SafeWork NSW v Solveco Pty Ltd

The Brentwood Shredder

1. At the site, in an outdoor work area referred to as the destruction area or product destruction area, was a Brentwood Shredder machine (shredder) used for shredding waste in recycling.
2. Mr Lawson and Mr Brownless were involved in the purchase of the shredder in February 2009. Prior to Solveco purchasing the shredder, it was being used in tyre recycling. It required modification before it could be used by Solveco. Solveco changed the blades and cutters to a smaller width for it to be used for shredding small containers, such as shampoo bottles.
3. As part of the installation of the shredder at the site, Mr Brownless engaged an electrical engineering company to wire the shredder and make it flame proof. Solveco also installed fire suppression and fume dispersal equipment in the form of a water spray system attached to the hopper and shredder.
4. Behind an intermediate bulk container (IBC) below the shredder, a portable fan was used to dissipate any gas released from shredded aerosol cans. The fan was a 240V "Kool" brand domestic blower (Kool fan).
5. The shredder was connected to a mechanical conveyor which led up to a hopper. Adjacent to the shredder was a steel rolling machine. This steel roller was used to re-route some of the power supply to the shredder by means of an electrical extension lead from the steel roller which was plugged into the 3 phase 41SV switches of the shredder.

Operation of the Shredder

1. The shredder was used to shred a number of different products delivered to the site, including decommissioned riot police helmets, shoes and shampoo bottles. The shredder was also used to shred aerosol cans delivered to the site in IBCs.
2. Mr Forsyth was the usual operator of the shredder. He performed shredding on a daily basis. Aerosol cans were processed every one to two weeks. The system of work in place did not require the aerosol cans to be punctured and degassed prior to shredding.
3. Mr Forsyth checked Solveco's run sheets to see what product had come in and to determine what needed to be done for the destruction of different products.
4. Once Mr Forsyth determined which product was to be processed by the shredder, he transported that product via forklift to the base of the conveyor leading to the shredder. Workers, when placing aerosol cans into the shredder, were only instructed to look for cigarettes, lighters and bullets. Workers stated that at times aerosol cans were partially filled with gas or liquid when they were shredded. Cans seized by SafeWork NSW from the site confirmed this.
5. At the base of the conveyor an IBC containing aerosol cans was lifted with a forklift and unloaded onto the conveyor belt. This transported the aerosols up into the hopper, where they were shredded and captured in an IBC positioned below the shredding blades.
6. Depending on the type of product being processed, Mr Forsyth placed items on the moving conveyor belt while the shredder was in operation.
7. Mr Forsyth operated the shredder differently depending on the type of product being shredded. When shredding aerosol cans, Mr Forsyth would: 1. Empty product at the base of the static conveyor belt. 2. Turn on the conveyor belt to convey the product into the hopper until it was full. 3. When the hopper was filled with product, turn off the conveyor. 4. Turn on the water jets inside the hopper. 5. Turn on the fan adjacent to the receiving IBC below the shredder. 6. Turn on the shredder to shred the product.
8. As the product in the hopper passed through the shredder, it dropped into an IBC below. Once the IBC was full of shredded product, Mr Forsyth lifted it using a forklift.

Aerosol Cans

1. Some aerosol cans were empty, and some were either partially or fully filled with flammable liquids and gases.
2. The most common propellant for an aerosol can is a mixture of flammable volatile hydrocarbons, typically propane, n-butane and isobutane.
3. Shredding aerosol cans at the site released a cloud of flammable vapour which was heavier than air.

Manual Aerosol Degassing Machine

1. In 2011, Solveco trialled a manual aerosol degassing machine called a Heathway Gas Scrubber (Scrubber). The Scrubber involved one aerosol can at a time being placed into a holder which punctured the can, removing and capturing the flammable gas.
2. Solveco produced a Job Safety Analysis (JSA) for the task of operating the Scrubber, which was subsequently marked as obsolete when the Scrubber was no longer used.
3. Solveco did not pursue its use because the Scrubber was not a reasonably practicable way to degas the number of aerosol cans being delivered to the site. No other means of degassing the aerosol cans prior to shredding was put in place by Solveco.

Pressure Washing Equipment

1. Pressure washing was a task that was undertaken from time to time at Solveco. This task was usually performed in the driveway area at the site, which was away from the product destruction area.
2. In 2015 and 2016, Solveco hired a Kerrick pressure washer and a hot water heater (firebox) from Allcott Hire.
3. The pressure washer connected to the firebox which had a diesel burner to heat the water. The firebox was then connected to electrical power by a long extension cord.
4. In combination, the pressure washer and firebox were used to produce high pressure steam and water from a handheld "gun" with a trigger and nozzle controlled by an operator.

