IOSH N ATIONAL S AFETY & H EALTH C ONFERENCE 2016 S ENTENCING GUIDELINES – Title I MPACT ON C ORPORATE H EALTH AND S AFETY O FFENCES Richard Atkins QC & James Puzey
HISTORY • Howe & Sons (Engineers) Ltd [1999] 2 AER 249. Guideline judgment in the Sentencing Council Guideline Compendium. “Historically fines have been too low. ” • Balfour Beatty Rail Infrastructure Services Ltd [2007] 1 Cr App R (S) 65 @ para 22. Lord Phillips CJ, approving Mackay J’s 13 principles derived from Howe & Sons. • “Corporate Sentencing Guidelines Council Manslaughter & Health and Safety Offences Causing Death” Definitive Guideline 15/2/10 – 31/1/16
WINDS OF CHANGE • Three Factors: i. R v Sellafield Ltd and Network Rail Infrastructure Limited [2014] EWCA Crim 49 On 17 January 2014 the Court of Appeal gave its judgment in the jointly heard appeals of Sellafield Ltd and Network Rail Ltd against fines imposed upon them for breaches of environmental and health and safety legislation respectively. In Sellafield some radioactive waste had been disposed of unsafely. It had caused no harm and was very unlikely to have caused any harm. In Network Rail a young boy had been permanently and very seriously disabled due to a poorly maintained level crossing.
Fines of £700,000 against Sellafield and £500,000 against Network Rail were upheld without reservation by the Court of Appeal: In relation to Network Rail’s offending the Court of Appeal stressed the importance of considering the actual and potential harm and the level of culpability in the sentencing exercise. It also pointed out that simply because the fine was imposed on what was effectively a public service would not deter the Court from imposing what on any view was a very significant fine. ii. Definitive Guideline for Environmental Offences Signalled a significant increase in the level of fine iii. Consultation Exercise by SGC for Corporate Manslaughter and Health and Safety Offences
The Present • Sentencing Council “Health and Safety Offences, Corporate Manslaughter and Food Safety and Hygiene Offences” Definitive Guideline, 1/2/16 + www.sentencingcouncil.org.uk/wp-content/uploads/HS-offences-definitive-guideline-FINAL-web1.pdf • S85 (1) (2) and (4) Legal Aid, Sentencing and Punishment of Offenders Act 2012 Removal of limit on certain fines on conviction by Magistrates’ Court (28/5/14) • Criminal Justice Act 2003 s 143 Determining the seriousness of an offence (1) In considering the seriousness of any offence, the court must consider the offender's culpability in committing the offence and any harm which the offence caused, was intended to cause or might forseeably have caused.
164 Fixing of fines (1) Before fixing the amount of any fine to be imposed on an offender who is an individual, a court must inquire into his financial circumstances. (2) The amount of any fine fixed by a court must be such as, in the opinion of the court, reflects the seriousness of the offence. (3) In fixing the amount of any fine to be imposed on an offender (whether an individual or other person), a court must take into account the circumstances of the case including, among other things, the financial circumstances of the offender so far as they are known, or appear, to the court. (4) Subsection (3) applies whether taking into account the financial circumstances of the offender has the effect of increasing or reducing the amount of the fine. [ cited at Step 3 p. 10 of the Definitive guideline)
THE NEW GUIDELINE • Who does it affect? All organisations and offenders aged 18 and older who are sentenced on or after 1/2/16 regardless of date of offence. • How does it work? A Organisations Breaching Duties & Regulations 1. Determine the Offence Category i. Establish level of culpability (very high, high medium or low) and harm (high, medium and low according to whether death or reduced life expectancy, serious injury or not occasioned) ii. Consider how many people were put at risk and whether the offence was a significant cause of actual harm.
2. Starting Point and Category Range i. Identify the appropriate size of organisation using the tables provided (Large: £50 million +; Medium: £10 - £50 million; Small £2 – 10 million; Micro: less than £2 million) focussing on annual turnover or equivalent (The Court should have comprehensive accounts for the last 3 years). Profitability is relevant both ways. ii. Factor in aggravating and mitigating features as set out. 3. Check whether the proposed fine based on turnover is proportional to the overall means of the offender. “The fine must be sufficiently substantial to have a real i. economic impact which will bring home to both management and shareholders the need to comply with H&S legislation.” ii. Consider other financial factors listed to ensure proportionality iii. Allow time to pay, if necessary over a number of years and in instalments.
