[17] In view of the above, it is my opinion that the company has limited resources to pay a large fine. Certainly, a large fine will exacerbate the company's efforts to achieve a sustainable financial position and could have a negative impact on the overall viability of the company.
58
Annexed to Mr Wilson's affidavit, inter alia, are the financial records of APC for the period 1999 to date.
59
Mr Wilson was not required for cross examination. I have no reason to reject the general assertions he makes as to the defendant's current financial position. Future projections and what impact a 'large fine ... could have' on the defendant's future viability is another matter and much more speculative.
60
Reference to the financial records of the defendant for the period referred to, particularly the Balance Sheet, reflect a corporate defendant who can best be described as 'asset rich and cash poor'. For example, the Statement of Financial Position as at 31 December 2004 reflects a net asset base of $13,927,779.14. That figure can be favourably compared with the net asset base of $2,563,483 as at 31 December 1999 given that the defendant was only established and started trading in 1998. True it is, the trading profit and loss statements for the defendant for the years ending 31 December 1999 to 2004 inclusive reflects successive trading losses. They do so, however, against a background of generally rising sales. For example, in the 1999 year, sales were recorded as $85,909. In 2003, total sales were $5,960,563.47 falling to $2,225,781 in the 2004 year. The financial position for the 2004 year reflects a very modest profit.
61
Overall, APC is a company that, without more, would appear to be fundamentally financially sound. I am not persuaded that the defendant's financial position is so finely balanced that it could not properly meet the impost a financial penalty would bring without causing it significant financial difficulties going forward.
62
In considering all of the financial material and without any additional oral evidence, expert or otherwise, the approach I propose to adopt to the imposition of penalty with respect to the defendant is in accord with the observation of Wright J, President in Ferguson v Nelmac Pty Limited (1999) 92 IR 188 at 210 where his Honour observed:
... whilst I accept that the imposition of heavy fines would be a burden on the defendant and its financial resources and that consideration should be given appropriate weight on the question of penalty, it does not necessarily result in the Court not imposing a heavy penalty ... the penalty should reflect the objective seriousness of the offence.
To which I would simply add that the ultimate penalty should reflect all factors and considerations relevant to the sentencing process.
63
The principle of parity in the sentencing process becomes relevant in these proceedings when comparing the respective roles of APC and Skilled in the context of the factual circumstances of the respective offences and the failures particularised.
64
The approach to be considered in parity in sentencing is well settled. It is a matter to be determined having regard to the circumstances of the offences, the role of the co-offenders and their respective degrees of culpability: see Lowe v The Queen (1984) 154 CLR 606 and Postiglione v The Queen (1997) 189 CLR 295.
65
Ultimately, in my view, the liability of APC is somewhat greater than that of Skilled. Both defendants failed the fundamental steps underpinning their respective offences. That is, they failed by way of proper risk assessment to ensure a proper interlocking guard system and an accessible emergency stop switch between the operator controlled paint cabin and the paint booth incorporating the paint nozzle. Skilled knew there were deficiencies in APC's guarding systems before the accident involving Mr Osero but would appear to have done nothing to pursue the issue with APC.
66
More fundamental, however, is the role of APC as the direct operator of the machine in question. According to the agreed facts, the pipe coating plant had only been in operation since November 2002. It had been manufactured in Holland. In installing the new plant and machinery, APC had an obligation to ensure its operation was risk assessed to fully eliminate or control risks to safety arising from the operation of the machine. As the particularised failures in the offence pleaded succinctly identify, the defendant failed in a number of ways that clearly created risks to safety. This would have been particularly exacerbated in the case of Mr Osero who underwent induction at APC in August 2002. He left shortly after for a number of months and returned only some two weeks before the accident on 17 January 2003. In the intervening period, APC installed and commenced to operate the new pipe coating plant. Mr Osero was given no reorientation to the APC worksite or induction to the safe operation of the pipe coating machine when he returned. Clearly, he should have been and it was APC's ultimate responsibility to ensure that was done.
67
As well, APC failed to follow through with it's obligation to properly assess and act upon the obvious and foreseeable risk to safety that the machine presented by not ensuring that the paint machine could not operate while an employee was within the immediate confines of the operating components of the machine.
68
The defendants are entitled to have taken into account the respective pleas of guilty entered. In assessing that, the Court is guided by the decision of R v Thompson; R v Houlton (2000) 49 NSWLR 383, the principles of which are well settled and need no elaboration. I assess that discount at twenty five per cent with respect to each defendant.
69
Both defendants have no prior convictions. That is a matter that assists both defendants. Admittedly, APC has a relatively limited corporate history, having been established only in 1998. As Mr Wilson deposes, it has only a 'small and flexible staff' of some ten people in all, otherwise relying on labour hire companies such as Skilled, as demand requires.
