WorkCover Authority of New South Wales (Inspector Robins) v Labour Co-operative Ltd - [2001] NSWIRComm 223 - NSWIRComm 2001 case summary — Zoe

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WorkCover Authority of New South Wales (Inspector Robins) v Labour Co-operative Ltd

[2001] NSWIRComm 223

Industrial Relations Commission (NSW)|2001-07-01|Before: Hungerford J, Mr P, Hon Mr J

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Source facts

Court

Industrial Relations Commission (NSW)

Decision date

2001-07-01

Before

Hungerford J, Mr P, Hon Mr J

Catchwords

05/01/2001 DATE OF JUDGMENT: 09/20/2001

Source

Original judgment source is linked above.

Catchwords

05/01/2001 DATE OF JUDGMENT: 09/20/2001

Judgment (269 paragraphs)

[1]

Industrial Relations Commission of New South Wales in Court Session

[2]

CITATION : WorkCover Authority of New South Wales (Inspector Robins) v Labour Co-operative Ltd (No 1) [2001] NSWIRComm 223 PROSECUTOR WorkCover Authority of New South Wales (Inspector Steven Robins) PARTIES : DEFENDANT Labour Co-operative Limited FILE NUMBER: IRC 2974 of 2000 CORAM: Hungerford J CATCHWORDS : Occupational Health and Safety - Prosecution for failure to ensure health, safety and welfare at work of employee - Injured worker engaged by a labour hire firm to perform work at client's premises - Labour hire firm alleged to be proper defendant as the employer of the worker - Whether worker employed by client company - Whether a legal relationship existed between the defendant and the worker - Whether such relationship was a contract of employment - Whether defendant causally connected with alleged risks to safety - Availability of statutory defences - Offence found proven. LEGISLATION CITED : Occupational Health and Safety Act 1983 s 4(1) s 15(1) s 53 Australian Mutual Provident Society v Allan (1978) 52 ALJR 407, (1978) 18 ALR 385 Carrington Slipways Pty Ltd v Callaghan [1985] 11 IR 467 Commissioner of Taxation (Cth) v J Walter Thompson (Aust) Pty Ltd (1944) 69 CLR 227 Cullen v State Rail Authority of New South Wales [1989] 31 IR 207 Dalgety Farmers Ltd t/as Grazcos v Bruce (1995) 12 NSWCCR 36 Drake Personnel Ltd t/as Drake Industrial v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 432 Haynes v C I & D Manufacturing Pty Ltd (1994) 60 IR 149 Hollis v Vabu Pty Ltd t/as Crisis Couriers [2001] HCA 44 Italo Constructions Pty Ltd v Parkes [1988] 24 IR 428 Kirkby v A & M I Hanson Pty Ltd (1994) 55 IR 40 Massey v Crown Life Insurance Co [1978] 1 WLR 676 McMartin v Broken Hill Pty Co Ltd (1988) 100 IR 241 Mersey Docks and Harbour Board v Coggins and Griffith (Liverpool) Ltd [1947] AC 1, [1947] 2 All ER 345 CASES CITED : Moore v Palmer 2 Times L Rep 781 Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 Performing Right Society Ltd v Mitchell and Booker (Palais de Danse) Ltd [1924] 1 KB 762 Pitcher v Langford (1991) 23 NSWLR 142 Poulson v John Jarvis and Co Ltd [1919] 122 LT Rep 471 State Rail Authority of New South Wales v Dawson [1990] 37 IR 110 Steel Structures Ltd v Rangitikei County [1974] 2 NZLR 306 Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 Swift Placements Pty Ltd v WorkCover Authority of New South Wales (Inspector May) (2000) 96 IR 69 WorkCover Authority of New South Wales (Inspector Ankucic) v Drake Personnel Ltd t/as Drake Industrial (No 1) (1997) 89 IR 374 WorkCover Authority of New South Wales (Inspector Dubois) v Industry Staffing Services Pty Ltd t/as Action Workforce (1999) 89 IR 430 WorkCover Authority of New South Wales (Inspector Egan) v ATCO Controls Pty Ltd (1998) 82 IR 80 WorkCover Authority of New South Wales (Inspector Keelty) v Crown in Right of the State of New South Wales (Police Service of New South Wales) (No 2) (2001) 104 IR 268 WorkCover Authority of New South Wales (Inspector Penfold) v Fernz Construction Materials Ltd (1999) 91 IR 119 WorkCover Authority of New South Wales (Inspector Piggott) v Capral Aluminium Ltd (1998) 82 IR 468 HEARING DATES: 04/30/2001; 05/01/2001 DATE OF JUDGMENT: 09/20/2001

