Better Safe than Sorry - Sentencing Health & Safety Breaches and Other Developments in Health & Safety Law - Health & Safety Event
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Better Safe than Sorry
Sentencing Health & Safety Breaches and Other
Developments in Health & Safety Law
Chris Green
Partner
DDI: 0121 200 8125
Mobile: 07894 462112
chris.green@weightmans.com
© Weightmans LLP
Captain EJ Smith (Captain of the Titanic): “When any one asks me how I can best describe my experiences of nearly forty years at sea I merely say uneventful. Of course, there have been Winter gales and storms and fog and the like, but in all my experience I have never been in an accident of any sort worth speaking about. I have seen but one vessel in distress in all my years at sea… . I never saw a wreck and have never been wrecked, nor was I ever in any predicament that threatened to end in disaster of any sort. I will say that I cannot imagine any condition which could cause a ship to founder. I cannot conceive of any vital disaster happening to this vessel. Modern shipbuilding has gone beyond that.” © Weightmans LLP
“It is true that, on the facts of a particular case, an accident-free period may be a factor that weighs in the balance – and may weigh heavily. However, [it is not the case] that a substantial period in which a risk did not in fact fruit into an accident means that the likelihood of the risk was not high. It all depends on the circumstances of the case.” [Hickinbottam LJ in R v Diamond Box Ltd [2017] EWCA Crim 1904] © Weightmans LLP
HOT OFF THE PRESS
▪ Huge Fine for ▪ Appealing ▪ Nobody’s
NHS Trust Enforcement Perfect
Notices
© Weightmans LLP
Hot Off the Press – Huge Fine for NHS Trust R v Southern Health NHS Foundation Trust [2018] ▪ One epileptic patient drowned in a bath at a Short Term Treatment and Assessment Centre in Oxford ▪ One patient hanged herself with a phone cord at an Adult Mental Health Hospital in Southampton ▪ Against the background of a number of other alleged failings within the Trust around the same time ▪ A number of previous warnings ▪ Well-known risks within the industry © Weightmans LLP
Hot Off the Press – Huge Fine for NHS Trust
R v Southern Health NHS Foundation Trust [2018]
▪ “Systemic failure within the organisation to address
risks to health and safety”
▪ Both offences produced a high risk of death
▪ NHS Trust with limited and stretched finances with any
potential fine having an effect on services
Fine = £2m
© Weightmans LLP
Hot Off the Press – Appealing Enforcement Notices HSE v Chevron North Sea Ltd [2018] ▪ HSE Inspector served a Prohibition Notice on the access stairway to the helideck on an oil rig ▪ HSE said that corrosion rendered it weak and unsafe ▪ As a result, Chevron got the stairway independently tested – it complied with the BS strength test ▪ Chevron Appealed the Prohibition Notice to the Employment Tribunal © Weightmans LLP
Hot Off the Press – Appealing Enforcement Notices
HSE v Chevron North Sea Ltd [2018]
▪ What Approach Should Tribunal take when considering
appeal of Enforcement Notices?
▪ Chevron said Tribunal should consider all of the
relevant facts – which could include the subsequent
testing
▪ HSE said Tribunal should limit its considerations to
information available to the Inspector at the time
▪ Case went to UK Supreme Court
© Weightmans LLP
Hot Off the Press – Appealing Enforcement Notices
The Supreme Court’s Judgement [2018] UKSC 7
▪ Key question for Tribunal is whether a risk actually existed
▪ No good reason for confining consideration to material
available at the time
▪ If no risk actually existed, then Tribunal should cancel the
Notice, even if Inspector had been fully justified in serving
it on basis of the information at the time
Notice = Cancelled
© Weightmans LLP
Hot Off the Press - Nobody’s Perfect © Weightmans LLP
HSE Crown Censure ▪ At HSL Buxton site ▪ Setting up an experimental pressure testing rig ▪ Prototype hydrogen storage vessel tested to see whether the design was suitable ▪ Whilst filling, a connector failed, releasing hydrogen under pressure, which ignited ▪ One worker suffered serious burns ▪ Investigated by HSE itself (conflict of interest?) © Weightmans LLP
HSE Crown Censure – Findings of HSE Investigation
▪ HSE “co-operated fully with the investigation”
▪ Found “failings to assess, plan, manage and control a
well-known risk of death of serious injury”
▪ “Incident could have been prevented by putting in place
recognised control measures available in longstanding
published guidance”
▪ Control measures for pressure testing are outlined in
the HSE’s own guidance
▪ HSE “served itself with a Notification of Contravention,
which requires it to pay a Fee for Intervention bill to
cover the time that its inspectors spent on the case.”
