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And when your company can be fined out of existence. Mark Preston summarises the new sentencing guidelines
The health and safety industry is bracing itself for new sentencing guidelines that could see tougher sentences imposed on individuals and organisations that are guilty of serious offences. It is anticipated that the number of prosecutions for health and safety offences will increase significantly along with level of fines.
The Sentencing Council’s proposals were under consultation until 18 February 2015. Following that review it is anticipated that the guidelines will come into effect at the beginning of 2016.
Under the proposed sentencing guidelines, large businesses found guilty of the most serious health and safety offences could face significantly increased sentences. For example, fines for corporate manslaughter could be as high as £20million for a business with a turnover in excess of £50million, while for fatal health and safety offences they could reach up to £10million.
The aim of the guidelines is to promote a consistent approach to sentencing for health and safety, corporate manslaughter and food offences and to ensure all sentences are proportionate to the offence committed and in relation to other offences. It is proposed the courts will adopt the following structure when sentencing businesses and individuals.
Step one: determining the offence category
The court should consider the harm and culpability factors to identify the seriousness of the offence. The court should ask:
- How foreseeable was serious injury? The more foreseeable it was, the more grave the offence.
- Did the defendant fail to comply with advice from regulators, authorities or employees?
- Did the defendant fail to comply with industry standards?
- How adequate was training, supervision or reporting arrangements?
- How widespread was non-compliance?
- Was there more than one death or a high risk of further deaths, or serious personal injury in addition to death?
Step two: starting point and category range
The court should obtain the business’s financial turnover to determine whether the organisation is: micro, small, medium, large or very large. The court will then identify a starting point and range for the appropriate level of fine.
The court will also consider aggravating and mitigating factors to make adjustments from the starting point. The proposed starting points and ranges are provided in appendix 1
Step three: is the proposed fine proportionate to the defendant’s means?
The court should consider whether the suggested fine is proportionate to the means of the defendant.
Step four: other factors that warrant adjusting the proposed fine
The court should consider any wider impacts the proposed fine may have on innocent third parties, such as employees and service users. Where necessary, the fine should be adjusted to avoid unjustifiable wider consequences.
Steps five through to nineare standard steps in Sentencing Council guidelines, including factors to be considered for the reduction of a penalty. These include an early guilty plea and previous good record.
These proposals are serious for businesses and they should be alert to the fact that tougher sentencing is definitely on its way. The new sentencing landscape will align the sentencing for serious health and safety offences with a defendant’s financial means, culpability and likelihood of harm.
Experts are predicting that this will result in increased sentences and fines. The Council has said that fines should be big enough to have a real economic impact “which will bring home to the offending organisation the importance of achieving a safe environment for those affected by its activities”.
Sentencing in relation to low-level offences is unlikely to change as they are viewed as being proportionate. It is unlikely that objections to the proposals will alter the Council’s proposed approach to sentencing. At present the proposals remain in draft form and do not propose to change existing legislation. The Council expects to publish the definitive sentencing guidelines for these offences by the end of 2015, with increased sentences and fines taking effect from early 2016. In the interim, businesses should concentrate on implementing adequate health and safety measures that both protect their workers and the public from injury, and their business from exposure to financial and custodial penalties.
Culpability
Levels of culpability will fall into four categories: very high, high, medium and low. These are defined as follows.
Very high. This involves a deliberate breach of or flagrant disregard for the law.
High. In this category the offender fell far short of the appropriate standard. Typical examples: failing to put in place measures that are recognised standards in the industry; ignoring concerns raised by employees or others; failing to make appropriate changes following prior incident(s); exposing risks to health and safety; allowing breaches to subsist over a long period of time.
Evidence of serious, systematic failings within the organisation to address risks to health and safety will lead to high culpability.
Medium. This applies when the offender fell short of the appropriate standard in a manner that falls between descriptions in ‘high’ and ‘low’ culpability categories
Low. Here the offender did not fall far short of appropriate standard. This could be because significant efforts were made to address the risk although they were inadequate on this occasion, or there was no prior event or warning indicating a risk to health and safety.
For individuals, levels of culpability will fall into four categories: deliberate, reckless, negligent and low. These are defined as follows.
Deliberate. Where the offender intentionally breached or flagrantly disregarded the law.
Reckless. Actual foresight of, or wilful blindness to, risk of offending but risk nevertheless taken.
Negligent. Offence committed through act or omission, which a person exercising reasonable care would not commit.
Low. Offence committed with little fault. This could be because significant efforts were made to address the risk although they were inadequate on this occasion, or there was no prior event or warning indicating a risk to health and safety, or failings were minor and not systemic.
Aggravating and mitigating factors
A statutory aggravating factor is previous convictions. This takes into account the nature of the offence to which the conviction relates, its relevance to the current offence and the time that has elapsed since the conviction.
Other aggravating factors include:
- Cost-cutting at the expense of safety.
- Deliberate concealment of illegal nature of activity.
- Breach of any court order.
- Obstruction of justice.
- Poor health and safety record.
- Falsification of documentation or licenses.
