- New law makes prosecution of companies easier
- Significant improvement of some health & safety practices expected
- Makes the company culpable, rather than an individual within
What has changed?
A new law taking effect next year will make it easier to prosecute companies for corporate manslaughter. The move follows intense campaigning from trade unions and organisations, such as the Centre for Corporate Accountability, alarmed at the rising number of workers killed and the near insuperable difficulty of holding large organisations to account under the current law. In the year to April 2007 there was a 10% increase in workplace fatalities.
The Corporate Manslaughter and Corporate Homicide Bill received Royal Assent in July, and comes into force on 6th April 2008. It provides for corporate liability – with an unlimited fine – if the gross negligence of a company, organisation or government body results in the death of an employee, consumer or other person affected.
The act breaks new ground in holding government bodies accountable – and its passage through Parliament was considerably delayed by debate as to whether deaths in custody should be included. Although the act will eventually apply to deaths of people: in prison, police custody, children’s secure accommodation, or detained under mental health legislation, this will come into force later.
What’s wrong with the present law?
Under existing common law, in order to establish corporate responsibility for manslaughter by gross negligence, the prosecution must identify an individual who represents the ’embodiment’ or ‘controlling mind’ of the company. It is not possible to add up the negligence of several individuals to show that the company is grossly negligent.
Identifying such an individual who is also personally guilty of manslaughter is virtually impossible in large organisations – hence the failure to convict after large – scale disasters such as the Southall, Paddington or Ladbroke Grove train crashes. The few successful prosecutions have involved small companies or partnerships where the director and the company were effectively indistinguishable.
What does it mean to the industry?
The new offence
The new act creates a statutory offence of corporate manslaughter (in England, Wales and Northern Ireland) or corporate homicide (in Scotland). A company will be liable if the way its activities are managed or organised by its senior management amount to a gross breach of the duty of care owed to employees, the public or other individuals, and those failings caused the person’s death.
According to Justice Minister Maria Eagle, the new act “will make it easier to prosecute companies who fail to protect people”. Describing the act as “a ground – breaking piece of legislation”, she said: “For too long it has been virtually impossible to prosecute large companies for management failures leading to deaths.” This legislation send out “a very powerful deterrent message to those organisations which do not take their health and safety responsibilities seriously”.
“Hollow victory”
However, while welcoming the act as a step towards improving health and safety standards, trade unions remain unhappy that it maintains the effective immunity of individual directors or managers of large companies. Alan Ritchie, general secretary for construction union UCATT, described the Bill’s passing as “a hollow victory” and believes that without the specific imposition of duties on directors, the construction industry – one of the most dangerous – will not become appreciably safer.
Although the existing common law can still be used if there is sufficient evidence against an individual running a small company, and managers can still be held accountable for breaches in health and safety legislation, UCATT and the TUC generally wanted legislation to provide for the possibility of imprisonment for negligent directors.
Under the new act, as with common law manslaughter, the prosecution will still have to prove that there was a duty of care owed to the deceased; that management failings amounted to a gross breach of this duty, and that this breach caused the death. Effectively this means that a company’s conduct must fall well below that which could reasonably be expected of it. However organisational health and safety failings resulting in a fatality can now lead to prosecution without the need to prove an individual guilty of gross negligence or manslaughter.
From April, the court will be thus able to address the collective failings of senior management in large organisations. Factors that will be taken into account in any prosecution include compliance with health and safety legislation, the seriousness of any failures to do so and the risk posed thereby. Any organisational attitudes, policies, systems or accepted practices likely to have encouraged, or tolerated, such failings will also be considered.
Health and safety practices highlighted
“All organisations need to have in place effective health and safety management systems, with safe systems of work and adequate training, instruction, supervision and monitoring, ” says Gary Lewis, senior solicitor in the Health and Safety Environment Group at Hammonds in Manchester, which is already offering seminars on the new act to its corporate clients. “Those that do have nothing to fear from the new legislation – but most companies are likely to feel nervous at the enactment of this new offence and now is a good time to re – visit the issue of check.”
It is also vital to investigate any past accidents or ‘near misses’, and learn the lessons, he says – rail companies, for example, got away with significant safety failings under the old law; they would be caught by the new one.
He also stresses that whereas the old common law was targeted at companies, the new act has a much wider application. It could well apply, for instance, to deaths stemming from outbreaks of MRSA in hospitals. If a hospital has already received warnings about its hygiene procedures, this is the equivalent situation to a near – miss in a factory – and the fact that the NHS is a non – profit – making organisation won’t help them.
Increased scope of penalties
As well as an unlimited fine, the court can impose remedial orders – requiring an organisation to take steps to remedy any management failings – and publicity orders – publicising the fact the company has been convicted of the offence – providing details, the amount of any fine imposed and the terms of any remedial order made.
The act can thus be expected to considerably concentrate employers’ minds on ensuring safe working practices. Elena Fry, a partner in the health and safety team at Biggart Baillie one of Scotland’s top legal practices, believes it likely that the prosecution authorities will make good use of the new law. “The penalties and knock – on effect on business that prosecution would bring must make health and safety a top priority for all organisations.”
Credit to this article to be given to Sheena Meredith a freelance medical journalist and contributor to Legal & Medical – the magazine for Personal Injury Specialists.