▪ ©
HSE “took immediate action to resolve immediate issues
Weightmans LLP
identified”Grenfell Tower © Weightmans LLP
“actually we are maybe looking at a system failure, built up over many years, which we now have to address urgently...” “It is worth reminding ourselves here, that the primary issue on those [four Camden] tower blocks was not the cladding. It was the condition of the buildings themselves and the lack of fire doors…” “We may have to confront an awkward truth. That over many years and perhaps against the backdrop of, as data shows, a reduced risk in terms of fire, in terms of number of incidents and deaths, that maybe as a system some complacency has crept in. There is no room for that and Grenfell changes everything.” © Weightmans LLP
Dame Judith
▪ Rules not clear and too complex
▪ Roles and responsibilities in CDM
▪ Competency esp high rise
▪ Compliance enforcement and sanctions on Building
Regs Residents concerns and rights Product
Testing and QA methods
© Weightmans LLPImmediate actions A. Review of Building Regs B. Competence in construction and inspection C. FRS early involvement in design process D. Building developers and handover to RP E. Building control bodies coordinate information F. Responsible person ANNUAL FRA review G. Government & industry to consider cladding safety © Weightmans LLP
Also Note ▪ New Gas Safety Regulations ▪ New Rules on HMOs © Weightmans LLP
Sample Fire Prosecution Cases ▪ R. v John Patrick O’Rourke ▪ New Look Retailers Limited v The London Fire and Emergency Planning Authority ▪ R. v Southwark Council ▪ Leicestershire Fire And Rescue Service v Mr Haresh Patel ▪ Hallmark Hotels Limited ▪ Sandhu and the Guidelines © Weightmans LLP
Fee For Intervention (FFI) © Weightmans LLP
Fee For Intervention (FFI) ▪ Allows HSE to charge companies £129/hr if in HSE Inspector’s opinion there is a “material breach” of health and safety law ▪ Does not include costs incurred once a case goes to Court ▪ Does not automatically mean no prosecution as well © Weightmans LLP
Fee For Intervention (FFI) Former System for Disputing Invoices ▪ Panel where 2 of the 3 members are HSE staff ▪ Negative view in industry (and from some within HSE) ▪ HSE Forced to change dispute system when permission to JR the system was granted by the High Court © Weightmans LLP
Fee For Intervention (FFI) ▪ CD284 – “Consultation on a revised process for considering disputes under Fee for Intervention (FFI)” ▪ Consultation ended June 2017 ▪ HSE has now produced its response to the Consultation results (available on its website). © Weightmans LLP
Fee For Intervention (FFI) – New System
▪ 3 person panel
▪ Lawyer as chair (drawn from AG’s Civil Panel)
▪ 2 members “with practical experience of health
and safety management”
▪ Procedure
▪ Usually disputes decided on papers – but can
convene meeting if necessary
▪ No witness evidence
© Weightmans LLPFee For Intervention (FFI) – New System ▪ Key Point – “HSE will suspend the disputes process until the outcome of the [IN/PN] appeal or enforcement action is known” ▪ Still little information on how panel members appointed – will this be transparent? ▪ Expect lots of disputes early on to test the panel’s approach © Weightmans LLP
Legal Professional Privilege and Internal Accident Investigations © Weightmans LLP
Privilege and Internal Investigations
▪ HSE have powers under s20 HSWA to compel the
production of documents
▪ Where a Accident Investigation is –
1) Carried out by, or on the instructions of, a lawyer
2) Carried out “for the sole or dominant purpose
of… reasonably contemplated litigation”
… the findings and documents of that Investigation are
Privileged and are excluded from the s20 HSWA power
▪ If an accident report is not privileged, HSE can
demand it and use it as evidence against a Company
© Weightmans LLPPrivilege and Internal Investigations 2017 Law Society Guidance for Solicitors ▪ Seeks to confirm the right of Privilege for Internal Accident Investigations ▪ “No adverse inferences should be drawn by investigators or regulators from a claim to privilege or a refusal to waive it.” ▪ “Lawyers do not have to satisfy enforcement agencies or regulators that claims to LPP are well- founded, and the latter are not entitled to make this decision themselves.” © Weightmans LLP
