SafeWork NSW v Grandcity Constructions Pty Ltd; SafeWork NSW v Cai

Background

1. The parties presented an Agreed Statement of Facts and this material is summarised below.
2. Grandcity was in the business of building construction services, specialising in medium sized residential premises, home extensions and renovations. In January 2016, Grandcity entered into an agreement to construct a three storey residential boarding house consisting of 46 studio units and a basement (the Building). The Building was constructed at 51-55 Homebush Road, Strathfield NSW (the Site).
3. Mr Cai was one of two directors of Grandcity. Mr Cai is a licensed builder with approximately 10 years experience at the time of the incident. Mr Cai was the builder and foreman at the Site and was responsible for supervising, controlling and providing instructions in respect of construction work undertaken by Grandcity. Mr Cai was present at the Site on a daily basis, including when the incident occurred.
4. Ms Angela Cai (Ms Cai), the second director, managed the work health and safety procedures, project management, and administrative operations of Grandcity.
5. Mr Wang was employed by Grandcity, on a casual basis, as a cleaner at the Site. Mr Wang commenced employment with Grandcity on 5 September 2016. Mr Wang was 55 years old at the time of the incident. Mr Wang had not worked as a cleaner or in the construction industry prior to his employment with Grandcity and he did not have a Construction Induction White Card. When working at the Site, Mr Wang was supervised, instructed by, and reported to Mr Cai.
6. Mr Wang does not speak, read or understand English. His primary language is Mandarin with a Henan dialect. Mr Wang did not speak standard Mandarin. Mr Cai speaks Cantonese and standard Mandarin. He was not fluent in Mandarin with a Henan dialect. As a result, Mr Wang had difficulties understanding Mr Cai's instructions regarding the work Mr Wang was to perform at the Site.

The Incident

1. At the time of the incident, the Building consisted of a concrete slab on the first level, surrounded by brickwork on the external walls. The Building also included an exterior balcony with a concrete floor located on the first level of the south side of the Building (the Balcony). There was no temporary edge protection installed on the Balcony. Mr Wang was not wearing any fall protection personal protective equipment, for example, a harness.
2. On 10 September 2016, at approximately 2.00pm, Mr Wang prepared to finish his shift at the Site. After walking downstairs and removing his safety clothing and hat, Mr Cai directed him to go back up to the first level of the Building and clean up any discarded bricks. Mr Wang did not put his safety clothing and hat back on before returning to the first floor of the Building.
3. While Mr Wang was cleaning up the bricks in the vicinity of the Balcony, a timber pallet fell over the unprotected edge of the Balcony. Mr Wang then fell off the Balcony, for approximately three metres, onto the concrete slab below. Mr Wang landed on his head and upper body on top of the timber pallet. Shortly after the incident, Mr Cai and four other workers attended to Mr Wang. The Ambulance Service and Police were notified of the incident. Shortly after, Mr Wang was taken to hospital by ambulance.
4. Mr Wang was hospitalised for treatment from 10 September 2016 to 18 September 2016. He sustained serious injuries including a fractured left wrist, C6 spine fracture, fractured nose, 9th and 10th rib fractures, left renal laceration and hematoma and amnesia. Mr Wang has not returned to work.

