We have identified the seven most important things every CEO needs to know about the new guidelines to aid the prevention of damaging corporate reputation, legal fines, and increased insurance premiums.
Since the implementation of the new Safety Offences Sentencing Guidelines in February 2016, we have seen organizations of all sizes plead guilty of health and safety offences. These offences are generating bigger fines than ever before.
Therefore, it is important that all organizations are fully informed of the implications of the guidelines and understand the importance of health and safety best practice.
1. The fines for Health & Safety offences are now bigger than before
Past fines for health and safety offences that had resulted in deaths were sometimes derided by victims’ families as “a drop in the ocean” for large companies. Corporations were accused of not putting in place safety measures where the cost of implementing the measure was greater than the likely fine. Making fines more expensive for larger organizations was intended to overcome this. However, the following points show how in practice the fines might be inflated beyond that originally intended.
2. You could be guilty, even if no one is hurt
This was true, even before the guidelines. Some health and safety legislation is prescriptive, and if you expose people, for example, to the risk of inhaling asbestos or substances controlled by workplace exposure limits (WELs) you can be prosecuted even if there is no evidence that someone was actually exposed. The new guidelines, however, extend the “risk of exposure” consideration further.
3. You will be judged by what could have happened
Whereas previous judgements relating to the Health and Safety at Work Act tended to focus on the outcome – how many people were hurt and how badly – the new guidelines force the courts to consider the “seriousness of harm risked”.
If someone falls off unguarded scaffolding, but by luck suffers only bumps and bruises, you could still be facing harm category 1 (the highest likelihood of harm). In addition, even where only one person has been injured, if others were exposed to the same risk (for example, others walked along the scaffolding) this can increase the harm category on which a fine is based.
4. If you do kill or injure someone, you are guilty until you can prove your innocence
A House of Lords judgement in 2008 made it clear that, whereas an individual is innocent until proven guilty, once an employee has been hurt the onus is on the defending organization to prove its innocence, either by showing that the accident was unforeseeable, or that there was no practicable way of preventing it. Blaming workers for not following rules is not a defense. Employers must “protect workers or others who may be neglectful of their own safety.”
5. If you ignore warnings, the courts will be harsh
When Scottish Power was sentenced in June 2016 for a valve failure that led to the life-changing scalding of an employee, the court heard that the valve was first reported as faulty in 2009 and again in 2013 with no repair having taken place. This was an accident waiting to happen, and Scottish Power was punished accordingly with a fine of £1.75 million (but see point 7). Although Scottish Power are appealing on the basis that the English sentencing guidelines shouldn’t have been applied in Scotland, the legal opinion is that Scottish courts will refer to the same figures.
6. You could go to prison
Employees, the self-employed, and employers can all be subject to jail terms for health and safety offences, with a maximum sentence of two years. The sentencing guidelines list the criteria that will make them more likely to consider a long term in prison, and these include a poor health and safety record, falsification of documentation, and cost-cutting at the expense of safety.
In the past, people were only sent to prison where culpability was demonstrably high, but the new guidelines allow a prison sentence of up to 6 months, even for the lowest culpability level if the harm risked is serious enough – see the table for details.
7. It might get even worse over the net few years
In May 2016 the Sentencing Council closed their consultation process for the revised guideline on Reduction in Sentence for a Guilty Plea. The new guideline intends to encourage individual criminals who know they have committed a crime to admit guilt earlier in the process to save public time and money and to reduce the impact on victims.
Currently, an organization facing a health and safety charge can gain a reduction of up to a third if the guilty plea is entered at the “first reasonable opportunity”. The flexibility in determining what is “reasonable” will be removed if the new guideline is implemented, and the full reduction will not be applied unless a guilty plea is entered at the first point at which the charge is put to the offender in court. However, it is often only at this point that an organization understands the offence and hence will need time to investigate the circumstances before offering a plea and presenting any mitigating circumstances.
The maximum reduction for a later plea will be reduced from 25% to 20%, and in some circumstances could reduce to zero. The impact of this could be to increase fines by a further 50% - in the case above, Scottish Power would have paid £2.5 million instead of £1.75 without the reduction for an early plea – the new guideline could cost large organisations several hundred thousand pounds.
If you’re not ready for a demo, why not check out our short 15 minutes "The CEO's Health & Safety Headache" clip that focuses on the common headaches and duty of care every CEO and senior management faces when tackling the issue of health and safety.