Accidents at work: the Corporate Manslaughter and Corporate Homicide Act 2007

Mike Fitzgibbons of Steeles (Law) LLP continues a series of articles on accidents at work with a look at the Corporate Manslaughter and Corporate Homicide Act 2007.

Introduction

The Corporate Manslaughter and Corporate Homicide Act 2007 comes into force on 6 April 2008 and will apply to deaths occurring on or after that date. The Act does not create any offence for individual directors, managers or other company officers but could have serious financial and practical implications for corporate bodies and other organisations. It will apply to the whole of the UK.

The Act is intended to focus primarily on organisations that breach the requirements of health and safety law, although it has been observed that it is not necessarily limited to this and will apply to deaths resulting from a breach of any other type of legislation, such as environmental law. This article deals with possible breaches of health and safety requirements only.

The offence

The Act creates a new criminal offence of corporate manslaughter (referred to in Scotland as corporate homicide) and replaces the existing common law offence of manslaughter by gross negligence, in relation to which the 'directing or controlling mind' of the organisation also has to be proven guilty of the offence for the organisation itself to be liable. The Act provides that an organisation will be found guilty of an offence if a death is caused by the way its activities are managed or organised, and the way its activities are managed or organised amounts to a gross breach of a relevant duty of care owed by that organisation to the deceased individual.

However, the organisation will be guilty of the offence only if the management or organisation of activities is attributable to its 'senior management'. The definition of senior management is broad. It includes any person involved in both the making of decisions about management or the organisation of activities, and the actual management or organisation by those in senior operational roles. The Act does not require the prosecution to prove specific failings on the part of individual senior managers, but that senior management, collectively, did not take adequate care.

An 'organisation' caught by the Act could be a company, a partnership, or almost any other form of incorporation. Many government departments are also included in the definition.

A 'relevant duty of care' includes, among other things, the duty that an organisation owes to its employees and other people carrying out work for it to take reasonable steps to protect their safety.

A 'gross breach' of this duty of care means conduct that falls far below what can reasonably be expected of the organisation in the circumstances.

The new offence is intended to complement rather than replace other forms of accountability such as prosecutions under health and safety legislation. The law remains unchanged in relation to individuals being charged with manslaughter if they are thought to be personally culpable for a death, therefore individuals may still be charged under common law.

Avoiding prosecution under the Act

It is important to note that only the most serious cases will be prosecuted and convicted under the Act. Less grave breaches of health and safety legislation will continue to be prosecuted under the Health and Safety at Work etc Act 1974 and other existing legislation. The Act is intended to provide a greater incentive to employers to ensure that they comply with existing requirements. Even if a death occurs there will be no liability if reasonable safeguards, including reasonable health and safety measures, are in place.

The Government recommendsin A guide to the Corporate Manslaughter and Corporate Homicide Act 2007 (PDF format, 185K) (on the Ministry of Justice website) that organisations contact the relevant regulatory authority particular to their industry sector or business, as well as the Health and Safety Executive and/or the local authority, to ensure that they are complying with health and safety requirements.

The Institute of Directors (IoD), together with the Health and Safety Commission, has issued guidance (Leading health and safety at work - leadership actions for directors and board members (PDF format, 440K) (on the IoD website) setting an agenda for businesses to follow to aid effective leadership on health and safety issues. Whether the guidance has been followed may be a relevant consideration in the employer's favour, for the jury, in the event of a prosecution for corporate manslaughter under the Act.

The guidance sets out a four-point agenda intended to 'embed' the essential health and safety principles. These principles are defined as 'strong and active leadership from the top', 'worker involvement' and 'assessment and review'. Each part of the agenda consists of: core actions that are intended to set the standard; good practice guidelines that set out ways to give the core actions practical effect; and case studies intended to demonstrate the effectiveness of the agenda in action.