Guidance Material

1. At the time of the incident, the SafeWork Australia Managing the Risk of Falls at Workplaces Code of Practice (SafeWork CoP) was available. This document provides at section 3.2: "Barriers Barriers (or edge protection) to prevent a person falling over edges and into holes should be provided on relevant parts of a solid construction. These include: (a) The perimeters of buildings. … The barrier should be designed and constructed to withstand the force of someone falling against it. Edge protection should consist of guard rails, solid balustrades or other structural components, for example wire mesh supported by posts and provided with reinforced top edge. The top of the guard rail or component should be between 900 mm and 1100 mm above the working surface. If a guard rail system is used, it should a/so have mid-rails and toe boards or wire mesh infill panels."
2. At the time of the incident, the WorkCover Preventing Falls in Housing Construction Code of Practice (WorkCover CoP) was available. The WorkCover CoP provides guidance on how to eliminate, or if that is not possible, to minimise the risk of falls from height. This document provides that "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", and that: "(a) A person conducting a business or undertaking has more specific obligations under the WHS Regulations to manage the risk of a fall by a person from one level to another, including requirements to: (b) Ensure, so far as is reasonably practicable, that any work involving the risk of a fall is carried out on the ground or on a solid construction; (c) Provide safe means of access to and exit from the workplace; and (d) Provide adequate protection against the risk of falls."
3. The SafeWork CoP provides guidance for persons conducting a business or undertaking (PCBU) for managing risk under clauses 34 to 38 of the Work Health and Safety Regulation 2011 (NSW) (Regulation) in relation to falls from heights.
4. Clauses 34 to 38 of the Regulation require that duty holders must: "(a) identify reasonably foreseeable hazards that could give rise to risks of health and safety; (b) eliminate the risks to health and safety so far as is reasonably practicable, and if it is not reasonably practicable to eliminate risks to health and safety - minimise the risk so far as is reasonably practicable by implementing risk control measures in accordance with the hierarchy of control measures under clause 36 of the Regulation; (c) maintain the implemented control measure so that it remains effective; and (c) review and, if necessary, revise all risk control measures."
5. The Regulation requires duty holders to work through the hierarchy of risk controls to choose the most effective measures to eliminate or minimise the risk.
6. The WorkCover CoP provides guidance on various control measures in the hierarchy which are available to be implemented in order to provide adequate protection against the risk of falls, such as: "(a) Level 1: Carrying out any work that involves the risk of a fall on the ground or on a solid construction....A building structure that is used as an existing place of work and includes safe access and egress from which there is not risk of a fall from one level to another, for example, properly constructed stairs with fixed handrails, flat roofs with a parapet or permanently installed guardrails around the edges. (b) Level 2: Carrying out the work using a fall prevention device. For example, guardrails."
7. Section 3.1 and 3.4 of the Australian New Zealand Standard 4994.1:2009 on Temporary Edge Protection (the Standard) provide that temporary edge protection for exposed edges should be attached to the building structure and shall be designed so that forces transferred to the equipment will not cause or enable the edge protection to become detached from the supporting structure, in order to prevent a person falling from the edge.
8. Section 3.6 of the Standard provides that edge protection may include barriers such as railings, toe-boards and structural and non-structural infill panels.
9. Grandcity and Mr Cai failed to comply with the above guidance material.
10. Grandcity could have installed temporary edge protection, such as scaffolding or perimeter guard railing, around the edge of the first level Balcony of the Building to eliminate the risk of Mr Wang falling from height.
11. Grandcity could have provided adequate training, information and instruction to workers, in particular Mr Wang, as to the presence of the unprotected leading edge on the first level of the Building, the nature of the risks associated with working at heights, and the means by which the risk was to be eliminated or minimised, before commencing work on the Site.

Systems of work before the incident

1. Up to the time of the incident, there was no edge protection in place to eliminate the risk of workers falling over the edge of the Balcony.
2. There was also no system or barrier in place preventing workers from accessing and performing work on the first level of the Building where no edge protection was installed.

SafeWork Method Statement

1. Grandcity Enterprises Pty Ltd (a company separate from the defendant) had created a Safe Work Method Statement (SWMS) dated 1 May 2016 for the work being undertaken by Grandcity at the site.
2. Mr Wang signed the SWMS on 5 September 2016. As the SWMS was written in English, Mr Wang was unable to read the SWMS. Ms Cai stated that she verbally explained the contents of the SWMS to Mr Wang in Mandarin.
3. The SWMS document identified the general risk of falling from height at the Site. It also identified the following existing controls in respect to the risk of falling from height: "(a) All workers to attend in Full PPE Prior to Site Sign on Daily Toolbox covers all known risks on site with Task Leading Hand to Review each Workers PPE for appropriate condition."
4. However, the SWMS was inadequate as it did not require as a control measure the installing of temporary edge protection around the unprotected leading edges of the Building. Also, it did not require as a control measure the prevention of workers from accessing and performing work on the first level of the Building unless and until edge protection was installed around the unprotected leading edges of the Building.

Risk Assessment

1. Mr Cai was identified as the person responsible for controlling and reviewing the risk of falling from height on the Site.
2. Ms Cai stated that she conducted a non-documented risk assessment of the Site which was verbally communicated to Mr Cai. According to Ms Cai, the risk assessment identified risks associated with falling from height and did not address the specific risks at the Site.
3. As at the date of the incident, there was no formal documented risk assessment in respect of the risk of workers falling from heights while working on the first level of the Building.

