The first company to be convicted of workplace manslaughter in Victoria is facing a $3 million fine after its original fine of $1.3 million was more than doubled on appeal. The Victorian Supreme Court of Appeal found that, in originally sentencing the company, the trial judge failed to give proper weight to the principle of general deterrence and gave improper weight to other factors, including the financial circumstances of the company and its sole proprietor.
In February 2024, LH Holding Pty Ltd (LH Holding) became the first company to be convicted of workplace manslaughter since the offence was first introduced in Victoria. The company was fined $1.3 million after a 25-year-old subcontractor was tragically killed when a forklift carrying a raised load, operated improperly by LH Holding’s sole proprietor, Mr Hanna, toppled and fell on the deceased.
Now, more than a year after the original sentence was handed down, LH Holding has been ordered to pay an increased fine of $3 million.
The fine more than doubled as a result of a successful appeal brought by the Victorian Director of Public Prosecutions (DPP). The appeal was brought on the grounds that the original fine, being roughly 7% of the maximum penalty available for the workplace manslaughter offence, was ‘manifestly inadequate’ and that the trial judge had failed to give proper weight to the principle of general deterrence while simultaneously giving improper weight to other factors.
In its appeal submissions, the DPP noted that, as part of the process of determining the appropriate sentence, the trial judge had contrasted the offending conduct of LH Holding against that of Brisbane Auto Recycling Pty Ltd (Brisbane Auto), a Queensland based company that was convicted of industrial manslaughter. The DPP submitted that the trial judge had erroneously categorised LH Holding’s offending as less serious than Brisbane Auto’s, based largely on the fact that the former’s offending occurred over several seconds while the latter took place over a period of approximately 17 months.
The DPP also submitted that the trial judge gave too much weight to the financial circumstances of the LH Holding and Mr Hanna having observed that LH Holding had assets of between $300,000 and $400,000 and that Mr Hanna had approximately $400,000 of equity in heavily mortgaged properties.
The Court of Appeal allowed the appeal in relation to LH Holding after finding that “notwithstanding that Mr Hanna’s conduct occurred over a relatively brief period…it could not be seen as falling within the least serious category of offending.”
The majority Judges also observed that, while the original fine of $1.3 million imposed on the company was beyond its capacity to pay, and the imposition of a higher fine would be ‘ruinous’ for the company and would likely remain unpaid, “the company’s financial circumstances cannot immunise it absolutely from the consequences of its offending, which demand the imposition of a fine of a magnitude which is commensurate with the objective seriousness of that offending, and which adequately reflects the need for general deterrence.”
While the original fine was set aside and substituted for $3 million, the majority Judges commented that but for the company’s plea of guilty, they would have imposed a fine of $4.5 million.
The DPP also appealed the sentence imposed on Mr Hanna on similar grounds, however, this portion of the appeal was not successful. Mr Hanna, who had been convicted of an offence pursuant to section 144(1) of the Occupational Health and Safety Act 2004 (Vic) as an officer of a company, was sentenced by the trial judge to a two-year Community Corrections Order to complete 200 hours of unpaid community service and a course in forklift operation. The majority Judges found that, while lenient, the sentence imposed on Mr Hanna was not altogether outside the range of sentences open to the trial judge in the exercise of their sentencing discretion.
Key takeaways
The outcome of this appeal will set the tone for future workplace manslaughter prosecutions, and indeed equivalent prosecutions in other jurisdictions. We will likely see an increase in financial penalties for workplace manslaughter offences and a greater focus on general deterrence during sentencing. Significantly, a company’s financial circumstances will not safeguard it from the imposition of significant financial fines that are commensurate with its offending and the objective seriousness of the offence.
All companies must be aware of, and comply with, their duties under applicable OHS and WHS legislation regardless of size, composition, or financial value. A company that proactively manages risks to health and safety in compliance with its legal duty of care will go far in protecting itself from prosecution.
For more information, please contact Michael Tooma, Partner, Head of ESG, Co-head of Workplace & Safety.
