High Court decision means fundamental changes to OHS prosecutions in NSW

The High Court of Australia quashed convictions under the OHS Act 1983 (NSW) (1983 Act) in a key decision on the interpretation of NSW's OHS legislation: Kirk v Industrial Relations Commission of NSW [2010] HCA 1.

Although the 1983 Act has been replaced by the OHS Act 2000 (NSW) (current OHS Act), the relevant offence provisions of the 1983 Act have similarly worded equivalents in the current OHS Act. Accordingly, this decision is critical to the way in which prosecutions should now be conducted.

The High Court's decision is likely to fundamentally change the investigation and prosecution of OHS incidents in NSW.

The relevant incident occurred in 2001 on a farm located near Picton, NSW. The owner of the farm, Kirk Group Holdings (KGH), employed Mr Palmer as a farm manager. Palmer was driving a vehicle on the farm, to make a delivery of steel to contractors performing work at the farm. A road linked Palmer's departure point and his intended destination but, for reasons unknown, in mid-journey Palmer took the vehicle off-road, down a steep slope. The vehicle overturned on the slope and Palmer was killed. Mr Kirk was a director of KGH, but did not take an active part in the running of the farm.

KGH was prosecuted for breaching section 15 of the 1983 Act (which is in similar terms to section 8(1) of the Current OHS Act) for failing to ensure the health, safety and welfare at work of its employees and prosecuted under section 16 of the 1983 Act (which is in similar terms to section 8 (2) of the Current OHS Act) for failing to ensure the health and safety of contractors on the farm.

Kirk was prosecuted in his capacity as a director of KGH. The prosecutor relied on section 50(1) of the 1983 Act (which is in similar terms to section 26(1) of the Current OHS Act) which provided that where a corporation breaches the legislation, each director of the corporation, and each person concerned in the management of the corporation, is taken to have contravened the same provision (unless an exception is established).

The proceedings were originally heard in 2004 by what is now known as the Industrial Court of NSW. KGH and Kirk both entered ‘not-guilty’ pleas. The Industrial Court ultimately found that KGH and Kirk were guilty of all charges.

Prior to coming before the High Court, aspects of the prosecutions came before a single judge of the Industrial Court, the Full Bench of the Industrial Court and the NSW Court of Appeal.

The charges against KGH and Kirk essentially repeated the phrasing of sections 15 and 16. The charges did not specify particular acts or omissions by which KGH was said to have failed to comply with its OHS duties. For example, the charges alleged that KGH's systems of work were deficient, but did not specify how those systems were deficient or what KGH should have done to address the alleged deficiency.

The High Court confirmed that:

• an employer's obligation to ensure the health, safety and welfare of employees at work is higher than the standard to take reasonable care at common law; and
• an employer must identify risks to the health, safety and welfare of employees at the workplace and take steps to obviate those risks.

Approach of Industrial Court of NSW

The High Court found that the Industrial Court of NSW's approach failed to distinguish between the content of the employer's duty to identify and address risks present in the workplace and the fact of a breach in a particular case.

The High Court held that it is necessary for the prosecutor in a charge to identify the measures which should have been taken by an employer: “If a risk was or is present, the question is what action on the part of the employer was or is required to address it? The answer to that question is the matter properly the subject of the charge.”

Therefore, it was not enough for the prosecutor to simply prove that there was a risk to the health and safety of employees and others; the prosecutor needed to establish specific acts or omissions that gave rise to that risk. In this case, the particulars of the charge were silent on the alleged measures KGH should have taken to eliminate or control the relevant risk.

The operation of the defence

Under section 53(a) of the 1983 Act, an employer could defend a charge if it could be established that “it was not reasonably practicable for the person to comply with the provision of (the) Act or the regulations the breach of which constituted the offence.” Similar wording is contained in the defence in section 28 of the Current OHS Act.

The High Court found that where an employer relies on section 53(a), it would be necessary for the employer to satisfy the Industrial Court to the civil standard of proof that it was not reasonably practicable to take the measure identified in the charge. The defence did not require an employer “to establish that every possible risk was obviated”.

The High Court found that the charge did not specify a measure KGH was required to take, and therefore KGH could not have known what measure(s) it was required to prove were not reasonably practicable. The failure of the prosecutor to identify a particular measure was contrary to the requirement that adequate particulars of criminal charges need to be provided by a prosecutor so that a defendant can respond. This denied KGH the opportunity to properly put a defence under section 53(a).

The High Court quashed the convictions against KGH and Kirk, and WorkCover was ordered to pay the costs of KGH and Kirk.

What are the implications?

The High Court's decision does not affect the duty owed by employers, which remains strict. However, the High Court's decision will have profound implications for the investigation and prosecution of alleged safety breaches in NSW.

A prosecutor will need to be rigorous in understanding measures to eliminate or control risks, and also to plead their case with much more particularity about the measures it is alleged a defendant should have taken.

As such, employers may notice a change in the way inspectors conduct investigations of OHS incidents. If prosecutions are subsequently commenced, employers may expect to be told with more precision how it is said they have allegedly breached the law. In situations where there are multiple duty holders, the prosecutor may also need to carefully consider which measure was practicable to be taken by which duty holder. All of the above may expand the availability of successful defences.

Key implications for employers:

1. Compliance with OHS duties remains a critical issue for employers in NSW. The High Court's decision does not mean that an employer's duties under the Current OHS Act are any less strict.
2. If your organisation has a prosecution on foot, the prosecutor's charges should be considered carefully in light of this decision.
3. Prosecutors may adopt a different approach to investigations to focus on specific, identified allegations or failings.
4. The onus will now be on the prosecutor to specifically identify what measure it is alleged a defendant should have taken to eliminate/control a risk. Generally speaking, there is likely to be more scope to defend OHS prosecutions in NSW in the future.

© Blake Dawson 2009. Reproduced with permission.
This article was first published in Blake Dawson's Safety Matters on the Blake Dawson Website at www.blakedawson.com.

*Stephen Nettleton, partner Blake Dawson