Lessons from the landmark prosecution of former Ports of Auckland Chief Executive
Former Ports of Auckland Limited (POAL) chief executive, Tony Gibson, has been found guilty of failing to meet his due diligence obligations as an officer under the Health and Safety at Work Act 2015. The verdict comes six months after his high-profile trial.
This case is particularly significant as it marks the first time since the Act’s introduction eight years ago that the courts have provided guidance on the due diligence responsibilities of an executive officer in a large company.
Summary from the Court Case
- The District Court found that Mr. Gibson failed to exercise due diligence in ensuring POAL met its primary duty of care to protect workers, exposing them to the risk of death or serious injury.
- While Mr. Gibson implemented several positive health and safety initiatives, the Court determined these were insufficient to meet the strict due diligence standard required.
- Internal health and safety audit reports and previous convictions made Mr. Gibson aware of workplace safety shortcomings. A reasonable chief executive, in this context, would have taken appropriate steps to address them.
- Although officers can delegate health and safety responsibilities, they remain ultimately accountable for ensuring the business has proper resources and processes in place. Delegation cannot serve as a defence, even in large, complex organisations like POAL.
- The ruling reinforces that while the role of a chief executive is demanding, health and safety responsibilities cannot be sidelined in favour of other business priorities.
POAL pleaded guilty to the charges laid against it. In doing so, it admitted that:
- it failed to ensure, so far as was reasonably practicable, the health and safety of its workers on the date of the incident leading to Mr Kalati’s death, and thereby exposed Mr Kalati and one other worker to a risk of death or serious injury; and
- it had committed a series of systemic failures, which meant that it had failed to ensure, so far as was reasonably practicable, the health and safety of its workers over a period of 14 months, which exposed those workers to a risk of death or serious injury.
Maritime NZ charged Mr Gibson as an “officer” of a PCBU, with offences under sections 48 and 49 of the HSW Act.
Safework NSW V Miller Logistics Pty Ltd Court Case
Judge Bonnar’s judgement has been very different from the decision from the District Court of New South Wales (NSW), SafeWork NSW v Miller Logistics Pty Ltd; SafeWork NSW v Mitchell Doble [2024] NSWDC 58 (Doble). NSW District Court held that the “duty on an officer to exercise due diligence does not mean that the officer must do everything that the PCBU must do to ensure compliance with its own duty and that a failure by the PCBU does not, of itself, demonstrate a failure by an officer to exercise due diligence.”
Judge Bonnar took the Doble decision into account, along with other Australian cases decided under earlier legislation. However, he acknowledged that these precedents, including Doble, were not binding and that Mr. Gibson’s charges had to be assessed based on the specific facts of his case.
Importantly, Judge Bonnar clarified that POAL’s breach of its primary duty of care to workers did not automatically mean that Mr. Gibson had failed in his personal duty:
“A PCBU can breach its duties despite proper efforts by its officer to do all that he or she could reasonably have been expected to do in the circumstances, having regard to what the officer knew, what they ought to have known, and their ability to make or influence decisions in relation to the relevant matter.‘
What can Director’s do?
So if you as an officer know that alcohol and drugs is a known risk in our society so what are we doing to mange that risk. Institute of Director’s’s presentation on this case by Phill Parkes from HSE highlighted the key take aways as follows:
Personally and Proactively Acquire and Maintain Knowledge
You don’t need to be a subject matter expert, but you should have a solid understanding of key operations and be able to identify critical risks and controls.
- Spend time on-site to observe day-to-day operations and speak directly with workers about the challenges they face.
- Arrange regular briefings from frontline staff and safety representatives to gain firsthand insights into potential hazards and mitigation strategies.
- Implement mechanisms to encourage open discussions, such as confidential feedback channels or structured “walk and talk” sessions, to understand how work is actually being done versus how it is planned.
Work as Done vs. Work as Imagined
Relying only on reports and policies isn’t enough—you must actively seek out how work is actually performed in practice.
- Connect directly with workers or their representatives to gain insight into their daily tasks and challenges.
- Participate in operational walkthroughs alongside subject matter experts to observe real-world practices.
- Encourage open and unfiltered feedback from your health and safety (H&S) professionals to identify gaps between procedures and reality.
Ensure Sufficient Investment in Critical Control Management
It’s essential to ensure that systems and resources are in place to manage critical risk controls effectively.
If hard controls for critical risks are not in place, request written documentation outlining the decision-making process and the criteria used, ensuring the “reasonably practicable” test has been applied.
Establish the expectation that robust controls are implemented for critical risks. Regularly assess the effectiveness of these controls through in-depth reviews.
Verify the Competence of People with Health and Safety Critical Control Responsibilities
While you can rely on the expertise of safety and technical professionals, it’s crucial to verify their competence:
- Establish a clear process to confirm the qualifications and skills of individuals responsible for managing critical risks and health and safety obligations.
- For example, ensure that health and safety advisors are registered with a recognised body, like the HASANZ register, or another similar certification system, to verify their credentials.
Carry Out Effective Monitoring and Review
Implement a credible approach to independently monitor health and safety performance and ensure follow-up actions are taken:
- Use recognised frameworks, such as SafePlus, to conduct independent health and safety assessments of your systems and practices.
- Request regular updates on the implementation of recommendations from independent assessments to ensure issues are addressed and improvements are made.
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