In a recent case where an apprentice suffered an electric shock, the courts have voided the insurance of a business and prevented it from covering the court or workers compensation costs of the injured worker because of the indifference and inaction of the business.  This case is a cautionary tale for all businesses.

The incident occurred in Victoria and resulted in serious injury to the worker when scaffold was accessed while electrified.  The business identified the electrocution risk, but failed to prevent the work from continuing and failed to make the work safe.

The site controlling business was charged with breaching the OHS Act and fined $100,000.  The workers direct employer was also fined $40,000.

Following the judgement the worker sued both businesses for damages and the Victorian WorkCover Authority sued for recovery of costs paid to the worker as part of the workers compensation claim.

The businesses insurer argued that it was not responsible to pay the compensation or damages because the business had in face breached the safety regulations.

The Justices hearing the case concurred with the insurance company that the business was required to establish that it had taken reasonable precautions in order for the insurance policy to respond and that it was their assessment that in this case the business did not take reasonable steps.  It was acknowledged that the director noted the powerlines and pointed them out to the site supervisor but “did nothing to check with the supervisor when he returned to the site the following day to complete the scaffolding as to whether anything had been done by the supervisor.  In a sense, his attitude was one of ‘not my problem’.  He recognised the danger, raised the alarm but was indifferent to whether any action was taken to prevent the risk”

Learnings for all businesses

“This case should be a massive wake up call to all businesses.  It is simply never good enough to put safety on autopilot, or worse, leave it for someone else to fix”  explains ACAPMAs Elisha Radwanowski.

“When people are put at risk then there is a breach of the law, injury or not, and there will be repercussions, one of which is that the businesses insurance may not respond” adds Elisha.

“What businesses need to do to ensure their insurance coverage is firmly in place is the same things the business needs to do to keep their staff and the community safe, that is; understand the risks, implement appropriate controls and make sure those controls are utilised.  Failure to do so opens humans to risk and businesses to crippling fines and cost recovery without the benefit of insurance” concludes Elisha.

Elisha Radwanowski BCom(HRM&IR)
ACAPMA

 

SHARE THIS ARTICLE: