New Sentencing guidelines welcomed
This month new guidelines on the sentencing of those who break health and safety laws come into effect.
They represent a huge change in attitude to health and safety offences and have broadly been welcomed by the TUC who have argued that the current penalties for breaking the law do not act as any kind of deterrent.
Under the Sentencing guidelines that came into force on 1st February, penalties following convictions of health and safety offences or for corporate manslaughter are likely to rise, especially for large employers. In some cases the increase could be at least 10 times the previous level.
There is certainly a need for that. If you read the Risks newsletter, most weeks there will be a story of someone being injured or even killed only to find the employer fined a few thousand pounds. Last year there were 682 convictions with an average fine of £27,860. However many companies were fined much less. Under the new guidelines, large companies with turnovers in the tens of millions of pounds, who put people at risk will face fines upwards of a million pounds
The TUC, in its response to a consultation last year, told the sentencing council that any fines must recognise that health and safety offences are criminal acts that should be treated no differently to other crimes involving violence. Any sentences should reflect not only the harm, but also the potential for harm, and should be sufficient to allow the victim or their dependants to have a sense of justice. Most importantly it must act as a deterrent both to the person convicted and to others. At the same time the TUC does not generally support penalties which threaten the livelihood of innocent workers should a business close because of a fine imposed on a company, and that may be taken into account, but should not be the sole criteria. I have to say that, when I saw the final guidelines, they had pretty much mirrored our view.
They are not perfect of course. There are two areas in particular where we think that the guidelines could have been stronger. The first is that they do not give guidance on dealing with “Phoenix” companies, which are wound up prior to conviction or sentencing only to reappear under a different guise later (mind you that is a wider problem than just sentencing). The second big omission relates to the issue of disqualification of directors. Although the guidance says that courts must consider this, there is no guidance on when that should happen. This is a major omission. Hitting irresponsible directors is one of the biggest deterrents going.
Not everyone shares our views. Before they came into effect, there were a lot of mutterings from solicitors, many of whom usually represent employers. Simon Joyston-Bechal a director at Turnstone Law said “I am concerned the outcome will be very much more dramatic than intended, with much greater fines across the board and more individuals being imprisoned for offences that would not previously have been regarded as sufficiently serious to merit a custodial sentence.” Oliver Campbell QC is quoted as saying “In adopting turnover as the starting point, the Sentencing Council has rejected some powerful representations, including from the CBI, that assessing a company’s financial health by reference to turnover is wrong. Even the Justice Select Committee described it as “something of a blunt instrument”. While Gerard Forlin QC said “We are now where we are, but I cannot help in thinking that companies and organisations may feel it somewhat unfair that a sentence this month, in certain circumstances, could be 10 or15 times higher than it would have been on the 31st of January!”
However the biggest complaint has been that it may make prosecutions harder to take. A lot of law companies are complaining about “unintended consequences”. They think that higher penalties may mean that more defendants will plead not guilty and fight charges or will appeal fines. On this, I actually agree with them. More employers will try to fight prosecutions through the courts, or spend huge amounts trying to complicate sentencing hearings. This could lead to the HSE facing greater costs as they will have to spend much more time preparing for hearings. But that is an argument for increased resources for the HSE and for the HSE to be better at demanding that they get all their costs back, rather than an argument against the sentencing guidelines.
We have had precious little good news about health and safety over the past five or six years, so let’s celebrate those few successes that we do get, and if courts do adhere to these guidelines properly they will act as a real incentive to employers to clean up their act.