Corporate Manslaughter - What You Need To Know
The Corporate Manslaughter and Corporate Homicide Act 2007 comes into force on 6 April 2008, and all businesses must therefore take a look at their existing health and safety regulations, if they don’t want to face an unlimited fine plus potential humiliation by ‘name and shame’.
The new offence of corporate manslaughter is committed where an organisation commits a ‘gross breach’ of a ‘relevant duty of care’, leading to a person’s death. This recent change to corporate law and health and safety law means that it will no longer be necessary to identify an individual director guilty of gross negligence, all that is required is an organisational or gross management failing causing death.
What happened in the past
Under the existing common law provisions, to punish an organisation appropriately, the Prosecution have to prove ‘gross negligence manslaughter’ by an individual who is part of the ‘directing mind’ of the organisation which caused or contributed to the death.
This has proved to be an almost insurmountable task, particularly in relation to large organisations where, in reality, there is no one individual who could properly be considered part of the ‘directing mind’ of the organisation.
As a result, governments have long been under pressure to update corporate law and health and safety law in order to force businesses to be brought to justice in the case of gross negligence leading to the death of a worker.
A shift of focus
The new offence of corporate manslaughter will be committed if the way in which a business’ senior managers organise or manage the activities causes a person’s death and this amounts to a gross breach of a relevant duty of care owed by the organisation to the deceased.
The shift of focus - from the ‘directing mind’ to senior managers - in the new offence is considered to make it easier to obtain successful convictions.
What must businesses do now?
Organisations should prepare themselves for the changes in corporate law and health and safety law by undertaking a complete and thorough review of their safety management systems and of how they are practically implemented. This will necessarily incur costs but these costs are likely to be a fraction of any potential penalty if found guilty of corporate manslaughter.
The penalty
Of course, companies cannot be sent to prison, so the penalty usually imposed is a financial one. The Sentencing Guidelines Council have suggested that on conviction for an offence of corporate manslaughter, the court, as a starting point, should impose a fine which is equal to 5% of the organisation’s annual turnover, with the ability to go up to 10% or more if there are aggravating factors. This would, for most companies, represent a very large fine indeed.
In addition to a fine, courts can compel the organisation to ‘advertise’ their conviction in the local or national press on the basis that a ‘name and shame’ culture may send a message to other businesses. The idea is that the stigma of being convicted of corporate manslaughter could have a devastating affect on a business, and the threat will cause businesses to take more care with their health and safety regulations.
Iain Mackintosh is the managing director of Simply-Docs. The firm provides over 1100 legal document templates covering all aspects of business from corporate law to workplace health and safety regulations. By providing these legal documents (with content provided by leading commercial lawyers, HR and health & safety consultants) at an affordable price, the company intends to help small businesses avoid costly breaches of regulation and legal action.
Tags: corporate manslaughter, health and safety, health and safety law, corporate law
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