On 27 February 2025, the High Court overturned the conviction of Whakaari Management Limited (WML). WML had been charged by WorkSafe for breaching a duty owed under s 37 of the Health and Safety at Work Act 2015 (HSWA). Section 37 of the HSWA contains the duty for a PCBU who manages or controls a workplace to ensure, so far as is reasonably practicable, that the workplace, the means of entering and exiting it as well as anything arising from it is without risk to health and safety.

The District Court held that WML breached its duty under s 37 of the HSWA (refer to our November 2023 update). Specifically, the District Court found WML actively managed and controlled the ‘walking tour workplace’ on the island and it had failed to ensure the workplace was without risks to the health and safety of any person (namely, those visiting the island for a walking tour).

The High Court did not agree and held that WML did not:

• owe a duty under s 37 of the HSWA because it did not ‘actively manage and control’ the workplace in a practical sense; or
• breach any duty under s 37 of the HSWA that it might have had.

The key findings are:

• “Management and control” of a workplace will fall on a continuum, from mere ownership of the workplace at one end to control over the work carried out at the workplace at the other.
• Whether a PCBU “manages or controls” a workplace under s 37 of the HSWA is a factual question that depends on the nature of the workplace, and the PCBU’s actual power to control the workplace as part of its business or undertaking in practice. PCBUs cannot avoid liability by not exercising powers of control that they possess.
• In assessing what constitutes a “reasonably practicable step” by a PCBU who controls a workplace, the courts will consider whether the underlying access agreements impose robust health and safety obligations on the PCBU(s) actually carrying out the work. While PCBUs cannot contract out of or disclaim their duties under the HSWA, contractual mechanisms can be a reasonably practicable step to eliminate or minimise risks in certain circumstances.

WML did not have a duty under s 37 of the HSWA

The High Court acknowledged that it would be inconsistent with the purpose of the HSWA if a PCBU could escape a duty under s 37 of the HSWA by neglecting to actively manage or a control a workplace that is within their management and control. It also recognised that the phrase “who manages or controls” in s 37 was deliberately adopted by Parliament to exclude PCBUs who merely have the ability to control or manage the workplace.

To strike the right balance between active management of a workplace and the ability to manage a workplace, the High Court looked to Australian cases that emphasised the need to attribute the responsibility for health and safety to the person that actually possessed active management and control of the workplace (as opposed to the work itself), in a practical sense. The High Court found that the following questions need to be considered to determine whether a PCBU “manages or controls” a workplace under s 37 of the HSWA:

1. What is the workplace for which a PCBU is alleged to owe a duty to under s 37 of the HSWA?
2. What would it mean for a PCBU to have the power to actively manage or control that particular workplace?
3. Did a PCBU in fact have the power to actively manage or control that particular workplace (whether in whole or in part) as part of its own business or undertaking?

In the case of WML, the workplace in question was the “walking tour workplace” on Whakaari | White Island. The High Court’s analysis turned on what the power to actively manage or control the walking tour workplace would require, and whether WML had that power as part of its business or undertaking.

The Court found that it did not. This was based on the following considerations:

• Grant of access: While WML controlled the walking tour workplace by granting access to the island so that tour operators could carry out tours, the granting of licences did not give WML an ability to manage or control what happened at the walking tour workplace in an active or practical sense. That duty fell to the tour operators to discharge.
• The terms of the licence agreements: The licence agreements did not grant WML an ability to direct and control what was happening at the walking tour workplace on a day-to-day basis. Instead, the licence agreements imposed obligations on the tour operators that were aimed at ensuring their operations were conducted safely. There was no practical mechanism for WML to ensure that its licensees were adhering to their obligations, or for WML to learn of a breach.
• WML’s actions after granting access: Attending meetings with users of the Island and emergency/scientific agencies (including NEMA and GNS) showed that WML was an interested and engaged operator of the island. Those actions did not elevate it to be a PCBU with active management or control of the walking tour workplace, nor did WML’s active role in developing tourism on the island. There was no evidence that WML made decisions for the tour operators about their day-to-day work at these meetings, nor otherwise that WML actively managed the walking tour workplace.
• Money and societal risk: Making money from its licencing operations did not make WML a PCBU with management or control of the workplace. That money simply allowed others to enter the island and did not give WML an ability to manage or control the walking tour workplace. Equally, while the High Court accepted that it was important for the “societal risk” of permitting the public to access the island to be understood and managed, the High Court was not willing to work backwards from that fact and deem that WML must have managed or controlled the walking tour workplace in circumstances where, as a practical matter, it did not.

