Part 4: Other people with duties

The Act prescribes a range of duties on others who - although they may not be employers - have a role to play in the prevention of harm to employees and others in or about places of work.

4.1 Duties of persons who control a place of work (section 16)

Section 16 of the Act describes the duties of "persons who control a place of work" in relation to people in the vicinity, and to visitors. These duties are intended to meet the gap in coverage of the Act when an employer/ employee, contractor/principal relationship does not exist.

"Person who controls a place of work" includes a person who owns, leases, subleases or occupies a place of work, or who owns, leases or subleases plant or equipment used in a place of work. It is discussed below.

"Place of work" is another important definition. It is also discussed below.

There is a duty to all people in the vicinity of a place of work

A person who controls a place of work is responsible for taking all practicable steps to ensure people in the vicinity are not exposed to harm - regardless of the purpose for which they are in the vicinity.

The extent of the duty to visitors depends on the purpose of the visit

The extent of the duty that is owed to visitors is determined by the activity or purpose for which the visitor is present.

Where a visit brings some benefit to the controller

Broadly, where people are visiting for work-related reasons, pay to be there, or are present for the benefit of the controller, the person who controls the place of work is responsible for taking all practicable steps to ensure they are not exposed to harm. This includes people in the place of work:

• Working as employees, contractors, subcontractors (or their employees) for the person who controls the place (section 16(1)(b)); or
• With express or implied consent, and who have paid to be there, or who are customers or potential customers (section 16(2)).

Other authorised visitors

There is a duty to authorised visitors not included in the above categories - to warn all people who are to be in the place of work of known significant, out-of-the-ordinary hazards arising from the work that has been, or is being, carried on there. For this duty to apply, the visitors must have:

• The express authorisation of the occupier to be in the place of work (subsection 16(3)(c)(i)); or
• Have given the controller of the place oral advice that they will be working there under statutory authority (subsection 16(3)(c)(ii)).

When there is no duty to visitors

People visiting a place of work under any other circumstances are owed no duty under section 16 by the controller. This includes people visiting for the purpose of recreation or leisure.

People who are working in the place of work - but not as employees or contractors of the occupier - are owed only the warning duty under subsection 16(3), and then only if they have express or statutory authority to be there.

People who control a place of work have no duty to trespassers.

Definition of "person who controls a place of work"

Section 16 uses the definition of "person who controls a place of work" in section 2 of the Act.

It includes any:

• Owner, occupier, lessee, or person in possession of a place of work; or
• Owner, lessee or bailee of plant used in a place of work.

The section does not apply to residential premises. This means that, in the case of farms and some other businesses with accommodation attached, those parts of the property used for domestic accommodation are not a "place of work".

Several people may simultaneously have duties under section 16. This is made clear by section 2(2) of the Act. However, what each person must do to fulfil those duties may be very different, and the steps that it may be reasonably practicable for one person to take may not be for another.

The term "person in possession" needs some explanation. A person who is not an owner, occupier or lessee would be in possession of a place if they have been given the right to use the place by the owner, occupier or lessee. For example, a construction contractor frequently takes possession of a construction site for the duration of the project. Or, alternatively, a self-employed truck driver, by license from the business owner with whom they are dealing, may take possession of the place where a truck is parked while it is being loaded or unloaded.

The extent of each of the respective duties is set out below.

Duties to people in the vicinity of a place of work (section 16(1)(a))

A person who controls a place of work must take all practicable steps to ensure that people in the vicinity are not harmed by hazards arising from the place of work.

The reason for this duty is that people outside a place of work (or in the vicinity of plant or equipment) have no reason to expect that they will be harmed. People at work should conduct their operations in a way which is not likely to harm people outside the place of work. In contrast, people entering a place of work must accept some responsibility for their own safety once they are inside the place.

The duty under subsection (1)(a) extends to taking practicable steps to ensure that people do not enter a hazardous place of work unintentionally. This may mean the person who controls a hazardous place of work needs to place signs or notices warning people who may enter the place about hazards in the place, or to erect fences or other barriers to restrict entry. In determining what steps are reasonable, consideration needs to be given to the significance of any hazards and the likelihood that people may enter the place of work - warning notices and barriers are not always needed.

The section is intended to cover situations such as objects falling from a construction site into the street below. Two examples of such cases are set out below. It is noteworthy that in neither case was any person actually harmed, illustrating that the duty is a proactive one and that harm need not have occurred before an offence is committed.

The application of subsection 16(1)(a) is obvious when there is a clear boundary to the place of work. If, on the other hand, there is no clear boundary, the place of work should be considered to be the surrounding area where hazards would normally arise from the work - while good work practice was being observed. For example, if blasting was taking place to remove tree stumps, the place of work would include all areas where debris might be thrown, when the explosives are used properly, plus a safety margin. Similarly, if trees are being felled, the place of work would be an area with a radius twice the height of the trees.

In practice, therefore, this duty will be complied with so long as good work practices are followed. Alternatively, and using the example above, if an excessive charge was used, or charges were not placed properly, people in the vicinity may be harmed. Similarly, if trees were felled in such a way that they could land on vehicles travelling along a road or track, the duty is probably not being met.

As people in the vicinity of a place of work are likely to be harmed only if poor work practices are used, failures to comply with section 16 (1)(a) may arise where there has also been failure to comply with sections 15, 17 or 19 of the Act.

Examples:

1. Greywacke Quarries Ltd operated a quarry where rock was extracted for crushing as aggregate. It bordered housing and an industrial area.

   One day the company's foreman, Jock, prepared to fire three sets of charges into a rock face. Fellow employee, Jim, had drilled holes along the rock face, while Jock charged them with explosives.

   Two set of charges were fired as planned, although some smaller stones were noted as flying out into the immediate area at the time of the second charge. This blast also removed slightly more rock than was intended. However, Jock decided to use the holes that had been predrilled, plugging them to allow for the decreased amount of spoil to be removed.

   When the third set of charges was fired there was a cloud of flying rock which caused some minor damage to neighbouring cars and premises. One boulder was flung across the road into industrial premises, where it damaged buildings and vehicles, although no one was hurt.

   A similar incident had happened two months before. This time people whose property had been affected contacted a health and safety inspector, who investigated the incident and prosecuted Greywacke Quarries under section 16.

   The court found that the company should have paid more attention to the consequences of each charge that it placed and that it should have changed their direction and or intensity.

   The company was convicted and fined.

2. PV Smellie Fumigants Ltd was a firm of horticultural fumigators who were engaged by Granny Smith Ltd to fumigate the soil of two paddocks before an apple orchard was planted on them.

   The soil fumigation was required to ensure there was no bacteria in the soil which could harm the trees.

   The fumigation agent used contained the active ingredient chloropicrin, a dangerous poison. To be effective and safe it must be applied to wet soil and covered with either polythene or a water seal.

   Before application, Paul, the owner -operator of PV Smellie Fumigants Ltd, checked the soil's moisture content and determined it to be high enough. He carried out fumigation from a tractor towing an applicator which injected the poison into the soil as a liquid. Paul drove the applicator, while Rose, a Granny Smith employee, followed behind with another tractor towing a roller to compress the soil and, supposedly, create a seal.