The Incident

1. In the period leading up to the incident, Mr Petersen was requested by Mr Brownless to prepare equipment which had been purchased by Solveco for use to undertake a new business activity involving the separation of water and oil waste. To get the equipment ready for use, Mr Petersen was required to clean the metal filter plates used in the oil and water separator. There were about 300 steel plates which had to be cleaned with high pressure hot water.
2. Mr Petersen hired the pressure washer and firebox from Allcott Hire on 25 July 2017 to undertake the task. The pressure washer and firebox were not intrinsically safe. The Kerrick operating manual for the pressure washer equipment contained a warning that the equipment must not be used in potentially explosive atmospheres (vapours or gas).
3. Mr Petersen and Mr Rose commenced the high-pressure washing task at the site on 25 July 2017. This task was undertaken by Mr Petersen and Mr Rose approximately 20 metres from the shredder located in the product destruction area.
4. Mr Petersen set up the pressure washer and firebox in a bunded area of the site and in an area where shampoo bottles were stored.
5. The firebox required electricity to operate, and so an electrical extension lead was run along the ground into the destruction area toward the shredder and plugged into a nearby general power outlet (GPO).
6. Mr Petersen and Mr Rose shared the pressure washing task while undertaking other duties at the site over the subsequent days.
7. In the week prior to the incident, aerosol can destruction using the shredder and the cleaning of the steel plates using the pressure washer and the firebox had been occurring simultaneously, approximately 20 metres apart. During that time, no incident occurred.
8. The following week, on the day of the incident, Mr Hender was asked by Mr Rose to assist with the pressure washing task. Mr Hender started to pressure clean the remaining steel plates at 6.30am. Mr Hender had not been provided with any training with respect to hazardous areas at the site. Mr Hender had not received any information about ignition sources.
9. Mr Wager had returned to the site on the day of the incident after being on annual leave. He walked around the site before the incident occurred and saw Mr Hender pressure washing. The shredder was not in operation when Mr Wager walked around the site.
10. On the morning of the incident Mr Forsyth observed that approximately eight IBCs of aerosol cans had been delivered to the site over the preceding weekend for destruction.
11. Shortly after 8.00am, Mr Forsyth used a forklift to pick up one IBC of aerosol cans and took it to the base of the conveyor attached to the shredder. Mr Forsyth raised the IBC using the forklift's tines and emptied the aerosol cans at the base of the conveyor. Mr Forsyth then started the conveyor to load the first IBC load of aerosol cans into the hopper.
12. Mr Forsyth ran the conveyor for approximately five minutes and during that time loaded all of the aerosol cans into the hopper. Once the IBC was empty, Mr Forsyth removed it from the area using the forklift.
13. Mr Forsyth then collected a second IBC of aerosol cans from the driveway at the site, drove to the conveyor attached to the shredder, and placed the IBC on the ground next to the conveyor.
14. The aerosol cans that were loaded into the hopper had not been degassed before being processed through the shredder. Some aerosol cans that were found at the scene after the incident contained highly flammable propellants. An example of the aerosol product found at the scene afterwards was "Paslode Impulse Fuel Cells".
15. When the hopper was filled with the cans, Mr Forsyth switched off the conveyor and turned on the fan and the water spray system of the shredder. Mr Forsyth then turned on the power to the shredder, which ran the motors and blades. The blades pierced and shredded the aerosol cans, which then fell into another IBC below, releasing a cloud of flammable gas.
16. This was the method commonly used by Mr Forsyth and other workers, including Mr Rose, to shred aerosol cans where there was a large quantity to be destroyed. This method was faster than loading the aerosol cans onto the conveyor by hand, using a shovel-type implement.
17. The shredding of aerosol cans had been occurring for approximately three minutes when Mr Hender, who had been operating the firebox and pressure washer for approximately two hours, decided to take a short break from the cleaning work.
18. Mr Hender placed the pressure washer gun on the ground. He then walked over to the firebox and turned the "on/off" switch of the firebox to the "off" position. When Mr Hender turned off the firebox, an explosion and fire immediately occurred.
19. The flame rapidly travelled from Mr Hender's location to the base of the conveyor, eventually then moving to the shredder.
20. Mr Forsyth was not standing by the shredder when this happened as he had moved to another part of the site to perform a different task. If Mr Forsyth had remained near the shredder he could have been seriously injured or killed.
21. A large fire resulted affecting the product destruction area and the adjacent property of a neighbouring business. The other IBC filled with aerosol cans placed at the base of the conveyor by Mr Forsyth to be loaded into the shredder caught on fire. Numerous cans were projected into the air and landed in different parts of the site and in the neighbouring premises. The area around the shredder and the conveyor was severely fire damaged. Fire and Rescue NSW attended the site and extinguished the fire.
22. Paramedics treated Mr Hender at the site and he was flown to Concord Hospital.

Injuries

1. Mr Hender sustained serious burn injuries to his face, palms, groin and his left and right lower limbs. He had burns to 30% to 32% of his Total Body Surface Area.
2. Mr Hender underwent multiple skin graft surgeries at Royal North Shore Hospital.
3. Mr Hender was 50 years of age at the time of the incident. Mr Hender has been able to return to work, but only on a part-time basis, due to his injuries. He receives ongoing treatment for his injuries and he will have a life-long disability.

Safety Systems in Place Before the Incident

1. Plant in the product destruction area, including the shredder, underwent monthly maintenance reviews, conducted by Mr Wager and Mr Petersen.
2. There was a Maintenance and Service Manual for the shredder issued by its manufacturer, Brentwood Engineering. Solveco was provided with a copy of the manual by Brentwood Engineering in June 2016. The manual advised: "Your machine will have been built to shred the materials specified at the time of order. DO NOT SHRED ANY OTHER MATERIAL WITHOUT FIRST CONTACTING YOUR DISTRIBUTOR OR THE FACTORY".
3. In August 2009, Solveco undertook a risk assessment titled "Hazard Identification Checklist" and "Risk Assessment Worksheet" for putting aerosols through a shredder. That document identified flammable gases as a hazard. One control suggested was positioning a watcher in place with a fire extinguisher and personal protective equipment.
4. This risk assessment was carried out by Mr Wager in his capacity as Solveco's Operations Manager and Mr Petersen in his capacity as Maintenance Officer and Foreman. Mr Wager is a qualified chemist.
5. The risks arising from the new work undertaken in the area or new equipment being introduced to the area were not assessed.
6. Solveco created a Job Safety Analysis (JSA) for "Shredder Operation" on 20 August 2013.
7. Workers were provided with training in the operation of the shredder from the JSA. The JSA did not specifically refer to the shredding of aerosol cans. However, the JSA stated "ensure the water spray and fan are operative, if required" and "refer to MSDSISDS or product information for clarification".
8. The JSA was reviewed in 2014 and 2016 but no changes were made to identify any further control measures. No other risk assessments for the shredding of aerosol cans were undertaken prior to the incident.

