In a landmark decision, the Port of Auckland’s former CEO has been found guilty in relation to the death of a worker – due to the CEO’s breach of duties under the Health and Safety Act 2015.
It’s the first time the CEO of a large company has been charged individually under the Act (HSWA) for a breach of health and safety duties.
The case clarifies that the Port’s liability did not automatically assume its officer’s liability. Instead, the former CEO’s liability arose from his own conduct within the role.
The detail
The Ports of Auckland (POAL) worker – a 31-year-old father of seven – was killed in a tragic accident after being crushed by a falling container while on night shift. He was instructed to work in an area within an exclusion zone where a crane was being operated by the site’s leading hand.
Maritime NZ, as the relevant health and safety regulator, charged both POAL as a PCBU and its now ex-CEO as an officer.
The former CEO was employed for 10 years until June 2021. He was charged with two charges under sections 48(1) and 49(1) HSWA, which both alleged that he failed to comply with the duty to exercise due diligence as an officer to ensure that POAL complied with its duties under the HSWA.
The section 48 HSWA charge is the greater charge because it connects the due diligence obligation with the exposure of a worker to death or serious injury.
The finding
The Auckland District Court held that the former CEO was guilty on the charge laid under section 48 HSWA.
The Court found the ex-CEO failed to exercise due diligence in ensuring that POAL complied with its primary duty of care – to ensure, as was reasonably practicable, the health and safety of its workers. This failure exposed workers to risk of death or serious injury.
In establishing the former CEO’s liability, the specific facts of the case were fundamental to the decision, for example:
- Unsafe practices were entrenched, particularly on night shift.
- POAL had been alerted to these unsafe practices, and it was the responsibility of POAL officers, including the ex-CEO, to ensure they had adequate systems in place.
- POAL’s training and policy in relation to the exclusion zone surrounding cranes were confusing and inconsistent.
- The risks involved in handing suspended loads were well recognised within the industry.
- The former CEO was ultimately responsible for health and safety at POAL. He was a “hands on” CEO.
- Issues within the health and safety systems had been highlighted by audit reports. POAL’s management had accepted the recommendations but they were not advanced in a timely manner. The ex-CEO was aware of these recommendations and the judge found it was his duty as CEO at the time to ensure that POAL did progress these matters in a timely matter.
- He failed to ensure that POAL’s Health and Safety Steering Committee was adequately performing its functions.
- He was on notice for POAL’s difficulties in adequate monitoring for a previous incident.
The District Court ultimately found that:
“A reasonable CEO, with Mr Gibson’s knowledge and experience and in his circumstances, would have recognised the shortfalls in POAL’s management of exclusion zones around cranes working over ships and would have ensured that POAL utilised appropriate resources and resources to address those shortfalls.”[1]
Judge Bonnar was satisfied beyond reasonable doubt that the former CEO failed to exercise the care, diligence, and skill that a reasonable officer would have exercised in the same circumstances.
The law that he was prosecuted under derives from policy implemented after the Pike River tragedy which ensured that officers of large companies take responsibility for the health and safety of their workers.
Maritime NZ director Kirstie Hewlett says, “We hope this result provides useful case law and clarification around the obligations and helps prevent future tragedies.”
Our take
This case serves as a warning to officers of all companies of their significant personal liability under the HSWA, in ensuring that their PCBU provides for health and safety in the workplace.
Officers should not simply rely on health and safety personnel in their organisations for health and safety purposes. Instead, they should regularly monitor, review, and audit systems to ensure proper due diligence is achieved by the PCBU.
While an officer can –and should – delegate measures to health and safety personnel, complete responsibility is not transferred.
The former CEO still has the potential to appeal the decision. The maximum penalty that he may face is a fine of $300,000.
- Please contact our Employment Law team if you would like to discuss this case further or understand how it may impact your or your business.
Author: Jane Tingey
[1] MARITIME NEW ZEALAND v ANTHONY MICHAEL GIBSON [2024] NZDC 27975 [25 November 2024] at [427].
