Company fined $3 million in Australia’s first industrial manslaughter conviction

Brisbane Auto Recycling (the Company) has become Australia’s first company to be convicted of industrial manslaughter under Queensland’s new Work Health and Safety (WHS) industrial manslaughter laws.

The Company purchased used motor vehicles for resale, recycling and parts. Its two directors, Mr Asadulla Hussaini and Mr Mohammad Ali Jan Karimi (the Directors), who both supervised the workplace, were handed 10 month suspended jail terms over their involvement in a worker’s death.

The Company was also fined $3 million for industrial manslaughter under provisions of the Queensland Work Health and Safety Act. Queensland District Court Judge Anthony Rafter noted that the Company did not have the capacity to pay such a large fine, but went on to say:

“That does not preclude the imposition of an appropriate fine in the circumstances,” observing that anything less “would not adequately punish [the Company] or serve to adequately deter others”.

Queensland’s industrial manslaughter legislation is designed to punish companies and senior management whose conduct grossly falls below the standard required and which warrants criminal punishment. Under the new legislation, the maximum penalty which may be imposed against a company is $10 million, while the maximum penalty for an individual is $600,000 or five years’ imprisonment.

The Accident

The worker was loading tyres at the Company’s site at Rocklea in May 2019 when he was unfortunately crushed between a reversing forklift and a truck. The worker later died as a result of the serious injuries sustained.

Despite the incident being captured on several CCTV cameras, the Court heard that the Directors told ambulance responders and the deceased worker’s daughter that the worker had fallen off the back of a truck and that the accident may have been his own fault. Judge Rafter criticised the Directors’ “disgraceful behaviour” as a desperate attempt to “deflect responsibility”.

The Directors were aware of risks

The Court heard that the Company had no safety systems in place at the time of the incident — instead, workers were verbally told to “look after themselves“.

“The defendants knew of the potential consequences of the risk, which were catastrophic… The cost of implementing such measures was quite modest… They knew of the risk to the safety of their workers, but consciously disregarded that risk,” Judge Rafter said.

The Judgement

The Company was charged with industrial manslaughter contrary to s 34C of the Work Health and Safety Act 2011 (Qld) (Act). The Directors were also charged with the category 1 offence contrary to s 31 of the Act for failing to comply with their duty, as an officer of the Company, under s 27 to ensure that the Company complied with its work health and safety duty under s 19(1). The Company and the Directors pleaded guilty to the charges.

The District Court of Queensland found that the gravity of the offence and the moral culpability of each defendant was high, taking into account that:

• there were no safety systems in place;
• the Directors knew of the potential consequences of the risk posed by mobile plant operating near pedestrians;
• steps to lessen, minimise or remove the risk posed by mobile plant was available – which were neither complex nor overly burdensome;
• there were no real attempts to assess or control the risks posed by mobile plant;
• the offending conduct of the directors was not a momentary or isolated breach. By contrast, the business had grown in size, in terms of employees, turnover and the presence of mobile plant, to the point where the conduct of the Directors, in not taking steps to ensure the risk posed to workers was controlled, amounted to recklessness;
• the lengthy period of time over which many workers were placed at risk was relevant to an assessment of the criminality of the Company; and
• the imputed conduct of the Directors led to the death of the worker, as did the conduct of the forklift driver, which flowed from the prolonged failures.

The Court concluded that the reckless conduct of the Company caused the death of the worker, because it failed to control the interaction of mobile plant and workers at the workplace, to effectively separate pedestrian workers and mobile plant, and to effectively supervise operators of moving plant and workers. The Court held that the Directors were reckless as to the risk to workers and members of the public who had access to the workplace and failed to ensure that the Company complied with its duty.

The Court noted that the Directors engaged in conduct that was designed to deflect responsibility for the incident by deliberately naming someone else as the forklift driver and proposing a different version of the incident that placed responsibility for it on the deceased worker.

Nevertheless, the Court also considered a number of mitigating factors, among other things the Directors’ ages and prospect of deportation.

The Court considered the gravity of the offence to be high and the Company was convicted and fined $3 million out of a potential maximum of $10 million. The Directors were both convicted and sentenced to 10 months imprisonment but, having regard to the significant mitigating factors, the whole of the term of imprisonment was suspended for an operational period of 20 months.

The takeaway for employers

This is a significant industrial manslaughter conviction as it sets an expectation for penalty levels under these new laws. Currently, a separate offence for industrial manslaughter exists in a number of jurisdictions including the ACT, Northern Territory, Queensland and Victoria. New South Wales has determined not to implement a separate offence at this stage.

This decision serves as a timely reminder that individuals will be prosecuted for workplace health and safety breaches, especially those that cause the serious injury or death of workers. As such, directors must ensure that the safety of workers is their number one priority, having well drafted policies, procedures and training in place to reflect this.

If you require any advice or assistance to ensure your firm is implementing effective and compliant workplace safety policies, procedures or training please contact Nick Stevens, Jane Murray or Bernard Cheng.