Victorian WorkCover Authority v Horsham Rural City Council
[2008] VSC 404
•9 October 2008
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
No. 7334 of 2007
(On appeal from an order of Senior Member Davis of the Victorian Civil and Administration Tribunal, VCAT Ref No B24/2007)
| VICTORIAN WORKCOVER AUTHORITY | Appellant |
| v | |
| HORSHAM RURAL CITY COUNCIL | Respondent |
---
JUDGE: | HOLLINGWORTH J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 1 April 2008 | |
DATE OF RULING: | 9 October 2008 | |
CASE MAY BE CITED AS: | Victorian WorkCover Authority v Horsham Rural City Council | |
MEDIUM NEUTRAL CITATION: | [2008] VSC 404 | |
---
Occupational health and safety – Employer – Condition of livestock saleyards presented risk to public users – Saleyards owned by council – Saleyards managed by other entity under contract with council – Council an “employer” within the meaning of s 5 of the Occupational Health and Safety Act 2004 – Whether council an “employer” for the purposes of s 23 of that Act
---
APPEARANCES: | Counsel | Solicitors |
| For the Appellant | Mr W R Ray QC and Mr R W Taylor | Victorian Workcover Authority |
| For the Respondent | No appearance | Maddocks |
---
HER HONOUR:
Introduction
This case concerns the meaning of the word “employer” in s 23(1) of the Occupational Health and Safety Act 2004 (“the Act”):
23 Duties of employers to other persons
(1) An employer must ensure, so far as is reasonably practicable, that persons other than employees of the employer are not exposed to risks to their health or safety arising from the conduct of the undertaking of the employer.
Penalty: 1800 penalty units for a natural person;
9000 penalty units for a body corporate.
“Employer” is defined in s 5 of the Act as follows:
(1) In this Act …
“employer” means a person who employs one or more other persons under contracts of employment or contracts of training; …
The only issue before me is whether the word “employer” has a different meaning in s 23 than in s 5. The issue arises in the following context.
The respondent council owns some livestock saleyards at Horsham. On 1 March 2007, a WorkSafe inspector employed by the appellant (“VWA”) issued an improvement notice to the council under s 111 of the Act. The notice said that the inspector reasonably believed that the council was in breach of s 23, insofar as it had failed to ensure, so far as reasonably practicable, that persons other than employees of the council were not exposed to risks to their health or safety whilst using a particular cattle ramp at the saleyards. The improvement notice required the council to take certain steps to remedy the breach by 26 July 2007.
On 8 March 2007, the council lodged an application for internal review by VWA. On 22 March 2007, the internal reviewer affirmed the inspector’s decision to issue the improvement notice.
The council was dissatisfied with the internal review decision and, on 2 April 2007, applied to the Victorian Civil and Administrative Tribunal (“VCAT”) for a review of that decision.
The VCAT proceeding came on for hearing before a senior member on 25 June 2007. During the course of discussion, the senior member said he was concerned about a matter which was not raised at all in the council’s application for review. The senior member queried whether the council was an “employer” for the purposes of s 23. After allowing only a short time for the parties to consider and address him in relation to that matter, the senior member determined that, although it was an employer for the purposes of s 5, the council was not an employer for the purposes of s 23, of the Act. He set aside the improvement notice on that basis, without considering the merits of the council’s objections.
VWA now appeals against the VCAT decision to this court.[1] The only question of law pressed in the appeal is whether the senior member erred in his construction of s 23, in holding that the council was not an employer within the meaning of that section.[2]
[1]On 31 August 2007, Master Daly granted leave to appeal.
[2]Question 2 in the notice of appeal, based on an alleged denial of natural justice, was not pressed before me.
Although represented by solicitors in this appeal, the council chose not to appear at the hearing. It does not seek to uphold the VCAT decision; on the contrary, it has provided written consent to an order setting aside the VCAT order and affirming the internal review decision.
Notwithstanding the council’s consent to the setting aside of the VCAT order, the court has been asked to provide written reasons, because the issue raised in this appeal is of general importance to VWA and employers.
Relevant findings of fact
The following findings of fact were made by the VWA internal reviewer.
The council is a local government council and a statutory corporation by virtue of the Local Government Act 1989. Accordingly, it falls within the definition of a “person” for the purposes of the Act.
The council employs a range of persons under contracts of employment; it is therefore an “employer” under s 5 of the Act.
The council is the owner of the saleyards. However, council employees do not work on any regular basis at the saleyards.
The council has contracted with Atlex Pty Ltd for that company to manage the saleyards on its behalf. Atlex employees do work at the saleyards.
The saleyards are used primarily by people delivering cattle, such as farmers and livestock transporters, as well as members of the general public. They are the persons most likely to be injured if the relevant cattle ramp is defective, as alleged by the inspector. They are not employees of Atlex or the council.
The council is not a commercial entity, in the sense of conducting a business for profit. However, it does perform a range of services and offers various facilities to ratepayers and others within the municipality. The provision of community infrastructure, such as the saleyards, does form part of the “business” of the council in the broad sense. Although the council does not itself carry out activities in the saleyards, it has ultimate control of the saleyard facilities and their condition. The “conduct of the undertaking” of the council includes making available to a range of non-employees access to and use of the saleyards, including the relevant ramp.
