High Court agrees that HSW Act applied to consultancy
The New Zealand High Court has dismissed the appeal of Safe Business Solutions Limited (SBS) against its conviction for breaching the primary duty of care under the Health and Safety at Work Act 2015 (HSW Act).
The case arose following a workplace accident at a shared premises used by two haulage companies.
SBS, an external health and safety consultant, was hired to assist with safety measures. In its role, SBS identified the need for a traffic flow plan to mitigate safety risks at the site.
However, before the plan could be implemented, a worker was injured when a telescopic handler, a type of forklift/crane, collided with him. SBS had agreed to prepare the traffic flow plan but had not done so at the time of the incident.
WorkSafe New Zealand charged SBS, along with one of the haulage companies, with breaching its duty under the HSW Act.
The haulage company pleaded guilty, but SBS sought to have the charge dismissed. It argued that the HSW Act did not impose a duty on health and safety consultancies, asserting that if Parliament had intended for consultants to be held accountable under the Act, it would have specifically outlined such a duty.
In her ruling, Justice Grau rejected this argument, stating that the HSW Act applies to a wide range of relationships and actors within the workplace, including health and safety consultancies like SBS.
Grau emphasised that SBS had a direct connection with the work of the Person Conducting a Business or Undertaking (PCBU) that engaged it, and therefore, the company fell under the Act's scope.
Furthermore, the Court upheld SBS's conviction, affirming that the duty under section 36(2) of the HSW Act was broad and applied to SBS in this instance.
The Court found that SBS had failed to fulfil its responsibility to prepare the traffic flow plan, which was crucial to minimising risks at the workplace.
Grau further clarified that while the HSW Act imposes broad duties, section 30 of the Act limits these duties to matters within a PCBU's control and influence.
While SBS was not required to control traffic at the site, it had the ability to produce the traffic flow plan, which it failed to do.
Commenting on the ruling, the MinterEllisonRuddWatts said the outcome continues a recent trend of Court decisions rejecting the "work product" / "work activity" distinction, which was previously referenced in the District Court's decision in NEMA v WorkSafe New Zealand.
According to the firm, had this distinction been applied in the SBS case, the company would not have faced liability, as the breach concerned its "work product" (the traffic flow plan) rather than its "work activity" ensuring health and safety on-site).
"In this case, while SBS would not be liable in connection with its 'work product,' the haulage company would be liable as the accident arose in connection with its 'work activity,'" the firm said in an insight.
It further emphasised that the rejection of this distinction highlights the potentially broad application of the primary duty of care and underscores the importance of section 30 of the HSW Act, which ensures that PCBUs are only held accountable for matters within their control and influence.