[25]

It is alleged that the Defendant, Labour Co-operative Limited, being an employer on 1 July 1998 at the CSR Limited trading as CSR Timber Products premises at Masonite Road, Raymond Terrace in the State of New South Wales did fail to ensure the health, safety and welfare at work of all of its employees and, in particular, Ms Julie Anne Lister, in that: (a) it failed to provide such information, instruction and training to Julie Anne Lister so as to enable Lister to carry out her duties at CSR safely and without risk to her health which included spotting up the wet lap on Press 4 in the Boardmaking Area of the premises. The information, instruction or training provided to Lister with regards to the safe system of work relating to the operations in the Boardmaking Area was insufficient in that the training provided by the Defendant did not highlight the hazards of presses and/ or automated mobile plant. (b) it failed to supervise Lister so as to ensure that Lister was only carrying out duties that she was qualified to perform and not required to carry out duties which were hazardous, without adequate training and supervision, given that Lister had had no previous experience operating heavy machinery and had no qualifications related to the operation of plant. (c) it failed to ensure that Lister was provided with adequate supervision and training by CSR whilst she was at its premises in that it failed to assess the effectiveness of the training or supervision provided by CSR to Lister. 4 The defendant pleaded not guilty. However, through its counsel, the Hon Mr J J Macken, the defendant indicated there was no issue raised by it concerning the circumstances of the accident and the injuries occasioned thereby to Ms Lister. Indeed, at the commencement of the hearing counsel conceded as being established all of the essential elements for a s 15(1) offence, other than that the defendant was the relevant employer of Ms Lister and, even if it were, the circumstances were such that it could not have done anything to prevent the accident occurring. Counsel emphasised, as he said, that "the substantial issue is that she isn't an employee of Labour Co-operative". Thus, three issues emerged for determination: first, the status of the defendant as the employer; second, the causal connection of the defendant with the alleged detriments to safety; and, third, the defence available under s 53 of the Occupational Health and Safety Act. The hearing proceeded on that basis and I too will consider the issues in the order they were raised.

[34]

(9) In the procedures section of the said package, the defendant advised Ms Lister so as to assist "in alleviating any problems which may occur whilst you are an employee of the Co-operative" in relation to "Work Availability", "Sick Leave/Absenteeism", "Pay Requirements", "Tickets/Certificates/Licences", "Clothing Allowance" and "Labour Co-op Safety Rules". In relation to the various matters so dealt with, the following extracts are of particular significance : · "The Co-operative will contact you if work is available. If you have not been contacted please contact the office between the hours of 8.30 am and 5.00 pm and confirm your availability". · "If you are unable to work through illness please notify us - we will then notify the client of your absence. In certain circumstances you may contact the client direct but you will need to notify us also in case a replacement is required". · "All Co-operative employees are required to complete and sign a tax declaration form, a superannuation fund application form and a deduction form for weekly pay deductions payable to the appropriate union". · "All pays are electronically transferred to an approved financial institution and are available to you on Thursdays. Your account number must be supplied to the pay office to enable your pay to be deposited". · "It is your responsibility to ensure your time sheet is completed correctly and signed by the client and forwarded to the pay office on time each week". · "You cannot operate machinery, drive a vehicle or direct traffic unless you have current certification". · "All employees receive a weekly clothing allowance (where applicable). ... If you are working on weekly hire for a long period you will be given a clothing issue but you will cease to receive a weekly clothing allowance". · "The objective of these rules (Labour Co-op Safety Rules) is to ensure the health, safety and welfare of all employees. ... Any deliberate breach of these rules may result in disciplinary action." · "Please note that although you are working for another organisation Labour Co-operative is your employer and will be responsible for the payment of Workers Compensation. Therefore it is important we are notified of all injuries and accidents."

