Health & safety prosecutions and how insurance policies can respond

Health & safety prosecutions and how insurance policies can respond

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2024 February 11

Between 2014 – 2022, WorkSafe reported a 46% increase in work- related injuries that have resulted in the injured taking more than a week away from work.

While the hybrid model of working following the COVID lockdowns appears to be staying, work-related injuries continue to increase. For directors and officers of businesses where there is a higher chance of injury, this also means that there is a higher risk of being prosecuted under the Health and Safety at Work Act 2015 (“HWSA”).

What are the key things you need to know and how can statutory liability insurance assist if you find yourself in the firing line?

Fines are on the rise

Workplace-related injuries have many forms, can affect all companies no matter how big or small they are, and can occur at any time. In the event of a workplace-related injury, WorkSafe may investigate and then charge the alleged offending company as well as any applicable directors, for potential breaches of the HSWA. This may include things such as not ensuring a safe work place environment, health and safety standards and proper training/supervision. The maximum fines receivable were increased in 2018, which demonstrates the Government’s and WorkSafe’s seriousness in ensuring high standards of health and safety in New Zealand’s workplaces.

Recent examples

In May 2022, an employee at a food processing plant suffered a workplace-related injury. While they were processing chopped onions, they noticed that the machine was jammed and tried to push the onion waste down to clear the blockage. With the machine still operating,  the worker’s hand got caught and they consequently lost their fingers.

The company was held liable for the injury as the Worksafe investigation alleged the company didn’t provide sufficient health & safety training for operating the machine, there was a lack of proper supervision, inadequate training on how to operate the machine, and a lack of proper safety measures (e.g. a protective guard). In 2023, the company received a fine of $249,275 alongside a reparation order of $35,000 to the employee.

It gets even more serious of course when an employee dies, as happened in the case of a fire curtain protection installation company in 2021.

An employee (who was well experienced in the industry implementing smoke curtains) tragically suffered a fatal injury when he didn’t use the correct safeguard.

Both the company and the sole director pled guilty to, and were sentenced for, breaching the HSWA. WorkSafe’s investigation concluded that there was insufficient health and safety training which was causative of the tragic fatality. The company received a fine of $75,000 and a total emotional reparation payment of $215,937.

It is worth noting that WorkSafe can go after both the company and the director. In this case, the Court had to reduce the fines against both the sole director and the company, as the company would have almost certainly had to cease trading.

How insurance policies can respond

Statutory Liability insurance can help fund the legal costs to defend claims brought by WorkSafe alleging a company’s breach of the HSWA. It can also cover reparation payments ordered by the Court, but cannot cover fines ordered by the Court. Statutory Liability policies may also provide cover for alleged breaches of the HSWA by directors. However, it is important to review your policy to ensure this cover is in place. In the event that a Statutory Liability policy does not cover the director(s), a Directors and Officers liability policy can respond to the legal defence costs and reparation payments a director may face, if charged with a breach of the HSWA.

If you need to make a claim against your policy, you are often given access to legal support services through the insurer’s specialist legal panel. Access to experienced and specialist barristers from an insurer’s legal panel, who regularly fight these types of claims, can be instrumental in getting particular charges dropped and fines reduced.

If you have any questions about these cases, statutory liability, or directors & officers liability cover, please reach out to our liability specialists on or phone 09 377 4314.