The current state of the ramp does give rise to a risk to the health and safety of persons other than employees of the council.
Having regard to the relevant facts, including the likely cost of remedial works, the decision to issue the improvement notice was correct.
VCAT decision
The senior member accepted that the council was an “employer” for the purposes of s 5, but said that was not sufficient to make it an “employer” for the purposes of s 23(1). The essence of his reasoning is contained in the following paragraphs:
20. In my view, to give the word “employer” in s 23 the wide definition as is sought by [VWA’s counsel], to include any person that employs another person, would not be what the legislation intended. To give it such a wide meaning would lead to absolutely absurd results. I put to [VWA’s counsel] that a private person may own a piece of real estate that he lets out to some organisation and short of letting it out to the organisation, have nothing to do with it whatsoever, apart from receiving the rent and paying whatever obligations the landlord is expected to pay. Under those circumstances, in my view, it would be absurd to bring the landlord within the definition of “employer” merely because for instance, the landlord employed a housekeeper or because the landlord might employ a bookkeeper. That cannot have been the intention. In my view, the word “employer” must directly relate to the enterprise or undertaking to which the improvement notice was to issue in this particular instance, the operation of the saleyards.
…
24. In my view, it is unlikely that a practical person would look at the council as the owner of the saleyards and say that it was an “employer”. A practical person would say that Atlex was the employer. The mere owner of the saleyards, even though it may employ people in other pursuits was not an employer within the operation of s 23.
Relevant construction principles
In interpreting s 23, a construction which would promote the purpose or object underlying the Act (whether or not expressed in the Act) is to be preferred to a construction that would not promote the purpose or object.[3]
[3]Interpretation of Legislation Act 1984 s 35(a).
The objects of the Act include “to ensure that the health and safety of members of the public is not placed at risk by the conduct of undertakings by employers and self-employed persons.”[4]
[4]Section 2(1)(c).
The legislature has also chosen to include in the Act general principles which govern health and safety protection, including the following: the importance of health and safety requires that employees, other persons at work and members of the public be given “the highest level of protection against risks to their health and safety that is reasonably practicable in the circumstances”[5]; and employers and self-employed persons should be pro-active and take all reasonably practicable measures to ensure health and safety at workplaces and in the conduct of undertakings.[6] These general principles confirm the very important public policy underlying the Act.
[5]Section 4(1).
[6]Section 4(3).
As Nettle JA noted in R v ACR Roofing Pty Ltd[7], it is a well-recognised principle of statutory construction that legislation which is concerned with furthering industrial safety is to be construed “so as to give the fullest relief which the fair meaning of the language will allow.”[8] The High Court has said that where the rule requiring strict construction of penal statutes collides with the need to construe industrial safety legislation effectually, the latter tends to prevail.[9]
[7][2004] VSCA 215 at [43], with whom Ormiston and Vincent JJA agreed.
[8]Bull v Attorney-General (NSW) (1913) 17 CLR 370 at 384 per Isaacs J.
[9]Waugh v Kippen (1986) 160 CLR 156 at 164-5.
The meaning of s 23
The Act repealed and replaced the Occupational Health and Safety Act 1985 (“the 1985 Act”).
“Employer” had the same meaning in the general definition section of the 1985 Act
(s 4) as it has under the general definition section of the Act (s 5).
Section 22 of the 1985 Act was in the following terms:
22. Duties of employers and self-employed persons
Every employer and every self-employed person shall ensure so far as is practicable that persons (other than the employees of the employer or self-employed person) are not exposed to risks to their health and safety arising from the conduct of the undertaking of the employer or self-employed person.
The duties owed by employers and self-employed persons to non-employees have now been separated into two sections in the Act: s 23 in the case of employers and
s 24 in the case of self-employed persons. However, the key concepts of “employer”, “persons other than employees of the employer” and “risks … arising from the conduct of the undertaking”, remain the same in the old and new provisions.
Many of the sections in the 1985 Act and the Act which impose duties on persons do so by reference to a “workplace”.[10] “Workplace” is defined in s 5 of the Act as “a place, whether or not in a building or structure, where employees or self-employed persons work”. Sections 23 and 24 of the Act contain no such reference; that is to say, they are not limited to risks arising in or in connection with “a workplace”.
[10]For example: ss 21(2)(c) and (d), 22(1)(b) and (c), 26-32 of the Act.
The Victorian provision may be contrasted with s 17 of the Occupational Health and Safety Act 1991 (Cth), in which an employer’s duty to members of the public is specifically limited to “persons at or near a workplace under the employer’s control”, in respect of risks “arising from the conduct of the employer’s undertaking.” [11]
[11] 17 Duty of employers in relation to third parties
An employer must take all reasonably practicable steps to ensure that persons at or near a workplace under the employer’s control who are not the employer’s employees or contractors are not exposed to risk to their health or safety arising from the conduct of the employer’s undertaking.
