By Kevin Elliott
Regulatory partner at international law firm Eversheds LLP
A new era of health and safety regulation for businesses, which could face considerable penalties if they are found guilty of the offence, is being ushered in on 6 April when the Corporate Manslaughter and Corporate Homicide Act comes into force.
What is the new law and why was it brought into force?
For more than ten years there has been significant political commitment to reforming the law in relation to workplace deaths.
Successive high profile accidents have led to renewed calls for changes in the law following failed prosecutions against large companies and against individuals for manslaughter.
It is impossible to predict the full impact
The new offence certainly appears to address the criticism of the law as it presently stands where a single individual, identifiable as the directing mind of the company, has to be personally guilty of gross negligence/manslaughter before the organisation can be convicted.
In essence, the new law makes it easier to convict organisations whose senior managers have breached their duty of care, causing death.
Previously, prosecutions have failed against all but the smallest companies, so the new act could potentially see a dramatic rise in the number of corporate manslaughter cases against businesses of all sizes.
The new law will bring further scrutiny to businesses across all sectors.
Increasingly, health and safety performance is seen as indicative of the culture and corporate governance of a business.
A business that fails to address these issues may find itself not only on the wrong end of very serious charges, but also with a real impact on recruitment, retention, customers and reputation.
How it will affect businesses
It is impossible to predict the full impact of the Corporate Manslaughter Act.
However, it is more important than ever that health and safety moves up the priority lists of all businesses.
There will surely be considerable pressure in reality to test the water with the new offence
Of the major changes, the new Act holds all employers accountable for the actions and decisions of their senior managers, rather than one single individual, which was perceived to be the key failure under the current law.
The Government says in its guidance that it only expects the new law to be applied to the most serious and obvious cases and that organisations with good safety policies have nothing to fear.
There may be only a dozen or so prosecutions under the new legislation every year.
The reality is that every workplace fatality already results in an investigation commenced by the Police looking at the possibility of manslaughter before passing on responsibility to the Health and Safety Executive or Local Authority to investigate health and safety breaches.
Once the new law is in force, the Police will have to look at the new corporate manslaughter offence so will remain involved in any workplace fatality investigation for longer.
There will surely be considerable pressure in reality to test the water with the new offence.
On top of this, the penalties will become far more severe with the Courts potentially encouraged to fine a guilty company based on a percentage of annual turnover, a recommendation outlined in a recent consultation paper from the Sentencing Advisory Panel.
In addition, a convicted company may be forced to publicise their offence which could be extremely damaging to the business' reputation.
How to prepare for the Act
Businesses with a strong commitment to health and safety, which is followed through in practice, should have nothing to fear.
However, it is vital that all companies are up-to-date with the new laws.
Some key steps include:
- Identify potential areas for risk and address them immediately
- Check all health and safety policies are up-to-date and are consistently reviewed
- Ensure all senior management are trained in health and safety and are aware of the implications of the new legislation.