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Sentencing Guidelines for Corporate Manslaughter & Health and Safety Offences Causing Death:
Iain Daniels and Ranna Jahanshahi discuss the most recent proposed guidelines for corporate killing.
Introduction
On the 27th October the most recent proposed guidelines for Corporate Manslaughter & Health and Safety Offences Causing Death were published by the Sentencing Guidelines Council: these apply to Corporate Manslaughter and Corporate Homicide Act 2007 and sections 2 and 3 of the Health and Safety at Work Act 1974. Gone are sentences calculated by a percentage of gross turnover and in comes a proposed minimum sentence, in most cases, of £500,000 for convictions for Corporate manslaughter and £100,000 for offences involving death under the Health and Safety at Work etc Act 1974 (“HSWA”). But has this fundamental change thrown out the concept of sentences proportionate to the size of the business along with the unfair concept of percentage and gross turnover?
Summary of the Approach to Sentencing under the Guideline
The guidelines suggest that the following approach be taken when sentencing, which in essence is little different to that already contained in the leading authority of R v F Howe & Son (Engineers) Ltd (1999) 2 All ER 249 CA (Crim Div).
The sentencing court would be required to consider the following:
1. the seriousness of the offence;
2. aggravating or mitigating factors;
3. the nature/finance/resources of the defendant;
4. consequences of a fine;
5. the appropriate fine taking the context into consideration
6. reductions for a plea of guilty;
7. costs;
8. whether a publicity order is appropriate;
9. a remedial order (if needed).
Summary of the Guidelines
The proposals are billed as representing the first of their kind in relation to sentencing organisations as opposed to individuals, although of course in respect of the HSWA the Court of Appeal has already issued not dissimilar guidance in cases such as Howe, where causation was a major aggravating factor. Experience of course shows that the HSE and other prosecuting agencies always argue causation and that more often than not this is accepted by the Court. The guidelines, if finally adopted, will further up the ante in the causation argument on HSWA offences and will potentially lead to increased Newton hearings on the basis of sentencing.
Certain factors are deemed to affect the seriousness of the offence under either Act and are summarised as follows:
• How foreseeable was serious injury? The more foreseeable the injury was the more serious the offence becomes;
• How far short of the applicable standard did the defendant fall? It is suggested that where such serious injury has occurred, that in itself is clear evidence of major failings on the part of the defendant;
• How common is this kind of breach in this organisation? Put another way, is this simply a one-off breach, or is there evidence of a number of breaches of the type in respect of which the defendant has been convicted;
• How far up the organisation does the breach go? At what level of management can the breach be said to originate? A conviction for Corporate Manslaughter requires a breach at the senior management level, but it will be relevant to ask where the breach occurs within the structure of senior management, for example at Board level or below.
Aggravating factors which would in effect heighten the seriousness of the offence have been identified as including:
• Where more than one death has occurred or very grave personal injury in addition to a death;
• Where there has been a clear failure to heed to warnings, made either externally or internally;
• Where cost-cutting has occurred at the expense of risk-avoidance, the familiar concept of profit before safety;
• Where an injury to vulnerable persons has occurred.
Certain circumstances are also highlighted where mitigation would play a positive role in reducing the seriousness and/or punishment of the organisation, including:
• Prompt acceptance of responsibility;
• Full co-operation with the investigation;
• Genuine efforts to remedy the defect;
• A responsible attitude to safety.
Financial information, size & nature of organisation: the guidelines emphasise that although the size of the organisation may affect the seriousness of the offence, it plays no role in determining its culpability. However the means of any defendant are relevant to the fine. Courts will require information from the organisation with regards to their means (as is currently required by R v. Friskies Petcare UK Ltd [2000] 2 Cr. App. R.(S) 401), usually for a three year period prior to the offence, including the year of the offence. The guidelines state that Courts should look at turnover and profit in order to assess the resources of any defendant, this represents a very positive step forward tacitly acknowledging that a turnover only approach disproportionately affecting those with low profit margins.
In assessing the financial consequences of a fine, the courts are suggested to consider the following:
• The effect on innocent persons’ employment;
• The effect upon the provision of services to the public will be relevant;
• Whether a fine would put the defendant out of business is relevant, although this may not prevent the sentencing court doing just that;
• The effect upon shareholders and directors is not relevant;
• The cost of meeting any remedial orders is not relevant; and
• Liability to any civil compensation is not relevant (normally the defendant’s insurers will meet any liability arising out of a civil action).