70
Notwithstanding the relatively short corporate history of APC, the information and annexured material contained in Mr Wilson's affidavit, none of which was challenged, satisfies me that APC was approached and does approach it's occupational health and safety responsibilities as part of a structured and ongoing process with generally commendable results. On the evidence and documentary support material of Mr Bassett, the same conclusion can be drawn in relation to Skilled. Certainly, on the evidence before me, the audit and review activities undertaken by Skilled since the accident involving Mr Osero are impressive. Both defendants are entitled to be given credit as employers who are both proactive and properly committed to their workplace safety responsibilities.
71
Skilled is a large company by comparison with APC. As Mr Bassett stated:
Skilled operates a National Labour Hire Business which provides staff to work at its client's premises throughout New South Wales. Currently there are approximately 14,000 employees of Skilled at approximately 6,000 client premises throughout Australia. Across New South Wales, Skilled engages an average of 2,000 to 2,500 workers per day. On an annual basis, the workers are engaged for approximately 700 different clients throughout New South Wales.
72
As was explained by counsel for Skilled, reference to Skilled in Mr Bassett's affidavit is reference to those corporate entities who make up the Skilled Group, of which the defendant before me is but one. In relation to the defendant Skilled Warehousing (NSW) Pty Limited, I was advised that it employs approximately one thousand employees per day.
73
Again by way of clarification, it should be stated that while the Skilled Group has been in operation for some forty years, Skilled Warehousing (NSW) Pty Limited has been incorporated only since 2000.
74
I understand the first defendant Skilled continues to provide labour to APC and, by all accounts, both companies cooperated well with WorkCover in the investigations into Mr Osero's accident.
75
On behalf of APC, Mr Wilson stated:
[18] By pleading guilty to this case, APCS acknowledges its failures in regard to actions which may have been taken to prevent this unfortunate accident in the first place. Further, I am instructed by the Board to express the sincere regret of the company for this accident, and that every effort has been made and will be made in the future to rehabilitate the injured worker, who came back to work with the defendant by 27 March 2003, and to prevent any further occurrence of such an incident or similar incident.
76
On behalf of Skilled, Mr Pollett visited Mr Osero at home after the accident and took him to see the company's doctor in Warrawong. Mr Osero was returned to the APC site, initially on light duties for about two weeks.
77
I am satisfied both defendants are entitled to further favourable consideration by way of mitigation for the subjective features I have identified.
78
In relation to the respective defendants and their related offences and taking account of all relevant considerations, including those identified by ss21A and 22 of the Crimes (Sentencing Procedure) Act 1999, I determine penalty as follows:
(i) Matter No IRC 3397 of 2004: WorkCover Authority of New South Wales (Inspector Katf) v Skilled Warehousing (NSW) Pty Limited: Offence pursuant to s8(1) of the Occupational Health and Safety Act 2000. I determine a penalty of $71,500.
Accordingly, I order as follows:
(i) I impose a penalty in this matter of $71,500.
(ii) I allocate a moiety to the prosecution on the usual terms.
(ii) Matter No IRC 3398 of 2004: WorkCover Authority of New South Wales (Inspector Katf) v APC Socotherm Pty Limited: Offence pursuant to s8(2) of the Occupational Health and Safety Act 2000. I determine a penalty of $84,500.
Accordingly, I order as follows:
(i) I impose a penalty in this matter of $84,500.
(ii) I allocate a moiety to the prosecution on the usual terms.
79
On the question of costs, some considerations arise. As was acknowledged on behalf of the prosecutor:
This prosecution was attended by a number of procedural difficulties. This involved a number of amendments to the application for orders and the erroneous filing of material not associated with this prosecution. The prosecutor accepts that the costs associated with these issues ought not be borne by the defendants.
80
The procedural issues referred to are those matters associated with the proceedings before me on 6 May 2005. The parties are well aware of those matters. Given that the difficulties that arose lay with the prosecutor, I agree that the defendants should not have to bear the prosecutor's costs of those proceedings or issues related thereto.
81
APC has sought costs from the prosecutor for the proceedings of 6 May 2005. I am not minded to make such an order. Ultimately, it was the prosecutor who bore the brunt of the procedural difficulties of its own making.
82
Apart from the costs associated with the procedural difficulties as understood between the parties, in which each party will bear its own costs, I order as follows:
(i) The defendants are to pay the prosecutor's costs equally between them as agreed or, failing agreement within 28 days, the matter may be referred to the Registrar for assessment.
(ii) If agreement is reached as to costs, the parties are to prepare and file draft orders to reflect the decisions I have made in order to record convictions and specific costs.
83
In relation to the costs order sought by APC in Matter No IRC 3399 of 2004, which was not before me at any time, I refer the parties to the position that issue was left in when it was before Haylen J on 3 December 2004 when his Honour said:
What I will do is reserve the question of costs. I direct the parties to confer on that matter. If there is an agreement, I will make the orders in Chambers without requiring the parties to attend. If there needs to be some argument, the parties have liberty to apply to have the matter re-listed.
84 Failing agreement, I commend that course upon the parties involved.