The Ports of Auckland

On 26 November 2024, Tony Gibson (the former Chief Executive of the Ports of Auckland (POAL)) was found guilty of exposing workers to a serious risk of death or injury in breach of his due diligence duties as an officer under the Health and Safety at Work Act 2015 (HSWA) [1].

This outcome is significant as it is the first successful prosecution of an officer of a large complex organisation under the HSWA. Prior prosecutions against officers have tended to involve small closely held companies or similar organisations, where the officers in question were much closer to the day-to-day operation of the business or undertaking. The only exception to this is the unsuccessful prosecution of the directors of Whakaari Management Limited in 2023 following the Whakaari White Island eruption [2].

The prosecution of Mr Gibson stems from a 2020 incident in which a stevedore was killed by a container falling from a crane. Mr Gibson was charged with failing to exercise the care, diligence, and skill that a reasonable officer would exercise in the same circumstances to ensure that POAL complied with its statutory duty to ensure the safety of its stevedores. The particulars of the charges alleged that Mr Gibson had failed to take reasonable steps to:

• ensure that POAL had available for use, and used, clearly documented, effectively implemented, and appropriate exclusion zones around cranes; 
• ensure that POAL had available for use, and used, clearly documented, effectively implemented, and appropriate processes for ensuring coordination between lashers and crane operators; and 
• verify the provision and use of the resources and processes described above.

Mr Gibson was found guilty in relation to the first and third particulars but not guilty in relation to the second particular. In reaching its decision, the court summarised several general principles that relate to the assessment of an officer’s exercise of due diligence, including:

• Whether an officer has exercised due diligence must, necessarily, be fact and circumstance dependent.
• The due diligence duty applies to all officers across all PCBUs, large and small, with both flat and hierarchical structures. An officer operating at the head of a large, hierarchical organisation does not mean that the officer’s obligations are diminished.
• A breach of duty by a PCBU does not imply an officer’s failure to exercise due diligence. Equally, failure to exercise due diligence is a strict liability offence, meaning an officer does not need to act intentionally or even recklessly to be found in breach.
• An officer in a large organisation does not need to be involved in day-to-day operations in a hands-on way but cannot simply rely upon others within the organisation either. An officer must personally acquire and maintain sufficient knowledge to reasonably satisfy themselves that the PCBU is complying with its duties under the HSWA. In this regard, an officer must:
  • ensure that people with assigned health and safety obligations or roles have the necessary skills and experience to properly execute their roles;
  • acquire and maintain sufficient knowledge of the PCBU’s operations and the work actually carried out “on the shop floor” to adequately identify and address actual hazards and risks;
  • ensure entrenched and adequate systemic processes are put in place to ensure the PCBU complies with its duties (which is described as key in large organisations);
  • ensure there are effective reporting lines and systems for the flow of necessary health and safety information to the officer and others with governance and supervisory functions (again, described as key in large organisations);
  • and engage upon, or arrange, an effective process of monitoring, reviewing and/or auditing of the PCBU’s systems, processes and work practices to ensure they are achieving their purposes and being adhered to (as applicable).
• Industry standards, guidelines, and comparators are relevant to the court’s assessment, but not determinative.

While it is unclear whether Mr Gibson will appeal, this case sets a clear precedent that officers of large, complex organisations can be held liable for breaches of their due diligence obligations, even if they are not directly involved in day-to-day operations. This should give officers of large organisations pause for thought.

As we look ahead to 2025, we consider this decision will influence the approach taken by WorkSafe (and other health and safety regulators) to the enforcement of officer duties under the HSWA. While we do not anticipate any immediate spike in the number of officer prosecutions, we do anticipate:

• A greater level of interest by WorkSafe in officer duty compliance more generally. This may include an increase in proactive engagement with officers in the absence of workplace incidents. We may also see WorkSafe placing a greater emphasis on the use of standards and guidelines to support compliance with officer duties, for example, the new Health and Safety Governance: A Good Practice Guide released by the Institute of Directors in July 2024 [3].
• An increase in the number of investigations into officer duty compliance following workplace incidents, particularly serious harm incidents. As part of this, we may see the general principles from the POAL judgment (summarised above) influencing the shape and scope of WorkSafe’s investigations. For example, we may see a greater focus on issues around assumed knowledge and the degree to which officers appropriately test and challenge the information they receive via health and safety reporting.
• A gradual increase in the number of officer prosecutions under the HSWA, to the extent that this aligns with WorkSafe’s new prosecution strategy.

WorkSafe’s new prosecution strategy

In November 2022, Te Tari Ture o te Karauna | Crown Law was commissioned to undertake a review of WorkSafe’s prosecution function [4]. In August 2024,Crown Law completed its review and issued a report. At a high level, the report concluded that, among other things, there is “a level of confusion and uncertainty as to what WorkSafe’s remit, priorities, and goals are when it comes to enforcement…”. This results in an excessive number of investigations, placing a strain upon the organisation’s resources and negatively impacting the quality and timeliness of investigations. It also requires WorkSafe’s legal team to advise on whether to file charges without adequate information and under time pressure. This reality has been reflected in several recent successfully defended WorkSafe prosecutions [5].

To address these issues, WorkSafe has taken steps to refresh and refocus its prosecution strategy [6]. As we move into 2025 and beyond, WorkSafe has indicated that it will take a more “targeted” approach to investigations and prosecutions in order to “maximise their deterrent effect”. WorkSafe’s refreshed strategy is totarget three specific types of harm:

• Acute harm being any serious injury, illness, or death that arises from a single event.
• Chronic harm being any serious injury, illness, or death, that is caused over time.
• Catastrophic harm being any serious injury, illness, or death, affecting multiple people – usually from a single event.

WorkSafe has identified four industries that are the most susceptible to these types of harm: construction, manufacturing, agriculture, and forestry. This is nothing new. WorkSafe has consistently identified these industries as high-risk, and the new prosecution strategy will continue to focus on these areas.

While the impact of this new prosecution strategy remains to be seen, we expect to see a greater focus on incidents of acute, chronic, and catastrophic harm in 2025.

Footnotes

[1] Maritime New Zealand v Gibson [2024] NZDC 27975
[2] WorkSafe New Zealand v Buttle (No 5) [2023] NZDC 18939
[3] Health and Safety Governance: A Good Practice Guide, Institute of Directors New Zealand, 16 July 2024
[4] Review of WorkSafe’s Prosecution Function, Crown Law, August 2024
[5] WorkSafe New Zealand v Glenbrook Farming & Equipment Hire Limited [2024] NZDC 19871; WorkSafe v Whakaari Management Limited [2023] NZDC 23224; WorkSafe New Zealand v RDAgritech [2024] NZDC 12446 and Maritime New Zealand v Goodhew [2024] NZDC 12301
[6] Where we focus our effort: priority plans 2024–2026, 26 August 2024; and WorkSafe Strategy 2024