   Application took all day. Early on, the raising of some dust suggested the ground was too dry, and by the end of the day Rose's eyes were streaming.

   At the end of the day, the soil was neither covered with polythene nor sealed with a layer of water in order to prevent the release of the gas from the ground - as required by the directions on the product.

   After application the chloropicrin began escaping from the soil. This resulted from a combination of factors, including the soil being too dry to apply and an inadequate seal being applied to retain the gas. In addition, the fumigated area was low lying and prone to mists.

   By about 7pm that evening nearby residents began to develop symptoms consistent with exposure to chloropicrin. These included sore and watery eyes, respiratory problems and nausea. Emergency services were called, and residents in the affected area were evacuated at about 9.30pm.

   The all clear was given for residents to return at 8.30am next morning. That evening however some residents again began to display symptoms of exposure and they evacuated again at about 9pm. Those worst affected by the initial exposure were more susceptible to becoming symptomatic from any lingering traces of the chloropicrin which remained in the area.

   PV Smellie Fumigants Ltd were convicted and fined for a breach of section 16 (1) (a).

   The use of the fumigant constituted a significant hazard to residents in the vicinity of the fumigated land. The company had failed to take all practicable steps to ensure that chloropicrin did not harm these residents and consequently a number of them suffered harm and serious harm.

Duties to employees, contractors and subcontractors (section 16(1) (b))

Duties to employees

A person who controls a place of work must take all practicable steps to ensure that employees of the person in control of the place of work are not harmed by hazards in or arising from the place of work.

This subsection should be read in conjunction with sections 6 to 13, which relate to the duties of an employer to employees.

Duties to contractors and subcontractors

A person who controls a place of work must take all practicable steps to ensure that contractors and subcontractors engaged by the person who controls the place of work, and any employees of a contractor or subcontractor, are not harmed by hazards in or arising from the place of work.

Distinction between sections 16 and 18

Section 18 requires a person (the principal) who engages a contractor, to take all practicable steps to ensure that contractors and subcontractors, or their employees, are not harmed as a result of any work the contractor is engaged to do. In most circumstances, it would be more applicable to the safety of contractors and subcontractors than the duties of section 16.

The distinction between the two sections is that section 18 deals with the work that a contractor is engaged to do while section 16(1)(b) deals with the environment in which that work is done (although there is inevitably some overlap). Under both sections, it is the person who engages the contractor (the principal) who has the duty.

Section 16 will apply to situations where a contractor, subcontractor - or any employees of a contractor or subcontractor - may be harmed by hazards other than those arising from the work the contractor is engaged to do. For example, section 16 would apply ahead of section 18 in a situation where a contractor needs to take a heavily-laden vehicle on a track or across a bridge, the person engaging them must ensure that the access routes they control are suitable for the purpose, and inform the contractor if they are not.

Example:

1. Mark, a self-employed plasterer, had been engaged by Giant Construction Limited to carry out gib-stopping work on a high-rise contract.

   He and another plasterer, Ross, were working from a platform across a lift shaft, when a wooden bearer, used to support the planks providing the work surface, collapsed.

   Ross managed to hang on and scramble to safety, but Mark fell 13 metres to the bottom of the lift shaft. He suffered fractures to his ribs, two vertebrae, right elbow and three parts of his pelvis.

   When the remains of the platform were investigated after the accident they showed evidence of serious rot and a lengthwise fracture about a metre long, which was present before the collapse.

   Investigation also revealed that Giant Construction periodically cleared its yard and destroyed bad planks, but no individual was designated to carry out the task. The site supervisor had viewed the platform after it had been constructed by a company employee, but had not inspected it closely.

   Giant Construction Limited was convicted and fined under section 16.

Duties to customers and clients (section 16(2))

A person who controls a place of work must take all practicable steps to ensure that customers and clients are not harmed by hazards in or arising from the place of work.

Those who are owed the duty are people who:

• Have paid the person in control (either directly or indirectly) to be there or to carry out some activity in the place; or
• Are buying or inspecting goods for sale and from the sale of which the person in control would derive some gain or reward (either directly or indirectly).

In relation to properties, it includes such situations as:

• Shops and shopping malls;
• Fruit and vegetable stalls;
• Pick-your-own fruit and vegetables;
• Where a property owner or occupier provides an activity (either as the principal business or a secondary business) for which clients are charged. For example, a swimming pool or "tag-war" game;
• Where a property owner charges people to use part of the property. For example, farmstay holidays or picnickers; or
• Where a property owner or occupier grants a concession (and receives payment from the concessionaire) to another company or organisation that provides an activity on the property.

If the person who controls the place of work does not receive any financial benefit from the visitor, then there is no duty under subsection 16(2). The only duty in such situations is the duty to warn of known, significant, out-of-the-ordinary, work-created hazards, under section 16(3), and discussed below.

What constitutes payment?

The payment for the purposes of subsection 16(2) (a) does not have to be monetary - it could be in goods or services. Nor must it involve financial benefit to the person owing the duty - it may be a reimbursement of expenses that would not have been incurred if the visit had not taken place.

The benefit to a person who controls a place of work may be indirect. For example, the proprietor of a shopping centre may not receive any payments directly from shoppers, but benefit from their patronage through rents. The section 16(2) duty applies.

Donations, gifts and koha

Broadly, when there is an invitation to make a "donation" the offering should be considered payment - although this may differ in the circumstances. A "gift" is not considered payment, but would generally need to be unsolicited or unrequested. It may be difficult to separate "gifts" from payment, and each case needs to be considered on its merits. "Koha" needs to be considered in this light, and when it is unsolicited it should be considered as a gift, i.e. not payment.

Consent

In all cases, for the full duty to be owed under subsection 16(2), the person must be on the property with express or implied consent. If any person comes on to the property outside notified hours, they may not be there with consent. Similarly, if a person comes on to the property for a particular purpose, but goes somewhere not necessary for the purpose of the visit, there may be no consent for them to be in that part of the property and consequently no duty under the Act.

Consent for the purposes of subsection (2) may be express or implied. This contrasts with subsection (3) where only express consent is involved, see below.

The visit must be to a "place of work"

The duty does not apply where a place of work is also the home of the person who exercises control over it.

A place is not a "place of work" unless work is being carried out there - whether at the time, recently, or soon after.

If, for example, a property owner or occupier charges people to picnic or camp in a quiet spot, the picnic or camp site itself may not be a place of work if work is not going on there. Alternatively, the picnickers or campers may have to pass through a place of work to get access to the site.

Extent of the duty

If a person taking part in an activity (or buying or inspecting goods) on a property injures themselves entirely through their own actions, then the person who controls the place is not liable. The duty is limited to taking "all practicable steps" to prevent harm - see 1.5, All practicable steps. If the person who controls the place could not reasonably have been expected to do anything to prevent harm, then they are not liable if such harm occurs.