[152]

31 Before reviewing the evidence and applying it to the relevant principles of law so as to enable a determination of the present question, it is necessry to identify the ultimate question, namely, whether Ms Lister was employed by the defendant under a contract of employment on 1 July 1998 when she suffered the detriment to her safety at the Raymond Terrace premises of CSR Timber Products. In so doing, I think it important to recognise that the answer to that ultimate question is one of fact, although in reaching the conclusion questions of mixed law and fact will arise: see Clarkson v Dent (1998) 84 IR 250 at pp 252-253; Performing Right Society Ltd v Mitchell and Booker (Palais de Danse) Ltd [1924] 1 KB 762 at pp 765-766; and Commissioner of Taxation (Cth) v J Walter Thompson (Aust) Pty Ltd (1944) 69 CLR 227 at p 229. Given the true nature of the relationship to be a question of fact, it is appropriate in reviewing the evidence to have in mind the comment of Handley JA, with whom Kirby P agreed, in Pitcher v Langford (1991) 23 NSWLR 142 at p 160 that admissions as to the true nature of a relationship are admissible and entitled to considerable weight. Indeed, that comment was consistent with what Lord Denning MR said in Massey v Crown Life Insurance Co [1978] 1 WLR 676 at p 679 that the agreement between parties "becomes the best material from which to gather the true legal relationship between them"; the Privy Council in Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 at p 601 adopted Lord Denning's statement as correct and referred to the principle to the same effect stated by the Privy Council in Australian Mutual Provident Society v Allan (1978) 52 ALJR 407 at p 409, (1978) 18 ALR 385 at pp 389-390 per Lord Fraser of Tullybelton. The only qualification one might add to the intention of the parties in characterising the nature of their relationship is where it was a sham or not a genuine statement of intent. Here, however, there was nothing in the evidence to suggest lack of bona fides and counsel did not say there was.

[154]

33 Once it be accepted, as I have found, that there was no legal relationship between CSR Timber Products and Ms Lister then the reliance by Mr Macken on the degree of alleged control over her work by CSR Timber Products fades into insignificance. It was not suggested by counsel that she was not employed by someone, only that she was not employed by the defendant but by CSR Timber Products - there was no other entity available for consideration on the facts and it was not said she was an independent contractor but only that the prosecutor had the onus according to the criminal standard to establish the existence of a contract of employment. In my view, the only possible area on the evidence where a relationship of employment between the defendant and Ms Lister could be doubted was on the aspect of the control exercised by the defendant over her work. The aspect of control by itself, in my view, cannot be decisive of the nature of a relationship. As Mason J, as he then was, observed in Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at p 24, "the existence of control, whilst significant, is not the sole criterion by which to gauge whether a relationship is one of employment. ... regard it merely as one of a number of indicia which must be considered in the determination of that question ... .". His Honour added (160 CLR at pp 28-29) : The traditional formulation, though attended with some complications in its application to a diverse range of factual circumstances ( Federal Commissioner of Taxation v Barrett ((1973) 129 CLR 395 at p 400)), nevertheless has had a long history of judicial acceptance. True it is that criticisms have been made of it. It is said that a test which places emphasis on control is more suited to the social conditions of earlier times in which a person engaging another to perform work could and did exercise closer and more direct supervision than is possible today. And it is said that in modern post-industrial society, technological developments have meant that a person so engaged often exercises a degree of skill and expertise inconsistent with the retention of effective control by the person who engages him. All this may be readily acknowledged, but the common law has been sufficiently flexible to adapt to changing social conditions by shifting the emphasis in the control test from the actual exercise of control to the right to exercise it, "so far as there is scope for it", even if it be "only in incidental or collateral matters": Zuijs v Wirth Bros Pty Ltd ((1955) 93 CLR 561 at p 571). Furthermore, control is not now regarded as the only relevant factor. Rather it is the totality of the relationship between the parties which must be considered. The approach so stated was followed by the majority of the High Court ( Gleeson CJ, Gaudron, Gummow, Kirby and Hayne JJ) in Hollis v Vabu Pty Ltd t/as Crisis Couriers [2001] HCA 44 at pars [43]-[44] and where their Honours then commented at par [45] that "guidance for the outcome is provided by various matters which are expressive of the fundamental concerns ... include, but are not confined to, what now is considered 'control'".

