Who is liable if there is a breach of health and safety? A new case gives us some insights.
A former Port of Auckland CEO was found guilty for breaching his duties as an officer under the Health and Safety at Work Act 2015 (the “Act”). It is an important reminder that all officers have critical roles to play in health and safety – even if they are operating at some distance from ‘where the work is done’.
The former CEO, Mr Gibson, was found guilty as an officer of failing to exercise due diligence under section 44 of the Act. A port worker died while loading containers on a ship berthed at the port. The judgment found Mr Gibson had exposed the worker to a risk of being struck by objects falling from cranes.
In this situation, the port was first found guilty and required to pay a fine of $561,000.
Why is this newsworthy?
We are more used to hearing about directors and / or entities being charged with health and safety at work breaches. This situation is about an officer being found in breach.
Under the Act, any person that has ‘significant influence over a Person Conducting a Business or Undertaking’ (“PCBU”) may be an ‘officer’ and subject to officer duties and liable for any breaches of these.
It is a little confusing as to why the Board itself was not also held liable.
What does due diligence mean?
The Act (Section 44) requires officers to exercise care, diligence and skills to ensure the PCBU (in this case the port) complies with its duty. The Act says that due diligence includes taking ‘reasonable steps’, as set out in column A of the table below. Note the use of the word ‘and’ at the end of each point – officer due diligence includes all of the matters.
Failure to exercise due diligence is a strict liability offence – an officer need not have acted recklessly or intentionally to be found in breach of the requirement.
In this situation, the Court noted, among other things, that the CEO had been put on notice regarding insufficient monitoring of ‘work as done’ in a report from KPMG and had not taken action to implement its recommendations.
The Court also noted that the CEO should have known there were shortcomings around the management of exclusion zones and should have addressed these in a timely manner.
What can officers do to help ensure they are exercising due diligence?
In column B we provide some suggestions for how an officer might exercise due diligence, including useful questions for officers to ask.
We do not suggest relying on this or any other industry guides – what due diligence constitutes is specific to the circumstances and the nature of the work. The court may consider industry standards and guidelines when determining if an officer has exercised due diligence, but this is not determinative.
| Column A | Column B |
| (a) to acquire, and keep up to date, knowledge of work health and safety matters; and |
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| (b) to gain an understanding of the nature of the operations of the business or undertaking of the PCBU and generally of the hazards and risks associated with those operations; and |
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| (c) to ensure that the PCBU has available for use, and uses, appropriate resources and processes to eliminate or minimise risks to health and safety from work carried out as part of the conduct of the business or undertaking; and
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| (d) to ensure that the PCBU has appropriate processes for receiving and considering information regarding incidents, hazards, and risks and for responding in a timely way to that information; and
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| (e) to ensure that the PCBU has, and implements, processes for complying with any duty or obligation of the PCBU under this Act; and
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| (f) to verify the provision and use of the resources and processes referred to in paragraphs (c) to (e).
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What else can officers do in terms of health and safety?
Leaders set the tone from the top. When leaders demonstrate visible leadership in health and safety, it shows that it is an important part of the organisation’s culture.
Visible leadership includes more than just making and following rules. It means taking a genuine interest in how health and safety is managed and understanding and acting to remove any barriers to a safety culture. Officers should ask to visit the relevant PCBU and to speak to workers, to ask workers what is working well and what could be improved when it comes to safety.
They should also act in a timely manner to address any shortcomings in health and safety.
Resources
There are many resources available to help officers at all levels with health and safety governance, such as:
Institute of Directors Health and Safety Governance: A Good Practice Guide: https://www.iod.org.nz/resources-and-insights/guides-and-resources/health-and-safety-a-good-practice-guide#
Parry Field Lawyers Charities Healthcheck Part 3 People: https://www.parryfield.com/wp-content/uploads/2024/06/Part-3_People_Charities-Healthcheck_PF.pdf
Worksafe – Health and safety leadership guide: for owners and company directors of small to medium businesses: https://www.worksafe.govt.nz/managing-health-and-safety/businesses/guidance-for-business-leaders/
This article is intended for general informational purposes only and does not constitute legal advice. For advice specific to your situation, please contact a qualified legal professional. Reproduction is permitted with prior approval and credit to the source.
