“Speak, even if your voice shakes”.
Today marks the eighth National Day of Action against Bullying and Violence throughout Australia (https://bullyingnoway.gov.au/NationalDay). Thousands of schools across the country will stand united today to celebrate and raise awareness, holding anti-bullying events including school activities and lesson plans to educate children and work towards wiping out what seems to be such a growing epidemic for the younger population.
Bullying isn’t just an epidemic for teenagers in the playgrounds though. Bullying, harassment and in some cases, violence, can happen within the workplace, no matter your industry, age, gender or position held. Despite companies and businesses working in conjunction with their legal counsel and human resource departments to produce policies and codes of ethics for employees, managing workplace behaviour can be a difficult process and in some cases, can fail altogether.
Workplace bullying is not only extremely distressing and potentially life threatening for those who experience it directly, but also for those who witness the behaviour as it occurs. It can also have significant financial, reputational and emotional consequences for directors of businesses who ignore their duties to ensure the health and safety of its employees.
In New South Wales, workplace bullying is governed by SafeWork NSW (Formerly WorkCover), a department of the NSW Government. SafeWork NSW states workplace bullying is “repeated and unreasonable behaviour directed towards a worker or a group of workers that creates a risk to health and safety”. Examples of potentially unreasonable behaviour are offensive language or comments, unjustified criticism, deliberately excluding someone from workplace activities or even withholding information that is required for work, amongst other things.
SafeWork can (and do) carry out legal prosecutions through the courts against individuals, employers or businesses who have broken WHS laws.
The legislation covering employers and employees in the workplace in New South Wales is the Work Health and Safety Act 2011 (Act) (formerly the Occupational Health and Safety Act 2000). Under the Act, company officers (which includes company directors) must undertake due diligence, taking reasonable steps to ensure their business complies with work health and safety (WHS) obligations. The reasonable steps a company officer must take to ensure they are exercising and demonstrating due diligence broadly includes (but is not limited to):
- Having up to date knowledge of WHS matters;
- Ensuring the business has (and uses) appropriate resources and processes to eliminate or minimise safety risks from the work carried out;
- Ensuring that the business has appropriate processes to receive information about incidents, hazards and risks and responding in a timely manner to that information;
- Ensuring the business has and implements processes to comply with any duty or obligation under WHS laws
- Verifying the provisions and use of the resources mentioned in these steps.
The Penalties for Directors
Failing to undertake due diligence and/or failing to adhere to a director’s duties can lead to offences with significant monetary penalties.
There are three categories of offences for failing to comply with a WHS duty, and they reflect the different degrees of seriousness or culpability:
Category 1 – the most serious breaches, where a duty holder recklessly exposes a person to the risk of death or serious injury.
Category 2 – failure to comply with a health and safety duty that exposes a person to risk of death, serious injury or illness.
Category 3 – failure to comply with a health and safety duty.
The Act provides for the following maximum penalties:
|Category of Offence||For Corporations||For Individual PCBUS or Officers||For individual workers or others|
|Category 1 offence||$3 million||$600,000 and/or five years imprisonment||$300,000 and/or five years imprisonment|
|Category 2 offence||$1.5 million||$300,000||$150,000|
|Category 3 offence||$500,000||$100,000||$50,000|
In addition, Courts can also impose non-monetary consequences to those offending. They include (but are not limited to) public statements of the offences (i.e. in company or annual reports), a direction to undertake compliance-type programs within the workplace to prevent, respond to, properly investigate and remedy issues caused by or related to their offence, or order proper workplace training be undertaken within the workplace.
History: The first prosecution against directors arising from Workplace Bullying
The company the subject of the proceedings was engaged in the timber joinery and shop fitting Industry, and its business was conducted at a multilevel factory in Lidcombe. At the time of the incident in December 2001, Mr Brian Coleman was the Managing Director of the Company, and Mr Graham Coleman was the Factory Foreman.
The person the subject of the workplace bullying was Mr Dwayne Doyle, a 16 year old who was employed by the company to work in the factory as a labourer. Interestingly, his mother, Carmen Doyle, was also an employee of the company.
On 21 December 2001, the day of the workplace Christmas party which was to commence at noon, Mr Doyle was called to the top floor of the factory to “assist in moving cabinets”. On arrival at the top floor, Mr Doyle was grabbed by 5 of the company’s employees, who wrapped Mr Doyle from his neck to his feet in plastic wrap, placed him on his back on a mobile work trolley and secured him to the trolley using more plastic wrap. For approximately 30 minutes, Mr Doyle, who was also asthmatic, was subjected to having handfuls of sawdust shoved into his mouth, causing him to choke and preventing him from breathing. He also had sawdust thrown over him and shoved into his shirt and shoes, as well as having wood glue (as well as a fire hose) squirted into his shoes, over his body and into his mouth. Eventually, a contracted site foreman cut him free, despite objections from other employees.
