Our German Desk
At 146 pages, and 504 paragraphs, the recent Maritime NZ v Tony Gibson judgment is certainly not short on detail.[1] This is unsurprising given the complex factual matrix and landmark nature of this case. In this article, we traverse the findings of Judge Bonnar KC and highlight some key takeaways from the decision.
What Happened
In 2020, an incident took place at the Ports of Auckland where, tragically, Mr Pala’amo Kalati was killed. Mr Kalati was a lasher at Ports of Auckland Limited (POAL), responsible for securing and lashing containers loaded onto ships. He was tragically struck by a container being loaded onto a ship by one of POAL’s cranes on one of his night shifts.
Subsequently, Maritime New Zealand (MNZ) charged POAL, as a person conducting a business or undertaking (PCBU), with two offences under s 48(1) of the Health and Safety at Work Act 2015 (HSWA). Section 48(1) provides that it is an offence where a duty holder breaches their duty, and that breach exposes any individual to a risk of serious injury or death. POAL pleaded guilty to these charges.
Former POAL Chief Executive Officer, Tony Gibson, was also charged under s 48(1) of HSWA. MNZ alleged that Mr Gibson had breached his officer duties under s 44 of HSWA, exposing POAL’s stevedores to a risk of death or serious injury. Section 44 imposes a duty on officers of a PCBU to exercise due diligence to ensure that the PCBU complies with its obligations under the HSWA. MNZ asserted that Mr Gibson had failed to meet his due diligence duties in two ways:
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Mr Gibson failed to take reasonable steps to ensure that appropriate resources were available and used to eliminate or minimise two risks. These risks were:
- The risks arising from operating cranes due to a lack of clearly documented and effectively implemented exclusion zones (Particular 1(a)); and
- The risk of miscoordination between crane operators and lashers because there was no effective or appropriate process to facilitate their coordination (Particular 1(b)).
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Mr Gibson did not take reasonable steps to ensure that health and safety resources were provided, and health and safety processes were followed (Particular 2).
The Decision
Ultimately, Mr Gibson was convicted under s 48(1) of the HSWA. The Judge was satisfied, beyond reasonable doubt, that Mr Gibson had committed the breaches outlined in Particulars 1(a) and 2. However, the Judge was not satisfied beyond a reasonable doubt that Mr Gibson was guilty of Particular 1(b) of the charge.
Particular 1(a)
The finding that Mr Gibson was guilty of the offending described in Particular 1(a) turned on the inadequacy of the control measures POAL had in place to manage the risk posed by operating cranes. POAL and Mr Gibson were aware of the risk of being struck by a crane’s load. However, Mr Gibson did not exercise due diligence by taking reasonable steps to ensure that POAL eliminated or minimised this risk. POAL’s primary control was a behavioural control called the “three container width rule”. This rule aimed to keep workers clear of operating cranes by requiring them to remain at least three containers away. However, the evidence was that this rule was poorly implemented. POAL’s documentation was confusing and inconsistent, and workers had a varied understanding of the rule. Mr Gibson became aware that physical controls were required to keep workers out of exclusion zones. POAL explored GPS and laser geofencing but decided that this technology was too undeveloped. The Judge noted simpler physical controls such as barriers could have been implemented, but that Mr Gibson had not turned his mind to these options. The Judge concluded that a reasonable CEO, in the circumstances, would have recognised the shortfalls in POAL’s exclusion zones and taken action to address them.
Particular 1(b)
Particular 1(b) related to the decision to have ship leading hands assume the responsibilities of lasher leading hands, when POAL was operating under COVID-19 restrictions. As noted above, Mr Gibson was not found guilty in respect of this Particular. Much of the reasoning is specific to the COVID-19 pandemic and POAL’s response to it. Given the limited applicability of Particular 1(b) going forward, we will not address this point any further in this article.
Particular 2
The key failing that led to Mr Gibson’s guilt in respect of Particular 2 was that POAL’s systems failed to identify and respond to work as done rather than work as planned. This was caused by ineffective monitoring of workers. To clarify, ‘work as done’ “is the reality of work as it is actually carried out by the workers on the ‘shop floor’” (at [324]). Essentially, this means, irrespective of policy or procedure, how, in practice, an organisation conducts its operations. ‘Work as planned’ or as it may be referred ‘work as imagined or intended’ refers to the methods of work “designed, understood or expected” by management and staff who do not undertake the work themselves (again at [324]).
Mr Gibson was aware that work at the Port was not being effectively monitored for health and safety compliance. Despite this knowledge, this shortcoming was not addressed. Implementation of a KPMG audit recommending that specific responsibilities be assigned to executives was delayed. A proposed change in team structure, which would have assigned expert coaches to specific groups of stevedores, enabling better monitoring, was abandoned. Finally, the Health and Safety Steering Committee, chaired by Mr Gibson, did not compare POAL’s health and safety performance against its policies and procedures. This meant the Committee could not confirm if workers were following the rules. Mr Gibson was able to control what POAL did in these areas. However, he failed to intervene, and monitoring remained ineffective.
Mr Gibson’s failure to ensure that work at the Port was effectively monitored meant that POAL was unable to determine whether health and safety procedures were being followed. Accordingly, dangerous practices such as corner cutting on night shifts were never addressed. This exposed POAL’s stevedores to the risk of death or serious injury. Accordingly, the Judge found that Mr Gibson had not taken reasonable steps to ensure that POAL’s safety procedures were followed.
Our Comment
Those persons who hold significant influence over the management over PCBUs, such as a CEO or other senior leader, should take this decision seriously.
The Judgment notes that Mr Gibson was a dedicated leader with good intentions. However, the issue in the case was not whether Mr Gibson was a good leader but whether he failed to discharge his duty of due diligence. This is a reminder that the HSWA sets a high standard for officers. As noted by Judge Bonnar KC (at [55]),
“a practical tension exists… between the purpose of the [HSWA] legislation, which is to sheet home the due diligence duty to those at the apex of large hierarchical organisations and the fact that officers in such organisations will be, by virtue of the nature of their role and the size of such organisations, removed from day-to-day implementation of business systems, processes and health and safety standards”.
Despite the inherent difficulty for officers of large organisations to have ‘hands on’ involvement in all health and safety matters, the HSWA is capable of imposing heavy sanctions on those officers who get it wrong. Mr Gibson now has a criminal conviction, which he can (and may) appeal. However, if the conviction stands Mr Gibson may face a fine of up to $300,000 (he is currently awaiting sentencing). This is a stark reminder that being separated from the ‘shop floor’ does not allow officers to disregard their health and safety responsibilities.
If you need advice about a health and safety matter, including due diligence obligations for officers, please contact our Employment Team or your usual contact at Hesketh Henry.
Jim and Mary gratefully acknowledge Luke Gordon (summer clerk) as co-author of this article.
Disclaimer: The information contained in this article is current at the date of publishing and is of a general nature. It should be used as a guide only and not as a substitute for obtaining legal advice. Specific legal advice should be sought where required.
[1] Maritime New Zealand v Gibson [2024] NZDC 27975.