- Deliberate failure to obtain or comply with relevant licenses in order to avoid scrutiny by authorities.
Mitigating factors:
- No previous convictions or no relevant/recent convictions.
- Evidence of steps taken to remedy problem.
- High level of co-operation with the investigation, beyond that which will always be expected.
- Good health and safety record.
- Effective health and safety procedures in place.
- Self-reporting, co-operation and acceptance of responsibility.
Corporate Manslaughter
When considering levels of sentencing the courts should take the following into account.
How foreseeable was serious injury?
Usually, the more foreseeable it was, the more grave the offence. Failure to heed warnings or advice from the authorities, employees or others or to respond appropriately to ‘near misses’ arising in similar circumstances may be factors indicating greater foreseeability of serious injury.
How far short of the appropriate standard did the offender fall?
Where an offender falls far short of the appropriate standard, the level of culpability is likely to be high. Lack of adherence to recognised standards in the industry or the inadequacy of training, supervision and reporting arrangements may be relevant factors to consider.
How common is this kind of breach in this organisation?
How widespread was the non-compliance? Was it isolated in extent or, for example, indicative of a systematic departure from good practice across the offender’s operations or representative of systemic failings? Widespread non-compliance is likely to indicate a more serious offence.
Was there more than one death, or a high risk of further deaths, or serious personal injury in addition to death?
The greater the number of deaths, very serious personal injuries or people put at high risk of death, then the more serious the offence.
Fines
| Large – Turnover more than £50 million | ||
| Offence Category | Starting Point | Category Range |
| A (More serious offences) | £7,500,000 | £4,800,000 – £20,000,000 |
| B | £5,000,000 | £3,000,000 – £12,500,000 |
| Medium – Turnover £10 – £50 million | ||
| Offence Category | Starting Point | Category Range |
| A (More serious offences) | £3,000,000 | £1,800,000 – £7,500,000 |
| B | £2,000,000 | £1,200,000 – £5,000,000 |
| Small Turnover £2 to £10 million | ||
| Offence Category | Starting Point | Category Range |
| A (More serious offences) | £800,000 | £540,000 – £2,800,000 |
| B | £540,000 | £350,000 – £2,000,000 |
| Micro – Turnover up to £2 million | ||
| Offence Category | Starting Point | Category Range |
| A (More serious offences) | £450,000 | £270,000 – £800,000 |
| B | £300,000 | £180,000 – £540,000 |
Appendix 1
Health and safety offences fines
Micro – Turnover not more than £2 million
| Starting Point | Category Range | |
| Very high culpability | ||
| Harm category 1 | £250,000 | £150,000-£450,000 |
| Harm category 2 | £100,000 | £50,000-£200,000 |
| Harm category 3 | £50,000 | £25,000-£100,000 |
| Harm category 4 | £24,000 | £12,000-£50,000 |
| High Culpability | ||
| Harm category 1 | £160,000 | £100,000-£250,000 |
| Harm category 2 | £54,000 | £30,000-£110,000 |
| Harm category 3 | £30,000 | £12,000-£54,000 |
| Harm category 4 | £12,000 | £5,000-£21,000 |
| Medium Culpability | ||
| Harm category 1 | £100,000 | £60,000-£160,000 |
| Harm category 2 | £30,000 | £14,000-£70,000 |
| Harm category 3 | £14,000 | £6,000-£25,000 |
| Harm category 4 | £6,000 | £2,000-£12,000 |
| Low Culpability | ||
| Harm category 1 | £30,000 | £18,000-£60,000 |
| Harm category 2 | £5,000 | £1,000-£20,000 |
| Harm category 3 | £1,000 | £200-£7,000 |
| Harm category 4 | £200 | £50-£2,000 |
Small – turnover between £2million – £10million
| Starting Point | Category Range | |
| Very high culpability | ||
| Harm category 1 | £450,000 | £300,000-£1,600,000 |
| Harm category 2 | £200,000 | 100,000-£800,000 |
| Harm category 3 | £100,000 | £55,000-£400,000 |
| Harm category 4 | £50,000 | £20,000-£190,000 |
| High Culpability | ||
| Harm category 1 | £250,000 | £170,000-£1,000,000 |
| Harm category 2 | £100,000 | £50,000-£450,000 |
| Harm category 3 | £54,000 | £25,000-£210,000 |
| Harm category 4 | £24,000 | £12,000-£100,000 |
| Medium Culpability | ||
| Harm category 1 | £160,000 | £100,000-£600,000 |
| Harm category 2 | £54,000 | £25,000-£230,000 |
| Harm category 3 | £24,000 | £12,000-£100,000 |
| Harm category 4 | £12,000 | £4,000-£50,000 |
| Low Culpability | ||
| Harm category 1 | £45,000 | £25,000-£130,000 |
| Harm category 2 | £9,000 | £3,000-£40,000 |
| Harm category 3 | £3,000 | £700-£14,000 |
