Mining prosecutions - the Queensland experience

Every company aspires to an impeccable safety standard, but the unfortunate reality is that there will be accidents which result in serious injury or death. There is an enormous impact on any workplace when this happens, not only from the personal point of view of the victims, but also their families and colleagues. There is the adverse publicity the accident generates as well as the close attention from those who enforce safety standards. Close scrutiny often crystallises breakdowns in procedure, in particular training practices, which accordingly amount to prosecutions.

Since the commencement of the Queensland Mining and Quarrying Health and Safety Act (MQHSA) in 2001, there have been six deaths in the state's mining industry. Three prosecutions have been completed and two are pending. The sixth and most recent involved an employee being pinned under a tyre assembly when he was changing a wheel. A coronial inquiry is yet to take place. The completed prosecutions were all pleas of guilty. As there is yet to be a defended prosecution, the sentencing boundaries are unknown.

Where is a business facing prosecution to look for guidance? It may be possible to draw a comparison with Workplace Health and Safety Act (WHSA) prosecutions. There are similar penalties and there has been a far greater volume of prosecutions (even discounting those with an early plea in mitigation). Under that Act, a maximum penalty includes the potential for a prison term. While these provisions have not yet been used, there is little comfort for directors or senior site executives. The new ceilings are not truly reflected in increased penalties at this time.

Recent decisions for prosecutions arising from the Workplace Health and Safety Act have been in the vicinity of $37,500 to $40,000. In Robert William Watson v Chevron Construction Company, President Hall discussed the concept of the general range of penalties when this matter came before him on Appeal. He stated that he was unpersuaded to alter the penalty from the first instance from $37,500 when "involving a first offender of modest means and an otherwise good safety record, would not ordinarily attract a fine at the top of the suggested 'general range'. I am not prepared to say that an Industrial magistrate who had the advantage of the trial and the full flavour of the evidence was "plainly unreasonable or unjust" in settling on a mid range figure."

President Hall in Short v Lockshire (2000) 165 QGIG 521 indicated that the general range of penalties is between 8 and 25 per cent of the maximum penalty. Is it reasonable to expect these principles to apply under the MQHSA? We are yet to obtain enough decisions under this Act to confirm whether this will be the case. If the WHSA general penalty range was followed then we could expect penalties of $24,000 to $75,000 for those prosecuted under the new mining legislation.

As with the WHS Act 1995, the initial prosecutions under the MQHSA have to date produced only relatively minor fines. The maximum was $25,000 to the company and $2,500 to each of the directors, after the death of a seven-year-old boy at the Mount Hay Tourist Mine in July 2002. In the last 12 months there have been two coronial inquiries as a result of other mining-related deaths.

It would be fair to say that a defended prosecution will result in a test case in which the benefits of an early plea become more of an incentive, considering the test is one of almost strict liability.

The potential penalties under the MQHSA include a maximum fine of $300,000 for a company if the contravention of its obligation causes death or grievous bodily harm. A director or senior site executive can be held liable for a breach similarly and be sentenced to a maximum of two years' imprisonment. Similar penalties to those in the MQHSA are contained in the Workplace Health and Safety Act. Section 24 of the WHSA imposes a maximum penalty of $375,000 for a company or two years' imprisonment for a failure to discharge a workplace health and safety obligation which causes death or grievous bodily harm.

Queensland is fortunate. The state is still yet to see penalties like those in NSW. Its Workplace Health and Safety Act imposes a maximum penalty of $825,000 for a breach which results in serious injury or death (if there are prior convictions, or $550,000 if it is a first offence).

In a recent decision in NSW a prosecutor successfully appealed the penalty imposed on a workplace after a fatality. The penalty of $65,000 was imposed after applying a 35 per cent discount in mitigation (due to an early plea). On appeal to the Full Bench, the penalty was found to be inadequate and a fine of $155,000 was imposed. In Department of Mineral Resources (Chief Inspector McKensey) v Berrima Coal Pty Ltd 2001 a fine of $91,000 was imposed; it was noted that the offence was a serious one and there was a general need for deterrence.

Certainly in the principles of sentencing there is a need for general deterrence. There should always be a transparent benefit for those who do enter an early plea. The MQHSA offers non delegable responsibilities and there are limited defences available for those who fall foul of their obligations.

What impact will this legislation have on the mining industry? Are we likely to see similarities with the Workplace Heath and Safety Act or will prosecutors be pushing to set higher penalties? While it is anticipated that penalties are comparable to the WHS Act 1995, it is also anticipated that in this new era of accountability there will be a sharp upward movement, although application of sentencing principles will prevent this from happening for the time being.