Prior Incidents Involving Fire

1. Workers reported previous occasions of fire occurring at the site, including a fire related to the shredder. No documented records of any such fires were produced by Solveco.
2. Mr Hopkinson stated that approximately 18 months prior to the incident a small fire occurred outside the shredder when an aerosol can that was being shredded came out of the shredder and ignited some cardboard that was present in the immediate area. The fire was put out with fire extinguishers. Fire and Rescue NSW attended the incident in response to an emergency call made by a neighbouring business.

Safe Work Australia Code of Practice, Managing Risks of Hazardous Chemicals in the Workplace, July 2012 (COP Hazardous Chemicals)

1. Section 3.4 of the COP Hazardous Chemicals provides that a person conducting a business or undertaking (PCBU) must manage the risk to health and safety associated with a hazardous atmosphere or an ignition source in a hazardous atmosphere at the workplace. The PCBU when identifying hazards should identify all sources of fuel in the workplace that could contribute to fire and explosion risks. The PCBU should also identify ignition sources including sparks from electrical equipment such as switches, or from static electricity including from friction sources. Section 3.4 says that not all electrical equipment is an ignition source if it is specifically designed so that it does not create sparks. This type of equipment is referred to as "intrinsically safe".
2. Section 3.4 of the COP Hazardous Chemicals states that the level of risk of a fire or explosion occurring can be influenced by the physical state of chemicals and that gases present a greater risk as concentrations in air are generally higher than for liquids and they can spread more rapidly. The following example is provided: "For example, vapours which have a density greater than air can move along the floor and spread to adjacent work areas where ignition sources may be present, thereby creating a significant risk in those areas."
3. Section 4.2 of the COP Hazardous Chemicals provides information on key control measures that should be considered when managing risks from hazardous chemicals in the workplace. In particular, ignition sources must be eliminated from any hazardous areas. This may be achieved by use of intrinsically safe equipment. Section 4.2 also states: "A hazardous area is a three-dimensional space in which a hazardous atmosphere exists... a hazardous atmosphere is one in which a flammable or combustible substance, such as fuel, is present in combination with air or other sources of oxygen and which would ignite to cause a fire or explosion if an ignition source was introduced."
4. The COP Hazardous Chemicals provides that PCBUs can obtain further information on hazardous areas from the Classification of Areas Standard referred to below.

Safe Work Australia Code of Practice, Managing the Risks of Plant in the Workplace, July 2012 (COP Plant)

1. The COP Plant provides guidance to PCBUs who have management or control of plant in the workplace. The COP Plant outlines a number of systems to eliminate or minimise the risks of working with plant so far as is reasonably practicable, including inspecting the plant for possible risks, reviewing safety information, reviewing incident records and data, and eliminating, substituting or isolating risks.
2. The COP Plant refers to the inspection of plant and the identification of risks associated with the plant by a competent person who is defined to be "a person who has acquired through training, qualification or experience the knowledge and skills to carry out the task". Section 3.1 of the COP Plant provides information on the hiring of plant including that PCBUs should check whether the plant being hired "does not introduce other hazards... into your workplace".
3. Appendix B of the COP Plant is a Hazard Checklist which identifies the hazard of "explosion" and indicates the need to implement appropriate control measures for the hazard if anyone can be injured by explosion of gases, vapours, liquids, dusts or other substances, triggered by the operation of the plant or by material handled by the plant.

Australian/New Zealand Standard 60079.10.1:2009, Explosive atmospheres Part 10.1: Classification of areas-Explosive gas atmospheres (Classification of Areas Standard)

1. The Classification of Areas Standard sets out essential criteria against which ignition hazards can be assessed and gives guidance on the design and control parameters which can be used in order to reduce such a hazard. The Classification of Areas Standard should be applied where there may be an ignition hazard due to the presence of flammable gas or vapour.
2. The Classification of Areas Standard identifies that an ignition source is a source of energy sufficient to ignite an explosive gas atmosphere and that such sources include electrical sparks and mechanical impact sparks. An "explosive gas atmosphere" is defined as follows: "…mixture with air, under atmospheric conditions, of flammable substances in the form of gas or vapour, which, after ignition, permits self-sustaining flame propagation."
3. The Classification of Areas Standard specifies that in a situation in which there may be an explosive gas atmosphere, the following steps should be taken: 1. Eliminate the likelihood of an explosive gas atmosphere occurring around the source of ignition; or 2. Eliminate the source of ignition; or 3. Where this is not possible, protective measures, process equipment, systems and procedures should be selected and prepared so the likelihood of the incidence of (1) or (2) is so small as to be acceptable.
4. The Classification of Areas Standard sets out criteria for hazardous area zoning taking into account the flammable and/or combustible hazards at the relevant facility, the degree of ventilation around the facility, and the relative density of the gas or vapour when it is released. If the gas or vapour is significantly heavier than air then it will tend to accumulate at ground level. The horizontal extent of the zone at ground level will increase with increasing relative density.
5. The recognition and classification of the hazardous areas at the site should be carried out by a competent person in accordance with the Classification of Areas Standard. Hazardous area classification can be used as the basis for the selection and use of electrical plant and equipment at the site. The Classification of Areas Standard provides in section 5.1: "The area classification should be carried out by those who understand the relevance and significance of properties of flammable materials and those who are familiar with the process and the equipment along with safety, electrical, mechanical and other qualified engineering personnel."

