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Perspective

The myths of contractors shedding liability unravels again

Can principal contractors be just as liable as contractors? Of course they can! Even if the contractors are undertaking specialised work that the principal contractor has no knowledge in.

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The case of SafeWork NSW v HD Projects Pty Ltd [2021] NSWDC 126 (16 April 2020) establishes that there are minimum safety obligations that principal contractors must discharge in order to devolve liability.

In this case, HD Projects Pty Ltd (HD Projects) had engaged a specialist crane company, All Cranes 4 Hire Pty Ltd (All Cranes), to move some wall panels. This was a highly specialised task and required experienced workers to implement due to the high risk of injury. In the process of attaching the crane to the wall panels, the labour-hire worker who was not skilled, engaged by HD Projects, incorrectly inserted tines of pallet hook under the second panel instead of under the bottom panel. The broke through plastic wrapping and falling on workers below as the crane driver slewed the panel above them. The 76kg wall panel falling on two scaffolding workers resulting in shoulder, knee and cheek injuries. Under the SWMS the All Cranes had to ensure the path of the crane was cleared of people. It didn’t.

In December 2020, All Cranes was fined $200k for the incident. Although the Court found the contractor “slightly more culpable” since they were “in the best position to prevent an unqualified person from becoming involved in the cranage work” it did not absolve HD Projects of any liability.

In particular, the Court found that there were identifiable breaches of HD Projects’ safety obligations, in particular, its obligations to the supervision of the labour-hire workers and ensure compliance with the SWMS, and as a result, had breached sections 19 and 32 of the Work Health and Safety Act 2011 (NSW). This was established because:

  • The labour-hire worker had been witnessed and supervised by HD Projects completing the task incorrectly for 2 hours before the incident occurred and no one from HD Projects had stopped the worker;
  • HD Projects had completed an SWMS which counted for risks of falling loads of scaffolds, including noting exclusion zone, traffic management controls, and only using qualified dogmen; and
  • Although an SWMS had been completed, none of the safety measures identified by the SWMS were put in place and they failed to check that the safety measures were established.

HD Projects was fined $170,000, a costly lesson to learn to follow your SWMS.

Key Lessons for employers

  • Make sure SWMS accounts for all safety risks. As Head Contractor it is your responsibility to obtain a copy of SWMS and review it to make sure labour-hire has covered all risks.
  • Principal Contractors have control over the site, they must supervise labour-hire workers including being satisfied that they are compliant with SWMS.
  • All parties on site in respect of a shared operation must be satisfied that specialised tasks, like a rigger/dogman, is undertaken by currently skilled and certified people.

Written by Nina Hoang

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Our team are here to provide the right advice for your business and workforce. If you have a question or require assistance, please contact Andrew Douglas or Kim McLagan.

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