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Why failure to focus on health & safety could cost you long after the fine is paid

Fines levied under corporate manslaughter prosecutions could be the least of your problems, says Beale and Company partner Sheena Sood.

When the Corporate Manslaughter and Corporate Homicide Act 2007 (“the Act”) came into force six years ago it was anticipated that this new statutory regime by which companies and organisations could be prosecuted for fatalities would give the HSE/CPS greater clout against large companies and organisations.  

Penalties for successful prosecutions include an unlimited fine and the Sentencing Guidelines Council has advised that an appropriate fine will rarely be less than £500,000 and may be measured in the £millions.

However, to date none of the prosecutions have been against any large companies.  As such the resultant fines for successful corporate manslaughter prosecutions have been less than £500,000.  

"Health and safety remains a very important issue.  For the good of your own health and the people working for you make sure all health and safety policies and procedures are reviewed no matter the size of your company and location of projects".

The level of fines should not be taken as a weakening of the judicial approach to fines and therefore the seriousness of corporate manslaughter but is reflective of the financial position of the companies.  For example:

  • In the prosecution arising from the Princes Sporting Club fatality the judge fined the company £135,000 being “every penny that it has”.
  • In R v Mobile Sweepers (Reading) Limited the company pleaded guilty to corporate manslaughter and although the Judge commented that the seriousness of the case warranted a fine closer to £1 million, the company was fined the totality of its assets - £12,000.  However, the company’s sole director was fined £191,000 after pleading guilty to an offence under the Health and Safety at Work Act.

The Mobile Sweepers prosecution also highlights a trend that in the majority of corporate manslaughter prosecutions, the HSE/CPS also bring charges against individual directors/officers of the company for gross negligence manslaughter and other health and safety breaches to secure a successful outcome against the company.

"It should not be forgotten that a successful corporate manslaughter prosecution results in a criminal record and can affect a company’s competitiveness and ability to win future work".

It was considered that the HSE/CPS was using the potential loss of individual freedom – gross negligence manslaughter carries a maximum sentence of life imprisonment with the average being 3-4 years – to obtain an offer of a guilty plea on behalf of the company in return for charges against the individuals being dropped. Although made to fight all the way in Mobile Sweepers, in Lion Steel the gross negligence manslaughter charges against the directors certainly assisted in obtaining a guilty plea to the corporate manslaughter charge.

Similar laws regarding fatalities at work are spreading internationally.  In the UAE there are federal and local laws and regulations, for example the Dubai Code of Construction Safety Practice.  In Nigeria, the Senate has just passed a corporate manslaughter bill which includes an unlimited fine for companies found guilty and imprisonment and/or a fine for an individual whose performance of their duties causes or leads to the incident that causes a fatality.

Companies who are undertaking work abroad must ensure it ascertains what relevant local health and safety laws, regulations, orders and guidelines apply – which could be numerous –and that health and safety obligations in appointments are compatible with such laws.

Health and safety remains a very important issue.  For the good of your own health and the people working for you make sure all health and safety policies and procedures are reviewed no matter the size of your company and location of projects to ensure they are up to-date and being properly implemented.  

It should not be forgotten that a successful corporate manslaughter prosecution results in a criminal record and can affect a company’s competitiveness and ability to win future work.  

 

Sheena Sood leads the Construction, Engineering and Infrastructure team at Beale and Company Solicitors www.beale-law.com