Safety Data Sheets

1. Safety data sheets (SDS) pertaining to aerosol cans found in and around the area of the fire showed that the aerosol cans contained highly flammable vapours which posed a "severe explosion hazard"' when exposed to an ignition source. For example, the SDS relating to the "Paslode Impulse Fuel Cells" found in the debris of the fire stated that these cans contained highly flammable liquid and vapour. The SDS included the following precautionary statements: "Keep away from heat/sparks/open flames/hot surfaces. … Use explosion-proof electrical/ventilating/lighting/intrinsically safe equipment."
2. The SDS contained the following further advice on the hazard of "fire/explosion": "Liquid and vapour are highly flammable. … Vapour forms an explosive mixture with air. Severe explosion hazard, in the form of vapour, when exposed to flame or spark. Vapour may travel a considerable distance to source of ignition."
3. The SDS stated that the primary precaution for safe handling of this product was to "Remove all ignition sources".
4. The SDSs for the various aerosol products delivered to the site were available online and could have been accessed when and if required. There was also a SDS register in the amenities room at the site.

Australian/New Zealand Standard 600079.0:2012, Explosive atmospheres Part 0: Equipment-General requirements (Equipment Standard)

1. Electrical equipment that is certified for use in a hazardous area zone is equipment that is protected by an explosion protection technique. Such equipment would not be an ignition source and would be intrinsically safe to use in a hazardous zone. Such equipment is required to have an "Ex" marking, to show that is has been certified for use in hazardous zones and/or explosive atmospheres.
2. Prior to the incident, Solveco ensured that the shredder had some electrical components installed that were suitable for hazardous areas and in particular suitable for safely shredding aerosol cans containing flammable gas.
3. During the course of SafeWork NSW's investigation into the incident, it was found that some of the electrical equipment or connections on the shredder had specific "Ex" markings, meaning that those particular items were flame proof or "explosion protected" at a time prior to the incident.
4. The 3 phase 41SV switches on the shredder were "Ex" rated, also with the required "Ex" marking.
5. In addition, the steel roller next to the shredder (which re-routed some of the power to the shredder) had an electrical plug which was "Ex" rated and had the required "Ex" marking.
6. However, not all components installed in the shredder were suitable for use in hazardous areas. The following electrical equipment and components of the shredder and its related equipment were found not to be "Ex" rated as was required for all equipment intended to be installed and/or used in a hazardous area: 1. The twin 3 phase electric motors for the shredder. 2. The 240V Kool fan situated 1.25 metres from the IBC below the shredder. 3. The motor driving the conveyor which fed the aerosol cans and other products into the hopper. 4. An electrical junction box on the conveyor. 5. Loose electrical leads used in the area of the shredder, including the electrical leads for the Kool fan and the firebox. 6. The GPOs which the leads for the Kool fan and firebox were plugged into at the time of the incident. 7. An electric-powered pump fitted to the pit below the shredder which collected liquids released from the shredded aerosol cans and other products.
7. The shredder operation did not use nitrogen purging, or explosion panels, or a foam injection system on the shredder, each of which were methods to control the risk of a fire and explosion created by the shredding of aerosol cans.

Cause of the Explosion and Fire

1. The explosion and fire that injured Mr Hender was caused by the ignition of flammable gases that had been released from the shredding of the aerosol cans. Being heavier than air, the gases stayed low to the ground after having been released from the shredded cans. The Kool fan below the shredder, which had been switched on by Mr Forsyth, pushed these gases toward the location of Mr Hender.
2. The ignition source of the explosion and fire was a spark created by the firebox when it was switched off by Mr Hender. When the gases came into contact with the spark created by the pressure washer equipment, the explosion occurred and Mr Hender was engulfed in flame. As depicted in the CCTV footage of the incident (PX 1, Tab 7), the flame then travelled back towards the shredder along the path of the gases released from the shredded cans, and there was a large fire at the site.
3. Following the incident, the pressure washer equipment was seized by SafeWork NSW and then examined at a laboratory facility. This examination revealed that numerous components and devices within the pressure washer, the firebox and the extension lead for the firebox were possible ignition sources.
4. Those components and devices in the equipment had the capacity for sparking, making and breaking contact. None of these ignition sources were explosion-proof or intrinsically safe equipment.

Hazardous Area Classification

1. Solveco did not identify and classify hazardous areas associated within and around the shedder in accordance with the Classification of Areas Standard.
2. Further, Solveco did not put in place electrical hazardous area zonings of the site, including the product destruction area, in accordance with the Classification of Areas Standard.
3. Solveco did not ensure all electrical plant and equipment could be safely used within the hazardous area zonings of the site, including the product destruction area.
4. Solveco did not install and use plant that was designed for use in hazardous areas in order to ensure the capture of flammable aerosol gases in a controlled manner without the risks of associated ignition such as explosion proof enclosures, vacuum pressure, explosion-protected shredding components, and nitrogen purging/nitrogen blanket to suppress the oxygen level in the shredder.

Training in Explosive Gas Atmospheres

1. Mr Forsyth was provided with basic training to operate the shredder when he commenced employment with Solveco. Mr Forsyth was not provided with any refresher training to operate the shredder during the remainder of his employment.
2. The other shredder operator, Mr Rose, was provided training (including refresher training) on the operation of the shredder. He had taught himself to stay away from the hazardous gases for 5-10 minutes when he was shredding aerosol cans. Mr Rose received no specific information about ignition sources. When asked by a SafeWork NSW Inspector, Mr Rose said that he did not really know what a SDS was, but he was provided some safety information when asked to do tasks.
3. The pressure washing work had been carried out in the product destruction area for several days prior to the incident. Workers including Mr Hender and Mr Forsyth were unaware that the pressure washer and the firebox were ignition sources capable of creating a spark leading to fire and explosion in the product destruction area.
4. Workers including Mr Hender and Mr Forsyth had not been trained to not operate electrical equipment in a hazardous area without first checking that it was intrinsically safe to install or use the equipment.

