A few months ago, we blogged about proposed sentencing guideline changes in the UK - well, they've certainly arrived, with The Sentencing Council having released its new guidelines for prosecuting health and safety violations this week.
So what are the changes?
In a nutshell, it's the way in which fines are calculated that are changing. From the 1st February 2016, companies found to be offending health and safety law will face fines judged on "turnover; profit before tax; directors’ remuneration, loan accounts and pension provision; and assets as disclosed by the balance sheet”. This is due to concerns that fines imposed previously for the most serious offences have been too low and not having a big enough impact on offending companies to provoke a change in their health and safety habits. Whereas in the past companies would be fined around £100,000 for health and safety offences and £500,000 for corporate manslaughter, new sums will look more like £10-20million for large, enterprise-level organisations. A sum much more likely to have an impact, and in The Sentencing Council's hopes, much more likely to encourage companies to be up to standards in the first place.
Where will the changes affect?
England and Wales for the moment, but Scotland's independent sentencing council (established in 2015) are suspected to point towards these guidelines in the meantime, until new Scottish guidelines are written.
Why have changes been made?
We mention this above, but these changes have been made in the expectation that large organisations will pay more attention to health and safety, thus decreasing the amount of workplace accidents there are per year in the UK. Recently the HSE released figures for 2015, revealing that 142 people died from workplace injuries and 1.2 million were suffering from diseases due to their employment. These numbers are unacceptable - that's why The Sentencing Council and the Health and Safety Executive have welcomed new guidelines that reflect the seriousness of protecting employees.
Not only will health and safety offences be affected - companies involved in environmental crimes will face up to 100% of their pre-tax net profit being levied in fines, which could climb as high as £100million+. This means companies like Volkswagen, who were in the press for all the wrong reasons earlier in the year, would be right in the cross-hair of the firing line.
However, it's not all doom and gloom - if a company prepares accordingly, not only can safety incidents be more frequently averted, efforts to record data can also mean a less punishing consequence. In August we spoke to David Hennessey of Brodies Solicitors, who enlightened us to the new fining process in more detail and offered his specialist law advice:
"Organisations with an existing health and safety infrastructure ought to review it to ensure it is fit for purpose. A company health and safety policy, a nominated director or senior individual, task specific risk assessment and safe method of working, and a system for recording accidents are the very least an organisation ought to have in place. A failure to invest in resources such as a health and safety management system can put an organisation’s fate in the hands of the regulator or the courts. Sometimes an accident occurs despite an organisation’s best efforts. However, those efforts will be recognised by the court when considering the sentence.”
So, after 1st February 2016, offending organisations can expect to be taught a big health and safety lesson - what remains to be seen is the effectiveness of that lesson, and whether the Courts can achieve the more consistent prosecuting process they are after. What companies do in light of the changes now will be an integral, defining factor in their future.
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