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Large Increase in Health and Safety Penalties – who’s going to pay?

Category: Health & Safety | Bryan Richards Twitter | Published on: Mar 22, 2016 | Updated: Dec 12, 2016 Read more: Health & Safety

cashLarge companies could face fines of over £10 million for the most serious health and safety offences and more than £20 million for corporate manslaughter convictions under new sentencing guidelines which came into force on 1st February 2016.

The Sentencing Council’s guidance gives judges a framework of tiered penalties for different sizes of organisation, level of harm risked and culpability.

The new guidance will extend to all health and safety offences, where current guidance covers just fatalities.

 

What does this mean for Organisations?

The Guidelines use the concepts of ‘culpability’ and ‘harm’ to determine the level of fine, cross-referenced against the size of the organisation.

The measure of ‘culpability’ varies from ‘low’, where failings are minor and not systemic, to ‘very high’, where there has been a deliberate breach or flagrant disregard for the law. The level of ‘harm’ is based upon the risk of harm created by the offence, which is then exacerbated if actual harm has occurred.

Once the ‘culpability’ and ‘harm’ categories are established, the turnover of the organisation will be used to allocate a particular sentencing matrix. There are different matrices depending on the size of the organisation:

  • Micro – Turnover not more than £2 million
  • Small – Turnover between £2 and £10 million
  • Medium – Turnover between £10 and £50 million
  • Large – Turnover over £50 million

For each of the above the guide has tables to guide judges on the level of fine. The table for a medium-sized organisation is shown below:

table

What does this mean for individuals?

jailThe method of determining ‘culpability’ and ‘harm’ is similar to that used for organisations. There are also similarities with the use of a matrix to determine a starting point and category range for punishment.
The key message is the increasing possibility of custodial sentences. Even for those offences involving low culpability, there is still the possibility of a 26 week prison sentence in cases involving the highest level of harm.

What about Corporate Manslaughter?

The guidelines are much clearer for corporate manslaughter sentencing. There is no need to determine the level of ‘harm’ as all prosecutions will follow a fatality. ‘Culpability’ levels are also reduced into two categories: ‘serious’ and ‘more serious’.
The proposed fines are significant and much larger than the majority of those imposed for corporate manslaughter offences since April 2008. For example, the fines for ‘medium’ organisations are significantly higher:

table 2

What can you do to mitigate the level of fine?

The Guidelines list factors that may increase or reduce the level of fine as shown below:

table 3

Recent Court Cases

Since the start of 2016 there have been court cases that have highlighted the potential increase in fines and sentences. Examples of these are shown below:

Construction Co Director jailed for Six Years. It was reported in the IOSH Magazine that, in January 2014, a 47-year-old employee fell through a skylight onto the concrete floor nine metres below. He sustained fractures to his spine, pelvis, right leg, heel and wrist. Later on the same day, 42-year-old Scott Harrower, another BDC worker, fell through a skylight and sustained fatal head injuries. The day before the accident Harrower suffered a near-miss when he accidentally stepped through one of the skylights but managed to stop himself from falling.

The main contractor was found guilty of offences under the Health and Safety at Work Act and the Work at Height Regulations, which require employers to properly plan and supervise work at height and ensure it is carried out in a safe manner. The company’s owner, Allan Thomson, was jailed for six years, fined £400,000 and ordered to pay £55,000 court costs.

The second contractor was found guilty of offences under the Health and Safety at Work Act, the CDM (Construction Design and Management) regulations and Work at Height regulations. Michael Smith was jailed for eight months, fined £90,000 and ordered to pay £45,000 court costs.

£1.8m port operator fine reflected foreseeability of arm injury. A freight terminal operator was fined £1.8m fine for an incident in which a worker’s arm was fractured stemmed from a “comprehensive list of failings”, according to a Health and Safety Executive (HSE) inspector.

Power company fined £1m after runner electrocuted. A company which maintains the power distribution supplies to London, the South East and East of England has been fined £1million after a passing runner was electrocuted by a low-hanging high voltage power cable. Dr James Kew was running on land in Newport, Saffron Walden, Essex, when he came into contact with a cable which should have been 5.5 metres above ground. Members of the public had reported the cable, but the company decided not to isolate the power until an engineer had investigated. By the time the engineer arrived, Dr James had already run into the cable and been killed.

Conclusion

The Guidelines assume that employers will take health and safety more seriously if the penalties are higher. However, it remains to be seen whether these changes will improve accident prevention and save lives, or drive hazardous industries abroad and bring public perceptions of over-zealous enforcement to new heights.

Those organisations that react to the guidelines and bring it to the attention of senior managers will most likely be those that have robust procedures. Those organisations that are ignorant of the Guidelines may be in for an unwelcome surprise.

How Arinite can help

Arinite carries out audits and assessments based on either the principles of HSG 65 or BS OHSAS 18001 to suit our clients. We will be developing templates based on ISO 45001 once it is issued. If you want to find out more, just get in touch for an informal chat.

Contact us

Arinite clients appreciate we provide practical, no-nonsense advice about what you need to do to establish and maintain a safe and healthy working environment. My team of health and safety consultants take pride in keeping health and safety simple.

If you need to call upon our expert assistance, or just for an informal chat, please call me on: mobile 0780 361 2948, office 0207 947 9581, or drop me a line at b.richards@arinite.com.

Bryan Richards 17th March 2016

Arinite Ltd, Warnford Court, 29 Throgmorton Street, London EC2N 2AT

 
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