Who is liable when a worker is injured on a construction site?

In brief

This recent NSW Supreme Court decision serves as an important precedent for the apportionment of liability of various parties on a construction site where a worker is injured, and the factors a Judge considers in apportioning liability. This is an important consideration for all labour hire companies, employers and contractors, and their insurers, in order to understand their responsibilities and assess and minimise their risk and liability in the event that an injury occurs on site.

Facts

The plaintiff, Mr Milan Kabic, worked as an unskilled labourer on the redevelopment of the Redfern RSL. He was employed by a labour hire company, Caringbah Formwork Pty Ltd (Caringbah), and was hired out as a labourer to Calcono Pty Ltd (Calcono). Calcono was sub-contracted to undertake formwork for the site by the principal contractor, Deicorp Constructions (NSW) Pty Ltd (Deicorp). The sub-contract cast a number of obligations on Calcono with regard to site safety, including by way of compliance with the Occupational Health, Safety and Rehabilitation Act 2000 (NSW) (OHSR Act).

On 26 May 2011, the plaintiff fell two metres from a raised wooden platform on a metal frame within the building site. His claim is that he slipped on a piece of plywood on the platform, which he claimed was very slippery when wet.

The plaintiff claimed to suffer substantial injuries and allegedly remains in a significant amount of pain. Three medical experts prepared a joint report on the plaintiff, with two of the experts maintaining that the plaintiff was permanently unfit for the duties of a form worker or builder’s labourer. In contrast, another expert concluded that the plaintiff was fit to return gradually to his pre-accident employment duties. The Judge found that having fallen approximately two metres, the plaintiff suffered significant physical injuries, although there was an element of exaggeration.

Liability of each party

The Plaintiff sued Caringbah, Calcono and Deicorp, alleging that each was liable in negligence. The claim succeeded only against Calcono, with a contributory negligence finding against the plaintiff.

Proceedings were dismissed against Caringbah, the plaintiff’s employer, as the Judge held that although it had a non-delegable duty of care as the plaintiff’s employer, it had no control over the actual working conditions or state of the building site. Further, the Judge held that although Caringbah was the de jure employer of the plaintiff, Calcono was unquestionably his de facto employer, in terms of controlling the conditions in which the plaintiff worked.

Proceedings were dismissed against Deicorp, the principal contractor, as the Judge held that although it had a duty to take reasonably practicable steps to ensure that workers on the building site were able to work in safety, this duty was in the nature of a supervisory role, and did not entail a direct responsibility for the precise way the plaintiff was called upon to work by Calcono.

Calcono had contracted with Deicorp to undertake certain safety measures. For example, paragraph 4.2 of the sub-contract between Deicorp and Calcono stated that ‘Hand rails, guards and/or barricades are to be erected where any step or drop exceeds one (1) metre‘, with this obligation cast upon Calcono. The duty that Calcono owed the plaintiff was to take reasonable care to avoid exposing its (de facto) employees to unnecessary risk of injury. Calcono breached its duty to the plaintiff by failing to take reasonable precautions against the possibility that he could fall from the elevated decking. As a result, the Court found Calcono liable in negligence.

However, there was a finding of contributory negligence at 33.3%, as the Judge was satisfied that the plaintiff was negligent in failing to draw his superiors’ attention to the unsafe conditions in which he had been directed to work, and this contributed to his fall.

Implications

The case draws an important distinction between a de jure employer and de facto employer, with the plaintiff’s de facto employer being found liable.

In calculating damages, the Judge accepted that the plaintiff would not have worked past 50 years of age doing the heavy physical labour of a form worker, as one can only do that kind of work for a limited number of years.

Further, this case demonstrates the importance of principal contractors undertaking and recording safety measures that have been put in place, and the importance of carefully contracted agreements that clearly specify the obligations of each party on a construction site with regards to site safety and compliance with the OHSR Act.

Kabic v Workers Compensation Nominal Insurer