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February 3, 2017

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Sentencing guidelines discussed at HSE Leaders Connect

After a busy year in 2016, the HSE Leaders Connect group kickstarted 2017 with an event in Manchester to examine and explore the sentencing guidelines for health and safety. Aisling Reid reports.

Set in the bustling Spinningfields commercial district we looked over Manchester from the 14th floor of the beautiful offices of our welcoming partners, Pinsent Masons, who as always, went above and beyond to make us and our Leaders feel at home. After some networking, drinks and nibbles we took to our seats to embark upon the topic of the evening: Sentencing Guidelines.

HSE Leaders Connect is still growing and for many of the group this was their first taster of what HSE Leaders Connect is all about. Chris Rowlands, the Director of HSE Recruitment Network took this time to recap what has been a fantastic journey for the community.  Four events were held in 2016 across the country: in Birmingham, London and Manchester on topics not only designed to challenge us but to provoke incisive discussions. They covered topics like ‘Brexit’, ‘Wellbeing’, ‘Diversity and Inclusion’ and ‘HRD- friend or foe?’.

There wasn’t much deliberation into what would be the first topic of the year; it naturally fell to ‘Sentencing Guidelines’, considering recent landmark rulings against Merlin Attractions, Wilko and Travis Perkins.


To talk us through this fascinating subject were three heavyweight speakers, Bernard Thorogood, Ben Compton QC and Christopher Badger, followed by a riveting Q&A.

Bernard Thorogood started proceedings by addressing how fitting tonight’s topic was: “The definitive guidelines have bedded in; a year ago this night wouldn’t have been worthwhile”.

With this is mind he proceeded to give us a clearer idea of how the courts are interpreting the new guidelines, having prosecuted in several high profile cases including the Alton Towers Merlin Attraction case and the Wilko case.

The new guidelines direct the courts to consider the sentencing of offending organisations by way of a step-by-step approach, primarily examining culpability, the seriousness of harm risked and the likelihood of harm.

The value of the fine depends on how large the organisation is. Lord Chief Justice in the Wilko case stated that the guidelines do not give sufficient guidance to Very Large Organisations (VLO’s), the threshold of which is expected to greatly exceed the £50 million mark. Bernard confessed this uncertainty would be a recurring theme throughout his presentation.

How the legislation has been interpreted can be derived from the following cases. In the Radwell International case the fine was circa £80k when the guidelines state that it could have been up to £600k. In this case the judge looked at the whole picture, including company performance in addition to the accident.

In the Merlin Attractions case, the case for culpability was extremely high, the likelihood of harm was ‘level A’ and the risk and the likelihood of this harm arising was great. There was no block resetting of the track, the staff did what they thought was right and ultimately there was no avoiding this on that day. The fine was set at £7.5 million, however later reduced to £5 million. So why the reduction? The HSE stated that they hadn’t dealt with a business that had provided such an impressive level of cooperation and this fact greatly worked in Merlin’s favour.

Bernard advised we take a holistic view in each scenario. So far we know that culpability is an individual exercise; a detailed analysis of company action may be required over time, including looking at company performance.

Perceiving the likelihood of that particular risk arising requires looking at the bigger picture; including what exactly is being risked and the possibility of that harm occurring.

Aggravating vs mitigating circumstances are crucial to each and every case and realistically are what make each judgement unique. As a closing point, Bernard stated that it is important for businesses/individuals to demonstrate how they have learned from past mistakes and their willingness to cooperate and engage with vigour, however it is equally important to fight your corner when you need to.

Ben Compton QC was next to the stand. He echoed Bernard’s presentation, ‘this has been a complete sea change…. we have been used to fines below £100k, it will now be in the millions.’

Ben recently defended in the Travis Perkins case. For those of you not familiar with the facts in this case, in short, there was a fatality on site in what was deemed a freak accident involving a lorry. Numerous breaches were witnessed on the site including planning issues stating that HGV’s were not permitted in that area. It is important to note that the company placed a considerable amount of significance on health and safety policies and procedures.

Culpability was reduced from high to medium as the defendant was able to portray the company’s wide investment into health and safety. The level of harm in this case was high as well as likely to occur. Considered to be a VLO, based on their £3 billion company turnover, Travis Perkins fine was £3 million. This was later reduced to £2 million and was seen as a reasonable result, something that Ben highlighted would have been a terrible outcome last year.

In the Thames Water case the judge stated the fine needed to be large enough to send the correct message to the MD and the shareholders (highlighting again the ambiguity surrounding the guidelines at present.) It is likely that in the future, sentences will go outside the guidelines for larger companies, meaning that this outcome may not be the norm.

It is important to note the Court of Appeal are reluctant to change a decision and thus far haven’t done so. The Court of Appeal in the Conoco Philips case chose not to entertain the appeal and if anything considered the fine to be too little; £3 million fine against a £4.8 billion company.

In a room of 60 delegates, some of whom know our speakers quite well, Christopher Badger had the tricky task of being the final speaker and taking the Q & A session to round off our evening.

With a focus on environmental sentencing, Chris wanted to highlight strict liability in environmental law. A common theme throughout all three speeches is the fact that there is still limited guidance on what constitutes a VLO. Combine this with the judgement in R v Thames Water Utilities Ltd, were it was agreed that the courts are not bound by the fines issued from the sentencing guidelines, it leaves us in an uncertain position.

In this case the judgement stated that “sentences passed upon them for environmental offences will be sufficiently severe to have a significant impact on their finances”.

Thames water was fined £1 million in this case (£2 million being the largest fine in environmental case law) and was culpable of ‘repeated operational failures’ which added additional weight to the judgement in favour of the prosecution.

Most common mitigation factors that companies can consider in their defence include: statements from the board, the financial position of the company, low culpability, low harm and steps taken to ensure future avoidance. It is important to begin a defence at the earliest possible opportunity as previous decisions have shown.

The Q & A brought up some interesting concerns, one being: ‘How do we get the board to see health and safety as their responsibility not only the SHE Director?’

As Chris stated: “The culture surrounding safety is changing; safety is now a business risk with quantifiable and tangible effects to businesses.”

He admitted that he didn’t have an answer but the case law and fines should be reason enough to make board members sit up and listen.  Admittedly the focus had been on VLO’s, not SME’s but the fine can be proportionate to turnover.

By no means should companies start on the back foot when an accident occurs, they should strive towards a high level of health, safety and environmental compliance.

The landscape is changing, are you taking it seriously?

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Ray Rapp
Ray Rapp
7 years ago

Interesting observations, indeed with regards to VLOs or as I referred to them – MNEs, in the SC consultation document I suggested a fine of £50m might not be seen as proprotionate for a company with a turnover of billions.