Lessons on corporate manslaughter

MD Peter Eaton was charged with gross negligence manslaughter (a separate personal prosecution was subsequently stopped on health grounds). Cotswold was fined £385,000 over 10 years. The court of appeal rejected an appeal despite the fine representing 250% of turnover for this small company. What does this verdict tell us? Companies must set the right tone at the top if they are to avoid criminal prosecution for health and safety failings. Directors and senior managers must manage proactively, not turn a blind eye. They should ask the right questions about risks that their business creates and foster a culture of compliance. The legislation has not imposed any new duties on companies or managers. The primary duties to safeguard people's health and safety are in the Health and Safety at Work etc Act 1974 ('HSWA') and prosecution under this act remains the most likely threat. Senior managers who commit serious health and safety breaches are vulnerable to prosecution under the HSWA and imprisonment for up to two years is a possibility. Compliance with the IoD guidance – 'Leading Health & Safety at Work: leadership actions for directors and board members' – is highly recommended as a means of reducing risk. Corporate manslaughter prosecutions will be reserved for the worst examples of corporate failings which cause death. It is not the case that every workplace fatality will lead to a corporate manslaughter prosecution. Cotswold's fine of £385,000 should not be viewed as typical. Recent guidelines suggest that fines for corporate manslaughter could run to millions of pounds for large organisations with high turnovers. In the unfortunate event of a serious accident, it is important that managers know how to protect staff at the interview stage and conduct an internal investigation that may be privileged and protected from disclosure. These procedures should be captured in an incident response protocol and require specialist legal input.