Systems of Work Following the Incident

1. SafeWork NSW issued Prohibition and Improvement Notices to Solveco after the incident. In response to the Prohibition and Improvement Notices, Solveco: 1. Eliminated the risk of fire and explosion by ceasing the destruction of aerosol cans at the site and instead on-forwarding the aerosol cans for destruction to the specialist waste management company Tox Free Australia Pty Ltd (Tox Free). Tox Free uses equipment specifically designed to process potentially flammable materials, including aerosol cans. This equipment incorporates a fire suppression system to capture and isolate flammable materials prior to the shredding of aerosol cans, and to minimise oxygen levels in the shredder. A nitrogen purge is provided within the confines of Tox Free's shredder to maintain minimal oxygen levels to prevent ignition of the flammable material caused by the mechanical process. Tox Free's system also includes explosion-proof panels and multiple infra-red fire detectors fitted on the shredder. In addition, a foam injection system is activated by the explosion panel burst detectors fitted on the shredder. A burst explosion panel automatically shuts down the Tox Free shredder and associated components. 2. Developed a JSA for the task of cleaning using the pressure washer and a JSA for the task of cleaning using the firebox. 3. Implemented a system of work to manage the risks associated with static electricity. 4. Implemented a system of work for the testing of static electricity mitigation equipment. 5. Took steps to identify and classify hazardous areas at the site. In September 2018, Solveco provided to SafeWork NSW a Hazardous Area Classification (HAC) report completed by Nova Process Engineers. The objective of this report was to classify the areas around the plant where explosive gas/air mixtures may be present, in order to ensure that equipment installed or used within those zones was intrinsically safe. The HAC report by Nova Process Engineers was accompanied by a Verification Dossier which identified those items of electrical equipment which may be safely introduced into the hazardous area zones. The Dossier provided Solveco with a method to prevent items of electrical equipment that should not be introduced into the hazardous zones from entering those zones.

Evidence for Solveco

1. Mr Brent Lawson swore an affidavit on 25 July 2022. Mr Lawson is a Director of Solveco.

Background of Solveco

1. In 2005 Solveco was incorporated as a new entity within the Concrete Recyclers Group of Companies and acquired the business the subject of these proceedings (the business). The business under its various owners has now conducted a licensed waste facility for more than 30 years. It provides waste management and treatment services to companies throughout Australia from its facility in St Marys, NSW. At times the business has dealt with hazardous, liquid, chemical and industrial wastes, providing assessment, collection, removal, management, recycling treatment and disposal services.
2. Mr Lawson has been a director of Solveco since 5 November 2005. He acts as Solveco's Managing Director. Mr Orden has been a director of Solveco since 9 November 2005. He acts as Solveco's Operations Director.
3. At the time of the incident Solveco employed between 20 and 23 employees and also used the services of various contractors, including persons engaged through other entities within the Concrete Recyclers Group of Companies.
4. Solveco engaged Mr Craig Long of Concrete Recyclers Group of Companies to perform general management duties associated with Solveco's business. Mr Long held an Advanced Diploma in Occupational Health and Safety and had many years of relevant industry experience. Mr Long reported directly to Mr Lawson and Mr Orden.
5. Mr Wager and Mr Brownless assisted with the work health and safety duties for Solveco. Mr Wager and Mr Brownless were long-term managers of the business, commencing prior to the acquisition of the business by Solveco.

Safety Record

1. In the 17 years that Solveco has owned the business it has never been issued with any form of sanction or infringement in relation to a work health and safety matter.

Cooperation with SafeWork NSW

1. Solveco and its employees promptly and proactively cooperated with SafeWork NSW's investigation into the incident.
2. Solveco complied with all notices issued by SafeWork NSW and provided all requested documents.

Work Health and Safety Procedures Prior to the Incident

1. After Solveco's acquisition of the business Mr Lawson and Mr Orden looked into the nature of the operations, hazards and risks in the business. Mr Wager and Mr Brownless explained to Mr Lawson and Mr Orden the nature of the operations, hazards and risks, and the workings of the plant and equipment at the site.
2. Prior to the incident, Solveco: 1. Had the following risk assessments, checklists and procedures in place: 1. Hazard Identification Checklist and Risk Assessment Worksheet. 2. Shredder Operation JSA. 3. Risk Assessment document. 4. Pollution Incident Response Management Plan, which included emergency procedures and the site evacuation plan. 5. OHSE Policy. 6. OHSE Consultation Statement. 7. Daily Environmental & Safety Report Checklist. 8. Plant Maintenance Checklist. 9. After Hours Emergency Incident Procedure. 10. Chemical Register. 11. Induction Checklist. 1. Maintained a dangerous goods licence and had designated areas for the storage of dangerous goods. 2. Engaged an external consultant to assist in developing WHS training for workers at the site. 3. Ensured appropriate supervision was in place in accordance with a supervision hierarchy that included three Leading Hands who reported to Mr Wager. 4. Engaged an external auditor shortly after the acquisition, and again in 2009 and 2011. The objective of the audits was the identify whether there were any areas that required specific attention or improvement in relation to safety. 5. Provided appropriate personal protective equipment. 6. Conducted regular toolbox talks in which work health and safety matters were discussed. 7. Conducted periodic reviews of the work health and safety systems and processes.
3. Mr Lawson and Mr Orden personally took the following steps to ensure work health and safety at Solveco: 1. Ensured that there was an unlimited budget for expenditure on work health and safety measures. In the 12 months prior to the incident, Solveco's expenditure for general work health and safety purposes was at least $61,000. 2. Attended weekly site visits to discuss work health and safety matters with Mr Wager and Mr Brownless. 3. Attended monthly management meetings. 4. Mr Orden travelled overseas on various occasions to observe similar operations conducted by leading industry participants. 5. Maintained memberships with NSW Civil Contractors Federation and the Waste Contractors and Recyclers Association of NSW, which enabled access to briefings, information and training on work health and safety issues and updates on work health and safety issues that relate to Solveco's business.