For example, if a visitor trips over a tree-root or stone, a property owner or occupier is unlikely to be held responsible for the other person's carelessness. Also, if the property owner or occupier could not reasonably have been expected to know of a hazard, they cannot be held responsible for any harm that occurs to any customer or client.

Property

In practical terms, the sorts of things that will be necessary to comply with subsection 16(2) are:

Consider the parts of the property where a customer or client is likely to need to go. If work activities take place in those parts of the property, what hazards are created by that work?

Can the work be rescheduled to avoid contact? If not, make sure that customers or clients are informed of the hazards and make sure that the work is carried out in a way that will minimise the likelihood of harm to any customer or client.

Is there safe access (including bridges or other structures)? Place limits on times and places where a customer or client may go, and make sure they are informed of these limits (for example, by erecting signs or posting notices).

Consider what a customer or client would expect to find in a place of work of this kind. If there are hazards that would not reasonably be expected, inform them of these hazards either directly or place warning signs. For example, place weight limits on bridges.

Examples:

1. Every Thursday night the Diggers' Arms Hotel offered karaoke entertainment in one of its bars. The management engaged an operator with their own staging, lights and sound equipment to carry out the entertainment.

   The performance was staged in an area above a stairway leading down to a floor below. One Thursday night a stage had been placed in front of a handrail protecting against falls into the stairway. The added height of the stage had the effect of converting the handrail from a barrier to a fulcrum.

   The hazard went unnoticed throughout the evening, until it was the turn of the patron Philip to perform. He put on a spirited performance, but in the course of it fell backwards, tripped over the handrail and fell to the bottom of the stairs. He died of his injuries soon after.

   The Diggers' Arms Hotel was convicted under section 16.

2. Marlene was stacking cartons on shelving above an aisle in the BestBuys Supermarket. When she pushed in one carton a little hard, it caused boxes on the other side of the rack to fall on Rolf, a customer walking along that aisle.

   Rolf was knocked to the ground and, after he was picked up, was taken to hospital. There he was x-rayed before being fitted with a neck-brace and discharged.

   Investigation of the BestBuys premises showed that the rack in question did not have a central barrier fitted to prevent goods from one side dislodging goods on the other, despite OSH earlier advising the company of the hazard, and suggesting a top-of-rack barrier.

   Bestbuys was convicted and fined under section 16.

3. Curt was a polytechnic engineering student who was visiting and observing the work of an engineering contractor, Grills' Engineering Ltd. The firm was sub-contracting to a civil engineering company which was in turn contracting to a power company to build a spillway on a hydro dam.

   Curt was watching the managing director of the company, Charles, installing a galvanised web grating over a dam sump.

   In a moment of absent-mindedness, Curt walked backward along the grating and fell through a hole into a chamber below, breaking his neck in one place and his back in three places.

   When OSH investigated the accident it found that no contractor on site had any hazard identification process in place, there was no evidence of suitable training or supervisory measures take by any contractor in respect of active safety management, nor was there any active control, co-ordination, or monitoring measures in place. An environmental consultancy and a firm of architects had also been involved as agents for the power company.

   A manhole cover suitable for guarding the hole which caused the accident was available on site and rudimentary precautions would have prevented the accident.

   Grills Engineering Ltd was convicted under section 16.

Plant and equipment

A person who controls a place of work containing, or comprising plant or equipment should ensure that it is fit for the purpose for which it is being used, is properly maintained, and that adequate instruction is provided to the people who will be using it.

Warnings and/or signage should indicate safe working limits, and any particular hazards arising out of the plant or equipment.

This applies to situations such as the provision of lifts or lifting equipment, access equipment, heating, cooling, electrical or any other plant or equipment that may be present or used in a place of work.

Sellers or suppliers of plant and equipment have specific duties under section 18A. [Refer to section 4.4, below].

Alternative provisions

Subsections 16 (1) and (2) need to be read in conjunction with sections 15, 17, 18, 18A and 19 of the Act.

There are also some express requirements in the Health and Safety in Employment Regulations 1995 - in particular, regulation 25, Excavations of hazardous depth, and regulation 59, Presence of young persons.

Examples:

1. Anton was one of a groupwhich had hired the Starlight Convention Centre Ltd and were decorating it before a university ball.

   Anton was using a one-person vertical lift to fit a strobe light when it toppled over. He fell 5 metres to the floor before the machine landed on top of him, causing multiple injuries from which he died the next day.

   The hoist had been made available by the venue owners for the use of hirers. Although safety instructions were posted to the side of the machine, Anton had not put in place the outriggers of the lift before raising himself. Both the defendant's duty manager and health and safety co-ordinator were on site at the time and advised that they had seen people using the machine without outriggers beforehand and had instructed the operators to use them.

   No one had instructed Anton on the use of the machine, which was available on the day for anyone to use.

   Starlight Convention Centre Ltd was convicted and fined under section 16.

Duty to warn visitors (subsection 16 (3))

Visitors to a place of work that are not covered by subsections (1) or (2) above may be owed a duty to be warned of known significant hazards, if they:

• Have been given express authorisation to be in the place; or
• Have given oral advice that they will be working in the place under statutory authority.

Known significant hazards

The duty to warn relates only to hazards that:

• Are "significant" (see 2.3, Hazard management responsibilities);
• Are in, or likely to arise in, the place of work;
• Arise from work that is, or has been, carried on for gain or reward in the place of work; and
• Would not ordinarily be reasonably expected to be found in that type of place of work.

Construction activity is one example of a hazard or hazards that would not normally be expected to be found in most places of work. Other examples are: sludge ponds in a quarry, cyanide baiting on a farm, felling shelter belt trees, prospecting for minerals or oil, spraying toxic substances, or the use of explosives in or around roadworks.

There is no liability to warn visitors of natural hazards on a farm or other property, such as bluffs, tomos, landslides, rivers, swamps, wasp nests, and so on.

Express authorisation

Express authorisation means that a person must ask for, and be given, permission to enter the place of work.

Subsection (5) applies in the case of visitors given express authorisation. It describes the timing and extent of the warning required.

The extent of the warning

Any necessary warning must be given at the time that the authorisation is given.

If a group of people are seeking entry, the authorisation may be given to a representative or member of that group.

There are officers who have statutory authority to enter places of work, without consent - such as government inspectors, medical officers of health, police officers in some circumstances, and electricity workers. Such people must give the person who controls the place oral advice of their intention. This advice may be given either by the person who is to enter the place or by their employer. The person who controls the place of work is required to give any necessary warning at that time.

A warning only needs to be given once

Where an individual or group has ongoing authority to enter a place of work, they need to be given a warning only at the time they sought that authority - or gave oral advice, in the case of persons with statutory authority (subsection (3)). This means that if a new significant, work-related, unusual hazard arises in the place of work, the section does not require a new warning. (There may be a common law duty in some circumstances - see 1.7, The difference between the Act and the common law.)

However, if the visitors seek to renew their authorisation (or give a new oral advice) then the duty to warn arises again.

How section 16 relates to educational institutions

Children at school, kindergarten, etc. are covered by section 16(2) and all practicable steps must be taken to ensure they are not harmed by any hazard in the place of work.