Level of Fines: fines must be punitive and sufficient to have an impact on the defendant, but must also be capable of being paid (although this does appear to be in conflict with the suggestion that an undertaking can be fined out of business). The rather obvious point is made that fines are not an attempt to value a human life in monetary terms, but to penalise an organisation for serious breaches of regulations that are designed to protect life.
In corporate manslaughter the appropriate fine is suggested to be a minimum of £500,000 but where appropriate may be measured well into millions of pounds. This minimum amount was suggested as the offence requires a gross breach at senior level. A health and safety offence where death has been caused was suggested to start from a minimum fine of £100,000 and may go into several hundred thousands of pounds.
As is common in most sentencing, a guilty plea should be taken into consideration when deciding on an appropriate fine, and the timing of that plea will also be relevant.
The defendant ought to pay the prosecution costs, but no orders will be made in respect of compensation as this will probably be dealt with in civil proceedings.
Publicity Orders are only available in relation to corporate manslaughter and are considered part of the punishment. The object of these orders is the deterrence of future breaches and punishment for offences. However, remedial orders will be available both in corporate manslaughter and health and safety offences.
Commentary
The guidelines represent a major move forward from those previously proposed. Using turnover as a base for sentencing clearly created unfairness, although similar arguments could be applied to a profit only approach. Consideration of both turnover and profit without the rigid application of a percentage permits a sentencing court to properly take into account the aggravating and mitigating factors without fettering the court’s discretion. Assisting the sentencing judge with what is often a difficult and unfamiliar task whilst endorsing a return to a more traditional reliance on the court’s good sense should be seen as welcome.
In addition, by taking a different approach to public bodies such as NHS Trusts and Local Authorities (confirming the existing law found in R v. Southampton University NHS Trust [2007] 2 Cr. App. R(S) 37) the Courts acknowledge that fines simply damage the services provided.
The problems would seem to lie with determining the amount of a fine by reference to the size of the defendant. The guidelines make a clear distinction between large and small organisations, but make no attempt to suggest how this should be assessed.
This feeds into suggested minimum fines: £500,000 for corporate manslaughter and £100,000 under the HSWA where death has occurred. There is no indication as to how these figures are arrived at or what size of company would qualify for a minimum fine (provided the other mitigation is in place). Whilst any conviction under corporate manslaughter is inherently serious, the concern is that a minimum fine has a disproportionate effect on small businesses. A substantial number, if not the majority of businesses in this country would be unable either to survive a £500,000.
In fact the guidelines acknowledge that a defendant may be put out of business, perhaps in some cases a just result of conviction, but the concern is a small business is far more likely to be put out of business than a large one whatever the comparative culpability. It also sits uncomfortably with the principle that the innocent employee should be considered. For offences under the HSWA the level of concern is increased by the reverse burden of proof.
Finally there is no clear guidance on what factors a sentencing court should consider when determining whether to make a publicity order. Publicity orders are made in an attempt to ‘name and shame’ the organisation, or rather to get them to name and shame themselves and deter future breaches. No indication is made though as to what should be involved in deciding whether to make such an order and, if an order is to be made, what that will entail. Clearly consideration will need to be given as to what effect such orders will have on particular businesses and whether those orders will achieve the purposes for which they are put in place.
Conclusion
The Sentencing Guidance Council has embarked upon a difficult exercise but has reached conclusion that assisting the sentencing court without overly fettering its discretion is the best answer. This is of course the approach already taken by sentencing courts, with the guidance taken from the Court of Appeal in cases such as Howe and takes proper account of the fact that every health and safety case is unique on the facts. The feedback from industry is of unhappiness with the idea of minimum sentences and these complaints do have some force.
Of course these are only proposals and, as the major changes that have already been made show, the Sentencing Guidelines Council is open to the views of those that participate in consultation: any representations should be in by Tuesday the 5th January 2010.
The guidelines are to be found at:
http://www.sentencing-guidelines.gov.uk/docs/corporate_manslaughter/consultation_guideline_corporate_manslaughter.pdf
How to respond can be found at:
http://www.sentencing-guidelines.gov.uk/index.html
Iain Daniels advises and defends in a wide range of health and safety cases and is recommended in Chambers UK in the area.
Ranna Jahanshahi has worked in the areas of construction and risk assessment and is in the process of completing her Bar Finals.
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