The Shredder

1. Solveco purchased the shredder in February 2009. The shredder had been used by its previous owner for tyre recycling and it therefore required modification before it could be used by Solveco. The blades and cutters were changed to a smaller width to enable it to shred small containers such as shampoo bottles, which was the intention behind its purchase.
2. Mr Lawson and Mr Brownless engaged an electrical engineering company to wire the shredder in accordance with the Australian Standard on Dangerous Goods so as to make it flameproof.
3. Mr Brownless arranged for the installation of fire suppression and fume dispersal equipment in the form of a water spray system attached to the shredder.
4. At this time the shredder was used on a daily basis to process small products received for disposal from Solveco's clients, including: 1. Decommissioned riot police helmets. 2. Shoes. 3. Shampoo bottles. 4. Aerosol cans approximately once a fortnight.
5. The aerosol cans were often reject cans from PAX and Pascoes which contained residual product only. On rare occasions the aerosol cans came from Sydney Airport Customs and Security Confiscations. These aerosol cans contained varying levels of product. On the day of the incident, the shredder was used to process one IBC of aerosols received from PAX.
6. Mr Lawson stated that the pressure washing task being undertaken at the time of the incident was performed at a distance from the shredder of approximately 18.9 metres, in compliance with the relevant Australian Standard.
7. Senior counsel for Solveco submitted that the relevant part of the Classification of Areas Standard provided that a hazardous area extends for 15 metres from a source of release of explosive vapour (PX 2, Tab 22, pp 169-170). There was no reference to the Classification of Areas Standard in the Solveco risk assessment (PX 1, Tab 14) or the JSA (PX 1, Tab 15). There was no evidence that the safe distance between the shredder and Mr Hender was the subject of any consideration by Solveco. This distance was purely fortuitous. It was not selected or mandated by Solveco as a safe distance. I regard the reference by Mr Lawson to compliance with the Classification of Areas Standard as disingenuous.

Safety Procedures Introduced After the Incident

1. Following the incident, the shredder was decommissioned by Solveco and it has not been replaced. Items received by Solveco for disposal which require shredding are now sent to a third-party facility for processing.
2. Following the incident Mr Lawson and Mr Orden decided to markedly reduce the scope of many recycling services at the site. Since 2018 only water-based non-flammable waste has been recycled at the site. The scope and size of the business is now less than half what it was at the time of the incident, with only three remaining employees. Once Solveco's current contracts are complete, Mr Orden and Mr Lawson intend to cease operations at the site altogether.
3. Other safety initiatives that Solveco introduced following the incident include: 1. Updating relevant policies and procedures to take into account knowledge obtained from the incident. 2. Developing new JSAs for the task of cleaning using a pressure washer and the task of cleaning using a firebox. 3. Implementing a system of work to manage the risks associated with static electricity. 4. Implementing a system of work for the testing of static electricity mitigation equipment. 5. Commissioning a HAC report from Nova Process Engineers, in order to classify the areas around the site where explosive gas/air mixtures may be present, so that there could be proper selection of electrical apparatus for use in such areas.
4. Given Solveco's decision shortly after the incident to scale back its operations and cease processing hazardous goods, many of these procedures are no longer in place as they are no longer relevant to the work being performed.

Corporate Citizenship

1. Throughout the history of the company, Concrete Recyclers Group, to which Solveco belongs, has been involved with and donated and contributed to various non-profit and charitable organisations. For the past 15 years this has included an annual donation of $12,000 to each of the Smith Family and the Salvation Army.

Remorse

1. Mr Lawson expressed remorse over the incident and acknowledged Solveco's role in the incident. Immediately following the incident Mr Lawson arranged for Mr Long to meet Mr Hender's family at the hospital to offer whatever comfort and assistance he could. Mr Long later personally visited Mr Hender in hospital.
2. In the months that followed the incident, Solveco remained in contact with Mr Hender to monitor his progress and offer support in his rehabilitation.
3. The incident has impacted Solveco in a permanent way. The incident and the injuries to Mr Hender continue to influence Solveco's heightened commitment to improving work health and safety procedures and preventing any further incidents. The incident was a driving force behind Mr Lawson and Mr Orden deciding to significantly reduce the scope of the business.

