First ever court-ordered enforceable undertaking

In yet another instance of a non-financial sanction given under the Health and Safety at Work Act 2015 (HSWA), a court-ordered enforceable undertaking pursuant to s156 of the HSWA has been imposed for the first time in New Zealand, instead of a traditional fine.

A court-ordered enforceable undertaking is one of five non-financial sanctions under the HSWA.  It involves the Court requiring a defendant to give an undertaking that the defendant will complete specified conditions within a timeframe of up to two years.

Background

In April 2018, a student of Otago Polytechnic was using a draw saw to cut a length of timber in a pre-trade carpentry course. The student’s fingers slipped in front of the blade, which partially amputated his middle finger. His finger was later reattached in hospital.

A WorkSafe investigation found that the machine was not adequately guarded and that the Polytechnic’s risk assessment for the saw was inadequate.

Conviction and sentencing

The Polytechnic was convicted for failing to comply with its duty to reasonably ensure the health and safety of other persons is not put at risk, exposing them to a risk of serious injury from exposure to a cutting hazard from inadequate machine guarding.

The Polytechnic was ordered to pay reparations of $15,000 to the student and $3,432.45 in costs to WorkSafe. However, instead of a fine, Judge Phillips ordered a court-ordered enforceable undertaking (COEU) – the first in New Zealand.

Under the COEU, the Polytechnic was required to report to the court every six months over a two-year period, with additional reporting from an independent auditor as to its completion and compliance with the terms of the COEU.  Performing the COEU will involve a minimum spend of $275,000 in relation to health and safety measures and initiatives, including scholarships, awareness campaigns and safety training.

Implications

Noting that this is a “landmark decision”, WorkSafe’s Chief Inspector Steve Kelly stated that the COEU will support higher standards of health and safety at the Polytechnic.

In this instance, the Polytechnic consulted with the wider construction industry to gauge their health and safety requirements and to seek their views on the COEU activities, including the content of the proposed safety training.  Response from the construction industry had been positive and the Polytechnic noted that this was a way for it to “give back to the community”.

Comment (Bradley Alcorn)

This case is another example of the Court’s increasing use of sentencing alternatives (to that of a fine), which are available to it under the HSWA.  Other examples include project orders and training orders.

However, this is not the first time that a defendant has sought a COEU from the Court.  The defendants in WorkSafe New Zealand v Niagara Sawmilling Co Ltd [2019] NZDC 9720 and WorkSafe New Zealand v Discoveries Educare Ltd and Heng Tong Investments Ltd [2019] NZDC 13056 both sought COEU. 

Judge McIlraith in Niagara took the view that a COEU would be likely where the defendant’s culpability was low and where the defendant had no prior health and safety convictions (at least not of a serious nature).  Accordingly, His Honour refused to order a COEU.  Judge EP Paul in Educare held that there was nothing ‘exceptional’ about the circumstances of that case that required a departure from the normal sentencing outcomes and also declined to order a COEU.

In Otago Polytechnic’s case though, Judge KJ Phillips found that there was no reason to read s156 down to the point where there needed to be a low level of culpability, restrict such an option to first time offenders, or require exceptional circumstances.  Instead His Honour noted that s156 requires the Court to consider the principles and purposes of the HSWA, to take account of all relevant factors and culpabilities of the particular case, the suitability and utility of the COEU, and whether, in the Court’s view, the COEU meets the relevant principles and purposes of the HSWA and of general sentencing.

Judge KJ Phillips’ decision is therefore very useful for defendants (and their insurers) as it broadens the Court’s approach to considering and ultimately ordering COEUs.  It also goes some way to redressing the arguably unwarranted restrictions that had previously been applied to the consideration of ordering a COEU.  The expanded use of COEU is a positive step towards encouraging a proactive approach to health and safety compliance. 

Bradley Alcorn is a Senior Associate at Fee Langstone