It’s common knowledge that guidelines for health and safety, particularly with regard to food, are a priority for businesses handling consumable products, or where employees could be at risk. What’s less well-known are the refreshed guidelines released in 2016. Exposing you to potentially larger fines and longer custodial sentences, the 2016 sentencing guideline updates are no laughing matter.
Even if a breach doesn’t result in actual injury, you could still receive a significant fine. And, that’s before you’ve had to pay legal costs, compensation and take remedial action. The Sentencing Council guidelines apply to sentences handed down in England and Wales after 1 February 2016.
Strong arm of the law
Courts have used the revamped Sentencing Council guidelines to hit a number of firms and company directors hard within the first few years.
A tyre company in Kent was on the receiving end of a £1m fine and ordered to pay costs of £99,485 after an exploding tyre killed an employee. The worker was operating alone, with inadequate equipment, which had not been properly maintained. Nor had he had the appropriate training. Is your own equipment maintenance programme up to scratch and have all of your employees had the appropriate training?
Further up the corporate ladder, Balfour Beatty was fined £2.6m when a trench collapsed and killed an employee. A court heard that “Balfour Beatty failed to adequately assess, plan and supervise the work being undertaken.”
Even if no one is hurt, individuals and organisations cannot expect to escape without serious sanction.
By way of example, an engineering company in Kent was fined £160,000 and ordered to pay costs of £5,767 after a worker slipped and almost fell through a roof.
The fact that the worker was not hurt meant little in the eyes of the law. What mattered was that the company had not provided suitable working at height equipment and appropriate training.
A consistent catch-all approach
Four years on, and the new guidelines aren’t necessarily advertised, until the next big incident when the Sentencing Guidelines come into full force. In addition to grabbing major headlines when enforced, the aim of the guidelines are to create greater consistency in the sentences that courts in England and Wales hand down. This more considered approach shines a bright light on any health and safety transgressions and has already increased the number of fines and custodial sentences meted out.
Offending organisations are put into categories and their size will determine the recommended punishment they receive. They are grouped into the following brackets by turnover:
| Turnover or equivalent | Breach of Health and Safety Regulations fines. Depending on level of Harm & culpability |
Breach of food safety and food hygiene regulations fines. Depending on level of Harm & culpability |
Manslaughter fines. Depending on level of culpability |
|
| Micro | less than £2 million | £50 – £450,000 | £100 – £120,000 | £180,000 – £800,000 |
| Small | between £2 million and £10 million | £100 – £1,600,000 | £300 – 450,000 | £350,000 – £2,800,000 |
| Medium | between £10 million and £50 million | £1,000 – £4,000,000 | £2,000 – £1,200,000 | £1,200,000 – £7,500,000 |
| Large | £50 million and over | £3,000 – £10,000,000 | £6,000 – £3,000,000 | £3,000,000 – £20,000,000 |
Fines are determined by the seriousness of the potential or actual harm caused; the likelihood of harm; and the number of people put at risk. The level of culpability is considered on a four-tier scale from ‘low’ to ‘very high’, and this will also impact the level of the fine. Very large organisations whose turnover greatly exceeds the threshold for large organisations can face unlimited fines.
Individuals held to account
The Sentencing Council guidelines have not just upped the ante for organisations; they also create significantly increased exposures for directors and employees. For breaches of health and safety or food safety regulations, guilty parties could receive a custodial sentence of up to two years, depending on their level of culpability.
Protect your own position
The guidelines make it essential for you to understand where your firm fits into the sentencing matrix. It might not be new anymore, but it is definitely worth keeping this top of mind for your business.
They also demand that you prioritise risk management, best practice, and ongoing training to mitigate your exposure and to protect your organisation and its directors in the event of a transgression. Failing to prioritise such activity will increase your level of culpability should something happen and so increase the punishment handed out.
To make sure you don’t end up on the receiving end of these new guidelines, contact our business insurance and risk management team at Partners& to understand where your health and safety risks lie.