Section 16(2) is also relevant when children on organised school trips visit a place of work away from the classroom. In such a case, if the person who controls the place of work receives gain or reward, then they must take all practicable steps to ensure the children or others are not harmed by any hazard.

Section 16(3) applies where children on organised school trips don't pay to visit a place of work, but have express authority to be there. In this case, they must be warned by the person giving express authority of significant, out-of-the-ordinary work hazards in the place. The warning can be given through the teacher or other person in charge.

Where a student gains work experience for an employer or self-employed person, the Act deems the trainee an "employee" in terms of the Act, and they have most of the rights and duties with respect to health and safety as the people they are working alongside.

Where schools use volunteer workers to do work on the school premises, and on a regular and ongoing basis- the volunteers may be deemed "employees" in terms of the Act (section 3C). However, there is an exemption for any volunteers who are assisting with sport or recreational activities, whether on or off school premises.

In all cases where a school uses volunteer workers, the non-enforceable duties of section 3D apply.

There is no duty to unauthorised visitors to school grounds (including after school hours).

4.2 Duties of the self-employed

Most of the specific duties in the Act are to encourage employers to manage hazards and provide safe and healthy workplaces. Although many of the specific duties do not apply to the self-employed, section 17 does create a general duty for the self-employed to maintain their own safety and health, and that of others who may be affected by their work.

The meaning of "self-employed"

The Act does not define "self-employed", other than through the wording of section 17 itself - a person who is "at work" in any place of work.

"At work" is defined in section 2 of the Act as a person present for gain or reward in their place of work. For a discussion of "place of work", see the definitions at the back of this guide.

A self-employed person may therefore have duties under the Act as a principal, or in the performance of a contract for services - as long as they are not employing any other person. (For comparison, see 2.1, The meaning of "employer", or 3.1, The meaning of "employee".)

It should be noted that a self-employed person may have the same duties as an employer in relation to volunteers, people receiving work experience or on the job training, or loaned employees (sections 3C-3F)

The duty applies to the self-employed in all industries and occupations.

An important exemption is when someone works in or on their own residence.

For clarification of the situation when someone is working in or on the home of another, see 1.4, Coverage is broad.

It is important to note that as soon as a person employs another, the duties of an employer apply to them.

The duty

Section 17 requires that if you are self-employed, then you must take all practicable steps to ensure:

• Your own safety while at work; and
• That no action or inaction by you while at work causes harm to any other person.

The nature of the duty is similar to that owed by employees (under section 19) but it is more strictly enforced. It is in addition to any responsibilities as a principal or contractor (section 18), and as a person who controls a place of work (section 16).

Where there is a breach of the law, more than one party may be prosecuted as a result of an incident. This means, for example, that as a result of any breach, a self-employed contractor or subcontractor may be charged in addition to the principal, or a person who controls the place of work.

When work is suspected to be unsafe

The hazard management requirements of sections 7-10 of the Act do not apply to the self-employed. However, section 17 creates an obligation for the self-employed not to undertake work which is unsafe, or which involves unsafe practices. This implies a need to identify hazards, and there may be situations - such as beginning a contract or establishing a place of work - where there is an obligation to implement systems for identifying and managing hazards.

Where a self-employed person becomes aware of an unsafe work situation or practice, then they have a duty to make it safe (see 4.1 above). If they are contractors or subcontractors, then they should make the principal or head contractor aware of the situation and seek a solution before proceeding with any work that could be unsafe. If they are in control of the place of work, then they will have duties to visitors, people in the vicinity, and others.

The extent of the duty

The scope of the duty is wide, because it extends to not causing harm to "any other person" - whether fellow subcontractor, employees of others, visitors to, or the public in the vicinity of a place of work.

Because the standard of care is "all practicable steps", the degree of care and responsibility that is expected may vary from one self-employed person to another. For example, a self-employed roofing contractor would be expected to follow proper methods and, before fixing tiles, to stack them on a roof safely and without endangering passers-by. However, that would not necessarily make the roofer responsible for any failure due to factors beyond their control, such as the design of the roof, or construction methods they were instructed to follow.

Alternatively, a self-employed scaffolder may be expected to design and install scaffolding that is fit for its purpose and meets the relevant code.

Many self-employed people have particular skills or attributes that they bring to a place of work, such as tree surgeons, technical consultants, chimneysweeps, or pet groomers, or providers of professional services. In each of these cases, the self-employed person would be expected to exercise a high degree of skill and care in taking "all practicable steps".

It is important to note that the duty applies to acts or omissions. Section 17 therefore refers to any action by a self-employed person or anything they may forget to do or choose not to do in the place of work.

Harm does not need to have occurred for there to be a breach of section 17. The action or inaction only needs to have been likely to have caused harm, and the standard of care required is "all practicable steps" (see 1.5, All practicable steps).

Section 17 also requires a self-employed person to take all practicable steps to ensure that hazardous substances, plant or equipment used or stored in a place of work, including a vehicle such as a van, does not cause harm to others. This duty equates with that of employers under section 15 (see 2.8, People who are not employees).

Accident recording and reporting requirements

Self-employed people are required to maintain a register of accidents and occurrences of harm to themselves or others affected by their work activities, and to notify and report any occurrences of serious harm to OSH. See part 5, Accidents.

[Refer to the fact sheets, Self-employed people, Recording and reporting serious harm, and Serious harm.]

Requirements by health and safety inspectors

Self-employed people may be issued with improvement or prohibition notices by health and safety inspectors.

Improvement notices may be issued when an inspector believes a particular provision of the Act is not being observed, and that the failure will continue. A notice contains a description of which section of the Act is being breached, how it is being breached, a statement of what needs to be done to rectify it, and a date for compliance.

Prohibition notices are issued by inspectors when they believe that failure to comply with a provision of the Act is likely to lead to serious harm. Such a notice prohibits the use of a particular machine, process or other source of the hazard.

A self-employed person issued with a prohibition notice is responsible for ensuring that the prohibited action does not occur (section 42 (2)).

A self-employed person that is aware of the existence of a prohibition notice also commits an offence if they do not comply with it (under the general duty of section 17).

For more information, see 6.3, Improvement and prohibition notices.

Infringement notices may be issued by inspectors to self-employed people for infringement offences under the Act. They require the defendant to pay a fee of up to $4,000. See 6.5, Offences and penalties.

Examples:

1. Coolwall Ltd gained a contract for the manufacture and erection of a coolstore wall for a meatworks operated by Muscles Corporation.

   Although Coolwall operated principally as a manufacturer of insulation walls and panels, to gain the supply contract, the company undertook to erect them on site. This work was in turn subcontracted to a construction company, I M Frizen Ltd, which then undertook two further subcontracts - with a self-employed builder, Peter, who was to attend to the construction of the wall, and another with Straightup Scaffolding, who was to supply the scaffolding needed. The scaffolding subcontractor in turn sub-contracted Horace, who was self-employed, to build the scaffolding.

   The scaffolding structure, while adequate for access, was also required to support the new wall, but Horace's structure didn't allow for this. Before work was finished, the scaffold and the wall were together blown over by wind, seriously injuring two workers.