Induction

1. Mr Wang was inducted to the Site on 5 September 2016. The induction was provided verbally by Ms Cai, in Mandarin, and lasted approximately 45 minutes. The induction consisted of safety rules of the Site, including the use of safety equipment and clothing. Ms Cai verbally explained the contents of the SWMS to Mr Wang and showed him the location of the first aid kit, bathroom and kitchen.

Instruction and supervision

1. Safety instructions at the construction site were given verbally by Mr Cai to workers. Daily toolbox talks were conducted by Ms Cai at the beginning of each shift, during which any safety issues and the work to be completed that day were discussed. The toolbox talks were conducted in a combination of English and Mandarin.
2. According to Mr Cai, he instructed Mr Wang on 10 September 2016 not to work on the outside of the Building and to only undertake work on the inside. He also states he told Mr Wang to clean in the middle and not go too close to the edge. Mr Wang did not recall any verbal warning being provided to him regarding the existence of the unprotected leading edges on the first level of the Building.
3. Grandcity and Mr Cai did not provide adequate training, information and instruction to Mr Wang, as to the presence of the unprotected leading edge on the first level Balcony of the Building, the nature of the risks associated with working at heights, and the means by which the risk was to be eliminated or minimised, before undertaking work on the Site.
4. Mr Cai was the sole supervisor on Site and he did not adequately supervise Mr Wang while he cleaned the first level of the Building. Mr Cai was working at the other end of the Building and left Mr Wang under the supervision of a bricklayer, who Mr Wang was also instructed to assist. Mr Cai did not check on the work that Mr Wang was performing at the time, nor did he translate any instructions that the bricklayer might have given Mr Wang. Mr Wang only had five days of experience working on a construction site.

Systems of work following the Incident

1. Following the incident, Grandcity implemented the following systems of work: 1. Scaffolding was erected around the building, providing temporary edge protection on the first level of the building; 2. Consultation with an external work health and safety consultant who provided Ms Cai with additional training and assisted with Grandcity's safety processes; 3. Re-induction of all workers on site; and 4. Engagement of a specialist WHS consultant to conduct an overview and enhancement of Grandcity's approach to safety.

Evidence for Defendants

1. Mr Cai affirmed an affidavit on 22 November 2018. He said that before the incident in 2016, he communicated with workers every day about safety. He did a walk around on the Site to see if there were any safety issues. He gave no explanation as to why there was no edge protection on the upper floor from which Mr Wang fell.
2. After the incident he contacted Master Builders to come to the Site to check upon safety conditions and upon his existing safety documentation. Grandcity is now engaged in a construction at Concord West. Grandcity has engaged safety consultants who have attended to conduct safety meetings with workers and new employees.
3. Mr Cai expressed regret for what happened to Mr Wang. He has stayed in contact with Mr Wang and calls him sometimes.
4. Ms Cai affirmed an affidavit on 22 November 2018. She is a director of Grandcity. She is finishing a Master Builders course with the Master Builders Association. Grandcity began operations in 2009. The Strathfield project on which Mr Wang was injured was its first large construction project. It was completed in October 2017. She was the project manager at the Site.
5. After the incident Grandcity contacted the Master Builders Association to seek advice about safety processes and procedures. The Association came to the Site and helped her to develop new company safety procedures. It also taught her how to conduct a risk assessment and to complete a SWMS for the Site. Grandcity adopted and implemented the changes recommended by the Association.
6. In March 2018, before works commenced at the new Concord West site, Ms Cai contacted Mr Knox of Compliance OHS to develop a company specific safety process and procedure. She has been dealing with Mr Knox ever since. There is now a documented safety process which Grandcity follows in relation to induction of workers and safety matters generally. Ms Cai annexed a copy of a documented toolbox talk, which, inter alia, recognises the risk of falls from heights.
7. The defendant also tendered an affidavit of Mr Benjamin Knox sworn on 22 November 2018. Exhibited to his affidavit was a large volume of the new safety documentation for Grandcity, which he has developed. There is now a suitable SWMS in relation to working at heights and edge protection. He provided some on-site training to Grandcity's workers in September 2018. Grandcity has paid his company $18,513 in fees so far and it is anticipated that a further $10,000 will be spent on safety and compliance in the future.

Consideration

1. I have had regard to the objects set out in s 3 of the Act and the purposes of sentencing set out in s 3A of the Crimes (Sentencing Procedure) Act 1999.

