BHSEA Legal Update 10 June 2019 Louise Mansfield Associate For - - PowerPoint PPT Presentation

Louise Mansfield Associate

BHSEA Legal Update

10 June 2019

For today

• Legal refresher
• Legal update

– Personal Liability and Gross Negligence Manslaughter – Brexit! – The health agenda – Prohibition Notices – FFI – RIDDOR – Sentencing and case digest

• HSE will undertake a targeted programme of

approximately 20,000 proactive inspections in 2018/19

• 11,522 notices issued (2017-2018)
• 517 prosecutions, 493 convicted in 2017/18 (583 in

2016/17, 696 in 2015/16)

• Convictions between 93-95% of cases for past five years
• £72.6million in fines (2017-2018)

HSE Statistics

Illness and Injury

• 144 workers killed at work 2017-2018
• 555,000 estimated non fatal injuries
• £15bn annual cost of work related injury and ill health

(£3bn born by employers)

• 30.7m working days lost 2017-18 – work related ill health
• Practical impact on a business

Legal refresher

Corporate H&S Duties

Duty to “ensure” the health safety and welfare of employees Duty to “ensure” the health and safety of non-employees “So far as is reasonably practicable”

Section 2 Duty to employees Duty to non- employees Section 3

Individuals H&S Duties – 1974 HSWA

Duty to take reasonable care

• f self and others affected

by work (s.7) Where an offence… has been committed with the consent, connivance, or…attributable to any neglect on the part of any director, manager… or a person who purports to act in that capacity, he/she as well as the company shall be guilty of that offence (s.37)

Duty of employees Section 7 Section 37 Liability of directors and senior managers

Other Key legislation

• Construction (Design & Management) Regulations 2015
• Work at Height Regulations 2005
• Lifting Operations and Lifting Equipment Regulations (LOLER) 1998
• Control of Asbestos Regulations 2012
• Management of Health and Safety at Work Regulations 1999
• Provision & Use of Work Equipment 1998
• Corporate Manslaughter & Corporate Homicide Act 2007
• Gross negligence manslaughter for individuals

Civil law

• PI claims
• Compensation
• But Insurance available
• Claims by other parties / contractual claims – e.g. for

delay, reputational damage, financial impact etc.

Corporate Manslaughter and Corporate Homicide Act

• An organisation is guilty of corporate manslaughter if the

way in which its activities are managed or organised, (a)Causes a person’s death, and (b)Amounts to a gross breach of a relevant duty of care

• wed by the organisation to the deceased.

BUT

• An organisation is only guilty, if the way its activities are

managed or organised by its SENIOR MANAGEMENT is a substantial element of the breach

Personal Prosecutions / Gross Negligence Manslaughter

Personal Prosecutions

• Increased enthusiasm for personal prosecution = increased risk for

directors = increased importance in the boardroom

• No sign of an increase in pursuing employees themselves.
• Rise in prosecution of directors in recent years:

– In 2017, 40 directors were successfully prosecuted and six were convicted of corporate manslaughter on a personal basis – Of 46 convicted, seven faced fine at average of £8,022 – Where custodial sentence imposed, 17 directors had a suspended prison sentence – 17 received an immediate custodial sentence for an average of 21 months – In 2015/16 – 46 prosecuted, with 34 of those 46 found guilty (~73% - lower than usual!)

• BUT – reality is that these remain mostly in small(er) organisations

Gross Negligence Manslaughter

• Elements of offence:

– Duty of Care – Gross Breach – Causation – gross breach was a significant cause of death

• New sentencing guidelines – December 2018
• Applies to anyone sentenced on or after that date, regardless of the

date of the offence.

• Offence range of 1 to 18 years in prison.
• Apply to all manslaughter cases
• Effect is likely to be an increase in the length of custodial sentences

imposed in gross negligence manslaughter cases – the guidelines

• n fines certainly increased those!

