and at the perimeters of buildings and skylights.

[15]

SENTENCING PRINCIPLES

I have had regard to the objectives set out in s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW) ('the Sentencing Act') for the purpose of sentencing. The purposes for which a Court may impose a sentence on an offender are as follows: 1. to ensure that the offender is adequately punished for the offence; 2. to prevent crime by deterring the offender and other persons from committing similar offences; 3. to protect the community from the offender; 4. to promote the rehabilitation of the offender; 5. to make the offender accountable for his or her actions; and 6. to recognise the harm done to the victim of the crime and the community.
The penalties imposed must give effect to the intention of the Act, in particular, protecting workers and other persons against harm to their health, safety and welfare through the elimination or minimisation of risks arising from work: s 3 of the Act.
The court is to be guided by the provisions of the Sentencing Act which include: 1. Section 3A which sets out the purpose of sentencing; 2. Section 21A which sets out the aggravating, mitigating and other factors in sentencing; and 3. Section 22 which provides that a guilty plea is to be taken into account on sentence, as is the time when the plea was effectively indicated or entered.
The court is to approach a sentencing exercise on the basis of it being one of "instinctive synthesis": Markarian v The Queen (supra).
This approach to sentencing was reiterated by Russell SC DCJ in SafeWork NSW v HCM Building Pty Limited [2019] NSWDC 632 at [109] in this way: 'The court must identify all the factors that are relevant to the sentence, discuss their significance and then make a value judgment as to what is the appropriate sentence given all the factors of the case: Muldrock v The Queen [2011] HCA 39; [2011] 244 CLR 120. This approach to sentencing, known as the "instinctive synthesis" approach, involves the making of a global judgment without any attempt to state precisely how any given factor has influenced the judgment.'
The objective degree of foreseeability is a matter for the Court to have regard to when considering the gravity of the offence: Capral Aluminium Limited v WorkCover Authority of NSW (2000) 49 NSWLR 610 at [89].

[16]