If WML did have a duty under S 37 of the HSWA, would it have been breached

While the Court overturned WML’s conviction for these reasons, it did consider whether the duty under s 37 of the HSWA would have been breached if such a duty had been owed.

The question for the High Court to consider was whether it was reasonably practicable for WML to have obtained a risk assessment for its business and, if so, whether WML should have undertaken further steps to respond to any risk identified. For example, monitoring hazards arising from volcanic activity, ensuring the supply of appropriate personal protective equipment, and ensuring there was an adequate means of evacuation from the island.

The High Court found that obtaining a risk assessment was not a reasonably practicable step based on the nature of WML’s business and on WML’s reliance on Government agencies:

• WML’s business: The High Court focussed on the fact that WML’s business was not to undertake walking tours, but rather to permit other specialist tour operators to undertake walking tours in consideration for an annual fee and commission. While the risk of a volcanic eruption was always inherent to the workplace itself, the risk that people might be on the Island when this happened arose out of the work activity being undertaken by the tour operators. Imposing health and safety obligations on those tour operators through the licence agreements was sufficient to discharge any duty WML might have owed in these circumstances.
• Reliance on Government agencies: The High Court found that it was reasonable for WML to rely on Emergency Management Bay of Plenty (EMBOP), the “Whakaari Response Plan” EMBOP had authored in 2015, and the 2014 and 2017 audits of White Island Tours. It was relevant in this context that EMBOP was statutorily responsible for identifying, assessing, and managing the hazards and risks associated with Whakaari | White Island under the Civil Defence Emergency Management Act 2002. Moreover, although there had been an eruption in 2016 (i.e. after the production of the Whakaari Response Plan), WML could still reasonably rely on the consensus among several other agencies with leading health and safety expertise that walking tours could continue after the eruption.

It followed from these findings that the actions that a risk assessment would have identified (if one had been obtained), were not reasonably practicable for WML to have implemented.

Our view

The decision creates a test that in some respects is more onerous than the approach taken by the District Court.

The District Court had found that, because the intention was to capture those who actively manage or control workplaces, “[m]erely being able to manage or control a workplace, but not doing so, is not enough”. The High Court decision emphasises that this would allow a PCBU to escape a duty under s 37 by neglecting to exercise powers of management or control that were available and finds that “the inquiry...must be one of whether the PCBU has the power or capacity to actively control or manage the particular workplace in a practical sense”.

It is clear from the Court's decision that whether a PCBU has the power or capacity to actively control or manage a workplace in a practical sense will be a fact-specific enquiry (and the judgment notes the need for the law to remain flexible to circumstances that neither legislatures nor the courts can foresee at the time). Accordingly, while the High Court’s decision provides some indication of the circumstances in which the courts will not consider the duty in s 37 applies, there remains some uncertainty about how much management or control of a workplace a PCBU must exercise before the courts will consider the duty in s 37 is engaged. Despite this position, the approach taken in the judgment will obviously guide the courts in their consideration of the application of the s 37 duty in other cases.

Given this, we recommend PCBUs consider the judgment and its application to their business or undertaking to identify the circumstances in which they may owe a duty under s 37 and, if so, whether they are taking sufficient steps to discharge that duty. Pending further decisions from the Courts regarding the application of this duty, we consider there is a role for WorkSafe to publish further guidance regarding the s 37 duty so that PCBUs have some certainty about the circumstances in which the regulator will expect PCBUs to discharge this duty.

This article was co-authored by Michael O'Brien, a Solicitor in our Litigation team and Ella McCall, a Law Clerk in our Employment team.

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