The price of a life – how a court assesses the financial cost of an employee’s death.

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On September 20, 2015, Samantha Kudeweh, a zookeeper at Hamilton Zoo, was fatally mauled by one of the Zoo’s male Sumatran tigers, Oz. Samantha left behind a husband and two young children.

Almost one year to the day, on September 16, 2016, Hamilton City Council was sentenced for failing to take all practicable steps to protect her and ordered to pay a fine of $38,250 and reparation of $10,000 to her two children.

Judge Denise Clark said $100,000 was the appropriate amount of emotional harm reparation for the family, but noted that the council had already made voluntary payments totalling $116,000. However, Samantha’s husband, Richard Kudeweh, has disputed these payments have been made.

So how does the court assess the impact of an employee’s injury or death and reduce it to a monetary amount? The sentencing principles commonly used are those set out in a 2008 High Court decision: Department of Labour v Hanham & Philp Contractors.

These principles require the court to take a three-step approach: first by assessing the emotional harm reparation, including any financial loss, that should be paid to the victim or the victim’s family, then assessing an appropriate fine and finally, making an overall assessment of the case.

Typically, both the prosecution and the defence inform the court where they consider the amounts of reparation and fine should start from, based on cases involving similar injuries to the victim, the impact of those injuries on the victim and a comparison to cases where similar failures in a company’s obligations to take all practicable steps to protect employees (and others validly on premises under a company’s control) have occurred.  The judge then makes the final decision on the amounts.

Reparation and fines serve two distinct purposes; the former is to compensate the victim or the victim’s family and the latter is punitive against the defendant and a deterrent to others. Where there are financial constraints on how much a company can pay overall, reparation for the victim is prioritised.

Factors used when assessing an appropriate amount of reparation include the nature of any disability incurred, whether it is permanent or temporary and any financial loss suffered by the victim or the victim’s family. The Court will also take into account any reparation already paid or offered to the victim, the response of the offender, any action taken to remedy the victim’s suffering, the financial capacity for the offender to pay and other factors such as remorse and participation in restorative justice.

When attempting to set the starting point for the fine, the degree of culpability is categorised into one of three bands; low culpability from zero to $50,000; medium culpability $50,000 to $100,000; and high culpability from $100,000 and above. In the case of Hamilton City Council, Judge Clark set the starting point at $85,000, so at the higher end of the medium band.

From this starting point, the Court then either raises or decreases the amount depending on any aggravating or mitigating factors.  Aggravating factors such as previous health and safety convictions or failure to co-operate with WorkSafe investigators can raise the fine from the initial starting point.  Mitigating factors which can decrease the fine include an early guilty plea (up to 25 percent), co-operation with WorkSafe investigators, remedial action taken since the event to prevent a further occurrence, a good health and safety record and remorse. The latter factors can add up to a further 30 percent reduction from the starting point of the fine.

Finally, the Court stands back and makes an overall assessment of the amounts for reparation and fine including such factors as the ability of the offender to pay, the need for denunciation, deterrence and accountability and the extent to which reparation ordered will “make good” the harm done.

Take-home tips for employers from the above would be to ensure from the outset that when an accident does happen, the employer shows full co-operation with the investigators which usually involves providing all training records, health and safety policies and any other information requested, promptly.  It is only following an investigation that WorkSafe decides whether to proceed with a prosecution and they have six months to make that decision.  If they do proceed with a prosecution, there is certainly value in acknowledging the incident that happened was potentially preventable by entering a guilty plea as early as possible. Finally, this is definitely a situation where engaging a lawyer specialising in health and safety law at the earliest opportunity is essential.

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About Author

Erin Burke

Employment Lawyer and Director at Practica Legal Email: erin@practicalegal.co.nz phone: 027 459 3375

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