The legacy of the Pike River disaster

Last week in the Greymouth District Court, Judge Jane Farish convicted Pike River Coal Ltd (PRCL), which is now in receivership, on all nine charges laid by the former Department of Labour. The receivers of PRCL did not fight the charges. The company’s health and safety failures, which resulted in the death of 29 underground miners in November 2010, included:

• Four offences of failing to take all practicable steps to ensure the safety of its employees
• Four offences of failing to take all practicable steps to ensure the safety of its contractors, subcontractors and their employees
• One offence of failing to take all practicable steps to ensure that no action or inaction of its employees harmed another person

“There were fundamental breaches of the Health and Safety in Employment Act which led to the unnecessary deaths of 29 men,” Judge Farish found. A sentencing hearing is set for July.

The department has also charged the former CEO of Pike River Coal Ltd, Peter Whittall, whose case is yet to be heard. Currently, there is no charge of corporate manslaughter in New Zealand, although directors can be charged under the Health and Safety in Employment Act.

The president of the Council of Trade Unions (CTU), Helen Kelly, has called for a law change to make company directors liable where their company has acted negligently. “They were in charge, and the company was clearly negligent in their duties to the men down the mine,” Kelly said.

The CTU has put forward this recommendation to the Independent Taskforce on Workplace Health and Safety, which is due to report back April 30. “It would be interesting to see what form it would take, but it could be against directors and/or the managers … those managers who are actually on site and have the day-to-day direction of health and safety, as well as those who are sitting in the boardroom in Auckland,” Blair Scotland, partner at Dundas Street Employment Lawyers, said.

While there hasn’t been much indication regarding the possibility of such a charge, Scotland believes it is a possibility. In general, however, he predicts a higher degree of regulation will be the legacy of the Pike River disaster. “Pike River shows that the system of leaving employers to interpret these concepts, in what are complex, technical environments is not the best for everybody,” he said. While it leaves employers uncertain as to what their responsibilities are, it also creates uncertainty for employees, and the regulator’s role is unclear.

Scotland also predicted that those high risk industries, such as construction, agriculture, and manufacturing, will be the first to be targeted with greater regulation. “Will it mean greater compliance costs? Yes, it will. Will it mean potentially greater liabilities? Yes, it will. But will it mean, potentially, fewer workplace injuries and a reduction in costs associated with that…[yes],” he said.