In Whittaker v Delmina Pty Ltd[12], Hansen J confirmed that s 22 of the 1985 Act was not restricted to activities or conduct at a workplace. In that case, the owner of a horse riding business hired horses to members of the public, for them to ride on public land. Although the owner employed persons in connection with the horse riding business, no employees were present on the actual rides. His Honour held that the employer was nevertheless liable under s 22.
[12] [1998] VSC 175.
Hansen J went on to make the following observations about the meaning of the word “undertaking”:
The word is not defined in the Act. The expression is broad in its meaning. In my view such a broad expression has been used deliberately to ensure that the section is effective to impose the duty it states. It may have been thought that the word “workplace” had a narrower meaning. … [“Undertaking”] must take its meaning from the context in which it is used. In my view it means the business or enterprise of the employer … and the word “conduct” refers to the activity or what is done in the course of carrying on and the business or enterprise. A business or enterprise, including for example that conducted by a municipal corporation, may be seen to be conducting its operation, performing work or providing services at one or more places, permanent or temporary and whether or not possessing a defined physical boundary. The circumstances may be as infinite as they are variable. Although such a place may, and often will be, a workplace as defined it seems to me that the legislature has chosen not to use that word and, rather, to use an expression of breadth and possibly of wider application. I am of the view that this was deliberate to ensure the duty applied as it was intended and that the word “undertaking” should not be read as synonymous with “workplace”. It is neither helpful nor necessary to do so.[13]
[13]At [47].
Hansen J did not have to consider the meaning of the word “employer” in s 22 of the 1985 Act, because there was no suggestion in that case that the owner of the horse riding business was not an employer in the relevant sense.
Although the senior member did not actually mention the word “workplace” in his reasons, by focussing on whether the council has employees physically present at the saleyards, he seems to have thought that s 23 requires an employer to have employees present at a workplace at which the relevant risk exists. Such an approach is incorrect, for the reasons expressed by Hansen J.
Section 5 of the Act contains a broad, general definition of “employer”, which is said to apply “in this Act”. As a matter of general statutory construction, that definition should be used wherever the word “employer” appears in the Act, unless a clear contrary intention is expressed in a particular provision or part. Here, there is nothing in the ordinary and natural meaning of the words in s 23 to suggest that “employer” in that section is meant to have a meaning other than the meaning in s 5. Such a construction also promotes the purposes of the Act.
Section 23 is concerned with reducing risks to members of the public, arising from the conduct of an employer’s undertaking. Whether the condition or activity which has caused the risk amounts to part of the conduct of the employer of its undertaking must, in each case, be a question of fact.[14]
[14]R v Associated Octel Co Ltd [1996] 4 All ER 846 at 852 per Lord Hoffman, with whom the other members of the House of Lords agreed.
In the present case, the internal reviewer found, and both parties accept, that:
(a) The council is an “employer” within the meaning of s 5;
(b) The “conduct of the undertaking” of the council includes making available to a range of non-employees access to and use of the saleyards, including the relevant ramp; and
(c) The relevant risk arises from the conduct of the undertaking of the council.
The senior member’s reasoning seems to have been driven by what he assumed would be the result in the hypothetical situation which he put forward. He posited a situation in which a “private person”[15] lets out a piece of real estate to an organisation, but otherwise has nothing to do with the property except for receiving rent and paying the usual landlord’s expenses. Although not stated in his example, I presume the senior member was envisaging a situation in which there was a risk to the health and safety of members of the public, as a result of the condition of the property or some activity conducted on the property. The senior member said it would be absurd to bring the landlord within the definition of “employer” merely because, for instance, the landlord employed a housekeeper or a bookkeeper; therefore, he concluded that “the word ‘employer’ must directly relate to the enterprise or undertaking.”
[15]He did not explain what he meant by that term, but I infer that he meant it to refer to an individual who was not otherwise conducting a business.
I agree that s 23 may well not apply in such a case, but not for the reason suggested by the senior member. In the hypothetical case, the landlord would undoubtedly be an employer. But it is not clear to me that, merely by leasing the property, he would be conducting an undertaking which gave rise to the relevant risk to health or safety.
In so far as the senior member was influenced by his observation that “a practical person would say that Atlex was the employer”, he seems, with respect, to have addressed himself to the wrong question. It is not to the point to ask whether there is somebody else who is conducting an undertaking at the saleyards and who has employees working there, and then label them as “the” employer. Apart from the impermissible focus on a “workplace”, rather than an “undertaking”, such an approach ignores the fact that the Act creates a scheme of concurrent or multiple liabilities.[16]
[16]R v Commercial Industrial Construction Group Pty Ltd (2006) 14 VR 321 at [38].
It follows that the appeal must be allowed and the senior member’s decision set aside. Because the senior member did not go on to determine the merits of the council’s objections to the improvement notice, ordinarily this court would remit the matter back to VCAT for determination on the merits. However, because the council now consents to an order setting aside the VCAT order and affirming the internal review decision, I shall make orders accordingly.
---
5
0