   Horace, was convicted as a self-employed person under section 17.

   In court it was found that he had failed to identify the purpose of the scaffold and to notify the purpose of the structure once he had determined that it was to support a free-standing wall.

   The plans had contained information which should have alerted him to the fact that there was something unusual about the scaffold, and that he was obligated to find out the purpose of the scaffold.

   I M Frizen Ltd was also convicted as a principal under section 18.

2. A health and safety inspector visited a house building site where workers were clearing up material from a landslip that was covering an area of foundation. He noted that there was still substantial loose material sitting on a bank above the work area.

   After further inspection and discussion with Bill, of W and B Job Ltd - the site foreperson - a prohibition notice was issued to the company as principal contractor. The notice prohibited any further work in the area affected until an engineer had checked the stability of the material.

   The extent and effect of the prohibition was discussed with workers on site, including a self-employed blocklayer, Otto.

   Two days later, and before an engineer had checked the landslip, Bill contacted Otto and asked him to return to the site and build a concrete block wall in the area affected. Bill said that the wall's non-completion was holding up work on the site, and that the engineer's inspection would occur in the course of the wall being built.

   Both W and B Job Ltd and Otto were charged as a result of this action. W and B Job Ltd were charged for breach of its duty as a principal. Otto for breach of his duty as a self-employed person, under section 17.

3. Terence, a self-employed concrete cutter, was contracted by a concrete cutting company, PowerCut Ltd to cut grooves in the floor of a bank for cabling. The work was part of work being completed for the bank by a principal contractor, Retrofit Interiors Ltd.

   It was a warm summer's day when Terence used his petrol-driven water-fed cutting machine inside the building. The cutting was first carried out in a small room adjacent to a larger room where four workers, Suzy, Wayne, Darryl and Garth were working. Terence then began to complete the work in the neighbouring larger room. He had positioned two fans, and opened outside doors to allow airflow to avoid the build-up of fumes in the area.

   After a while all four workers nearby began to complain of headaches and nausea, and had to stop work. They were eventually diagnosed as suffering from carbon monoxide poisoning and required treatment in a decompression chamber.

   Investigation after the incident showed that Terence should have taken steps to ensure others in the area were not exposed to the fumes by:

   Positioning more fans in the area to further increase air flow;

   Installing a monitor to establish the level of carbon monoxide in the rooms, given that it is a colourless, odourless gas; and

   Advising the other workers that fumes would be emitted from the cutter, and advising them that if they developed any symptoms such as headaches, lethargy, dizziness, blurred vision, nausea or light-headedness, to evacuate the area.

   Terence was convicted and fined under section 17 for causing serious harm to each of the four injured workers.

4. Arnie, a self-employed builder, was using a gas-powered nail gun on the roof of a house he was building in a suburban area.

   Beth was weeding in the garden of her house next door, when a nail from the gun flew past, narrowly missing her and landing on the ground nearby. Beth retrieved the nail and found two others before contacting a health and safety inspector.

   The health and safety inspector spoke to Arnie, who said the nails had ricocheted from a piece of timber after they had passed through another. However, this was questioned by the inspector because binding tape was still attached to each nail.

   It was suggested instead that the nail gun may have been fired into the air to clear a blockage - also considered an unsafe practice. To do this, the operator would have had to hold back the safety platen.

   The cause of the flying nails was never settled in court - Arnie pleaded guilty to a section 17 charge and was fined.

4.3 Duties of principals and contractors

The Act places a duty on a principal to a contract to take all practicable steps to ensure that contractors, subcontractors and their employees, are not harmed while undertaking any work under the contract. This duty is set out in section 18.

A principal or contractor may also be an employer (with the duties set out in part 2 of this guide), a self-employed person, or a person who controls a place of work (with duties under section 16).

A principal's duty under the Act is limited to matters which they can reasonably be expected to control. There are situations where control of a place of work may be shared by the principal and by contractors. For example, an electrical subcontractor working on scaffolding may not be subject to the control of the main contractor (a "principal" in this case) regarding the electrical work he or she is doing, but the use of the scaffolding may be under the control of the principal.

Section 18 is intended to cover situations where either:

• The contractor does not have full control because of conditions in a contract or because hazards are under the control of the principal; or
• Work is being carried out where there is no employer/employee relationship, and the principal retains control of the place of work.

The meaning of "principal"

An individual or company who engages any person (other than an employee) to do any work for gain or reward is a "principal" in terms of the Act.

The major exception is when a householder contracts with someone to do work on their home.

As an example, if you hire a plumber to fix a blocked drain in your home, you are not liable under the Act for the safety and health of the plumber while he or she carries out the work.

If, on the other hand, you contract a builder to do a major alteration to your home, and they subcontract a plumber, then the builder is a "principal" in terms of section 18.

Contracts for services

Section 18 applies to "contracts for services", as distinct from employment agreements (which may be described as "contracts of service"). Reference can be made to a substantial body of employment agreement case law for determining when a person is an "employee", or alternatively, an "independent contractor". Where there is a contract of service (i.e. an employment agreement) in existence, then the duties of an employer/employee relationship apply. On the other hand, where there is a contract for services, the duties of a principal under section 18 apply.

The Act does not apply to a contract for the sale of goods, although there are occasions when a contract is for goods and services - for example, a company may have a contract for the purchase of a piece of plant, which includes a service agreement. In such a situation, if a service technician is required to visit the purchaser's premises to repair the plant, then the purchasing company has the duties of a principal.

This duty should be read in conjunction with the duties of designers, manufacturers and suppliers of plant set out in regulations 66 and 67 of the Health and Safety in Employment Regulations 1995.

"For gain or reward"

The contractor must be engaged "for gain or reward", and the case law has found that the "gain or reward" must move directly from the principal to the person or company engaged through a contract. The contract need not be written, and all the terms do not need to be explicit, but there must be contract formation in the normal legal sense.

The "gain or reward" need not be financial. It could be payment in kind, an exchange of labour or services, or the benefit gained from a service or warranty agreement. (For a discussion of what constitutes payment, see 4.1, above.)

The association between the principal and the contractor must be clear and direct. The use of an agent or a management facility by a principal does not mean that they avoid their duty under section 18. This means that in situations where, for example, a building owner asks a letting agency to organise a contractor to repair a roof, and the account is forwarded by the agent to the building owner, then the owner has the duties of a principal.

Alternatively, if the agency commissions the work and pays the bill, then it is a principal in relation to the contractor. Individuals acting as authorised agent of a principal may also commit an offence under section 56 if they "direct, authorise, assent or acquiesce in" a breach of the Act (see 1.4, Coverage is broad).

There are situations where a designer/adviser is engaged to manage a project, or as an agent. In such a case, where the designer contracts directly with a contractor, and makes payments, they have the responsibilities of a principal.

The extent of the duty

The standard of care required of a principal is that they take "all practicable steps" to ensure no contractor or subcontractor or their employees is harmed while carrying out the work they are engaged to do. See 1.5, "All practicable steps".

