Legal comment on prosecutions and the Health and Safety at Work Act 2015 (HSWA 2015), by Mallory Ward, solicitor, Kensington Swan’s Health and Safety team.
The Health and Safety at Work Act 2015 (the Act), which came into force in April of this year, has introduced significantly greater penalties than the Health and Safety in Employment Act 1992 that it replaced, whether for persons conducting a business or undertaking (PCBUs) and workers, or other individuals who fail to comply with health and safety standards.
Unsurprisingly, given the increased liability under the new HSWA, there has been much speculation about which duties WorkSafe New Zealand (the New Zealand health and safety regulator), will focus on under the new Act, and who is most likely to be prosecuted when something goes wrong.
Of course, certain industries are more likely to come under WorkSafe’s spotlight than others. The construction industry has been categorised as a ‘high risk’ industry and will therefore continue to be a particular focus area for WorkSafe under the new Act.
However, it is unclear which particular duties WorkSafe is likely to pursue prosecutions for when breaches occur. It is also unclear whether some entities will be given more slack than others, including not-for-profits and companies or individuals with excellent health and safety records.
WorkSafe’s prosecution policy
WorkSafe has recently released an updated Prosecution Policy which sets out guidance on its approach to enforcement of the new Health and Safety at Work Act 2015.
The policy describes the process that WorkSafe will follow when making a decision as to whether or not to prosecute a duty holder – including the ongoing review of charges, its approach to disclosure and its approach to press discussions and withdrawal of charges.
However, although the Prosecution Policy describes the factors that WorkSafe will consider in making a decision about whether or not to bring a prosecution, the policy contains very little guidance on who and what WorkSafe will prosecute under the Act.
Australian case law
Because the Health and Safety at Work Act 2015 is closely modelled on the Australian health and safety legislation, Australian case law can be a useful tool when predicting how the new Act will be interpreted and applied in the New Zealand courts.
Interestingly, some recent cases in the Australian courts have demonstrated that every duty holder will be equally on the hook, regardless of the nature of their duty, their excellent health and safety record, or their not-for-profit status. We will take a brief look at two of those decisions.
Boland v Trainee and Apprentice Placement Service Inc  SAIRC 14 (27 May 2016)
In a recent decision by the South Australia Industrial Relations Court, a labour hire company was convicted and fined $12,000 for failing to comply with its duty to consult, coordinate and cooperate with other PCBUs in relation to health and safety. This duty applied because the labour hire company and at least one other PCBU had a health and safety duty in relation to the same matter.
The labour hire company had placed a trainee worker with a roofing contractor. In order to ensure the health and safety of the workers that it placed and to understand the risks to its employees, the company had three field officers who attempted to attend the various sites every eight weeks.
Unfortunately, when carrying out work for the roofing contractor, the trainee worker was significantly injured when some guttering that he was working on came into contact with high-voltage power lines.
The court acknowledged that the labour hire company had an awareness of work health and safety issues on the host employer’s site. It also acknowledged that the labour hire company had a difficult task and that it must have been necessary for it to rely upon those on site to do the right thing.
Despite this, the labour hire company was convicted for failing to, so far as was reasonably practicable, consult, cooperate and coordinate activities with the host employer in relation to the worker placed on site.
The court explained that the host employer’s job safety analysis audit on the site was inadequate, as there were no safety measures in place on the site. It found that, in breach of the duty to consult, cooperate and coordinate, the labour hire company had entirely relied upon those on site to comply with health and safety obligations.
Even though the court found the labour hire company to be an ‘exemplary employer’ that had been in business since 1997, had no prior convictions and was a not-for-profit organisation, the court convicted the company of the health and safety offence and fined it $12,000. Interestingly, the failure to consult, cooperate and coordinate was not articulated as a particular of a breach of another primary health and safety duty – rather it was a standalone charge faced by the company.
This case is also interesting because it highlights the fact that health and safety duties will often overlap, and where they do it is important that each duty holder consults, cooperates and coordinates with other duty holders in respect of their overlapping duties.
Another interesting case is McKie v Al-Hasani and Kenoss Contractors Pty Ltd (in liq)  ACTIC.
That case, which was heard before the Australian Capital Territory Industrial Magistrates Court, was brought in response to an incident where an employee of a family owned construction company died from an electric shock when the tip-truck he was operating made contact with a power line.
The project manager for the company was prosecuted for failing to exercise due diligence as an ‘officer’ under the health and safety legislation by ensuring that the company was fulfilling its health and safety obligations. The company that employed the deceased employee was also prosecuted on the basis that it had a health and safety duty and failed to comply with that duty, exposing an individual to risk of death.
The court ultimately found that the project manager for the company did not fall within the definition of officer under the Australian legislation. The court said that whether or not a director will be an ‘officer’ will depend on an assessment of their role in the company as a whole, rather than a particular function or project that they are involved in. While the project manager was responsible for specific contracts entered into by the company, the court was not satisfied that he had sufficient control of the company or that the decisions he made were ones that affected a substantial part of the company’s business.
The company, on the other hand, was convicted and later fined $1.1 million (out of a possible maximum fine of $1.5 million). The court justified the substantial fine by explaining that the accident could have been averted had a number of relatively simple safety measures been implemented and because the company had tried to obfuscate the Australian safety regulator’s investigation.
In New Zealand, the test for who will be an ‘officer’ under the Act is slightly different to the Australian test. In short, a person will be an ‘officer’ if they have the ability to significantly influence the management of the business or undertaking. WorkSafe has indicated that this will only capture people who hold very senior leadership positions in the business – for example, chief executive officers.
Despite this difference, the McKie case is still useful in that it suggests that the issue of whether someone is an officer will be viewed by the courts in New Zealand as a question of fact, to be determined on a case-by-case basis. It will also be a useful case to refer to for individuals who merely have significant influence over a particular project (as opposed to the wider business of a company itself).
The case suggests that such individuals might not have influence over a sufficient amount of the business to meet the threshold of being an officer of the company. However, each case will turn on its facts. It will still be important for individuals in these ‘marginal’ situations to carefully consider with others in their company (and take independent advice if necessary) as to whether they might be deemed to be an officer under the Act by virtue of their role.
Finally, the McKie case indicates that if WorkSafe follows the example set by the Australian regulator, it is likely to have no problem prosecuting individual ‘officers’ alongside their companies, where WorkSafe considers that multiple duty holders have breached the Act.