NSW Sees First Category 1 WHS Prosecution

The Work Health and Safety Act 2011 (NSW) was first introduced in 2011, replacing and repealing the previous Occupational Health and Safety Act 2000. Its stated goal is to further advance the health and safety of everybody in the workplace and enforce strict penalties for companies or persons in breach of its rules and regulations.

It primarily aims to lay out a framework for companies to ensure their workers (and anybody else for that matter) are working in the safest environment possible. Additionally, it encourages continued review and assessment of any risks in the workplace by all parties involved.

Furthermore, the act defines a number of different offences and penalties for non-compliance, depending on the severity of the breach and the extent of the damage caused.

Offences and Penalties

Under the act, a company may be prosecuted in one of three different categories depending on the amount of negligence and the resulting consequences of the incident that took place.

The most basic level of offence is Category 3. In this category the company has shown a failure to maintain or comply with health and safety standards — however, it’s unlikely, but not impossible, any injury or incident has yet arisen from the breach. Companies found to be in breach at this level are subject to a maximum penalty of $500,000.

The next level of offence is Category 2. Companies prosecuted under this category have exposed a person under their charge or employment to the risk of serious injury or death. As with Category 3 offences, there is no requirement for injury or death to have actually occurred; all a company needs to do is expose somebody to the potential for injury or death. Companies successfully prosecuted under this category can expect penalties ranging up to $1,500,000.

The final, and most severe, category of offence is Category 1. For a company to be prosecuted under this category they must have committed a similar offence to Category 2, however with the added component of showing recklessness in their duties of care. The maximum potential fine for an offence under this category is $3,000,000.

The First Category 1 WHS Prosecution

2018 has seen the first successful prosecution of a company under a Category 1 offence, exposure to injury or death while showing recklessness in their regard for safety practices mandated by the WHS.

The case in question — Stephen James Orr v Cudal Lime Products Pty Ltd; Stephen James Orr v Simon Shannon [2018] NSWDC 27 — centred around a mining company, Cudal Lime Products Pty Ltd, and tragic death of the de facto partner of one of their workers.

The worker and their partner lived in a cottage adjacent to the limestone quarry operated by CLP. Electricity was supplied to both the mine and the cottage by the same system, operated and maintained by CLP. The partner was fatally electrocuted when they made contact with the metal fixtures of the shower in the cottage’s bathroom.

Due to a fault in the low voltage power systems the mine used to transfer power to the cottage, the fixtures were conducting a fatal supply of electricity. It was assessed that the fatal fault was the result of a series of failures building up over years in the mine’s system.

The ruling Judge, Judge Scotting, found CLP to be reckless under the WHS legislation, primarily due to the fitting of a new switchboard in the cottages supply line by an unqualified electrician, at CLP’s instruction.

It was ruled that a number of steps could have prevented the incident occurring, for example employing a qualified electrician to install the new switchboard, installing interrupt switches that could detect a fault and isolate the power supply, and ensuring the cable was properly grounded and insulated with an earth-neutral link and free from damage.


Under the WHS, a Category 1 offence can see a company receiving a fine of up to $3,000,000. Judge Scotting examined a number of factors in making his sentencing decision. When making the determination he looked at the deterrence value of the penalty (to discourage others from similar reckless action), the ability of CLP to pay, additional aggravating factors such as the impact of the fatality, and any mitigating factors e.g. a clean conviction record, charitable work, remorse, and steps taken to mitigate future issues.

A fine of $1,500,000 was deemed to be appropriate after considering the above factors, however, this was reduced by 25% due to CLP pleading guilty. The final fine imposed was $900,000.

When hiring contractors, it’s still the company’s responsibility to ensure that they are qualified to perform the work, utilising appropriate safe systems of work, and not endangering themselves or others while performing their tasks. ConserveTM can aid your company in ensuring that contractors engaged at your sites are properly insured, qualified and licensed, work with the required safe systems of work and are properly inducted on site thus mitigating the risks to health and safety and ultimately the risk of prosecution.

Contact ConserveTM today to learn more about how we can help keep your workers safe.

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