What this means in terms of any given contract depends on:

• The size and nature of the contract;
• The type of work the contractor was engaged to do;
• The contractor's and the principal's respective knowledge of the work being undertaken; and
• The nature of hazards in the place of work.

The steps expected of a principal to a photocopier service contract, for example, are different to those expected of the principal to a contract for a major building alteration or plant installation. The photocopier owner may only require a brief verbal exchange of relevant health and safety information. On the other hand, the practicable steps expected of the principal to a major building contract or subcontract will usually be extensive.

The duties of employers and principals will often be interrelated

Frequently the contractor's responsibilities as an employer will be greater than the practicable steps expected of a principal, and the steps expected of an employer will often not be practicable for a principal.

The case law has shown, however, that when there is a step which it would be practicable for the principal to take in the circumstances, that step is required to be taken irrespective of what steps might be required of the employer.

Typical contractor / principal relationships

The following diagram illustrates some of the typical relationships which will arise in the course of a significant project, such as the construction of a building.

A principal to a contract cannot distance themselves from what is occurring in a place of work simply because the employer is more directly related to and responsible for the employees carrying out the work. Nor can the principal always satisfy their obligations under section 18 simply by retaining a contractor who is competent. There may be occasions when this is the case, or where a principal may stipulate in advance the safety standards that are to be observed - and not be required to monitor - but this depends on the circumstances.

The steps required of a principal which, for example, has its head office in another city, may not be the same as the steps required of a head contractor working on site.

Principals or contractors cannot "contract out" of their liability under section 18. Contractual clauses that attempt to do this will not be accepted by the courts.

The "all practicable steps" requirement for principals can be discussed under the following headings:

• Contractor selection and negotiation of terms;
• Information sharing; and
• Monitoring contractors.

Contractor selection and negotiation of terms

Case law has set a high standard for principals to include health and safety issues in the negotiation of contracts. A Court of Appeal judgment has stated*:

…. in contract negotiations between principal and contractor or subcontractor - no matter how informal - safety is as critical factor as the contract price or duration. As between principal and employer who will supply and maintain safety equipment; who will bear any losses if that equipment fails or is unavailable, who will negotiate directly with the employees to ensure the safest working methods and conditions in the circumstances of the contract. If a principal lets a contract to an employer which does not incorporate and allocate responsibility for such features, the principal may well assume the burden of assuring that workers are not harmed.

* Central Cranes Ltd v Department of Labour [1997] 3 NZLR 694

There may be some circumstances where it is practicable for the principal to prescribe safety requirements in advance without subsequent monitoring, but this is dependent on the particular facts of any case. When negotiating any contract covered by the duty of section 18, the principal must turn their mind to the question of, and be satisfied that, the contractor is competent to perform the work being contracted for in a safe and healthy manner.

The principal may do this by deciding whether the contractor is a well-established and competent firm or person, and that the contractor is qualified to do the work (e.g. is the holder of the appropriate certificate of competence, such as a registered electrician). As part of the process, the principal should consider evaluations from earlier contracts, references provided by the contractor from previous clients, or other evaluative material as appropriate.

Is the principal responsible for advising on the appropriate safety standards to be observed?

The short answer to this question is, "yes". Depending on the nature of the work being undertaken, where a principal is required to take all practicable steps to avoid harm to contractors and their employees, this should involve an awareness of the required standards. The degree of prescription expected is high in cases such as the operators of a major electrical substation, or an oil depot, engaging contractors to carry out service work. It would be lower, for example, in the case of a self-employed potter engaging an electrical contractor to install a pottery kiln. But even in the latter case, the principal is unlikely to be able to avoid all responsibility for ensuring health and safety standards are met.

The contractor should submit a health and safety plan

For any significant contract, the contractor should submit a plan on how they intend to manage health and safety in relation to the proposed work - before the contract is formed. What is a significant contract will depend on the circumstances. For example, in the forestry industry, a contract to fell and remove several trees from an isolated farm paddock would probably not require a formal plan. But, to clear a similar stand of trees from beside a busy highway, or to extract a woodlot by a cable-logging operation, would both require a detailed plan.

Similarly, in the construction industry, the building of a single office partition might require elementary health and safety considerations, but for the refitting of an entire floor of an office building, or the construction of a new building, the courts would likely require a detailed plan.

This plan should as a minimum contain the following details:

• Hazards identified and control measures to be taken;
• Emergency procedures;
• Training, experience and qualifications of employees (including OSH certificates of competency where required); and
• Procedures for reporting and recording of accidents/incidents.

The health and safety plan or policy needs to be adequate, and appropriate to the hazards and circumstances of a particular contract. As mentioned above, this means that a standard policy that is intended to apply to all contracts is unlikely to be appropriate. The plan should describe the lines of accountability, and responsibilities for supervision. It is related to the information-sharing responsibilities described below.

Evaluation

Post-contractual evaluation by the principal should cover the safety and health performance of the contractor. Where appropriate, evaluation information should be included in the selection process for new contracts.

Information sharing between principals and contractors

The "practicable steps" required in the exchange of information varies according to the nature of any given contract.

In a situation where the contractor is employed for their particular expertise and the principal has little effective control over the place of work, the principal would not be expected to take many steps in relation to the contractor's specialised functions - and this may reduce the need for information sharing. This is in contrast to a situation where the nature of the work may be well known to the principal, or where the principal may exercise a high degree of control over the place of work - perhaps providing specialised plant or equipment for the use of the contractor - and there is associated information sharing.

Whatever the situation, effective information is critical, and the principal and contractor should discuss and share information about the work and the area the work is to be carried out in. This information should include the following details:

Reporting arrangements

Nominated contact persons for both the principal and contractor

Representatives nominated should have the appropriate level of knowledge for the role and be at a level of authority within the organisations that allows them to be effective. They should also be resourced and available to carry out the role effectively.

The planning and running of joint meetings

Meetings should be regular, and conducted in a format that allows a free and open exchange of information. It may be efficient to incorporate safety and health issues in other administrative meetings, but only where appropriate personnel and resources are available and the forum allows the subject to be covered sufficiently.

Procedures for reporting hazards

Although principals are required to take all practicable steps to monitor and manage hazards, there may be situations where they are reliant on the contractor to report hazards. Alternatively, there will often be situations where a contractor is dependent on the principal's control of hazards, or on their provision of information on hazards. For effective hazard management, there needs to be efficient transfer of information between the parties. This can only be achieved with any certainty through clearly designated reporting lines.

Contractors or principals who are employers are required to follow the formal hazard management processes of sections 7-10, see 2.3, Hazard management responsibilities.

Responsibilities where work is notifiable to OSH

The Health and Safety in Employment Regulations 1995 require employers to notify OSH of certain categories of work at least 24 hours before work begins. Much of this type of work - such as construction and forestry operations - is commonly performed by contractors. For a list, see the definitions at the back of this guide, under "notifiable work".

Section 18 requires that the principal to any contract involving such work be aware of the notification requirements and ensures the contractor complies.