Consideration

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

Objective Seriousness of the Offence

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 The Queen (No. 2) [1988] HCA 14; (1988) 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] NSWCCA 242; (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 [1988] HCA 67; (1988) 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. In Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120 at [27] the High Court said: "The objective seriousness of an offence is to be assessed without reference to matters personal to a particular offender or class of offenders. It is to be determined wholly by reference to the nature of the offending."
4. 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].
5. 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] NSWIRComm 71; (2000) 49 NSWLR 610 at [82]. The question of foreseeability of the risk is to be determined objectively.
6. 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. 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.
7. The Court of Criminal Appeal has examined the sentencing process with regard to the Act 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. Justice Basten at [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."
8. Further at [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 [event] 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, which were not even assessed, were straightforward and involved only minor inconvenience and little, if any, costs."
9. At [53] his Honour dealt with the proper approach to considering the objective seriousness of offences under the Act, saying: "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 materialize. The objective seriousness of the conduct will also be affected by the ease with which mitigating steps could have been taken."
10. My findings about Solveco's level of culpability are based upon the following: 1. Solveco knew of the risk. Solveco undertook a risk assessment in August 2009 for the task of placing aerosols through the shredder. This identified the hazards of flammable gases and fire. Unfortunately that risk assessment was inadequate. For example, in relation to the hazard of "flammable gases" the control measure was said to be "masks". In relation to the hazard of "fire" the control measure required there to be a fire extinguisher and a "watcher". An appropriate risk assessment would have suggested control measures to prevent fire occurring in the first place. 2. The risk was well-known generally and was thus foreseeable. The Classification of Areas Standard (PX 2, Tab 22, s 4.1) dealt with safety principles where flammable materials are handled or stored. Where there may be an explosive gas atmosphere the steps to be taken are: 1. Eliminate the likelihood of an explosive gas atmosphere occurring around the source of ignition, or 2. Eliminate the source of ignition. 1. Further, the Classification of Areas Standard pointed out in s 5.4.4 that where gases are heavier than air, they will flow downward and may travel long distances over the ground before they are safely dispersed by atmospheric diffusion. 2. The COP Hazardous Chemicals (PX 2, Tab 23) said at p 23: "Gases present a greater risk as concentrations in air are generally higher than for liquids (and their vapours) and can spread more rapidly. Depending on the vapour density, some gases can flow across surfaces in a similar way to liquids, rather than dissipating quickly. For example, vapours which have a density greater than air can move along the floor and spread to adjacent work areas where ignition sources may be present, thereby creating a significant risk in those areas." 1. Senior Counsel for Solveco submitted that the degree of foreseeability of the risk to safety was low on the following bases: 1. There were limited deliveries of aerosol cans, which were processed approximately every one to two weeks - this was so, although when processing was done, entire IBCs of potentially flammable aerosol cans were shredded, thus creating explosive gases when there were several potential ignition sources nearby. 2. When the shredder was installed, an electrical engineering company was engaged to make it flameproof - this is so, although not all of the ignition points in or near the shredder were made intrinsically safe. 3. Solveco installed fire suppression and fume dispersal equipment by a water spray system - this was so, although it clearly did not stop the cloud of flammable gas escaping from the shredder and moving along the ground towards Mr Hender. 4. The shredder had some electrical components installed that were suitable for hazardous areas - the key word is "some" - there were a number of nearby electrical components that were not suitable for hazardous areas. 5. A portable fan was used to dissipate any gas released from shredded aerosol cans - this is so, but on the day the fan simply blew the cloud of vapour along the ground towards Mr Hender thus putting him at risk. 6. Plant in the product destruction area, including the shredder, underwent monthly maintenance reviews - this is so, but in spite of that, the many risks involved in the operation were not identified. 7. Solveco undertook a risk assessment for aerosols through the shredder - this is so, but the flaws in that risk assessment, which are detailed above, were obvious. 8. Solveco created a JSA for shredder operation - this is so, but the JSA (PX 1, Tab 15) does not even identify the hazard of flammable gases or the hazard of an ignition creating a fire. 9. Workers were provided with training in the operation of the shredder from the JSA - this is so, but as pointed out above, such training would not have alerted the workers to the real risk posed by flammable gases and ignition points. 1. Senior Counsel for Solveco pointed out that the system in operation on the day of the incident had been used by Solveco for the previous eight years without incident. This is more a matter of good luck than good management. It does not make the obvious risk posed by flammable gases and ignition points any less foreseeable. Industrial companies are expected to take a proactive approach to safety, not a reactive approach. 2. I find that the degree of foreseeability of the risk to safety was significant. I reject the submission made by Senior Counsel for Solveco that the degree of foreseeability was "low". 3. Senior Counsel for Solveco submitted that the likelihood of the risk eventuating was low on the bases that: an incident of this type had not happened before; Solveco was not aware of any similar incident on another site; Mr Hender was working 20 metres away from the shredder; and not all cans were full when they went through the shredder. 4. I reject the submission that the likelihood of the risk eventuating was low. I fail to see the significance of Mr Hender being 20 metres away from the shredder at the time of the incident, when it can be seen from the CCTV that the cloud of flammable vapour generated by shredding the aerosol cans was forced across the ground towards him and had not dissipated by that point. True it is that an incident of this type had not happened before at the Solveco site, and that Solveco was not aware of any similar incident at another site, but that does not affect the likelihood of the risk eventuating. These aerosol cans were being processed in bulk every one to two weeks by a method which generated a cloud of flammable vapour. Even without the involvement of Mr Hender on the day, there were several potential ignition points which were not intrinsically safe located in or around the shredder. I find that the likelihood of the risk being created was significant. 5. The potential consequences of the risk were death or serious injury. This is a matter accepted by Solveco. 6. Simple and well-known steps were readily available to eliminate or minimise the risks. These were all taken immediately by Solveco after the incident. Solveco accepted that the control measures pleaded in par 10(a)-(i) of the Amended Summons were reasonably practicable. 7. There was no great burden or inconvenience in these steps being implemented. 8. Mr Hender sustained serious burn injuries to his face, palms, groin, left leg and right leg. 9. The maximum penalty for the offence is a fine of $1,500,000, which reflects the legislature's view of the seriousness of the offence.
11. I find that the level of culpability of Solveco 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: Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338 at [180].
2. Senior Counsel submitted that there was little or no role for general deterrence in the present sentence, as there was no proven need to send a message to the industrial community concerning the particular risk of shredding aerosol cans leading to an explosion and a fire. I take the view that it would be an error to focus specifically upon the incident which occurred rather than the general risk posed by mixing flammable vapours and ignition points. Any industrial company dealing with, or generating, flammable gases has to exercise care to prevent an explosion and a fire. Unfortunately such cases have come before this court in recent times. They usually result in serious burns to a worker, when flammable gases are ignited by an ignition point of one type or another. In recent years the following decisions of this court have involved such explosions: 1. SafeWork NSW v JA Investment Group Pty Ltd [2021] NSWDC 569. 2. SafeWork NSW v Plasser Australia Pty Ltd [2021] NSWDC 441. 3. SafeWork NSW v JPS Car Wash Management Pty Ltd; SafeWork NSW v SRS Star Management Pty Ltd; SafeWork NSW v Sarjeet Sidhu [2021] NSWDC 148. 4. SafeWork NSW v CRS NSW Pty Ltd; SafeWork NSW v Jay McGeachie Jenkins [2017] NSWDC 312. 5. WorkCover Authority of NSW v Customised Gas Australia Group Pty Ltd and Flynn [2014] NSWDC 361. 6. WorkCover Authority of NSW v Transtank Pty Ltd [2014] NSWDC 288. 7. WorkCover Authority of NSW v Drayton & Sons Pty Ltd [2014] NSWDC 180. 8. SafeWork NSW v Omega International and Shetty [2016] NSWDC 11.
3. The penalty must reflect the need for specific deterrence. Solveco is still conducting a business. Its reduced operations still involve waste management, treatment of liquid waste, recycling of commercial waste and the continuing engagement of workers.
4. Senior Counsel for Solveco pointed out that Solveco immediately ceased the shredding of aerosol cans and now that work is done by a specialised third-party firm. This is so, but waste recycling involves a number of risks which have to be managed, of which shredding aerosol cans is just one. It is appropriate to take account of specific deterrence in fixing a sentence, but I do accept the submission made by Senior Counsel for Solveco that it is not a large factor in this case.