Objective seriousness of the offence - principles

1. The proportionality principle requires that a sentence should neither exceed nor be less than the gravity of the crime having regard to the objective circumstances: Veen v R (No. 2) (1998) 164 CLR 465 at 472, 485-6, 490-1 and 496. At common law, the term "objective circumstances" was used to describe the circumstances of the crime. The gravity of the offence was assessed by reference to its objective seriousness: R v McNaughton (2006) 66 NSWLR 566 at [15].
2. The task requires the court to consider where in the range of conduct covered by the offence the conduct of the offender falls: Baumer v R (1998) 166 CLR 51 at 57. This assessment will generally indicate the appropriate range of sentences available which will reflect the objective seriousness of the offence committed, and set the limits within which a sentence proportional to the criminality of the offender will lie: BW v R [2011] NSWCCA 176 at [70].
3. The sentencing judge should take into account not only the conduct which actually constitutes the crime, but also such of the surrounding circumstances as are directly related to that crime and are properly regarded as circumstances of aggravation or mitigation: R v Wilkinson (No. 5) [2009] NSWSC 432 at [61].
4. The existence of a reasonably foreseeable risk to safety that is likely to result in serious injury or death is a factor relative to the gravity of the offence: Capral Aluminium Limited v WorkCover Authority of New South Wales (2000) 49 NSWLR 610 at [89]. The question of foreseeability of the risk is to be determined objectively.
5. The Court of Criminal Appeal has recently examined the sentencing process with regard to the Work Health and Safety Act 2011 in the matter of Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96; 93 NSWLR 338. His Honour Justice Basten at par 34, under the heading "Assessment of Risk" said: "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 an event 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."
6. Further at par 42 his Honour continued: "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."

Objective seriousness - Grandcity and Section 19

1. My findings about Grandcity's level of culpability in relation to the charge under s 19(1) of the Act are based upon the following: 1. There was an obvious and foreseeable risk to safety; 2. Measures such as edge protection and adequate training were available and feasible; 3. The risk was one known to or identified by the offenders; 4. No temporary edge protection was installed on the balcony at the time of the incident; 5. Mr Cai directed Mr Wang to go up to the first level of the building and clean up any discarded bricks, which involved working in the vicinity of the unprotected balcony; 6. There was considerable guidance material publicly available relating to the risk of falls from heights at workplaces; 7. The risk was not just foreseeable, but it was a clear and obvious one; 8. Mr Wang was a vulnerable employee, who had little or no training and who had language difficulties.
2. I find that the Grandcity's level of culpability for the s 19 offence is in the mid-range.

Objective seriousness - Mr Cai and Section 27

1. My findings about Mr Cai's level of culpability in relation to the charge under s 27 of the Work Health and Safety Act 2011 are based upon the following: 1. There was an obvious and foreseeable risk to safety; 2. Measures such as edge protection and adequate training were available and feasible; 3. The risk was one known to or identified by the offenders; 4. No temporary edge protection was installed on the balcony at the time of the incident; 5. Mr Cai directed Mr Wang to go up to the first level of the building and clean up any discarded bricks, which involved working in the vicinity of the unprotected balcony; 6. There was considerable guidance material publicly available relating to the risk of falls from heights at workplaces; 7. The risk was not just foreseeable, but it was a clear and obvious one; 8. Mr Wang was a vulnerable employee, who had little or no training and who had language difficulties.
2. I find that the Mr Cai's level of culpability for the s 27 offence is in the mid-range.

Deterrence

1. The penalty imposed in relation to this offence must provide for general deterrence. Employers must take the obligations imposed by the Act very seriously. The community is entitled to expect that both small and large employers will comply with safety requirements. General deterrence is a significant factor when safety obligations are breached: R v Irvine; R v Dynamic Industries Pty Limited [2000] VSCA 239.
2. In my decision in SafeWork NSW v Ru Dong Li [2018] NSWDC 189 I listed 22 judgments of this court, delivered since the start of 2016, which involved a fall from height. To that list can be added the recent decision in SafeWork NSW v Opcon Plumbing Pty Limited [2018] NSWDC 350. I repeat what I said at paragraph [47] of my previous decision: "In the light of that troubling litany of death and serious injury, general deterrence is a very important factor in this case".
3. The penalty must reflect the need for specific deterrence. The offenders are still conducting a construction business. Many of its operations involve working at heights and the need for edge protection to prevent falls.