[157]

In this case, having in mind the way in which we have formulated the contract between the appellant and Warman, the services of Mr Terkes were provided to Warman by the appellant in return for a fee and in respect of which it was for the purposes of the appellant's business as a provider of labour. The point was made by the High Court in Accident Compensation Commission v Odco Pty Ltd (1990) 95 ALR 641 in which Odco carried on business under the name of Troubleshooters Available (TSA) as a labour agency providing the services of tradesmen to builders. The High Court observed (95 ALR at p 652) : "Once it is accepted that there was (1) an agreement between TSA and the builder for the supply of a tradesman to the builder to do certain work on terms that the builder was to remunerate TSA for supplying the tradesman and for the work which he did, and (2) an agreement between TSA and the tradesman whereby the tradesman agreed to perform work at the site at the builder's direction for remuneration to be paid by TSA, it follows as a matter of plain language that the tradesman supplies services to TSA by attending at the site and doing work there. By attending there and doing work, he supplies services to TSA for the purposes of its business, notwithstanding he also at the same time supplies the same services to the builder for the purposes of its business." This same point was made by Kitto J in Perpetual Trustee Co (85 CLR at p 300), by following the illustration in Mersey Docks and Harbour Board v Coggins and Griffith (Liverpool) Ltd [1947] AC 1 at 17, that "the statement that the doing of the work must be for the benefit of the master does not mean, of course, that the direct benefit from the work itself must necessarily accrue to the master; he may, without altering the relationship, direct his servant to do work which will benefit another". We understand that to be the position here. Baldi & Fletcher Pty Ltd v Rabmar Pty Ltd [1988] 25 IR 101 further illustrates the point where Clarke JA, with whom Samuels and McHugh JJA agreed, commented (at p 102) :

[159]

35 As in Swift Placements, the most Mr Macken could argue here in supporting the transfer of employment from the defendant to CSR Timber Products would be the limited degree of control exercised by the defendant over Ms Lister's work so as to view her pro hac vice the employee of CSR Timber Products at the precise time on 1 July 1998 when she was injured by the moving rack. In rejecting such an approach in Swift Placements, their Honours concluded from the authorities that "whether the employee of the general employer becomes the employee of the particular employer will depend upon the circumstances of the case concerned and where, in any event, such a transfer in employment occurs only 'in quite exceptional circumstances' and where the obligation to establish a new employment was a 'heavy onus'" (96 IR at p 102): see also Mersey Docks and Harbour Board v Coggins and Griffith (Liverpool) Ltd [1947] AC 1, [1947] 2 All ER 345; Steel Structures Ltd v Rangitikei County [1974] 2 NZLR 306 at pp 310-311; and Poulson v John Jarvis and Co Ltd [1919] 122 LT Rep 471 at p 478. In that last-mentioned case, Lush J, in considering whether the particular employer had taken over the control of a person before that employer could be said to have become the employer, said "there must be a taking over by the particular employer of the complete control - a complete transfer of the service - before he can be held to be the responsible employer of the workman"; his Lordship added what Bowen LJ said in Moore v Palmer (2 Times L Rep 781 at p 782) that "the great test was this - whether the servant was transferred or only the use and benefit of his work?" In the present case, the evidence, in my view, was plain to the effect that all that was transferred to CSR Timber Products by the defendant was the use and benefit of Ms Lister's work rather than a complete transfer of her service, including the various incidents of employment. It follows, therefore, at the particular time of the detriment to safety on 1 July 1998, notwithstanding the control then exercised by CSR Timber Products over the work (and training) of Ms Lister, that there was no transfer of her employment from the defendant at the particular time or for the particular purpose.