OBJECTIVE SERIOUSNESS OF THE OFFENCE

The duties of the defendant required that it ensured the health and safety of workers as far as reasonably practicable. The duty requires the identification of risks in the workplace and an assessment of measures to address such risks.
Although the gravity of the risk, degree of foreseeability of the risk and the ease of implementation of remedial measures are relevant to the assessment of objective seriousness, I am not limited to taking into account such factors.
The primary factor to be assessed is the objective seriousness of the offence. Subjective factors play a subsidiary role: Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (1999) 90 IR 464, 474 - 5.
Subjective factors should not be permitted to produce a sentence which fails to adequately reflect the seriousness of the offence: WorkCover Authority (NSW) v Profab Industries Pty Ltd (2000) 49 NSWLR 700 at [714].
The gravity of the offence is determined by the extent of the duty holder's failure to ensure, so far as was reasonably practicable, that its workers were not exposed to risks to their safety: Orbit Drilling v The Queen [2012] VSCA 82 at [62], Veen v R (No 2) (1988) 164 CLR 465.
An offence will be serious where there is an obvious or foreseeable risk to safety against which appropriate measures were not taken even though such measures were available and feasible: Morrison v Powercoal Pty Limited & Anor (No 3) [2005] NSWIRComm 61.
In Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96, Basten JA explained the approach to sentencing as follows: '[34] The sentencing judge commenced his consideration with the proposition that 'greater culpability attaches to the failure to guard against an event the occurrence of which is probable rather than to guard against the occurrence of which is extremely unlikely'. However the truth of that proposition depends upon other considerations including (a) the potential consequences of the risk, which may be mild or catastrophic, (b) the availability of steps to lessen, minimise or remove the risk, and (c) whether such steps are complex and burdensome or only mildly inconvenient. Relative culpability depends on assessment of all those factors. ….. [42] The culpability of the Respondent is not necessarily to be determined by the remoteness of the risk occurring, nor by a step-by-step assessment of the various elements. Culpability will turn upon an overall evaluation of various factors, which may pull in different directions. Culpability in this case is reasonably high because, even if the pressure event of the force which occurred might not be expected to occur often, the seriousness of the foreseeable resultant harm is extreme and the steps to be taken to avoid it, were not even assessed, were straightforward and involved only minor inconvenience and little, if any, costs. ….. [53] The legitimate purpose of intervention in the present case are twofold. The first purpose is to identify the proper approach to considering the objective seriousness of the offences under the Work Safety Act. It is important to note that the risk to be assessed is not the risk of the consequence, to the extent that a worker is in fact injured, but is the risk arising from the failure to take reasonably practicable steps to avoid the injury occurring. To discount the seriousness of the risk by reference to the unlikelihood of injury resulting is apt to lead to error. The conduct in question is the failure to respond to a risk of injury, conduct which will be more serious, the more serious the potential injuries, whether or not they are likely to materialise. The objective seriousness of the conduct will also be affected by the ease with which mitigating steps could have been taken. (my emphasis)
The more obvious the risk, the ease with which it can be controlled or eliminated and the more serious the consequences of the offence, when considered together, the more serious the offence will be.
I note that the defendant, through Mr Pines' affidavit, does not cavil with the notion that falls are a well-known workplace hazard, but notes that the WorkCover COP at Tab 12 of the PTB, relates to building and construction work. The defendant contends that this site was not a building construction site, and the defendant was not engaged in construction work.
Mr Pines swore an affidavit and gave oral evidence before me. He was a very impressive witness, and I accept him as open and honest. The whole incident has had a significant impact on him, and he has in no way tried to deny his responsibilities, and has openly accepted the company's failings.
The defendant does not suggest that the risk was not foreseeable, and that submission could not be properly made, but submits that the incident needs to be properly contextualised.
I accept that the work that the defendant was doing was in actuality repair work. Prior to the incident, the vast majority of the work that the defendant was doing was repair work for insurance companies. Mr Pines in his affidavit sets out the contractual limitations that applied to the defendant in that context, and the methods by which those companies drove down costs. The matters raised in Mr Pines' affidavit demonstrate that performing work for insurance companies was particularly difficult, given the competitive nature of the work. I accept that this system was a disincentive to safety.
Whilst that does not diminish the defendant's statutory responsibility, and the defendant does not seek to do so, it does highlight the difference in construction work , and that which the defendant was doing, being repair work for insurance companies.
Further, I also accept that this was not a defendant who had no regard for the safety of its workers or contractors, or who failed to appreciate its WH&S obligations. In fact, the defendant had in place significant systems, checks and balances as at the date of the incident. The defendant chose its subcontractors, in part, based on the defendant's belief in the subcontractors' safety systems. The defendant did not skimp on safety, nor did it engage fly by night subcontractors, without regard to their safety.
The defendant supplied safety harnesses to be used at the site, but the workers whom Macfin had arranged to attend the site were not required by Macfin to wear the PPE, despite having attended the site to assess the work before it commenced.
I accept that the defendant had requested that Macfin source the workers, but also that the defendant had no knowledge of the arrangements made by Macfin to have these two potential workers attend on the day. I also accept the defendant did not have any involvement or influence over what occurred. Macfin, in its contract with the defendant, had taken on the responsibility of fall protection, but had not fulfilled those obligations. The defendant supplied safety harnesses, but Macfin had not ensured the use of the harnesses by the two men that it had arranged to be on site on the day of the incident.
Although the damage, injury or death caused by the breach does not of itself dictate the seriousness of the offence or the penalty, a breach where there was every prospect of serious consequences may be assessed on a different basis from a breach unlikely to have such consequences. The occurrence of death or serious injury may manifest the degree of seriousness of the relevant risk.
In the present case, plainly the possible consequences of the defendant's breaches were death or serious injury. The probability that such consequences would follow, in the event of a fall from the roof, were self-evident. The guidance material available to the defendant identifies the possibility of death or serious injury while working from heights. Such risk was a real and substantial one, and was not remote.
An offence under s 32 of the Act does not require an injury to be made out, but only the creation of a risk of death or serious injury. Here, the risk manifested: resulting in Mr Dennis sustaining fatal injuries including intracranial injuries, spine, skull and facial fractures, a collapsed lung and abdominal bleeding.
In SafeWork NSW v Emu Group Pty Limited [2019] NSWDC 537, Russell SC DCJ noted that since the start of 2016 and as at the date of his Honour's Judgment on 4 October 2019 the District Court had delivered sentence in 42 cases involving a fall from height. This court has dealt with a number of matters involving falls from defective or incomplete scaffolding and being unsafely up ladders in the construction industry, and it appears the message is not getting through to the industry.
The Court is obliged to make an assessment of where, on the scale of criminality, the offence lies referable to the maximum penalty prescribed by the legislature: R v Cage [2006] NSWCCA 304 per Latham J at [17]-[18].
I find that there was an obvious and foreseeable risk to safety against which appropriate measures were not taken, in circumstances where such measures were reasonably practicable.
Overall, having regard to the above, I conclude the offence is objectively serious, and that the offence falls within the mid-range of offending.

