Getting tough on corporate killing

Welcoming the new Act, the Institution of Occupational Safety and Health (IOSH), said it marked “a new dawn for corporate accountability in the UK”. IOSH president Ray Hurst (pictured) said: “This should serve as a deterrent to the minority of organisations that would otherwise disregard health and safety and by increasing corporate accountability, lead to overall improvements in workplace standards.” He added: “Tragically, 241 workers were killed in Britain last year and there are also an estimated 1,000 work-related road traffic deaths each year and thousands more deaths due to occupational cancers. However, there’s only ever been a handful of convictions under the existing corporate manslaughter laws, all involving smaller organisations – this important legal reform will now mean that larger organisations can more easily be held to account too.” Courts will be able to impose substantial fines and order guilty organisations to publicise their convictions, adding to the damage to their reputations. They will also be able to impose remedial orders, to help ensure organisations address the underlying causes of fatal accidents and that improvements are sustained. Ron Reid, from Shoosmiths Solicitors, commented: “The new manslaughter legislation is going to change this type of prosecution beyond all recognition. It will be at least a couple of years before we see prosecutions, but we will see investigations between now and then. The investigations will not be as we’ve seen before.” And Gerard Forlin, from barristers chambers 2-3 Gray’s Inn Square, added: “The delay between the death and knowing whether your name is going to be on the indictment is likely to be between four and six years – imagine the sword of Damocles hanging over you all that time.” And Marsh, the world’s leading insurance broker and risk adviser, warned UK businesses of the hidden risk and insurance implications of the Act, said it was advising firms that: · The Act affects organisations operating in the UK, not just large corporates · Organisations can be found guilty if a gross breach of duty is proved and that this breach is due to substantial failings in the way the activities are managed or organised by senior management. This is likely to extend to employees driving vehicles as part of their employment. Organisations should look again at occupational road risk for all employees who drive as part of their employment · There are no limits on the potential fines for convicted organisations. Organisations will have to satisfy the courts that there are mitigating factors in order to seek to reduce or limit the level of any fine imposed. · In addition to fines, organisations may be asked to take out publicity orders, which could result in advertising, statements in their annual reports or letters to suppliers and customers regarding their conduct and any penalties levied. The Act focuses on organisations - guilt will be attached to the organisation and not individual directors. Therefore, the insurances that organisations should be reviewing to check their existing criminal defence cover are their Employers’ Liability, Public/Product Liability and Motor cover, and not necessarily their Directors’ and Officers’ policies. · With the exception of the level of potential penalties, the fundamental requirements to manage heath and safety under the Health and Safety Executive’s ‘HSG 65’ framework for managing health and safety have not changed. · The new British Standard for Health and Safety – BS OHS 18001 – can help guide organisations on good health and safety practice. The firm’s Marc Spurling said: “The government expects that cases of corporate manslaughter or homicide following a death at work will be rare, as the new offence is intended to cover only the worst instances of failure across an organisation. However, if a successful prosecution does occur, the penalties could be severe. “While the Sentencing Advisory Panel has intimated that the starting point for setting fines is 5% of an organisation’s average annual turnover, fines are unlimited and if the Court considers that the organisation was particularly culpable, the level of fine could be much higher. In addition, the Act creates the new penalty of a publicity order by which the organisation can be made to advertise their prosecution and so damage its reputation further.”