2.1m FINE FOR SINGLE SAFETY INCIDENT

OVERVIEW

A Victorian Court has imposed its highest ever penalty for a single safety offence against Dennis Jones Engineering Pty Ltd (DJE).

 

DJE was fined $2.1 million after it pleaded guilty to recklessly endangering an apprentice, whilst he was being supervised by Dennis Jones, DJE’s sole director.

 

Jones pleaded guilty to the slightly less serious offence of failing to provide safe systems of work, and was fined $140,000 and placed on a 5-year community corrections order.

 

This month’s Safety Moment reminds directors that:

  • Persons conducting a business or undertaking (PCBU) and directors can be prosecuted for a breach of duty, even where the safety culture of the PCBU is generally good; and
  • Courts will apply the principle of general deterrence in sentencing PCBUs and directors for breaches, even if this places the PCBU at risk of liquidation or means that a sole director is effectively penalised twice.

What happened?

DJE has been operating for 30 years as a family operated machine shop.  DJE contains several items of plant that perform machining processes such as drilling, milling, threading and turning.  DJE services the power, paper, aeronautic, food and transport industries.

 

DJE generally had good safety practices and training.

 

Byron Foley was a second-year apprentice who had been trained to thread the ends of short lengths of pipes using a CNC lathe.

 

A lathe is a piece of plant used in machining.  It rotates a workpiece such as a length of bar or pipe, about an axis to create an object with symmetry about that axis.  The CNC lathe used by Foley had been programmed to make precise cuts and exact shapes, and its functions included threading the ends of pipes.

 

Foley was not permitted by Jones to work alone on pipe longer than 1500 mm, as longer lengths protruded from the back of the machine and required extra support to avoid them ‘wobbling’, ‘bending’ or ‘throwing the machine out’.

 

On 13 October 2021, Foley requested help to thread lengths of stainless steel pipe longer than 1500 mm. 

 

Jones told another employee Justin McQuillen to locate the portable steady, which was placed at the side of the lathe. 

 

The steady had a plastic insert sleeve, or ‘bung’ that was too small for the pipe.  McQuillen told Foley to machine out the insert so that the pipe would fit.  Foley tried to machine out the insert, however it was still too tight, so McQuillen instructed Foley to machine it out by a further 5 mm which he did.   McQuillen assumed that the steady with the sleeve prepared by Foley would be used.  This was not the case.

 

Instead of securing the pipe within the sleeve on the steady, Jones operated the lathe and directed Foley to stand at the end of the pipe protruding from the lathe, hold onto the plastic sleeve that encased the pipe and manually steady it while it rotated.  Jones and Foley threaded the end of 10 lengths of pipe in this manner.  On the 11th length of pipe, Jones noticed that ‘the pipe was wobbling a little bit’.  The pipe then bent and whipped.  Foley was struck to the left side of the head, either by the pipe or by his head striking something else when he was flung to the side after contact with the pipe. 

Jones applied pressure to Foley’s head wound.  An ambulance was called and Foley was airlifted to hospital, where he was placed in a coma.

 

After the incident, WorkSafe inspectors attended the workplace and observed that:

  • the length of pipe protruding from the rear spindle was unsupported;
  • there were no physical barriers preventing a person from approaching the pipe while it was rotating; and
  • the steady was located approximately two metres away from where it needed to be positioned to support the pipe.

When asked why the nearby portable steady had not been used, Jones said words to the effect of ‘good question – probably didn’t get a bung out for that’, and that there was no reason why the steady was not used.  Jones said that it was his normal practice to start with shorter lengths of pipe, and to bring the steady out only if there were issues.

 

Counsel for DJE submitted that anything other than a modest fine would place DJE into liquidation, resulting in the likely non payment of the fine and the redundancy of its seven employees.  However, the Court emphasised the importance of general deterrence and imposed a fine against DJE of $2.1 million – the largest fine ever imposed in Victoria for a

single safety offence, and double the previous record of $1 million imposed on Toll Transport Pty Ltd.

 

Jones was personally fined $140,000 and was sentenced to a 5-year community corrections order.  The Court noted that although Jones was the sole director and owner of DJE (and therefore would bear the financial burden of both fines), the two entities are distinct and must be treated as such. 

Takeaways for Directors

Boards, officers and directors should be aware that:

  • Work, health and safety offences are risk based rather than outcome based. Courts will take into consideration the gravity of the breach of duty owed under the Work Health and Safety Act. The gravity is measured by likelihood of the occurrence of an event as a result of the breach, and the seriousness of the potential consequence of the breach.
  • General deterrence is a predominant consideration in sentencing. The objective seriousness of the breach is the primary factor in determining the appropriate penalty.  Mitigating factors that are subjective to the offender (e.g. plea of guilty, remorse or previous good character) play a subsidiary role. 
  • Serious penalties can be awarded against both the PCBU and its directors and officers, even where the PCBU generally has a good safety culture or this would result in a sole director being responsible for two financial penalties.

Legislation

Work Health & Safety Act 2011 (Qld)
Section 27 – Duty of officers  

1. If a PCBU has a duty or obligation under this Act, an officer of the PCBU must exercise due diligence to ensure that the PCBU complies with that duty or obligation.

5. In this section, due diligence includes taking reasonable steps –

 

a) to acquire and keep up-to-date knowledge of work health and safety matters; and

 

b) to gain an understanding of the nature of the operations of the business or undertaking of the person conducting the PCBU and generally of the hazards and risks associated with those operations; and

 

c) to ensure that the PCBU has available for use, and uses, appropriate resources and processes to eliminate or minimise risks to health and safety from work carried out as part of the conduct of the business or undertaking; and

 

d) to ensure that the PCBU has appropriate processes for receiving and considering information regarding incidents, hazards and risks and responding in a timely way to that information; and

 

e) to ensure that the PCBU has, and implements, processes for complying with any duty or obligation of the PCBU under this Act; and

  • Example— For paragraph (e), the duties or obligations under this Act of a PCBU may include—
    • reporting notifiable incidents
    • consulting with workers
    • ensuring compliance with notices issued under this Act
    • ensuring the provision of training and instruction to workers about work health and safety
    • ensuring that health and safety representatives receive their entitlements to training.

 

f) to verify the provision and use of the resources and processes mentioned in paragraphs (c) to (e).

Where to from here?

If you require assistance to understand and manage your work health and safety duties as a board, director or officer, contact EmploySafe Legal.

 

The information contained in this Safety Moment is intended as a guide only.  You should seek professional advice before applying any of the information to particular circumstances.  Whilst reasonable care has been taken in the preparation of this update, EmploySafe Legal does not accept liability for any errors it may contain.

 

Kate Simpson
Managing Director – Employment & Safety Lawyer
+61 420 972 497
kate.simpson@employsafelegal.com.au 

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