[17]

DETERRENCE

In fixing a penalty in relation to this offence, an important objective feature is the need for specific and general deterrence. This is enshrined in s 3A(b) of the Sentencing Act.
General deterrence is a significant factor when safety obligations are breached. The fundamental duty of the court to ensure a level of penalty for a breach will compel attention to work, health and safety issues so that persons are not exposed to risks to their health and safety at the workplace: Fisher v Samaras Industries Pty Ltd (1996) 82 IR 384 at 388.
When examining matters of deterrence, both specific and general deterrence apply: R v Miria [2009] NSWCCA 68. The Prosecutor submits that the facts of this case do not present any basis for departing from the established principles relevant to deterrence.
The Court of Criminal Appeal in Bulga Underground Operations v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338 at [177]-[180] reaffirmed the principle that both aspects of deterrence are matters which should be normally given weight of some substance in the sentencing process, unless there are exceptional circumstances which would allow a Court to depart from this rule, citing with approval the decision of the Full Bench of the Industrial Court of NSW in Capral Aluminium Limited v WorkCover Authority of NSW [2000] NSWIRComm 71; (2000) 49 NSWLR 610: '[74] … It follows that both aspects of deterrence [specific and general] are matters which should normally be given weight of some substance in the sentencing process; and although there may be exceptional cases (see, for example, Page v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39 at [40]-[43]), we would expect such cases to be very rare and where the relevant circumstances were held by the sentencing judge to be established, the judge must indicate with some precision the circumstances which had led to the exceptional course being adopted. … [75] … Even where an offender demonstrates good character or a commitment to rehabilitation, the court may be obliged to have regard to the need for general deterrence: see R v Thompson (1975) 11 SASR 217 at 222. This is particularly so where the offence in question is prevalent in society and represents a serious threat to the community. The need for general deterrence in relation to serious offences under the Act is undeniable.'
General deterrence must be a significant feature of the sentence imposed upon the defendant. The failure by a company to recognise the dangers and risks that arise to persons working in the construction and related industries is concerning. Falls from height are a major cause of death and serious injury. The gravity and frequency of such incidents heightens the role of general deterrence. General deterrence can be appropriately used to direct the industry's attention to the consequences of inattention and the need for greater concentration on the potential risks associated with the risks of falling from heights.
The imposition of a component directed towards general deterrence, it is hoped, will highlight the need for other corporations and individuals, for proper planning and development of procedures to eliminate, or at the very least significantly minimise, the presentation of such a risk. The requirement to comply with the expectation of the community, that both large and small employers will comply with safety requirements, means that employers must take the obligations imposed by the Act very seriously.
I note that the work that was being done was not a "new" build construction, but a repair of a single storey house, with a flat roof. I accept that in these circumstances whilst general deterrence must be considered, it must be examined and considered in the context of domestic repairs, as opposed to new building and construction.
In relation to specific deterrence, the attitude of the defendant to questions of workplace safety and any steps taken to improve the safety following a breach of a duty are relevant, as is the propensity for the defendant to reoffend.
The steps taken by the defendant after the incident were strenuous and wide reaching, as these are detailed in Mr Pines' affidavit. The defendant initiated many safety initiatives for itself and within the industry. Mr Pines details as follows in Exhibit 1: '92. I estimate that the steps taken by CCP following the incident, including recruitment of a Safety Manager, training, delivering presentations, auditing CCP's compliance, reviewing and updating various safety mechanisms and all related actions cost approximately $450,000. 93. In or around February 2019, CCP engaged an external auditor, being Insync Workplace Solutions a total review of all safety documentation. The auditor, (Deanne Boules), that attended CCP's premises previously worked for SafeWork NSW.'
I also note that as a consequence of this incident the defendant was not offered much repair work at all for the insurers that he had previously done an enormous amount of work for. IAG ceased the agreement with the defendant, and the remainder of the insurance work has all but fallen away entirely. I accept that the defendant will pay any penalty imposed and then cease trading.
On that basis, I am very comfortable in the view that the risk of reoffending is minimal and the defendant has excellent prospects of rehabilitation. Thus, the need for specific deterrence in this instance all but falls away.

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