One accident, two regulators, two laws, two penalties

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The repercussions of a workplace accident can involve investigations, penalties and prosecutions; even before potential civil claims by those injured.

A case involving a Christchurch manufacturer shows that companies are not just at risk of a single penalty under one law from one regulator; sometimes additional authorities will also become involved.

VIP Frames and Trusses Ltd was taken to the Employment Relations Authority by Lyndon Fredericks who was injured when an inexperienced new employee accidentally misfired a nail gun which punctured Mr Fredericks’ lung. The ERA found in his favour and awarded $6,000 damages after concluding that there was ‘unjustified disadvantage’ from the company’s failure to provide a safe workplace.

Additionally VIP was ordered by the District Court to make an additional reparation for emotional harm payment to Mr Fredericks following action by Worksafe New Zealand under the Health & Safety in Employment Act 1992.

The company’s defence argued that as the ERA had already ordered a payment for emotional harm there should be no further payment under the HSEA, however the court concluded that the separate procedure and legislation used in the ERA decision did not bar a further reparation under HSEA.

The court did however take into consideration the amount awarded by the ERA and deducted it from the $15,000 it assessed as the appropriate payment due to Mr Fredericks.

In addition to the reparation payment, VIP Frames and Trusses was fined $85,000 for the incident due to an unsafe working practice, resulting from the placement of the two men in the workplace; and inadequate training of the new employee.

The fine was reduced by the reparation payments to Mr Fredericks; the company’s co-operation, remorse and steps taken since the accident; and its guilty plea. The remaining penalty was $46,962.50 in addition to the $15,000 paid in reparation.

According to law firm Chapman Tripp, the case should not increase similar claims in the ERA as the court will likely deduct any award made from the reparations awarded under the HSEA. Where a prosecution under HSEA is known about before the ERA hearing it may be possible for the company to stay the claim for unjustified disadvantage until after the court’s decision. 

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