Health and Safety Work Act: Landmark conviction and sentence of former CEO

The Jackson Russell team provide a summary of the relevant parts of New Zealand's Health and Safety at Work Act 2015 and the key takeaways from the Court’s decision in this landmark conviction and sentence of former CEO.

25 March, 2025

Family Business, Family Business Advisor, Family Business Advisors, New Zealand, Article

Landmark conviction and sentence of former CEO under the Health and Safety at Work Act 2015

Former Port of Auckland Limited (POAL) Chief Executive Tony Gibson was recently convicted of health and safety breaches under the Health and Safety at Work Act 2015 (HSWA) following the death of a worker fatally crushed at the Ports of Auckland.

Maritime New Zealand charged POAL, the person conducting a business or undertaking (PCBU), and Gibson (an “officer” under the HSWA) under the HSWA. POAL pleaded guilty and was fined $500,000. Gibson was convicted under section 48(1) of the HSWA for breaching his duty as an officer and exposing an individual to risk of death or serious injury or serious illness. On 21 February 2025, Judge Bonnar KC fined him $130,000 plus $60,000 in Maritime NZ’s court costs.

A brief summary of the relevant parts of the HSWA and the key takeaways from the Court’s decision are below, and further details can be found here.

Directors and Chief Executives are “officers” under the HSWA

The HSWA imposes a duty on “officers” of PCBUs, who include any person occupying a director role, regardless of title (if the PCBU is a company) and any other person able to exercise significant influence over management.

Duty of officers under section 44(1) of the HSWA

Officers must exercise due diligence to ensure that their PCBU complies with its health and safety obligations. This means they must exercise the care, diligence, and skill that a reasonable officer would exercise in the same circumstances, taking into account the nature of the business or undertaking and the position of the officer and the nature of the responsibilities undertaken by the officer.

“Due diligence” includes taking reasonable steps to:

acquire and maintain up-to-date knowledge of health and safety matters;
understand the nature of the PCBU's operations and associated hazards and risks;
ensure the PCBU has appropriate resources and processes to eliminate or minimise risks to health and safety;
ensure the PCBU has appropriate processes for receiving and considering information about incidents, hazards and risks, and for responding to those in a timely way;
ensure that the PCBU has and implements HSWA compliance processes; and
verify the provision and use of the resources and processes referred to above.

Breaching this duty is an offence under sections 48(1) and 49(1) of the HSWA. Fines can reach $300,000 if the officer’s failure exposes an individual to the risk of death or serious risk.

Key takeaways from the Court’s decision:

Compliance is case-specific: Officers must assess health and safety based on the unique facts and circumstances of each case.
Universal application: The due diligence duty applies to all officers, regardless of the size or structure (flat or hierarchical) of the organisation.
Beyond Governance: Due diligence extends beyond governance or directorial oversight – officers must obtain sufficient knowledge to be reasonably satisfied that the PCBU is compliant.
Distinct from PCBU Duties: Officers are not required to do everything a PCBU is required to do.
Personal Knowledge and Active Oversight: Officers of a large PCBU do not need to be hands-on but cannot rely solely on others. They must personally maintain sufficient knowledge to enable them to assess health and safety compliance.
Monitoring Delegated H&S Roles: Officers must ensure those with health and safety responsibilities have the necessary skills and experience and regularly monitor their performance to ensure they are properly discharging their duties.
Understanding Operations: Officers must have sufficient knowledge of the PCBU’s operations, including “shop floor” operations, to identify and address hazards.
Appropriate Systems: Officers must do more than implement policies; they must establish, entrench, and monitor effective systems to ensure the PCBU meets its health and safety obligations. This is particularly critical in large organisations.
Effective Reporting Systems: Officers must ensure robust systems are in place for health and safety information to reach them and other supervisors.
Proactive Monitoring: Officers must not assume compliance or rely unquestionably on subordinate reports; they must actively verify and assess health and safety information.
Audits and Reviews: Officers must ensure ongoing monitoring, review, and auditing of systems, processes, and work practices to verify their effectiveness.
Objective standards override industry norms: While industry practices and standards provide context, the Court will objectively assess whether an officer’s actions meet the statutory requirements, even if common industry practices fall below the required standard.