Gross Negligence Manslaughter

Gross Negligence Manslaughter

New guidelines:

Best practice for executive directors

The main expectations imposed on senior execs are:

• Scrutinise i.e. the conscience of the Board;
• Ensure the processes to support the Board in managing its

significant health and safety risks are in place and are robust

• to ensure awareness of the risks faced by the business and to

provide visible leadership on safety

• to ensure that appropriate systems are in place and regularly

reviewed and that adequate resources are available

• to delegate, empower and hold accountable
• to check compliance with the systems developed by the

Company to manage risk

• review safety performance at least once a year.
• It is NOT about micromanaging

16

Brexit!

Brexit

• Government remains committed to negotiated outcome.
• ‘No deal’ notices published (with HSE input) so

businesses can make informed plans and preparations.

• Topics include:

– Trading goods and product safety – Workplace rights – Regulating chemicals

• Watch this space …

The health agenda

HSE agenda

• Continuing emphasis on occupational health by HSE
• 17 June 2019 – HSE latest construction health inspection initiative –

focus on health

• Continuing enforcement action resulting in substantial fines
• Amount of work required in responding to HSE contact now much

higher

• Vibration, noise, dust, wood, asbestos, silica, COSHH, manual

handling, stress

• 1.4million work-related ill health cases in 2017/18
• 26.8million working days lost due to work-related ill health in 2017/18
• 13,000 deaths each year estimated to be linked to past exposure at

work, primarily to chemicals or dust

Nordam Europe Limited

• Maintains & repairs aircraft components
• 100 employees exposed over 22 years
• 30 employees exposed to risk of serious harm
• Tools included orbital sanders, rivet guns, grinders and

drills

• Absence of suitable assessment
• Should have introduced additional controls
• Absence of health surveillance
• £400k, costs of £39K

Vibration – common issues

Problems with health surveillance The RA – the regulations are very prescriptive Failure to identify the risk at all Allegations always involve multiple employees over a long period of time But – the condition is not straightforward and diagnosis is not a precise science. Is it actually reportable?

Remember

Occupational health is not the same as “wellbeing”

Key takeaway

• The HSE are promoting the occupational health agenda
• They mean it
• A continuing emphasis in enforcement and during

inspections

• The industry is doing a lot of work around mental health

Prohibition notices, FFI and RIDDOR

Prohibition Notices – Chevron

The Facts?

• 23 April 2013 - HSE took the view that stairways and gratings leading to

helipad weakened by corrosion

• Prohibition Notice served - Chevron ordered to stop using the stairways
• Some of the metalwork was removed for testing by Chevron and those

tests confirmed that the metalwork met the relevant British Standard and was not unsafe Challenge?

• Chevron appealed against the Notice
• Employment Tribunal cancelled the Notice
• HSE appealed – but cancellation affirmed
• Conflicting E&W judgment :
• Rotary Yorkshire v Hague [2014] EWHC 2126 (Admin): “…only evidence

available or which could reasonably have been available to the HSE Inspector could be taken into account when deciding an appeal”

• HSE sought leave to appeal to the Supreme Court

Prohibition Notices – Chevron cont…

Decision?

• Supreme Court upheld the previous decisions
• Ruled that later evidence can be taken into account when

determining an Enforcement Notice appeal

• Lady Black said that:

“When the inspector serves the Notice, section 22 makes clear that what matters is that he is of the opinion that the activities in question involve a risk of serious personal injury. If he is of that

• pinion, the Notice comes into existence. However … when it comes to an appeal, the focus
• shifts. The appeal is not against the inspector’s opinion, but against the Notice itself ….

The Inspector’s opinion about the risk, and the reasons why he formed it and served the Notice, could be relevant … but I can see no good reason for confining the Tribunal’s consideration to the material that was, or should have been, available to the inspector."

Fee For Intervention

• Now £154 p/h (from 6 April 2019)
• More reason to consider disputing a Notification of Contravention?
• OCS Group UK Ltd - Judicial Review re dispute process.
• Settled with consultation for a new scheme

– A FFI will still be charged – If a duty holder wishes to query it MUST be raised within 21-days (review undertaken by PI) – If upheld, a dispute can be raised now to a panel INDEPENDENT of HSE;

• Disclosure of evidence and reasoning to duty holder
• Notification of panel to duty holder
• New process - in force from 1 September 2017!