Privilege and Internal Investigations SFO v ENRC Ltd [2017] EWHC 1017 (QB) ▪ ENRC’s lawyers conducted investigation into potential criminal activity within ENRC ▪ Included evidence taken from witnesses and other third parties (e.g. accountants etc.) ▪ SFO tried to compel production of investigation documents ▪ ENRC refused, citing privilege ▪ SFO brought case to High Court © Weightmans LLP
Privilege and Internal Investigations – SFO v ENRC Ltd - Judgment ▪ “General” trend of Courts towards less protection ▪ Must be a real likelihood of litigation, not just a possibility ▪ Actual intention/state of mind at time document produced is relevant ▪ Documents produced for purposes of avoiding litigation (as opposed to resolving/winning litigation) not necessarily covered © Weightmans LLP
Privilege and Internal Investigations –
SFO v ENRC Ltd - Judgment
▪ Communications between client themselves and
lawyers always privileged
▪ Not all persons within company are the “client” (eg
lower level employees)
▪ Statements of employees taken by lawyers not
necessarily privileged
▪ But could be privileged if they contain lawyer’s
own thoughts/advice on evidence
= ENRC’s documents not protected by Legal
© Weightmans LLP PrivilegePrivilege and Internal Investigations – R (HSE) v Paul Jukes ▪ Employee killed at recycling plant by bailing machine where interlocking guard had been bypassed ▪ Paul Jukes was interviewed by Company’s Solicitors 6 weeks after the incident and told them that he was responsible for H&S ▪ PJ was interviewed by HSE 18 months later and told them that he was not the H&S Manager © Weightmans LLP
Privilege and Internal Investigations – R (HSE) v Paul Jukes ▪ PJ was prosecuted, along with Company (and ors) ▪ Company (and ors) pleaded guilty, PJ took case to trial ▪ Prosecution sought to rely on statement PJ had given to Company’s Sols ▪ PJ argued they could not as it was part of a privileged investigation © Weightmans LLP
Privilege and Internal Investigations – R (HSE) v Paul Jukes Court of Appeal [2018] EWCA Crim 176 ▪ Only privileged if litigation (i.e. prosecution) “reasonably contemplated” ▪ At stage that statement made, no evidence that anybody knew sufficient facts that would give rise to prosecution ▪ Not enough to say that “where there is a death and on the face of it a breach of duty, the HSE normally prosecutes” ▪ In any event, privilege is the Company’s and not PJ’s ▪ Would it be different if Company’s Sols had given evidence that Litigation was in fact contemplated by ©them? Weightmans LLP
Privilege and Internal Investigations – Analysis ▪ Huge implications for accident investigations, risk aversion and deterrent effect ▪ Counter-productive? Less open for fear of self- incrimination? ▪ Privileged investigations still possible – but requires careful navigation by experienced lawyers ▪ Terms of instruction of lawyers (and instructions sent by lawyers to third parties) now very important © Weightmans LLP
Sentencing Guidelines for Health & Safety © Weightmans LLP
Sentencing Guidelines for Health & Safety © Weightmans LLP
Sentencing Guidelines for Health & Safety © Weightmans LLP
Sentencing Guidelines for Health & Safety © Weightmans LLP
Sentencing Guidelines for Health & Safety
Turnover
▪ Now plays a central role
▪ Turnover, not profit
▪ Micro organisation £50m
▪ Very large organisation ???
© Weightmans LLPSentencing Guidelines for Health & Safety © Weightmans LLP
Sentencing Guidelines for Health & Safety
~ 40-45% of Large
© Weightmans LLPSentencing Guidelines and ISO 45001
▪ ISO 45001
© Weightmans LLPExamples of Recent Cases Sentenced Under The Guidelines © Weightmans LLP
High Profile 2017/18 Fines
Total T’over/
Notes
Fine Size
LSE Rail £2.5m £870m Worker electrocuted to death on railway.
+ Wetton Cleaning £1.1m £27m “Culture of cutting corners”.
Contractor fell 3m to his death from work
Iceland £2.5m £2.7bn platform. No barriers and trip hazards.