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. Solveco has no prior record of conviction: s 21A(3)(e) Crimes (Sentencing Procedure) Act 1999.
2. Solveco is otherwise of good character: s 21A(3)(f) Crimes (Sentencing Procedure) Act 1999. The steps which it took after the incident demonstrate this. Solveco has been in business for approximately 17 years.
3. Solveco is unlikely to re-offend: s 21A(3)(g) Crimes (Sentencing Procedure) Act 1999.
4. Solveco has good prospects of rehabilitation: s 21A(3)(h) Crimes (Sentencing Procedure) Act 1999. It has taken positive steps to guard against the risk of an incident such as this ever happening again. It has brought its documentation and its procedures into line with those which, on all the evidence, should have been in place before this incident occurred.
5. Solveco has shown remorse for the offence: s 21A(3)(i) Crimes (Sentencing Procedure) Act 1999. It has provided evidence that it has accepted responsibility for its actions and has acknowledged that the injury to Mr Hender was caused by its actions.
6. Solveco 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.
7. The incident which is the subject of these proceedings occurred on 31 July 2017. The Summons was filed in this court on 29 July 2019. The matter came before the court for directions on seven occasions until a plea of not guilty was entered on 12 October 2020. The proceedings were listed for hearing before me commencing on 15 June 2021 with an estimate of four weeks. On the first day of the trial the hearing was adjourned. The trial resumed on 24 June 2021, again with an estimate of four weeks. Senior Counsel for the prosecutor gave a detailed opening for more than two days. The prosecution then applied to amend the Summons. On 6 July 2021 I granted leave to amend the Summons: SafeWork NSW v Solveco Pty Ltd [2021] NSWDC 298. The trial was to resume on 7 July 2021, but an indication was given that the defendant was receiving advice concerning its plea. Thereafter the matter was stood over for directions eight times. On 29 April 2022 I granted leave to the prosecutor to file in court an Amended Summons and an Agreed Statement of Facts. A plea of guilty was then entered and the matter was stood over for a sentence hearing on 9 August 2022.
8. The plea of guilty was not entered at an early stage. However, the entry of the plea of guilty during the early stages of the trial, before any witnesses were called, reduced the public expense of the proceedings and saved several weeks of court time. It is appropriate to give Solveco a 12.5% discount for an early plea.
9. Solveco gave assistance to law enforcement authorities: s 21A(3)(m) Crimes (Sentencing Procedure) Act 1999. It cooperated 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 (NSW) 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: Mahdi Jahandideh v The Queen [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. In Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266 at [79] the Court of Criminal Appeal said: "First, and more generally, questions of specific deterrence should take into account the size and scope of the operations of the defendant; a fine which may be crippling to a small business may have virtually no impact on the financial operations of a large corporation. The maximum penalty for the offence is undoubtedly set having regard to such a factor. Secondly, the Court is required to have regard to 'the means' of the defendant, pursuant to s 6 of the Fines Act 1996."
3. There was no submission about capacity to pay, so this issue does not arise.

Costs

1. The parties have agreed to an order that Solveco is to pay the prosecutor's costs.

Penalty

1. My orders are: 1. Solveco Pty Ltd is convicted. 2. The appropriate fine is $240,000 but that will be reduced by 12.5% to reflect the plea of guilty. 3. Order Solveco Pty Ltd to pay a fine of $210,000. 4. Order pursuant to Section 122(2) of the Fines Act 1996 (NSW) that 50% of the fine is to be paid to the prosecutor. 5. Order Solveco Pty Ltd to pay the prosecutor's costs.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 12 August 2022