If I were to rule for a day
Twelve months too long
OLIVIA LUND wants WorkSafe to have to lay charges within six months and develop guidance around critical risks, and the courts to use the Companies Act.
I would revert to the six-month limitation period for charges to be laid. Extensions could be sought from the Court for more complex cases that involve multiple fatalities and multiple PCBUs, such as the investigation into the Whakaari eruption.
Charging decisions are routinely made in the days leading up to the 12-month limitation period, which is too long and unnecessary in most cases (if proper resources were applied to the investigation). The longer timeframe adds to the trauma, grief and stress of victims, their whānau and the PCBUs who await the outcome of the investigation.
The longer timeframe to lay charges also delays other investigative lines of inquiry such as coronial inquiries, which typically follow a WorkSafe investigation where no charges have been laid. This results in many cases not being determined for two to three years after an incident has occurred, which diminishes the deterrence and learnings objectives of the HSW Act.
I would like to see WorkSafe develop more regulations, approved codes of practice and guidance in conjunction with industry and sector groups to provide a framework for how organisations can manage their obligations in respect of key critical risks.
If the regulator can’t say (or doesn’t have an agreed position) on what good looks like, then who can?
Company out of business
It is the directors/leaders of an organisation who are ultimately responsible for its health and safety performance. Imposing large fines to put a company out of business is unlikely to achieve the desired outcome as it is not a “death penalty” that stops the directors or leaders of those organisations moving on to another organisation, or establishing a new legal entity to carry out another business or undertaking.
If the purpose is to eliminate companies who are blatantly disregarding their HSWA obligations and putting people’s lives at risk, the better approach might be to prosecute the officers of those organisations and impose orders that prohibit them from being an officer or director under the Companies Act, and/or order those officers to undergo health and safety training which is currently provided for under s 158 of the HSW Act.
Olivia Lund is a partner with Duncan Cotterill.
Change of name
JAMES WARREN argues for the legislation to be given a new name, for safe harbour reporting, and for using sentencing powers other than fines.
Time for a new name: how about the Wellbeing at Work Act? Less of a mouthful and a strong signal on where regulation should be heading.
A key issue with the current understanding of legislation is that the focus tends to be on the prevention of harm, rather than the promotion of health. Too many PCBUs still think “health & safety” is about preventing accidents, and ignore or minimise the health aspect of the legislation.
In line with and as part of this change, the introduction of an additional s3(1) “purpose” for the Act would go a long way. It could set out a positive requirement to ensure the health and wellbeing of workers.
Formalising a system for early safe harbour reporting could bring about more, and more positive, engagement with the regulator.
It’s right that PCBUs should at times be worried about potential WorkSafe investigation. There needs to be a threat of prosecution for serious health and safety failures. But there are also situations in which early reporting could be further encouraged – to ensure the issue is properly examined, that necessary action is then taken, and that any learnings are available for wider industry.
With careful limits (eg excluding serious incidents which are required to be reported, a short time window only) and clear rules (ensuring that WorkSafe is not forced to become a de facto health and safety adviser), this could reward reporting to WorkSafe with a promise that enforcement action will be limited, perhaps to lower-level steps than prosecution, or to an infringement notice – so long as relevant enforcement notices are then observed.
This may also allow relevant investigations to take place on a much more cooperative basis, with both investigators and organisations focused on improvement, rather than being in a potential court battle.
Company out of business
There needs to be a real deterrent when a company is irredeemably failing on health and safety, especially if that is linked to intent or recklessness. But fines should also be proportionate to the size of a business and its resources (and perhaps more directly than now; some jurisdictions use penalties based on turnover).
At present, the uncomfortable position is that well-off companies may be in a position to “pay” for risky health and safety practice in a way which smaller companies cannot afford. Equally unattractively, small businesses might choose not to spend resources on health and safety, knowing that they are likely to escape a large fine which would put them out of business.
When necessary, and this would only be in extreme situations, perhaps rather than relying on a large fine, there should be a specific court power to shutter the business (or key parts of it) and/or to ban the individuals involved. Arguably that may already be possible for the court to achieve by use of its power to order injunctions.
In any event, using a specific sentencing power would be a more direct and appropriate way to force a dangerous business to halt operations, or to remove individuals from the industry, rather than indirectly and perhaps less effectively achieving that result by imposing a large fine.
It might also be useful for deterrent purposes (and proper assessment between different cases) for the value of a fine to be reported and recorded formally as the figure, before any adjustment because of business size or inability to pay.
James Warren is a partner with Dentons Kensington Swan. These views are his own.
OLIVIA WELSH wants clarity around notifiable incidents and injuries and more resources for WorkSafe inspectors.
I would like to see changes to the definitions of “notifiable injury or illness” and “notifiable incident” under the HSWA that trigger the requirement on duty holders to report notifiable events to WorkSafe. At present, the lack of further guidance in the legislation itself, or provided separately by WorkSafe, means the task of identifying which circumstances need to be reported and which don’t is sometimes a difficult one.
Common questions that I see raised by duty holders are:
- What constitutes a “serious” head injury, eye injury, or burn to qualify as a notifiable injury?
- How do you know when an injury or illness “would usually require” treatment if treatment was not actually received in the circumstances?
- Does an “immediate or imminent exposure” for the purposes of a notifiable incident require proximity in time or space, or both, and if so, how close?
I would like to see WorkSafe’s inspectorate given better resourcing – both in a financial sense and in terms of training – so that WorkSafe can attract and retain top quality inspectors who have the necessary tools to conduct efficient and effective investigations.
At present it is clear that WorkSafe’s inspectorate is stretched and under pressure, which has a flow-on effect in terms of the quality of the many investigations they are trying to juggle. Better resourcing would also help investigations be completed sooner, which is better for the duty holder and any victims.
It would be great if WorkSafe had sufficient resource within its inspectorate to be able to have specialist inspectors who could be routinely allocated to particular types of incidents or industry categories. One of the concerns we often hear from clients involved in incident investigations is that the inspector assigned to the incident does not have a good understanding of the client’s business or industry sector. This compromises the efficiency of investigations and reduces client confidence as extra time is spent going through the basics so that the inspectors can properly understand the context in which the incident occurred.
Company out of business
In some cases it will be just and appropriate for a Court to impose a fine that is at a level that puts a defendant out of business. However, this should only occur in the most exceptional cases where there is evidence of a persistent and deliberate pattern of disregard for health and safety in the workplace.
Such behaviour has been alleged by the Police in its proceeds of crime case against Salters Cartage Limited and Ron Salter. When the company was sentenced for its health and safety related offending in 2017, the Court did not impose a fine at a level that would cripple the business, but the case may have been an appropriate one in which to do so.
Olivia Welsh is a senior associate with Anthony Harper.
Olivia Lund suggests one way to punish the worst offenders, and to prevent them escaping penalties by resuming operations under a new name, is for WorkSafe to lay charges against business owners as officers. Agree? Write a brief comment here and go in the draw to win a prize!