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When Parliament passed the Health and Safety at Work Act 2015 (‘HASWA’), it provided more extensive penalties for non-compliance, and empowered the Courts to make additional orders when sentencing duty-holders.

In Stumpmaster v WorkSafe New Zealand [2018] NZHC 2020 the High Court has considered the effect of these changes.  The decision reinforces that steps taken to prevent or minimise harm are key.  However, where an incident does occur, duty-holders should respond swiftly and appropriately to any incident, and should make efforts to assist the victim and their family.

Position prior to Stumpmaster

Under the previous legislation, the maximum fine was $250,000.  Under that legislation, the Court therefore established three culpability bands:

  1. Low culpability: up to $50,000;
  2. Medium culpability: $50,000 to $100,000; and
  3. High culpability: $100,000 to $175,000.

Under HASWA, the maximum fine has increased to $1.5 million.  In addition the Court has been empowered to make other orders such as adverse publicity orders.

As a result of these changes, the High Court has reviewed the approach to sentencing under HASWA.

New approach to sentencing

In Stumpmaster, the Court introduced the following four step approach:

  • Assess the amount of reparation;
  • Fix the amount of the fine by reference first to the guideline bands and then having regard to aggravating and mitigating factors;
  • Determine whether further orders under ss 152 to 158 of HASWA are required; and
  • Make an overall assessment of the proportionality and appropriateness of the combined packet of sanctions imposed by the preceding three steps. This includes consideration of the defendant's ability to pay, and whether an increase is needed to reflect the financial capacity of the defendant.

The Court determined that the following culpability bands should now be used:

  • low culpability: up to $250,000;
  • medium culpability: $250,000 to $600,000;
  • high culpability: $600,000 to $1,000,000; and
  • very high culpability: $1,000,000 plus.

These culpability bands have increased significantly. In determining which band applies, the following factors must be considered:

  • The identification of the operative acts or omissions at issue. This will usually involve the clear identification of the “practicable steps” which the Court finds it was reasonable for the offender to have taken in terms of s 22 HASWA.
  • An assessment of the nature and seriousness of the risk of harm occurring as well as the realised risk.
  • The degree of departure from standards prevailing in the relevant industry.
  • The obviousness of the hazard.
  • The availability, cost and effectiveness of the means necessary to avoid the hazard.
  • The current state of knowledge of the risks and of the nature and severity of the harm which could result.
  • The current state of knowledge of the means available to avoid the hazard or mitigate the risk of its occurrence.

The Court also confirmed that, while credit can be given for the steps a duty-holder takes after an incident, this did not automatically follow.  In particular, the Court distinguished between “going the extra mile”, and merely correcting deficits that should never have existed in the first place.  It commented that the efforts of a duty-holder to assist a victim from the outset were particularly significant.

Key Lessons

It remains the case that the prevention is better than cure.  In other words, the best approach to health and safety is to ensure that you have an appropriate and carefully considered Health and Safety policy.  Firstly, that will minimise the risk of harm to employees.  Secondly, if an incident does occur, the Courts will look favourably on duty-holders that take a proactive approach to their obligations.

Finally, the Court will also consider what steps a duty-holder takes after an incident occurs.  There is much to be said for taking a victim-centred approach, and making sure that they are properly looked after.  As the Court observed, these are “times of greater stress and uncertainty for the victim and family.”  The Court will look favourably on duty-holders who acknowledge this and take appropriate steps.

To discuss either your health and safety plan, or to seek advice following an incident, please contact one of our team.

Daniel WeatherleySenior Associate

Bailey McIntosh, Solicitor