27 July, 2017
The Health and Safety Offences, Corporate Manslaughter and Food Safety and Hygiene Offences Definitive Guidelines have been in force for over a year and during that time we have witnessed a dramatic increase in the level of fines being imposed on organisations following breaches of health and safety legislation.
When determining the appropriate penalty to impose the Courts now have clear guidelines to consider. A Judge must consider the culpability of the defendant ranging from low to very high, the risk of harm created by the offence, and aggravating and mitigating factors such as the number of people exposed to the risk. The Court then looks to the annual turnover as the starting point for the fine.
Since the introduction of the guidelines, fines for breaches of health and safety legislation have increased and larger organisations are notably receiving significantly higher fines. A report by IOSH confirmed that nineteen companies received fines of a million pounds or more in 2016, compared to only three in 2015 and none in 2014. The largest fine so far was handed down to Merlin Attractions Operations Ltd. They were fined £5 million following an accident involving the Smiler ride at Alton Towers which left 16 people injured.
Other examples of recent fines levied:
An investigation by the Health and Safety Executive (HSE) found that the company had failed to consider and properly plan the stacking and storage of the bales. There was also no formal training in stacking bales and lack of monitoring in the bale area.
May 2016, Balfour Beatty received the highest fine ever levied in the construction industry. Balfour Beatty was fined £2.6m for the death of a worker after a trench collapsed on an offshore windfarm.
The HSE found that Balfour Beatty failed to adequately risk assess the works or control the way in which the excavation took place.
An agency worker was cleaning parts of a bread line when his arm got trapped against a running conveyor belt. He suffered friction burns which required skin grafts.
An investigation by the HSE examined CCTV footage and found the machine could and should have been fitted with localised guarding to prevent access between the conveyors.
In addition, we have seen an increase in fines in cases where no injuries have been sustained. Health and safety offences are committed when there is a failure to manage risk and therefore proof of actual harm is not required.
ConocoPhillips (UK) Limited received a fine of £3 million following a gas leak on the Lincolnshire Offshore Gas Gathering System, the leak did not cause injury to workers or members of the public but the court indicated that it felt this matter should be fined as a 'category 1' case, because there was a high risk of serious injury or death being caused.
There is some light in the horizon for those organisations who are charged with breaching health and safety legislation. On 1 June 2017 the Sentencing Council released updated Definitive Guidelines on the Reduction in Sentence for a Guilty Plea. The purpose of the guidelines is to encourage those who are going to plead guilty to do so as early in the court process as possible. Where a guilty plea is indicated at the first stage of proceedings i.e. normally at the first hearing at which a plea or indication of a plea is sought and recorded by the court, a reduction of one-third should be made to the sentence. An early guilty plea post 1 June 2017 will result in a substantial reduction for organisations potentially facing a six figure fine.
The Guidelines will inevitably put pressure on organisations to make an early admission of guilt, although in health and safety cases it is often difficult for large organisations to enter a guilty plea at such an early stage. There is however an exception in the guidelines if the sentencing court is satisfied that particular circumstances significantly reduced the defendant's ability to understand what was alleged or otherwise made it unreasonable to expect the defendant to indicate a guilty plea at an earlier stage, in such cases a reduction of one-third will still be made.
There is a clear trend of increasing fines for health and safety breaches, and those companies with a large annual turnover are being hit the hardest with hefty fines. In light of the new Guidelines which offer a reduced sentence for a guilty plea, organisations will need to weigh up the commercial benefit of entering a guilty plea to avoid expensive litigation which may potentially culminate in an eye watering fine. However, as described above, it is not always easy for large companies to establish the legal position without a thorough investigation. Businesses who find themselves in this position should seek immediate legal advice and carry out prompt investigations so that they can make an informed plea at the earliest opportunity.
For more information please contact Ridwaan Omar by email or call 01254 662831.
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