Brian Coleman, the Factory Foreman, was on site at the time of the incident but asserted he did not know of and did not witness the incident. He was, however, later that day informed of the incident by one of the factory labourers, who told him an “initiation” had taken place. In addition, Mr Doyle’s mother separately made Brian Coleman aware of the details of the incident later that afternoon during the Christmas party.
During the proceedings, there was also comment that either Brian Coleman or Graham Coleman had prior knowledge of an ‘initiation ceremony’ that would take place on the day of the incident, but did nothing to prevent it from occurring.
The company had no policy prohibiting bullying, undertook no investigation and took no action against any worker, other than a group meeting where all employees were reprimanded and told that threatening and harassing behaviour would not be tolerated.
At the time, the relevant legislation was the Occupational Health and Safety Act 2000 (OHS Act), and the penalties were not as significant as they are today.
The company, Brian Coleman and Graham Coleman, were prosecuted for allowing this bullying incident to occur. The company was subsequently charged for failing to ensure the health, safety and welfare at work of its employees, in particular, Mr Doyle. Brian and Graham Coleman were also charged as directors for the company’s breach. The particulars of the breach were that the company (and therefore Brian and Graham Coleman):
- Failed to adequately supervise its employees to ensure they took reasonable care for the health and safety of people at the premises;
- Failed to adequately train its employers to ensure they took reasonable care for the health and safety of people at the premises;
- Failed to prevent an act of premeditated violence by employees to Mr Doyle at the premises; and
- Failed to implement adequate policies or procedures governing violence in the workplace.
Judgment in the matter was handed down by Chief Industrial Magistrate G A Miller on 5 May 2004.
The company entered a guilty plea. The Court attacked what it described as a ‘culture of initiation’ and found that the company’s failure to intervene, investigate or discipline any of those involved amounted to breaches of the OHS Act. The company was convicted and fined an amount of $24,000 (almost half of the maximum penalty amount at that time, of $55,000). The governing body at the time, WorkCover, submitted that “his Honour correctly assessed the nature and quality of the offence as identified in relation to the company as being ‘in the serious range of matters coming before this Court’. Allowing for a discount of 20% for subjective mitigating factors, his Honour properly imposed a substantial fine upon the company”. The company did not challenge this fine.
Brian and Graham Coleman initially sought to defend the charges against them, making an application to dismiss or permanently stay the proceedings on the grounds that other directors of the company had not been prosecuted. Those applications were denied, at which point Brian and Graham Coleman entered guilty pleas and were fined an amount of $1,000 each.
Subsequent to this decision, WorkCover appealed the decision to impose penalties of $1,000 on Brian and Graham Coleman, on the basis that (amongst other things), the penalty imposed was manifestly inadequate in the circumstances.
Brian and Graham Coleman also appealed, on the grounds that no conviction should have been recorded.
The full bench of the New South Wales Industrial Relations Commission agreed with WorkCover. Walton J, Kavanagh J and Haylen J felt that the $1,000 fines were simply not enough to deter anyone from failing to take necessary steps required by the OHS Act to prevent bullying in the workplace. They felt that higher-range penalties were required to give workplace bullying the attention it deserved.
The commission also stated that an employer and its directors have a duty to prevent employees from “having fun at the expense of another person“.
Accordingly, on 3 November 2004, Walton J, Kavanagh J and Haylen J made orders that (amongst other things) the penalty imposed on Brian Coleman be increased to $9,000 and the penalty imposed on Graham Coleman be increased to $12,000.
Brian and Graham Coleman’s appeals were dismissed and they were ordered to pay WorkCover’s costs of the appeal, as assessed.
The full Appeal decision can be found here: https://www.caselaw.nsw.gov.au/decision/549f72173004262463a74fb2
Bullying, harassment and violence should not be tolerated, on any level. It’s just NOT OK, and can’t be ignored. Companies and businesses alike must have in place policies and procedures for adequate training of staff, preventing incidents from occurring, dealing with issues as they arise, and providing discipline to offenders when necessary.
Employees have a right feel safe and secure in the workplace, and directors and company officers have a duty of care to ensure the health (including mental health) and safety of all of their employees.
If you require expertise in creating workplace policies and procedures, contact us today.
Craig Higginbotham and Lynette Prichard
16 March 2018