HSE Review of RIDDOR

• Currently meets its objectives, remains ‘fit for purpose’

and could not easily or desirably be replaced with another system.

• Recommendations:

– Narrow the scope of Reg. 5 (injuries to non-workers) to align with Reg. 4 (injuries to workers) – Expand the list of reportable occupational diseases – Simplify and clarify existing RIDDOR guidance

• HSE not taking recommendations forward at this time.

Why does any of this matter?

Maintaining relationships with regulators Costs and management time Preserving legal position in view of much higher fines/admission of breach of duty

Sentencing and Case Digest

Sentencing:

• Twelve months to October 2017:

– 146 fines of at least £100,000:

• 22 fines of at least £1m;
• 27 fines between £500,000 and £999,999
• 38 fines between £250,000 and £499,999
• 59 fines between £100,000 and £249,999

– 65 custodial sentences for offences related to health and safety at work (excluding manslaughter) including 29 involving immediate custody

Valero Energy UK Ltd (Chevron)

• Explosion killed four workers and seriously injured another at an oil

refinery in Pembrokeshire in 2011 (8 years ago!).

• Draining a chemical storage tank but flammable gases inside it

ignited

• Guilty pleas to s2 and s3 HSWA offences
• 6 June 2019 - fined £5 million and ordered to pay costs of £1 million
• Failings:

– failed to "know of or appreciate" the risk of "flammable vapour," which had apparently been building up inside the tank over a number of years. – one Chevron worker had carried out a gas test which should have alerted the refinery to the flammable atmosphere, but its results were either "not properly communicated" or "not understood."

Sanders Plant and Waste Management

• Death of an employee struck by a reversing JCB loading shovel.
• The vehicle, driven by another employee, was loading waste into both a trammel

and an HGV.

• An HSE investigation found:

– A lack of pedestrian and vehicle segregation at the site, meaning pedestrians and vehicles could not circulate safely.

• not separate entrances or exits
• no segregated walkways

– risk assessment identified some control measures but these had not been fully implemented and were insufficient to manage the risk of collision. – high volume of waste in the shed, which meant it was tight for the loader to move around. – a machine had broken down for a period of time and this had led to a build- up in waste.

• The company pleaded guilty to breaching the Health and Safety at Work Act

1974 and was fined £500,000 with costs of £14,042 – 13 May 2019

Mick George Ltd

• A driver emptying soil from tipper
• D had identified need for goalposts but only one was installed
• Driver pulled forward, came into contact with OPL
• Minor damage to vehicle and driver unhurt
• Should have assessed the risk more rigorously and realised its

system of work was inadequate

• PG to Reg 25 of CDM
• Fined £566,000
• HSE said “a very serious incident” – should have requested

diversion of OPLs underground prior to construction (if not RP goalposts either side)

• Appeal – 4 June 2019 – fine reduced to £334,000

Recent Appeals Against Sentence

• Squibb Limited

– Demolition contractor for school refurbishment project – Asbestos survey conducted before work commenced and steps taken to remove the identified asbestos – Additional asbestos later discovered after demolition works had already begun – Found guilty of breaching s.2 but acquitted s.3 – Turnover £29.5m, High Culpability, HC2 – Fined £400,000

Recent Appeals Against Sentence

• Squibb Limited

– Unsuccessful appeal against conviction – Court of Appeal disagreed with the company that its culpability could be properly categorised as Medium – All parties agreed asbestos exposure = Level A Harm – Court of Appeal agreed with the company that the judge had been wrong to disregard expert evidence regarding the likelihood of harm from exposure – Fine reduced to £190,000 (High Culp, HC3)

Recent Appeals Against Sentence

• Squibb Limited – Learning Outcomes

– Importance of expert evidence in sentencing – Approach to managing asbestos:

• Don't just rely on vague or verbal assurances
• Detail of survey proportionate for the work
• Check any survey caveats and assumptions
• What areas the surveyor was able to access?
• Does this correspond with the areas for work?
• Act upon survey recommendations

