The case of McKie v Munir Al-Hasani & Kenoss Contractors Pty Ltd  ACTIC 1 related to a fatal safety incident on 23 March 2012. Specifically, a delivery driver retained by Kenoss Contractors Pty Ltd (Kenoss) was electrocuted and died when the bucket of his truck came into contact with low hanging electrical wires at a site managed by Kenoss as part of the “Barry Drive project”.
Proceedings were brought under the ACT’s Work Health and Safety Act 2011 (WHS Act) against Kenoss as well as Kenoss’ project manager, Munir Al-Hasani, personally under section 27, and both parties were charged with a category 2 offence (ie. a failure to comply with a health and safety duty). The maximum fines for such offenses are $1.5M for corporate entities and $300K for individuals.
Section 27 of the WHS Act (which is based on the national model legislation) establishes the duty of an officer. In particular, section 27 provides that where a person conducting a business or undertaking (PCBU) has a duty or obligation under the WHS Act, an officer of the PCBU must exercise due diligence to ensure that the PCBU complies with that duty or obligation. Whether a person is an “officer” of a corporation for the purposes of the WHS Act requires proof of that circumstance beyond reasonable doubt.
In determining whether Mr Al-Hasani was an officer of Kenoss, the Industrial Court turned to section 9 of the Corporations Act 2001. In addition to obvious officers such as directors and liquidators, the definition extends to a person:
- Who makes, or participates in making, decisions that affect the whole, or a substantial part, of the business of the corporation; or
- Who has the capacity to affect significantly the corporation’s financial standing; or
- In accordance with whose instructions or wishes the directors of the corporation are accustomed to act (excluding advice given by the person in the proper performance of functions attaching to the person’s professional capacity or their business relationship with the directors or the corporation).
In the present case, an organisational chart in respect of the Barry Drive project was provided to the Court which showed that Mr Al-Hasani sat at the head as project manager. Further evidence was led to show that Mr Al-Hasani participated in management meetings, that he briefed, managed and supervised the performance of the project team, and that he would often make significant decisions affecting the company alone or in conjunction with the directors of Kenoss.
However, Mr Al-Hasani’s evidence was that one of Kenoss’ directors was “El Supremo” and that he had no power to even buy a glass of water without higher approval. Whilst Mr Al-Hasani conceded that he participated in decision-making, there was no evidence of him having a broader level of influence within Kenoss beyond the projects he worked on. Consequently, the Court was not satisfied beyond reasonable doubt that Mr Al-Hasani’s role rose to the level of an officer within Kenoss. Because the charge against Mr Al-Hasani directly related to him being an officer, the proceedings against him were dismissed.
This decision is an important one for employers insofar as it shows that the Court will take a practical, organisational view as to the definition of an officer for the purposes of the WHS Act (relevant to states where the model legislation has been adopted). Employers should review their own structure and consider whom within it would likely meet the definition of an officer for the purposes of the WHS Act and see that they are trained accordingly to avoid a substantial penalty.
Please contact a member of Lynch Meyer’s workplace relations team if you require advice about your duties under the WHS Act.