inbrief

Corporate

Inside The offence of corporate manslaughter Penalties Individual liability Other health and safety obligations Practical steps inbrief

Introduction The offence of corporate manslaughter any other activity on a commercial basis

Under the Corporate Manslaughter and The Act provides for a statutory offence of > keeping or using plant and equipment corporate manslaughter in England, Wales and Corporate Act 2007 (the Act), an Most organisations will owe duties of care to Northern Ireland, and corporate homicide in employees and others in connection with their organisation is guilty of an offence if the way Scotland. It applies to companies and other activities, so in the context in which its activities are managed or corporate bodies (in the public and private establishing a duty of care should not be sector), partnerships that are employers, and organised by senior management causes a difficult. death and this amounts to a gross breach of bodies such as Government departments and police forces. Senior management duty of care owed by the organisation to the deceased. The offence makes a company liable for The failure must be at senior management level. corporate manslaughter if: A ‘senior manager’ is someone who plays a This Inbrief provides a general summary of significant role in making decisions about how > the way in which its activities are managed the legislation and the steps an organisation the whole or a substantial part of its activities or organised should be managed or organised, or who is can take to comply with its obligations. actually responsible for managing those > by senior management activities. This will be a question of fact in each > causes death case, but is clearly capable of including executive and non-executive directors. It is the > is a gross breach of a duty of care owed by breach of a duty by ‘senior management’ that the company to the individual concerned gives rise to liability with the focus being on the collective management of the organisation, not The way in which activities are managed or the activities of a single individual. organised must be a substantial of the breach of the duty of care. Gross breach of the duty of care

The elements of the offence are looked at To constitute a ‘gross’ breach of the duty of below. care, the conduct alleged must fall “far below what can reasonably be expected of the Relevant duty of care organisation in the circumstances”. The organisation must owe the deceased a duty In deciding this, the jury must consider whether of care connected with the organisation’s the organisation failed to comply with health activities. Factors to be taken into account when and safety legislation and if so: deciding whether there is a duty of care include: > how serious that failure was > any duties owed by the organisation under the law of negligence > how much of a risk it posed

> a duty owed to the organisation’s The jury may also consider the extent to which employees or to other persons working for the shows that there were attitudes, the organisation or performing services for policies, systems or accepted practices within it the organisation that were likely to have encouraged any failure or to have produced > a duty owed by the organisation as an tolerance of it. This means that the occupier of premises organisation’s safety culture will be very important. For example, evidence that > a duty owed in connection with: employees were regularly required to work > supply by the organisation of goods and without adequate protective equipment could services be taken into account when determining whether there has been a ‘gross’ failure. > the carrying on by the organisation of It will not be a defence for the organisation in any construction or maintenance question to show that its safety record was no operations better or worse than other companies in the > the carrying on by the organisation of same industry, particular if that industry/sector inbrief

has a poor or sub-standard safety record. Individual liability individuals involved in health and safety matters have sufficient training and are ‘competent’ to Health and safety guidance can be taken into The Act does not impose secondary liability for undertake the tasks assigned to them by the account in deciding whether there has been a aiding, abetting or the commission of business. Remember the business has a non- ‘gross’ breach. This includes codes, guidance, the offence of corporate manslaughter. In other delegable duty of care to its employees and manuals or similar publications concerned with words, individual senior managers cannot be visitors. health and safety matters issued by an authority liable for the offence of corporate responsible for the enforcement of any health manslaughter. However, the Act does not Forward planning - before undertaking any and safety legislation, such as the HSE. preclude individuals being prosecuted in their change in working practices ensure that there is own right for primary liability offences including a period of planning and testing before final Penalties gross negligence manslaughter under the implementation. It is important that feedback is There are three possible sanctions for a breach common law (which is unaffected by the Act in obtained and recorded in relation to any of the Act: an unlimited fine and/or a ‘remedial relation to individuals) and/or breaches of other proposed change, and, if necessary, additional order’ and/or a ‘publicity order’. Failure to health and safety legislation. risk assessments carried out. comply with a remedial or publicity order is a Measure performance - set bench marks for Other Health and Safety obligations criminal offence punishable by an unlimited accident rates and measure against those fine. > The Health and Safety at Work Act 1974 standards. Constantly review the standards and A remedial order requires the organisation to (HSWA) requires employers to conduct their look for accident trends/patterns. Test and take steps to remedy the management failure, business so as to ensure the health and measure response time and provide feedback to including any deficiencies in health and safety safety of their employees, non-employees employees. Ensure that additional risk policies, systems or practices. and members of the public, as far as it is assessments are undertaken if any accidents reasonably practicable to do so occur or accident patterns emerge. Review A publicity order requires the organisation to performance and if necessary undertake publicise the conviction and may require > A breach of these duties is a criminal additional assessments. publication in a specified manner of the fact of offence that can be prosecuted by the Audit - it is important for businesses to have an conviction, specified particulars of the offence, Health and Safety Executive (HSE). If audit trail which shows that the policy is a living the amount of any fine and the terms of any convicted, a company can face unlimited document and the organisation takes its duties remedial order. fines very seriously. Guidance as to how courts should use the > In addition, individual directors can be possible sanctions was issued by the Sentencing prosecuted if the company’s breach was Guidelines Council in February 2010 in its due to their negligent acts. If convicted, the definitive guideline “Corporate manslaughter HSE can apply to have the individual and health and safety offences causing director disqualified under the Company death” (available at http://www.sentencing- Directors Disqualification Act 1986. guidelines.gov.uk/docs/guideline_on_corporate Individuals within the company can also be _manslaughter.pdf). prosecuted for manslaughter This guideline sets out key principles relevant to assessing the seriousness of the offence and the Practical steps appropriate financial penalty and looks at the The legislation is there to punish system failures. additional powers available to a court imposing The more robust the systems in place, the less . likely an organisation will be held liable for their The guidelines are clear that fines must be failure. Once a policy is established, it will be punitive and significant. The appropriate fine for critical to ensure that it is actually followed. an offence of corporate manslaughter will Policy - create a policy which is both robust but For further information on this subject seldom be less than £500,000 and may be at the same time simple to understand. It is please contact: measured in millions of pounds. Where other important to ensure the policy meets the health and safety offences cause death, the business’s needs but at the same time ensures Vince Toman appropriate fine is unlikely to be less than compliance with its obligations. Barrister £100,000 and may be up to hundreds and T + 44 (0) 20 7074 8171 thousands of pounds. Organisation - ensure there is in place an [email protected] organisational structure that is responsive to

safety needs. It is important to ensure that those inbrief

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