Sentencing guidelines: the legal view
With the new Sentencing Guidelines now in force, Eversheds’ Principal Associate Paul Verrico sought the opinion of the leading practitioners in the field to ascertain what differences, if any, they thought the changes would drive.
“As proposed in the draft guidelines, for defendant corporate organisations the published guidelines take the level of culpability and harm and turnover of the organisation as the starting point for determining the appropriate fine. This is likely to lead to an increase in fines imposed in many health and safety and corporate manslaughter cases when compared to the fines imposed to date. This is clearest when considering the guidelines for sentencing defendants convicted of corporate manslaughter. The proposed range of the fine for all organisations convicted of corporate manslaughter is greater, and for medium to large organisations, substantially greater, than the penalties imposed to date for like offences.
The penalties following convictions for the offence of corporate manslaughter have ranged from £8,000 to £600,000. Under the common law sentencing regime a company with an annual turnover of up to £10m (i.e the “small organisation” category under the new guidelines) was fined £385,000 following a conviction after a not guilty plea. Under the new regime, the starting range of penalty for a company of that size having committed that type of offence is likely to be £540,000 to £2.8m. Similarly, under the old regime a company with a turnover in excess of £70m was sentenced to a penalty of £600,000. That same company would fall into the “large organisation” category under the new guidelines and be exposed to a starting range of, at least, £3m to £12.5m.
The potential increase in financial penalties for the offence of corporate manslaughter also needs to be considered in the context of the increasing number of corporate manslaughter investigations and prosecutions. In recent years the CPS has reported a 40% increase in charges for corporate manslaughter and that figure is increasing year on year. It seems certain that in the coming years there will be an even more substantial increase in prosecutions for corporate manslaughter and, for organisations convicted of the offence, a substantial increase in the penalty they will be ordered to pay.”
Prashant Popat QC, Henderson Chambers
“Under the Guidelines the starting point for the assessment of a company’s ability to pay a fine is its turnover. In adopting turnover as the starting point, the Sentencing Council has rejected some powerful representations, including from the CBI, that assessing a company’s financial health by reference to turnover is wrong. Even the Justice Select Committee described it as “something of a blunt instrument”. The Sentencing Council have, no doubt, adopted turnover as the starting point because it is simple and easy for judges and magistrates to identify. However this approach may well lead to unfairness to companies who have high turnovers but are not profitable, and to business with low profit margins.”
Oliver Campbell QC, Henderson Chambers
“It is deeply disappointing that the Council has chosen not to provide any definition what a “Very Large” organisation will look like from a turnover perspective and what brackets may apply. It seems open ended. The Court of Appeal ducked the question of defining these organisations in Thames Water and notwithstanding requests and invitations for clarity on the point during the consultation phase, we are still left in the dark. How Judges will approach the point is entirely unclear. This is an opportunity missed for much needed clarification.”
Kevin Elliott, Head of Health and Safety, Eversheds LLP
“Will the Guidelines be an improvement on where we were? Yes as they provide more comprehensive guidance to Judges (and practitioners) who are not familiar with these areas leading to inconsistencies which have often made it difficult to provide clear advice as to outcome. That has long been a frustration of many of us. It would , however be misguided to assume that all concerns raised by practitioners beforehand have been addressed. The Guidelines do ameliorate the artificial pressure point of whether or not failings have caused death which had as a consequence the focus being on the minutiae of an accident rather than a focus on the wider exposure to risk. I do anticipate there being more contested cases towards the upper end of the scale and generally sentencing hearings will become more complex with an emphasis on identifying the appropriate category. The earlier work is geared towards doing so the better, especially if agreement can be reached with the prosecution and the consequent saving of costs. It would have assisted if greater guidance were given on the mitigating factors accepting responsibility, remediation and assistance given to the investigation as they go the heart of what we are trying to achieve in reducing future risk. Personally, I think the guidelines should have incorporated gross negligence manslaughter arising out of workplace failings.”
Jason Pitter QC, New Park Court Chambers who recently succesfully prosecuted the first corporate manslaughter case under the guidelines
“I must confess that I was both amazed and somewhat disappointed to see that only 104 organisations and individuals filed responses to this important consultation exercise. There have only been minor changes from the draft guideline. We may never know if there is a connection given this somewhat laissez – faire attitude!
We are now where we are, but I cannot help in thinking that companies and organisations may feel it somewhat unfair that a sentence this month, in certain circumstances , could be 10 or15 times higher than it would have been on the 31st of January!
This new regime is sending a chill through UK PLC , especially in larger companies and entities: only time will tell whether this new approach could be seen as a bridge too far!”
Gerard Forlin QC
“As expected, the draft and published guidelines are substantially the same. Generally speaking the new guidelines will lead to a more structured and consistent approach to sentencing. However, the position for “very large organisations” (i.e. where the turnover is significantly greater than £50m) remains more difficult to predict. For these organisations the guidelines state that it may be necessary to move outside the suggested range to achieve a proportionate sentence. The first few cases in this category will be of considerable importance.”
Charles Gibson QC, Henderson Chambers
Due to the reverse burden of proof imposed by Section 40 of the HSWA, most organisations know that, in retrospect, they could have done more to avoid an incident from occurring; there is an undoubted uneasiness across UK plc at the potential ramifications that may result. Such uneasiness increased throughout the last few days of January 2016 as several £1 million fines were imposed by courts – including a huge £1.8 million for C.RO Ports London Ltd in Basildon Crown Court following a guilty plea. The case involved, in essence, a non-fatal machine trap case in which an employee suffered fractures. The company’s accounts show that its turnover was below £50 million at last filing date.
All eyes are on the first cases through the criminal courts in February 2016. Only on the 5th February, the HSE published the prosecution of Solvay Solutions (UK) Limited in Warley Magistrates’ Court; the company was fined £333,000 following a guilty plea after an uncontrolled release of dangerous substance when a weld broke in two. The fine was imposed mainly on the potential for harm, rather than any actual harm to human health.
The world of the health and safety practitioner is changing. Now is the time for organisations to review their risk profile and take appropriate steps to mitigate against the potential for harm. The potential for custody has also become ever more real and we anticipate that will further influence positive safety behaviours. Whether the Guidelines act as a sword to punish duty holders when they take risks or a shield for workers – reminding good employers of the need for safety vigilance and to prioritise safety spend – remains to be seen.
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