Method for reporting accidents and incidents to the principal

The principal should ensure that they are advised by contractors of all accidents and incidents with respect at least to the hazards or potential hazards that they exercise control over.

Principals and self-employed persons have accident recording and notification duties under section 25(1A) and 25(3).

As is the case above, any principal or contractor who is also an employer has duties for the recording, investigating and reporting of accidents in the place of work.

(see part 5, Accidents, below).

[Refer also to the fact sheet, Recording and reporting serious harm.]

Information to be given by the principal about the workplace or procedures

Information to be given by the principal may include the following categories:

• Hazards that are known to exist in the place of work and may affect the contractor or their employees;
• Restricted areas;
• Any work permit procedures, e.g. hot work permits;
• Any company rules that the contractor will be required to comply with during the contract;
• Emergency procedures that exist and first-aid facilities available; and
• Specific job instructions and work methods.

The practicable steps are unlikely to include instruction on any specialised work for which the contractor has been employed. This means that, for example, having taken sufficient care to engage a competent diving contractor to inspect the piles of an estuary bridge, and that the work is notified to OSH, a principal would not usually be expected to provide instructions on diving practices or equipment. However, the principal would be expected to advise on such matters as traffic volumes over the bridge, a likelihood of flash flooding, or peculiarities in the method of construction that may create hazards for divers.

See also section 2.3, Hazard management responsibilities. Where a principal is also an employer, and is required to manage hazards in the workplace, it would be expected that any information on hazards acquired in this process would be readily made available to contractors. The section 18 duty also means there is a duty to inform of any known hazards, even when the principal is not an employer.

Information to be given by contractor about the workplace or procedures

Information to be given by the contractor may include the following categories:

• Information on hazards that the contractor is bringing onto or may be creating on site, e.g. hazardous substances, noise, dust, electrical hazards, etc;
• Safety provisions for other people who may be affected by the work, including the public;
• Safety equipment that may be necessary, including means of access to an appropriate standard; and
• Restricted areas.

Monitoring contractors' performance

The case law has established that there is a positive duty for principals to monitor contractors' and subcontractors' performance.

This is not a duty to constantly check for hazards, but at least to bring to the attention of the contractor any unsafe practices or conditions.

The principal may not have directly engaged subcontractors, but they still have a duty to ensure their safety at a level that could be reasonably expected - for example, by the provision of a safe power supply or access on a construction site.

What it is practicable for a principal to do will usually decrease the further the principal is removed from the subcontractor's engagement, but they are still required to do what could reasonably be expected in the circumstances.

As mentioned above, a head contractor is usually more able to influence general site safety, and less able to influence how subcontractors carry out specialist tasks for which the contractor has no expertise.

Interrelationship with the contractor's duty as an employer

A principal is required to monitor a contractor's performance in relation to employee's exposure to hazards. This is in addition to the contractor's responsibilities to their employees.

What is practicable for the principal will often differ from that expected of the contractor/employer in the circumstances. But if there is a step which it is practicable for a principal to take, then there is a duty to take that step. The principal cannot distance themselves from what is occurring in the workplace simply because the employer is more directly related to and responsible for the employees carrying out the work. It is a matter of fact and degree in each case, but the positive duty means "wilful blindness" is not acceptable.

There are few situations when simply appointing a competent contractor is all that is required. The following steps are therefore recommended to monitor contract work that is being undertaken, and identify problems before accidents or incidents occur:

• Raising issues that require attention by the contractor for any unsafe work practices that are observed;
• Regular inspections;
• Investigating accidents and incidents;
• Regular meetings to review health and safety performance;
• Effective management of the principal /contractor relationship, with all parties being aware of their roles and responsibilities;
• The principal having overall responsibility for the control and co-ordination of the contract; and
• Post-contract evaluation of performance.

Examples:

1. Associated Roofing Ltd had contracted to a large construction and development company, MegaSite Ltd for the supply and fixing of roofing to a major commercial building project. Associated Roofing then sub-contracted the work to Ray, who employed Jack and Jeff.

   One day Jack and Jeff were fixing the roof, finishings and guttering to the building when a health and safety inspector visited the site. They were working without a suitable working platform or any other safety device such as a harness to protect them from the risk of a fall of more than 10 metres. No protection had been provided by Ray or Associated Roofing.

   Associated Roofing had provided the workers with a "cherry picker", which had been removed from the site because it was too small. Another cherry picker on the site had been used to lift the guttering into place. This machine, which did not have a current certificate of fitness, was sitting in mud, which resulted in instability.

   Access to the roof was by way of an extension ladder. This ladder was not secured in any way, and it did not extend above the working platform.

   Associated Roofing Ltd's supervisor, Mick, when asked for an explanation, advised the inspector that he would pick up some safety harnesses. He said that no hazard identification had been completed for roofers. During the previous month OSH had conducted two seminars on the requirements of the Act for subcontractors on site.

   Associated Roofing Ltd was convicted for breach of section 18 (1) (a).

2. Graham was employed in the evenings as a cleaner by the Immaculate Cleaning Company Ltd, which had a contract to clean an export meatworks, Exco. The work involved the cleaning of machinery as well as work areas, surfaces and amenities.

   Graham's job included the thorough cleaning of a recently installed skinning machine. It was a large machine, which was used to remove membrane from meat. It worked when meat was fed into it through rollers, after which the machine would grip the meat and a fixed blade would remove the membrane.

   Cleaning the machine involved hosing it down with hot water, then opening an infeed guard to expose a toothed roller and blade while the machine was still running. One day, four weeks after the machine was installed, Graham was completing this cleaning when his glove was caught by the machine - but he avoided injury. He told his supervisor, Jed.

   A week later, his hand was caught in the machine and he lost the tips of two fingers.

   Exco, as the owner of the machine and principal to the cleaning contract, was convicted under section 18 (1) (b) for failing to take all practicable steps to ensure the safety of a contractor's employee.

   The Immaculate Cleaning Company Ltd was convicted under section 13 for failing to train Graham.

3. Tack and Flack Ltd were a firm of building contractors engaged to build an apartment block.

   It engaged a rigging company, Highwires Ltd, to complete work on site.

   One day, Glenn, an employee of Highwires, needed to shift a gas bottle and trolley set from the 5th floor to the 6th floor of the site by crane. He slung the load, and was helping the contractor's dogman, Anaru, to move it by lifting it over a wooden guardrail at the edge of the floor. The crane was taking the weight of the load when it became caught against the handrail, and Anaru asked Glenn to free the snagged load by lifting it over.

   In the course of this, the load released with great force, pulling Glenn through the railing to a fall of five storeys. He suffered multiple internal injuries and fractures of the lower limbs, leading to the amputation of one leg.

   Investigation determined the cause of the accident to be a combination of the victim's own inexperience in using cranes, poor lifting technique encouraged by a Tack and Flack employee, and an absence of safety devices.

   Tack and Flack had control of this aspect of the place of work. The company had identified workers inexperienced in using cranes as a potential hazard on site, but had taken inadequate steps to eliminate the hazard. By allowing the inexperienced worker to complete dangerous tasks under their supervision, they had breached their duty under section 18. The company was convicted and fined.

