The first trial to be brought under the Corporate Manslaughter and Corporate Homicide Act 2007 will open in Bristol Crown Court on February 23 2010 and is expected to last six weeks.
In June 2009 the Crown Prosecution Service authorised a charge of corporate manslaughter against Cotswold Geotechnical Holdings Ltd, in relation to the death of Alexander Wright on 5 September 2008.
Mr Wright, who was employed by Cotswold Geotechnical Holdings as a junior geologist, was taking soil samples from inside a pit which had been excavated as part of a site survey when the sides of the pit collapsed, crushing him.
Peter Eaton, a Director of the company, has been charged with gross negligence manslaughter and with an offence contrary to Section 37 of the Health and Safety at Work etc. Act 1974. Cotswold Geotechnical Holdings Ltd has also been charged with failing to discharge a duty contrary to Section 33 of the Health and Safety at Work etc. Act 1974.
The Act
The Corporate Manslaughter and Corporate Homicide Act 2007 came into effect on 6 April 2008. Until then there was a common law offence only, which, in order for a company to be found guilty of it, required the conviction of an individual person for gross negligence manslaughter and for that person to be so senior within the company that he or she represented its 'directing mind'. Whilst attempts were made to prosecute big companies under the old law these attempts were all unsuccessful.
The new Act is an offence-creating statute rather than a duty-setting one and itself imposes no new health and safety duties. In other words, the Act is solely designed to make it easier to prosecute organisations where their gross negligence leads to death.
The wording of the Act is that an organisation is guilty of an offence if the way in which its activities are managed or organised: causes a person’s death, and amounts to a gross breach of a relevant duty of care owed by the organisation to the deceased. An organisation is only guilty if the way in which its activities are managed or organised by its senior management is a substantial element in the breach.
Under this new law it is no longer necessary to convict one individual alone. The aggregated failures of a number of senior managers, who form the senior management, are sufficient.
In addition, the second part of the definition of senior management within the law catches people lower in the management chain than those who represented the ‘directing mind’ under the old law, meaning that a much wider part of the workforce could be considered by the prosecuting authorities when looking at whether the offence has been committed.
Having said that, the new offence continues to have a number of safeguards ensuring that the offence is likely to be restricted for the worst cases. In particular, in big companies the requirements for senior management involvement and for any breach to be gross.
The result of this is that to date the Act has not had the fearsome effect that some predicted and the safeguards that the Act provides is likely to mean that the floodgates will not open in terms of the number of prosecutions brought.
Convictions
Under the Act a conviction for gross negligence manslaughter carries a maximum sentence of life imprisonment, while a conviction for corporate manslaughter attracts an unlimited fine. Along with this goes the stigma of being a ‘corporate killer’.
The Home Office paper that went with the original Bill stated that the offence would be targeted at the worst cases of management failure causing death. If this is so, it is likely that fines for conviction will be set at a very high level and probably significantly in excess of record fines under HSWA.
A consultation guideline published in October 2009 by the Sentencing Guidelines Council, proposed that c ompanies and organisations that cause death through gross breaches of care could face fines of more than £500,000 and be forced to make a statement about offences on their website.
The publicity of a statement is designed to ensure that the conviction becomes known to shareholders and customers in the case of companies, and to local people in the case of public bodies, such as local authorities, hospital trusts and police forces.
The fines proposed in the consultation are not linked to turnover and some critics have claimed that this is a gross undermining of the Act and that the opportunity for a clear message to employers which might prevent deaths has been lost. The main reason for criticism of a minimum fine is that it may lead to the closures of smaller companies whilst being a drop in the ocean for much larger organisations.
Responses to the consultation should have been received by 5 January 2010, at which point the Council will consider any responses received and then issue a definitive guideline.
Conclusion
The outcome of the first case, while unlikely to be known for several months, will shed some light for employers on how this critical new legislation is likely to be interpreted by the courts. However, as the company is relatively small in size, many experts believe that the real test for the legislation will be when a substantial corporate body faces prosecution and that those expecting that this first case may provide some guidance on how the legislation will be interpreted will be somewhat disappointed.
Large or small, however, this is a timely reminder that companies that fail to keep their workers safe are liable to prosecution on a grand scale. Directors and senior executives need to act now if they want to avoid the heavy penalties and bad publicity that come from cases like this.
Although the Act has brought no new duties, it poses a natural reason and opportunity for organisations to review their safety management approach, their organisational framework and the systems underpinning them.
Guidance published by the HSE / IOD, defining what private and public sector directors should do to lead and promote heath and safety should be examined against organisations' existing safety management procedures to establish how they measure up and also to identify any weaknesses.
Bearing in mind the reach of the Act beyond the boardroom, organisations should not think that the principles set out in the guidance do not apply lower down the management chain.
It would also be prudent for organisations, particularly those in high-hazard industries, to review their liability insurance cover to ensure the legal defence costs for the new offence are covered. Many employers and Public Liability policies will provide such cover but some may not. Dependant on makeup and size the organisation may wish to explore the possibility of purchasing additional Directors' and Officers' cover or another form of management liability cover.
Experienced advice is important in the immediate aftermath of a workplace fatality, particularly as decisions made at this early stage can set the tone for the criminal investigation and can prejudice an organisation’s position and that of its directors and employees. In the circumstances, it is sensible to factor this in to the pre-planning of a major accident response.
If you are in any doubt about your responsibilities and how you should implement safe working practices then you should contact
health and safety consultants.
Article by the Workplace Law Network