| Harm category 4 | £700 | £100-£5,000 |
Medium – turnover between £10million – £50million
| Starting Point | Category Range | |
| Very high culpability | ||
| Harm category 1 | £1,600,000 | £1,000,000-£4,000,000 |
| Harm category 2 | £800,000 | £400,000-£2,000,000 |
| Harm category 3 | £400,000 | £180,000-£1,000,000 |
| Harm category 4 | £190,000 | £90,000-£500,000 |
| High Culpability | ||
| Harm category 1 | £950,000 | £600,000-£2,500,000 |
| Harm category 2 | £450,000 | £220,000-£1,200,000 |
| Harm category 3 | £210,000 | £100,000-£550,000 |
| Harm category 4 | £100,000 | £50,000-£250,000 |
| Medium Culpability | ||
| Harm category 1 | £540,000 | £300,000-£1.300,000 |
| Harm category 2 | £240,000 | £10,000-£600,000 |
| Harm category 3 | £100,000 | £50,000-£300,000 |
| Harm category 4 | £50,000 | £20,000-£530,000 |
| Low Culpability | ||
| Harm category 1 | £130,000 | £75,000-£300,000 |
| Harm category 2 | £40,000 | £14,000-£100,000 |
| Harm category 3 | £14,000 | £3,000-£60,000 |
| Harm category 4 | £3,000 | £1,000-£10,000 |
Large – turnover £50million and over
| Starting Point | Category Range | |
| Very high culpability | ||
| Harm category 1 | £4,000,000 | £2,600,000-£10,000,000 |
| Harm category 2 | £2,000,000 | £1,000,000-£5,250,000 |
| Harm category 3 | £1,000,000 | £500,000-£2,700,000 |
| Harm category 4 | £500,000 | £240,000-£1,300,000 |
| High Culpability | ||
| Harm category 1 | £2,400,000 | £1,500,000-£6,000,000 |
| Harm category 2 | £1,100,000 | £550,000-£2,900,000 |
| Harm category 3 | £540,000 | £250,000-£1,450,000 |
| Harm category 4 | £240,000 | £120,000-£700,000 |
| Medium Culpability | ||
| Harm category 1 | £1,300,000 | £800,000-£3,250,000 |
| Harm category 2 | £600,000 | £300,000-£1,500,000 |
| Harm category 3 | £300,000 | £130,000-£750,000 |
| Harm category 4 | £130,000 | £50,000-£350,000 |
| Low Culpability | ||
| Harm category 1 | £300,000 | £180,000-£700,000 |
| Harm category 2 | £100,000 | £35,000-£250,000 |
| Harm category 3 | £35,000 | £10,000-£140,000 |
| Harm category 4 | £10,000 | £3,000-£60,000 |
Penalties for individual
| Starting Point | Category Range | |
| Deliberate | ||
| Harm category 1 | 18 months custody | 1-2 year’s custody |
| Harm category 2 | 1 year’s custody | 26 weeks – 18 months custody |
| Harm category 3 | 26 weeks custody | Band F fine or high level community order – 1 year’s custody |
| Harm category 4 | Band F fine | Band E Fine-26 week’s custody |
| Reckless | ||
| Harm category 1 | 1 year’s custody | 26 weeks – 18 months custody |
| Harm category 2 | 26 weeks custody | Band F fine or high level community order – 1 year’s custody |
| Harm category 3 | Band F fine | Band E Fine-26 week’s custody |
| Harm category 4 | Band E fine | Band D Fine – Band E Fine |
| Negligent | ||
| Harm category 1 | £1,300,000 | Band F fine or high level community order – 1 year’s custody |
| Harm category 2 | Band F fine | Band E Fine-26 week’s custody |
| Harm category 3 | Band E fine | Band E Fine-26 week’s custody |
| Harm category 4 | Band D fine | Band C – Band D fine |
| Low Culpability | ||
| Harm category 1 | Band F fine | Band E Fine-26 week’s custody |
| Harm category 2 | Band D fine | Band C – Band D fine |
| Harm category 3 | Band C fine | Band B – Band C Fine |
| Harm category 4 | Band A fine | Conditional discharge – Band A fine |
Fine bands
| Fine Band | Starting Point | Category Range |
| Band A | 50% of relevant weekly income | 25–75% of relevant weekly income |
| Band B | 100% of relevant weekly income | 75–125% of relevant weekly income |
| Band C | 150% of relevant weekly income | 125–175% of relevant weekly income |
| Band D | 250% of relevant weekly income | 200–300% of relevant weekly income |
| Band E | 400% of relevant weekly income | 300–500% of relevant weekly income |
| Band F | 600% of relevant weekly income | 500–700% of relevant weekly income
|
Mark Preston BA, CMIOSH, MAPS is a registered safety practitioner with more than 20 years’ experience in health, safety and environment management. His consultancy work has included the development of systems, auditing, training and strategic advice to senior management in organisations including: BMW, AB World Foods, Eversheds, Microsoft, Air Canada, Thames Water, EA Sports and the New York Stock Exchange.
Mark is a member of the Institute of Occupational Safety and Health, the International Institute of Risk and Safety Management, the Association for Project Safety and the American Society of Safety Engineers. He has qualifications across the entire range of health, safety and environmental disciplines.