Worker paralysed by falling load. No RA or
Wilko Retail Ltd £2.2m £1.5bn training.
2 separate deaths and series of other
Southern Health £2.0m £30m failings. High Culpability. No reduction for
public body.
Bakkavor Foods £2.0m £1.5bn Crushed to death by falling bales
Worker fell 2m from mixing machine,
Warburtons £2.0m £526m fracturing spine. No WAH measures or
training. 1 previous conviction.
Trapped arm in conveyor belt. 2 previous
Warburtons £1.9m £526m convictions.
Lone worker drowned in filtration tank.
South West Water £1.8m £1.4bn Previous warnings.
Road worker killed by traffic. No safety zone
©Kier Services
Weightmans LLP £1.8m £562m or speed restriction.High Profile 2017/18 Fines
Total T’over/
Notes
Fine Size
2016 case reduced from £1.99m on appeal.
Tata Steel £1.5m £4.2bn 2x hand injuries from unguarded machines.
Electrician crushed to death by crane. Failed
Tata Steel £1.4m £4.2bn to react to 2 previous incidents.
Overloaded FLT overturned, killing delivery
Howden Joinery £1.2m £1.3bn driver. No pedestrian separation.
Red arrows pilot killed by faulty ejector
Martin Baker £1.1m £216m seat. Previous warnings of risk. Late plea.
Foot injuries from electric pallet truck.
Aldi £1.0m £7.7bn Working alone and inadequate training.
Tractor hit disabled member of public
Notts CC £1.0m £480m (seriously injured). Burden falls on taxpayer.
Dangerous storage of stock at 3 stores.
Poundstretcher £1.0m £397m Poor co-operation. Blamed local
management.
Two employees burnt removing hot gravy
KFC £0.95m £480m from microwave.
Worker crushed to death at Heathrow.
Laing O’Rourke £0.8m £1.1bn Workers didn’t have correct certs for plant.
© Weightmans LLPThe Effect of the Sentencing
Guidelines:
HSE Enforcement Statistics
© Weightmans LLPHuge Increase in Total Fines © Weightmans LLP
Numbers of Prosecutions/Notices
Prosecutions
Brought
Enforcement
Notices Served
© Weightmans LLPHuge Increase in Total Fines Year Prosecutions Convictions Total fines Average fine 2012/13 605 576 £12.9m £22k 2013/14 604 568 £17.0m £30k 2014/15 659 619 £18.1m £29k 2015/16 711 672 £38.8m £58k 2016/17 593 554 £69.9m £126k © Weightmans LLP
2016/17 By Sector
Industry Total fines Average fine
Agriculture £713k £34k
Mining and Quarrying £1,387k £462k
Manufacturing £25,094k £158k
Utility Supply £2,783k £696k
Water Supply/Waste Management £3,779k £189
Construction £15,981k £78k
Distribution, Hotels & Restaurants £3,074k £99k
Transportation and Storage £1,842k £102k
Business Services & Finance £6,070k £141k
Public Administration £612k £87k
Education £766k £77k
Health and Social Care £1,794k £94k
Arts/Entertainment/Recreation
© Weightmans LLP £6,056k £466kProsecutions Against Individuals
Immediate Suspended Community
Year
Imprisonment Imprisonment Sentence
2015/16 38 59 13
2016/17 46 93 24
© Weightmans LLPSpecific Sentencing Issues:
Very large Organisations
© Weightmans LLPSentencing Very Large Organisations Sentencing Guidelines “Where a defendant organisation’s turnover or equivalent very greatly exceeds the threshold for large organisations, it may be necessary to move outside the suggested range to achieve a proportionate sentence.” © Weightmans LLP
Sentencing Very Large Organisations R v Thames Water Utilities Ltd Court of Appeal’s comments on Very Large Companies… ▪ Highest category of harm and culpability = a fine up to100% pre-tax profit (even if in excess of £100m) ▪ Even in lower categories of harm = fines might be “measured in millions of pounds” © Weightmans LLP
Specific Sentencing Issues:
Company Groups
© Weightmans LLPInterdependence – Embrace All Ltd ▪ Embrace All Ltd turnover = £13m ▪ Turnover of the wider Embrace Group = £112m ▪ 2 tiers of companies above it, but also 58 subsidiaries ▪ Employed all staff in Group and held all Group’s real estate ▪ EAL’s pre-tax profits were £6.3m (nearly 50%!) ▪ PROSECUTION: should treat EAL as having £112m t/o ▪ DEFENCE: Only £3.4m t/o relates to care homes – should treat as having that t/o (ie small)… AND ▪ … Substantial © Weightmans LLP fine could risk ability to continue trading