4. High and Dry Ltd was a well-established roofing company. Based in one region, in another it employed a regional manager, Bryn, and conducted its business by employing subcontractors.

   It obtained a contract to supply and fix roofing and external cladding to an industrial building, and subcontracted a roofing contractor, Mato, to perform the work. There was verbal negotiation and agreement was reached between Mato and Bryn on how the work would be done, including health and safety issues, and particularly with regard to the height of the operation. Mato required a scaffolding truck to be provided for the installation of wall cladding, guttering and wire netting on site.

   High and Dry Ltd had a health and safety policy, which required, among other things, the use of safety harnesses. However, there was no requirement for supervision, or that High and Dry provide the recommended safety equipment. Mato had indicated to Bryn that he did not support the use of harnesses when installing the long-run roofing being installed.

   While standing on purlins and working with an employee laying building paper in preparation for the sheets of long-run roofing, Mato suffered a heart attack and fell through the wire netting, on to concrete 10 metres below. He died soon after from injuries arising out of the fall.

   High and Dry Ltd was convicted and fined under section 18 for failing as a principal to ensure the safety of a self-employed contractor.

4.4 Duties of persons selling or supplying plant for use in a place of work

The duty

The Act contains duties for any person who sells or supplies plant that can be used in a place of work (section 18A). The intent of the section is to ensure that any plant used in a place of work is designed and made, and has been maintained, so that it is safe for its intended use.

Towards this, the Act imposes similar, but distinct, duties on people who:

• Hire, lease or loan to another; or
• Otherwise sells or supplies

plant that can be used in a place of work.

Where a person hires, leases, or loans plant to another

The Act imposes a duty on any person who hires, leases, or loans to another person plant that can be used in a place of work (section 18(1A)).

In such a case, before hiring, leasing or loaning the plant to another person, they must first ascertain from the person:

• Whether the plant is to be used in a place of work; and, if so
• The intended use of the plant.

Where the plant is to be used in a place of work, the person hiring out, leasing or loaning the plant must take all practicable steps to ensure that the plant is designed and made, and has been maintained so that it is safe for its intended use.

This places a clear onus on hire companies and others to ask about the intended use of the plant they are hiring, leasing, or loaning. Also, because the Act refers to the "loan" of plant, in other situations - where money may not change hands - the same duty will apply when plant moves from one place of work to another.

Where a person sells or supplies plant (other than for hire, lease or loan)

Where the above duty doesn't apply, and a person sells or supplies plant to another person that can be used in a place of work, they have a duty to ensure it is safe. The duty is to take all practicable steps to ensure that the plant is designed and made, and has been maintained, so that is safe. It applies to:

• Any intended use that the seller/supplier knows of; or
• Any use that the seller/supplier could reasonably expect.

(section 18A (2))

As is the case with hirers, etc, the duty applies to plant that can be used in a place of work. The standard required is that the person selling or supplying the plant take "all practicable steps".

Although there is no explicit duty to enquire into the use of the plant being sold or supplied, the duty applies not only to any known use, but also any use of the plant "that the person could reasonably expect". This is an objective standard, the assessment of which will be based on the "reasonable person" test. For further explanation, see 1.5, "All practicable steps". This means for example, that if a supplier provides a woodcutting saw to a woodworking shop, and it is subsequently used to cut metal and fails, then the supplier is unlikely to be held liable for a breach of the duty. If, on the other hand, they supply the same saw to a metalworking shop, then they could well be liable.

Installing or arranging plant

Where the above duties apply to a person who, hires, leases, sells, or otherwise supplies plant to another person for use in a place of work, and agrees to install or arrange the plant, the person completing the work must take all practicable steps to install or arrange it so that it is safe for its intended use (section 18(3)).

"Plant" defined

The term "plant" is defined in section 2 of the Act. The definition is very broad, and includes, but is not limited to, any:

• Appliance;
• Equipment;
• Fitting;
• Furniture;
• Implement;
• Machine;
• Machinery;
• Tool; or
• Vehicle.

The plant must be of a nature that can be used in a place of work. So, for example, while a mountain bike is a vehicle or machine, it is unlikely to be used anywhere other than for leisure activities. Conversely, a forklift truck is unlikely to be used anywhere other than a place of work.

The term also includes part of any plant, its controls, or any thing connected to the plant. This further extends the duty. It means, for example, that if a person hires out a trailer-mounted concrete mixer for use in a place of work, the duty applies to the trailer assembly and coupling to a vehicle, the motor, the mixing bowl and transmission, the controls, and any guards or covers attached to the mixer. If electrical leads or connections are supplied with it, then the duty applies to them as well.

Refer to the definitions section at the back of this guide.

Goods sold "as is" are exempt

The duties do not apply to the sale of plant, whether or not in trade, to plant sold secondhand and "as is" - i.e without any representations or warranties about its quality, durability, or fitness, and with the entire risk in those respects to be borne by the buyer (section 18A (4) and (5)).

Relationship with consumer protection legislation

Section 18A (6) states explicitly that the duty contained in the Act does not limit the Consumer Guarantees Act 1993, which provides consumer protection for the purchase of goods and services other than in trade.

Example:

1. Squashers Ltd leased a waste compactor to a supermarket, TopBuys Ltd, whose employees were responsible for its day-to-day operation.

   The compactor had been manufactured to an American standard and imported by Squashers Ltd. When it was operated, there was a trapping point between a ram head and a hole through which employees fed refuse into it.

   One day, a young TopBuys employee, Ed, was using the machine, when it became clogged with refuse. He climbed into the machine to force down the cartons that had become stuck, and was crushed to death between the ram and the refuse.

   The compactor comprised a self-enclosed bin, into which rubbish was forced from above by a hydraulic ram in a separate compactor unit. Squashers' management had noticed that it was possible for employees operating the unit to climb on top of the housing and into the hopper on top of the compactor. An industry committee had been established to provide guidelines. Since 1989, literature available to the company had recommended secure fencing to prevent entry while the machine was operating, an automatic cut-out, should the guard be removed, and a continuous pressure switch.

   Squashers Ltd was charged under section 16. The court found that accidents caused by careless use were foreseeable. Squashers Ltd was found to have actual knowledge, and although American standards had been applied, this was not considered adequate to meet the New Zealand Act's requirements in the circumstances. The company was convicted and fined. Today the charges would be laid under section 18A.

2. Superb Painters hired a sky lift platform from Hyper Hire Ltd to provide access for a contract to paint a warehouse.

   Superb's employees, Yosef and Zac were painting from the platform when it collapsed. Yosef was thrown 6 metres from the platform on to a concrete floor, receiving facial injuries, lacerations, a skull fracture, fracture to the left tibia and a fractured pelvis. Zac received severe bruising to his legs.

   Investigation by a health and safety inspector showed that a director of Hyper Hire had added an extra scissor to the hydraulic platform to enable greater use. The welding was of a poor quality, and led to the collapse.

   Hyper Hire Ltd were convicted and fined under section 16. (Today any prosecution under similar circumstances would be taken against the company under section 18A.)