Sentencing for safety: Fines under the Occupational Health and Safety ActTuesday May 31, 2011 Written by David Cherepacha
When a company is convicted of an offence under Ontario's Occupational Health and Safety Act, the normal penalty imposed by the court is a fine. The courts in Ontario consider a wide range of factors when sentencing a corporation under the Act, although these factors are not of even weight.
The leading case in Canada on sentencing under occupational health and safety legislation is the 1982 Ontario Court of Appeal decision in R. v. Cotton Felts Ltd. Although this decision is now almost 20 years old, Crown prosecutors in Ontario continue to cite it when negotiating plea bargains with defence counsel, and when making submissions to the court on what is an appropriate sentence for a corporation found guilty of violating the Act.
Briefly, in Cotton Felts, a worker lost his arm when it was caught by a roller and pulled into a machine he had been cleaning, resulting in an amputation below the elbow. The worker had failed to stop the machine before he began cleaning it. Earlier, another employee had injured his thumb while working on a similar machine in motion. An inspection of the workplace by the Department of Labour resulted in 50 work orders being issued against the company for rectification of unsafe working conditions. The company was also charged under a section of the Act's regulations, which provided that a machine shall only be cleaned when motion that may endanger the worker has stopped. At trial, it was shown that management knew that the machines were cleaned without being turned off. The company subsequently pleaded guilty and the sentencing was adjourned to allow the company time to demonstrate what it could do to improve safety at the plant. The company spent $100,000 in health and safety improvements, including $11,000 on protective devices for machines.
Upon returning to court for sentencing, the Crown prosecutor recommended a fine in the range of $2,000 to $3,000, while the company asked for a more modest penalty because of the large expenditures it had made in meeting safety requirements. However, the court ignored both sentencing submissions and imposed a fine of $20,000 on the company, emphasizing the importance of general deterrence. At the time, this fine was significantly higher than other fines imposed for similar offences. The maximum fine permitted by the Act at that time was $25,000.
On appeal, the Ontario Court of Appeal upheld the trial judge's sentencing decision, noting the primary importance of enforcing regulatory standards by general deterrence, both with respect to the individual defendant company and to members of the community at large. The Court of Appeal stated that the amount of a fine will be determined by a variety of considerations, including:
• the size of the company involved;
• the scope of the economic activity at issue;
• the extent of actual and potential harm to the public; and
• the maximum penalty prescribed by the statute.
The Court of Appeal also emphasized that each case must be decided upon its own merits, stating, "Without being harsh, the fine must be substantial enough to warn others that the offence will not be tolerated. It must not appear to be a mere licence fee for illegal activity."
Courts will also take into account, by way of mitigating factors, such things as the past safety record of the company (e.g., any previous convictions) and the conduct of the company both before and post-accident (e.g., efforts to promote safety and prevent future accidents).
Recent fines imposed against corporations for occupational health and safety offences range widely. Today, the maximum fine against a corporation permitted by the Act is $500,000.
For example, in R. v. Pack All Manufacturing Inc. (2009), a fine of $55,000 was imposed on a small company charged after a worker lost one finger and the use of his hand due to multiple fractures when it became caught in machinery (a waste material hopper). The company failed to have the machine properly guarded and was found by the court to have a lax attitude towards safety. Two directors of the company were also fined $5,000 each.
In R. v. Peninsula Alloy Inc. (2010), the worker suffered serious burns and injuries to his scalp, face, back and right arm as a result of only wearing part of the protective equipment necessary when working with a charging furnace. On appeal, the court upheld a $70,000 fine against the company.
In Ontario (Ministry of Labour) v. Cox Construction Ltd. (2010), a worker died after being struck by an excavator operated by a co-worker. The company was convicted under the Act of failing as a "constructer" to ensure that the workers on its project were protected. After appeal, the fine imposed was $150,000, plus a 25 percent victim surcharge. (Under the Victims' Bill of Rights, a surcharge applied to fines is credited to a special fund to assist victims of crime.)
The courts will consider all of the facts and circumstances of each specific case, including mitigating factors, when imposing a fine against a corporation convicted of an offence under the Act. However, the overriding factor will always be what level of fine will effectively serve as a deterrent to both the company charged and the community at large to promote the objectives of health and safety legislation.