Aggravating factors

1. The injury, emotional harm, loss or damage caused by the offence was substantial: s 21A(2)(g) Crimes (Sentencing Procedure) Act 1999.

Mitigating factors

1. The offenders do not have a significant record of previous convictions: s 21A(3)(e) of the Crimes (Sentencing Procedure) Act 1999. There are no convictions recorded against either offender.
2. Both the offenders were otherwise of good character: s 21A(3)(f) of the Crimes (Sentencing Procedure) Act 1999. The steps which the offenders took after the incident demonstrate this.
3. The offenders are unlikely to re-offend: s 21A(3(g) of the Crimes (Sentencing Procedure) Act 1999.
4. The offenders have good prospects of rehabilitation: s 21A(3)(h) Crimes (Sentencing Procedure) Act 1999. The offenders have taken positive steps to guard against the risk of an incident such as this ever happening again. Grandcity has brought its documentation and its procedures into line with those which, on all the evidence, should have been in place before this accident occurred.
5. The offenders have shown remorse for the offence: s 21A(3)(i) Crimes (Sentencing Procedure) Act 1999. The offenders have provided evidence through Mr Cai that they have accepted responsibility for their actions and have acknowledged that the injury to Mr Wang was caused by their actions.
6. The offenders entered a plea of guilty: s 21A(3)(k) Crimes (Sentencing Procedure) Act 1999. The court must take into account the fact that the offender has pleaded guilty, when the offender pleaded guilty, and the circumstances in which the offender indicated an intention to plead guilty: s 22(1) Crimes (Sentencing Procedure) Act 1999. It is appropriate to give Grandcity a 25% discount for its early plea.
7. Mr Cai is entitled to a discount for a plea of guilty. It is appropriate to give Mr Cai a 25% discount for his early plea.
8. The offenders gave assistance to law enforcement authorities: s 21A(3)(m) Crimes (Sentencing Procedure) Act 1999. The offenders co-operated at all times with the prosecutor and provided all documents requested in a prompt fashion.

Capacity to pay a fine

1. I am required to have regard to s 6 of the Fines Act 1996 before imposing a fine. Where an offender seeks to have a fine reduced on the basis of a limited capacity to pay, it bears the evidentiary onus of convincing the court that it should exercise its discretion to limit the amount of the fine. The offender's capacity to pay is relevant but not decisive: Jahandideh v R [2014] NSWCCA 178 at [16]. A substantial fine may still be warranted as a result of the seriousness of the offence and the need for general deterrence.
2. No issue was raised in relation to capacity to pay a fine.

Consideration of penalty for Grandcity - Section 19

1. Having regard to the matters set out above, the appropriate penalty for Grandcity is a fine of $160,000. This will be reduced by the 25% discount for the early guilty plea to $120,000.

Consideration of penalty for Mr Cai

1. The appropriate penalty is a fine of $32,000 reduced by 25% to $24,000.

Costs

1. The parties have agreed to an order that the offenders are to pay the prosecutor's costs agreed in the amount of $45,000. While I will make an order for that amount against each offender, the prosecutor is only entitled to recover $45,000 in total.

Penalties for Grandcity Constructions Pty Limited

1. I make the following orders: 1. The offender is convicted of an offence under s 19 of the Work Health and Safety Act 2011. 2. The appropriate fine is $160,000 but that will be reduced by 25% to reflect the plea of guilty. 3. Order the offender to pay a fine of $120,000. 4. Order pursuant to s 122(2) of the Fines Act 1996 that 50% of the fine is to be paid to the prosecutor. 5. Order the offender to pay the prosecutor's costs agreed in the amount of $45,000.

Penalty for Mr Cai

1. I make the following orders: 1. The offender is convicted of an offence under s 27 of the Work Health and Safety Act 2011. 2. The appropriate fine is $32,000 but that will be reduced by 25% to reflect the plea of guilty. 3. Order the offender to pay a fine of $24,000. 4. Order pursuant to s 122(2) of the Fines Act 1996 that 50% of the fine is to be paid to the prosecutor. 5. Order the offender to pay the prosecutor's costs agreed in the amount of $45,000.

Amendments 17 December 2018 - Amended by consent of the parties to correct an error 29 January 2019 - Amended by consent of the parties to correct an error 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. Decision last updated: 29 January 2019