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May 20, 2024

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opinion

Could the HSE take a leaf out of the Environment Agency’s enforcement book?

Matt Kyle, Associate Director at Osborne Clarke, considers how health and safety enforcement is evolving with an eye on the approach of other regulators.

£1.5 million fine for Dairy Crest after series of environmental offences

An Environment Agency employee inspecting the outfall at the River Inny.

The lifting of the cap on civil sanctions that can be imposed by the Environment Agency (EA) on companies in breach provides a meaningful alternative to prosecution.

There are a number of factors that may make this an attractive approach for the Health and Safety Executive (HSE) to follow. Broadly, most duty holders would likely welcome a quicker and potentially less costly route to a resolution following an HSE investigation and allegation of breach.

However, there are downsides. Arguably, this could be a further shift in the balance of power to the HSE, which, with civil sanctions, could set the amount and conditions with minimal influence from the offending duty holder and with no independent intervention.

Enforcement precedents

There is some precedent for health and safety enforcement to follow the EA. The health and safety sentencing guidelines followed the model that had already been in operation for almost two years for environmental offences.

Matt Kyle, Associate Director at Osborne Clarke

Aligned with a similar enforcement management model – and with issues around capacity and backlogs in the court system – it is not improbable that health and safety enforcement might follow the EA’s lead again.

The EA has always had a slightly wider range of enforcement options, partly because of the nature of the offences. These include restoration notices, enforcement undertakings and civil sanctions, which are termed as variable monetary penalties (VMPs) for the more serious offences.

Substantial penalties

The removal of the £250,000 limit for VMPs per offence last year has enabled the EA to impose very substantial penalties without the costs, delays and legal challenges that are often factors in a prosecution.

On 30 November 2023, Yorkshire Water paid a civil sanction of £1 million split between two environmental charities.

An HSE VMP might not identify a particular cause, as the circumstances of a health and safety incident do not readily lend themselves to an obvious beneficiary; but otherwise, enforcement could be applied.

Limited options

Presently, the HSE’s enforcement options are more limited. Other than fees for intervention, duty holders can only be hit financially as a result of a conviction. The prosecution process invariably puts the HSE under pressure, in particular as it has recently lost knowhow and experience and its capacity is stretched; notably,  a similar talent pool has been required recently to staff the new Building Safety Regulator.

Criminal prosecutions have reduced, in 2022/23 the HSE completed 216 criminal prosecutions down from the 290 criminal prosecutions in 2021/22. Also, the pace of prosecution is slow. It’s not unusual to wait two or more years for a case to come to court.

The HSE’s conviction rate will always remain very high (last year it was 94%); but, while this might seem to infer a smooth process to conviction, in many cases that is not the reality. Even when defendants are pleading guilty, there can be long challenges to the basis of pleas and tactical pleas by defendants seeking to obtain the best mitigation, even in cases where the merits of being found not guilty are remote.

With the apparent declining appetite for prosecution – and associated costs that may not be fully recovered and delays – the HSE may be looking at the EA’s civil sanctions with interest.

Civil sanctions: good or bad?

q&aAny reforms that are introduced would follow a consultation, as they did for environmental offences. But there remains a central question for duty holders to consider: are civil sanctions good or bad?

Inevitably, it’s a mixed position depending on your perspective and the particular facts. However, the potential positive implications include:

  • Less trials and sentencing hearings, as a penalty can be imposed without recourse to the court.
  • Reduced legal costs as not locked into a court process.
  • Quicker resolution with the pace and parameters being subject to the control of the HSE and (to a lesser extent) the duty holder.
  • More of an opportunity for duty holders to engage and try to resolve breaches and enter into more constructive discussions, a process that is often constrained once a court process has begun.

The flip side is that this could also bring a potential increase in the number of penalties being imposed, and a civil sanction may be much more attractive and used more frequently in situations where previously no prosecution would have been brought. To launch a prosecution is a significant undertaking for the HSE, but negotiating an albeit substantial civil sanction is much more manageable.

It may be a simplistic view, but duty holders could be less exposed to large fines imposed at court but likely face the possibility of lesser payments being made more frequently as a result of breaches and resolution by civil sanction.

Keep reviewing

Health and safety enforcement continues to evolve, the only constant for duty holders is the requirement to keep reviewing and continually striving to improve its health and safety management, a process which will hopefully avoid harm and any penalty however it is imposed.

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