Interdependence – Embrace All Ltd = Medium sized organisation (based on £13m turnover) “… If a company is part of a group of companies, then of course, the court is entitled to look to the support that others in the group will give to a company, if it is the subject of a financial penalty, and if its continuation to trade is ever in question. To that extent, of course, I do take account of the fact that this is a member of a group and not a single entity company.” ▪ Fine adjusted upwards for financial proportionality ▪© Weightmans Fine wasLLP£1.5m (for a company turning over £13m)
Interdependence - Tata Steel UK … The approach in Embrace, echoed by Court of Appeal in Tata Steel UK Ltd ▪ Turnover of £4.2bn ▪ Operating at a £851m loss = No downward adjustment necessary to reflect losses as part of huge company group Court can take into account fact that Tata is part of big company group when looking at economic reality © Weightmans LLP
Interdependence – Martin Baker … similar approach again in R v Martin Baker … “In my judgment the “economic reality” here for sentencing purposes … must take into account the overall picture including the matters relating to [the parent company]. …The (perfectly legitimate) manner in which MBAL’s directors and (direct and indirect) shareholders have chosen to structure their affairs should not be allowed to mask the reality of the financial position.” ▪ But did not need to adjust fine upwards based on the facts. © Weightmans LLP
Specific Sentencing Issues:
Public Bodies, Charities and Not-For-
Profits
© Weightmans LLPSentencing Public Bodies ▪ Use Annual Revenue Budget instead of Turnover when determining organisation's size Sentencing Guidelines “Where the fine will fall on public or charitable bodies, the fine should normally be substantially reduced if the offending organisation is able to demonstrate the proposed fine would have a significant impact on the provision of its services.” © Weightmans LLP
Sentencing Public Bodies R v Havering BC [2017] EWCA Crim 242 ▪ Worker cut tree using cutting tool designed for ceramics ▪ Manual for tool (unavailable to worker) specifically warned against using on wood ▪ Not provided with cut-resistant clothing ▪ Blade came loose causing severe laceration to worker’s knee ▪ Council pleaded guilty © Weightmans LLP
Sentencing Public Bodies
R v Havering BC [2017] EWCA Crim 242
▪ Council argued that “Substantially reduced ” within
the Guidelines should mean “reduced by at least
50%”
▪ Court of Appeal rejected that argument – the
reduction is left to the discretion of the Judge
Fine = £500,000
© Weightmans LLPSentencing Public Bodies
Nottinghamshire County Council
▪ Disabled member of public struck by NCC tractor
▪ Serious but non-fatal injuries
▪ No SSOW or vehicle segregation
▪ Inadequate training of workers
▪ Council pleaded guilty
▪ ARB = £480m
▪ Burden likely to fall on tax payers or affect
provision of services
© Weightmans LLP
Fine = £1mSentencing Public Bodies
R v Shrewsbury and Telford NHS Trust [2017]
▪ 3x falls by elderly patients resulting in their deaths
▪ Budget = £325m
▪ Operating at £31m deficit
▪ Would have fined £666,666 is private company
▪ Additional 50% reduction given as NHS Trust
Fine = £333,333
© Weightmans LLPSentencing Public Bodies R v Southern Health NHS Foundation Trust [2018] “Although I have accepted both that the Trust operates under financial constraints, and that it has no apparent surplus funds available, and that the imposition of any fine will reduce the sums available for clinical services pro rata, the Trust’s evidence does not demonstrate that particular services will or will not be affected by a given level of fine.” ▪ No Reduction Given © Weightmans LLP Fine = £2m
Liability of
Individuals
© Weightmans LLPLiability of Individuals –
Gross Negligence Manslaughter
1. Duty of Care
2. Breach of that Duty
3. Causes (or significantly contributes to) the death
4. “defendant's conduct was so bad, in all the
circumstances, as to amount to a criminal act or
omission”
▪ Very high hurdle