The four-point agenda is:

• planning by a board of directors or an employer's managing body, with the intention of setting the direction for effective health and safety management;
• delivery of the desired plan, which is dependent on an effective management system to ensure the health and safety of employees;
• monitoring of health and safety, with management systems allowing the board to receive reports on the performance of health and safety policy; and
• reviewing of health and safety performance, for management to assess whether the essential health and safety principles mentioned above have been achieved.

To take effective responsibility for health and safety and to secure delivery of the agreed health and safety plan, members of the board must ensure that:

• health and safety arrangements are adequately resourced;
• they obtain competent health and safety advice;
• risk assessments are carried out; and
• employees or their representatives are involved in decisions that affect their health and safety.

In addition 'good practice' points are suggested to aid successful delivery of the health and safety plan, these being:

• having visible leadership and being seen to follow all safety measures;
• considering health and safety when deciding senior management appointments;
• having procurement standards for goods, equipment and services, to avoid the introduction of expensive health and safety hazards;
• assessing the health and safety arrangements of partners, key suppliers and contractors, and being alert to the possibility that those third parties' performance could adversely affect the organisation's performance;
• setting up a separate risk management or health and safety committee as a subset of the board of directors, to ensure that key issues are addressed and to guard against time and effort being wasted on trivial tasks and unnecessary bureaucracy;
• providing health and safety training to some or all of the board to promote understanding and knowledge of the key issues within an organisation; and
• supporting worker involvement in health and safety, above and beyond the legal duty to consult with worker representatives, to improve participation and help improve commitment.

Prosecution and possible conviction

In the event of a prosecution, the first question for the court to consider is whether there is a duty of care under the Act. If there is, the second question is whether there has been a gross breach of that duty thathas resulted in adeath.

In deciding whether an organisation has committed a gross breach of the duty of care, the jury is required to take into account:

• whether the organisation was in breach of health and safety legislation;
• how serious the management failure was; and
• how great the risk of death occurring was.

Additional factors that might be considered in determining a conviction include: the systems of work used by employees; the level of training and adequacy of equipment; issues of immediate supervision and middle management; the organisation's strategic approach to health and safety; and the organisation's arrangements for risk assessment, monitoring and auditing of processes. The new offence is concerned not only with the existence of formal systems for the management of an activity, but also how, in practice, the management systems and the activity itself were carried out.

The Ministry of Justice guide to the Act suggests that juries may also wish to have regard to any other relevant health and safety guidance, such as Approved Codes of Practice. It notes that, although organisations are not legally required to follow guidance, this may be taken into account when the extent of an organisation's failure to comply with health and safety legislation, and whether its conduct has fallen far below what could reasonably have been expected, are considered.

Consequences of conviction

An organisation that is convicted of an offence under the Act will face a fine and may also face a further penalty in the form of a remedial or publicity order. The Act prescribes no limit to the size of fine that the court may impose, although the Government has indicated that it anticipates seeing fines that reflect the size of the organisation concerned and the scale of the offence. Fines in health and safety cases pre-dating the Act have been as high as £15 million.

A publicity order is an order of the court that requires an organisation to publicise the fact that it has been convicted, the particulars of the offence, and the size of any fine imposed. For many employers this is potentially more damaging than the imposition of a fine. However, provisions in the Act relating to publicity orders will not come into force on 6 April 2008 but will take effect at a later date. A remedial order is a court order that requires the convicted organisation to remedy the breach of duty, and/or to remedy any other health and safety matter or deficiency identified by the court.

Conclusion

While the Corporate Manslaughter and Corporate Homicide Act 2007 does not seek to impose further obligations on employers, and in many instances no change to current practices will be required, it would be prudent for employers to review their health and safety policies and procedures now, in advance of the Act coming into force, and to ensure that they are regularly reviewed, to avoid potential liability in the future.

Next week's article will be a case study on accidents at work and will be published on 25 February.

Mike Fitzgibbons is a New Zealand qualified solicitor, due to be admitted as a UK solicitor, at Steeles (Law) LLP (MFitzgibbons@steeleslaw.co.uk )

Further information on Steeles Law can be accessed at www.steeleslaw.co.uk