Prosecutions of companies found responsible for deaths – from rail crashes to
accidents at work – are expected to rise significantly under laws that took
effect yesterday.
Companies that might otherwise have been able to avoid prosecution or
conviction will, under the Corporate Manslaughter Act, be more easily
brought to justice and will face the prospect of heavy fines. In 2006-07
alone 241 people were injured fatally at work, according to the Crown
Prosecution Service. Since 1992 there have been 34 prosecutions and six
convictions.
Under the old laws a company could be convicted only if the “directing mind”
or senior individual could be identified as responsible for gross failings
leading to a death. The new Act enables the collective actions of a
company’s management to be examined. Although individuals cannot be jailed,
companies face unlimited fines.
The measure, which comes into force after decades of lobbying by campaigning
groups, trade unions, relatives“ and others, follows a series of disasters
where prosecutions collaped or could not be mounted. They included the
deaths of 187 people after the capsizing of the Herald of Free Enterprise
in 1987; the King’s Cross Underground fire in the same year (31 deaths); the
Piper Alpha oil platform disaster in 1988 (167 deaths); and the Paddington
rail crash in 1999 (31 deaths).
Adrian Bever, a partner with the corporate law firm Addleshaw Goddard, said
that the measure was the “most significant change in health and safety law
for 30 years”. Guy Bastable, a partner at the London solicitor BCL Burton
Copeland, said although penalties were only fines, the consequences could be
crippling.
The Sentencing Advisory Panel had suggested fines of up to 10 per cent of a
company’s annual turnover during the previous three years, he said. “For the
largest organisations such a fine could easily be hundreds of millions of
pounds.” The Act would also apply to other organisations such as some
government departments, police forces, partnerships and trade unions, he
said.
Kevin Elliott, regulatory partner at the law firm Eversheds, gave warning that
linking fines to turnover would put small firms out of business. “While we
agree that fines for significant health and safety breaches should be high
enough to reflect the offence, surely the point is not seriously to
jeopardise the economic viability of many businesses which are ostensibly
very well run, including in the area of health and safety management,” he
said. Swingeing fines would also hit the capital pot available for future
safety investment.
Insurers said that the Act was a warning to businesses to ensure proper
healthy and safety measures. Tom Sheffield, technnical director at Aon, the
risk adviser and insurance broker, said: “This serves as a wake-up call to
businesses to update their health and safety controls for the wellbeing of
their employees and the public.”