[257]

45 The nature of the liability created by s 15(1) of the Occupational Health and Safety Act was extensively reviewed by a Full Bench of the Court (Wright J, President and Walton J, Vice-President, with whom Peterson J agreed) in Drake Personnel Ltd t/as Drake Industrial v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 432 at pp 449-452 by reference to the developed authorities, namely: Carrington Slipways Pty Ltd v Callaghan [1985] 11 IR 467 at pp 469-470; McMartin v Broken Hill Proprietary Co Ltd (1988) 100 IR 241; Italo Constructions Pty Ltd v Parkes [1988] 24 IR 428; Cullen v State Rail Authority of New South Wales [1989] 31 IR 207 at p 209; State Rail Authority of New South Wales v Dawson [1990] 37 IR 110 at pp 120-121; Kirkby v A & M I Hanson Pty Ltd (1994) 55 IR 40 at pp 49-50; Haynes v C I & D Manufacturing Pty Ltd (1994) 60 IR 149 at p 156; WorkCover Authority of New South Wales (Inspector Piggott) v Capral Aluminium Ltd (1998) 82 IR 468 at p 478; WorkCover Authority of New South Wales (Inspector Egan) v ATCO Controls Pty Ltd (1998) 82 IR 80 at p 85; and WorkCover Authority of New South Wales (Inspector Penfold) v Fernz Construction Materials Ltd (1999) 91 IR 119. I was required to review this general position in WorkCover Authority of New South Wales (Inspector Keelty) v Crown in Right of the State of New South Wales (Police Service of New South Wales) (No 2) (2001) 104 IR 268 and from which review of the cited authorities I drew the following propositions (104 IR at pp 288-289) - (1) The duty imposed on an employer to ensure the health, safety and welfare at work of employees is absolute. (2) Such duty to ensure is to be construed as meaning to guarantee, secure or make certain. (3) The duty so created is directed at obviating "risks" to safety at the workplace, even absent any actual incident causing injury; that is, where the circumstances create a potential danger to the health and safety of employees at the workplace. (4) The duty cast on an employer is both preventive and remedial in nature and is not necessarily satisfied by carrying out what ought be done by a reasonable or prudent person in the circumstances. (5) It is wrong in considering whether a breach has occurred to reason from the actual incident causing injury as the necessary detriment to safety as such an approach may well lead to a misunderstanding of the real facts on which a charge is based. (6) An incident itself causing injury may well, and probably does, manifest the existence of a detriment to safety and will, no doubt, be some measure of the degree of severity of the detriment. (7) It is necessary to establish both a relevant "failure" on the part of the employer and a causal relationship between the conduct of the employer and the consequent risk to health, safety or welfare of the employees. (8) It is to the essential ingredients of the offence charged which one must attend by assessing the objective facts causing the detriment to safety and the causal connection therewith of the employer. (9) The commission of an offence does not require the demonstration by the prosecutor that particular measures should have been taken to prevent the risk, although there can be no relevant failure by an employer in not taking steps to preclude a risk which was impossible to anticipate. (10) There is no warrant for limiting the detriments to safety contemplated by the statutory duty to those which are reasonably foreseeable. (11) Whilst relevant risks should not be merely speculative or unduly remote, measures which may have been taken to prevent any failure might be relevant to the statutory defence under s 53 that either, firstly, it was not "reasonably practicable" to have complied with the duty or, secondly, that the commission of the offence was due to causes beyond the control of the employer and against the happening of which it was impracticable to make provision. (12) The liability of an employer is to ensure that employees are not exposed to risks to health or safety while at work. The liability thus created according to the criminal standard of beyond a reasonable doubt makes out the offence; it is then for the defendant employer to prove to the civil standard on the probabilities the elements available under the s 53 defence. Relevant to this second issue in the present case as to causal connection are the propositions above-stated in pars (1), (2), (4), (7) and (9).

WorkCover Authority of New South Wales (Inspector Robins) v Labour Co-operative Ltd

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