Recent Appeals Against Sentence

• NPS London Limited

– Joint venture between property consultant and LA – Responsible for managing refurbishment project – Commissioned asbestos survey but failed to identify deficiencies in survey. – Asbestos later discovered by contractor Squibb – Guilty plea to breaching Section 3 – Turnover £4.9m, High Culpability, HC2 – Fined £370,000 (treated as large organisation based

• n turnover of parent company) – July 2017

Recent Appeals Against Sentence

• What do the Sentencing Guidelines say?

Recent Appeals Against Sentence

• NPS London Limited

– Court of Appeal concluded judge had been wrong to treat NPS as a Large organisation – Just because an offender is a subsidiary is not sufficient for the court to take into account the resources of a parent or linked organisation – Resources of linked organisation may still be relevant when assessing financial circumstances in the round (e.g. where subsidiary can rely on parent for financial support in paying a fine) – Fine reduced to £50,000

Recent Appeals Against Sentence

• Faltec Europe Limited

– Manufacturer of parts for other car manufacturers (Nissan, Renault, BMW, Honda) – Two outbreaks of legionella between October 2014 and June 2015. Four employees and one non- employee who lived near the company’s premises were diagnosed with Legionnaire's Disease – Explosion involving flocking machine on 16 October 2015 which injured an employee – Three offences: Section 2 and Section 3 (legionella) and Section 2 (flocking machine explosion)

Recent Appeals Against Sentence

• Faltec Europe Limited

– Turnover £36.4m – Fine £1.6m (£800k in connection with each incident) – Culpability – top of medium – Harm Cat 1 (high likelihood of death)

Recent Appeals Against Sentence

• What do the Sentencing Guidelines say?

Recent Appeals Against Sentence

• Faltec Europe Limited – Appeal
• Appeal – likelihood of death not “high” but “low” – 4 in 10,000 people

exposed would die – Court – likelihood “medium” – Legionella fine reduced from £800,000 to £380,000 – Flocker machine fine upheld at £800,000

Recent Appeals Against Sentence

• Faltec Europe Limited – Other Lessons

– Judge was critical of “weak line management, with insufficient priority being given to even the most fundamental issues of health and safety”. – “simply subcontracting out [health and safety]

• bligations cannot provide an answer to failures to

properly monitor and overview that contractor's work.”

Fire Safety – R v Butt

• Appeal against sentence of six months' imprisonment (suspended for 18

months), tagged curfew, fine of £250,000 and costs of £14,210

• Fine of £250,000 was reduced to £150,000
• H&S Sentencing Guidelines do not apply to RRO offences However, in R v

Sandhu [2017] Judge Collier QC observed that in fire safety cases the guideline might provide a "useful check for considering whether a sentence arrived at ... has produced a sentence which is either unduly lenient or manifestly excessive."

• Guidelines followed:

– Harm risked will be at the highest level - level A – Culpability will vary depending upon the circumstances of the

• ffending.

– Referred to requirement of offender to provide detailed evidence of their financial circumstances.

• General guideline: sentencing offences for which there is no offence specific

guideline – December 2018

Making it worse - sentencing key features

Persistent breaches over time (especially relevant to

• ccupational health)

Previous warnings – think near miss reporting Poor safety record – not just convictions – what about FFI and improvement notices? A poor response to the incident: what happens after an incident is increasingly as important as to what happened before it

H&S fines – key message

Very large fines can and are handed out in cases where there has been moderately serious injuries or no injuries at all The courts will be looking at what was the risk of death or serious injury

The reality

• Where do the Pinsent Masons team see most

enforcement action at present? – Work at height – Vehicle movements – Control of vibration

• Where do most problems arise?

– Control of contractors/illusory control of risk – The reality has changed but the plan has not – Inadequate risk assessment/SSW – Inadequate supervision at a site level

Questions?

Louise Mansfield (Associate) 0121 335 2954 louise.mansfield@pinsentmasons.com