© Weightmans LLPLiability of Individuals – Gross Negligence Manslaughter It is of some note that in Misra, Langley J, had directed the jury; “Mistakes, even very serious mistakes, errors of judgment, even very serious errors of judgment and the like are nowhere near enough for a crime as serious as manslaughter to be committed ….. (It has to be something which was) truly exceptionally bad which showed such an indifference to an obviously serious risk of life of the deceased and such a departure from the standard to be expected as to amount to a criminal act or omission and so to be the very serious crime of manslaughter.” © Weightmans LLP
Liability of Individuals –
Gross Negligence Manslaughter
Sentencing Gross Negligence Manslaughter
▪ Maximum Sentence = Life Imprisonment
▪ Immediate custodial sentences are the norm
▪ Draft Sentencing Guidelines for GNM currently out
for consultation –
▪ Would mean the vast majority of GNM sentences
are a minimum of 3 years custody, and higher in
many cases
© Weightmans LLPLiability of Individuals – Self-Employed s3(2) Health and Safety at Work Act 1974 “It shall be the duty of every self-employed person … to conduct the undertaking in such a way as to ensure, so far as is reasonably practicable, that he and other persons … who may be affected thereby are not thereby exposed to risks to their health or safety.” ▪ Incl Self-Employed Consultants © Weightmans LLP
Liability of Individuals – Directors s37 Health and Safety at Work Act 1974 “Where an offence …committed by a body corporate is proved to have been committed with the consent or connivance of, or to have been attributable to any neglect on the part of, any director, manager, secretary or other similar officer of the body corporate he as well as the body corporate shall be guilty of that offence” © Weightmans LLP
Liability of Individuals – Employee Liability
s7 Health and Safety at Work Act 1974
“It shall be the duty of every employee while at work—
(a) to take reasonable care for the health and safety
of himself and of other persons who may be affected
by his acts or omissions at work;”
© Weightmans LLPLiability of Individuals – Sentencing Sentencing Individuals for Health and Safety Offences ▪ Up to 2 years imprisonment (or a community sentence or fine) ▪ Custodial sentence (immediate or suspended) becoming much more common ▪ Would your legal costs/representation be covered by your insurance? © Weightmans LLP
Liability of Individuals – Statistics
Immediate Suspended
Year Community Sentence
Imprisonment Imprisonment
2015/16 38 59 13
2016/17 46 93 24
Year Number of directors prosecuted
Annual average over past 5 years 24
1 April 2014 to 31 March 2015 15
1 April 2015 to 31 March 2016 46
… but fewer employees prosecuted under s7
© Weightmans LLPNobody’s Perfect: What would HSE have been fined? © Weightmans LLP
Nobody’s Perfect © Weightmans LLP
Sentencing HSE – Culpability ▪ “Failings to assess, plan, manage and control a well-known risk of death of serious injury” ▪ “Incident could have been prevented by putting in place recognised control measures available in longstanding published guidance” © Weightmans LLP
Sentencing HSE - Culpability © Weightmans LLP
Sentencing HSE – Harm ▪ “… a well-known risk of death of serious injury” ▪ One worker suffered serious burns © Weightmans LLP
Sentencing HSE - Harm © Weightmans LLP
Sentencing HSE – Starting Point and Range ▪ HSE’s “Turnover” ▪ Central Government Grant 2018-19 = £128.5m ▪ Plus commercial income of ~£15m = Large Organisation © Weightmans LLP
Sentencing HSE – Starting Point and Range © Weightmans LLP
Sentencing HSE – Other Factors
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© Weightmans LLPSentencing HSE – Other Factors • “Where the fine will fall on public or charitable bodies, the fine should normally be substantially reduced if the offending organisation is able to demonstrate the proposed fine would have a significant impact on the provision of its services.” • 1/3rd Reduction for Early Guilty Plea © Weightmans LLP
Sentencing HSE – Other Factors © Weightmans LLP
Sentencing HSE – The Result? © Weightmans LLP
Any Questions? © Weightmans LLP
Crime and Regulation Team
Chris Green
Tom Boulton
Partner
Solicitor
DDI: 0121 200 8125
DDI: 0121 616 6672
Mobile: 07894 462112
tom.boulton@weightmans.com
chris.green@weightmans.com
James Muller
Solicitor
DDI: 0121 200 8130
james.muller@weightmans.com
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