4. Consider other factors which may warrant adjustment of the proposed fine. Does it impair the offender’s ability to make restitution i. ii. Does it affect the ability to improve conditions in the organisation to comply with the law iii. Does it impact on the employment of staff, service users, customers and the local economy, but not the shareholders or directors iv. If a public or charitable body the fine should be reduced if the offending organisation is able to demonstrate the proposed fine would have a significant impact on the provision of its services. 5. Consider factors such as assistance to the prosecution 6. Reduction for guilty pleas 7. Compensation and Ancillary Orders: Remediation, Forefeiture, Compensation 8. Totality (Offence range £50 to £10 million fine)
B. Corporate Manslaughter 1. Determining the Seriousness of the Offence i. How foreseeable was serious injury ii. How far short of the appropriate standard did the offender fall iii. How common is this kind of breach in this organisation iv. Was there more than one death or a high risk of further deaths or serious personal injury in addition to death Category A if the answers indicate a high level of harm or culpability, Category B if a lower level. 2. Starting Point and Category Range i. Identify appropriate level from tables. ii. Consider annual turnover or equivalent iii. Consider other financial factors iv. Consider aggravating and mitigating features.
3. Check whether the proposed fine based on turnover is proportionate to the overall means of the offender (consider profitability). 4. Consider other factors that may warrant adjustment of the proposed fine 5. Consider factors such as assistance to the prosecution 6. Reduction for guilty pleas 7. Compensation and Ancillary Orders: Publicity Orders, Remediation, Compensation 8. Totality (Offence range £180,000 to £20 million fine)
WHAT IS THE EFFECT • The Immediate Impact? An increase in the level of fines? Undoubtedly in Crown Court, question mark over Magistrates • Increase in Newton Hearings? But new guidance on credit due • Recent cases: Very few as too new. Consider R v Thames Water Utilities Ltd 2015 EWCA Crim 960 which was the first CoA case to consider the Environmental Offences Guidelines. Appeal against sentence (£250,000 + costs) for a 4 day discharge of sewage into an outstanding area of natural beauty. Appeal dismissed with the CoA commenting that the sentence was lenient.
• First Instance cases: • Travis Perkins (Apr 2016) fatal accident, worker run over, pleaded guilty to 2 H&S offences, £2 billion turnover, £2 million fine, £115,000 costs. • Balfour Beatty (Apr 2016) fatal accident, trench collapse, pleaded guilty to series of H&S offences, £2.6 million fine. • McCain foods (GB) Ltd, arm caught in unguarded machinery, £800,000 fine • Falcon Crane Hire (March 2016), crane collapse caused by metal fatigue, double fatality, £800,000 fine • Watling Tyre Services Ltd, fatal accident, pleaded guilty to 2 H&S offences, £1 million, £100,000 costs • Scottish Power Generator (May 2016) employee scolded, pleaded guilty to one H&S offence. £1.75 million fine
HOW WOULD OLD OFFENCES BE DEALT WITH NOW 1. Howe & Sons i. Then: Fine £ 15,000 (reduced from £48,000 due to company financial circumstances), costs £7,500. Turnover £355,000, net profit £27,000. ii. Now: Start point £54,000 (could be higher (£80,000?) as breach was a significant cause of death, range for micro company £30,000 - £110,000. Culpability high. Harm risk level A. Likelihood at least medium, so harm category 2. If £80,000 start, 1/3 rd reduction, fine c£53,000?
2. Balfour Beatty i. Then: Fine £7.5 million (reduced from £10 million due to disparity with co-Defendant). Turnover £52 million pa. Late guilty plea, no discount. “A serious systemic failure.” ii. Now: Start point £2.4 million (range £1.5 million to £6 million, large company turnover of over £50 million). Likely to be at the top end of the category, but given the exceptionally serious nature of the offending and multiple deaths may be taken out of the range and a fine of £7 million to £10 million might not be appealable.
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