Corporate Killing - New Laws Will Apply Offshore

The UK Government's proposals for a new offence of corporate manslaughter in England and Wales will also extend to all offshore installations in the UK sector of the Continental Shelf, including those in the Scottish sector. Legislation extending criminal jurisdiction offshore does not differentiate between Scots and English law. Any conduct which constitutes a criminal offence in either jurisdiction is deemed an offence offshore. Historically this has not been an issue since the criminal law in both jurisdictions is broadly the same.

The new Bill, if it becomes law ,will make an important difference since it will mean that companies operating in the Scottish sector of UKCS will now be exposed to the risk of criminal liability for corporate manslaughter even if that is not an offence under Scots law. It is not clear whether this was an intended consequence or whether the effect of the criminal jurisdiction regulations has been overlooked. Whatever the reason the Scottish offshore industry will be in a unique position and must understand the effect and consequences of the English Bill. So, what will this new offence involve?

What Is Proposed?

The new offence of corporate manslaughter does not focus on individual failures but rather on the way an organisation's activities are managed as a whole. The arrangements and practices put in place enable an organisation to carry out its work, and management failings by the organisation's senior decision makers are the key factors. The Bill contains a statutory framework for assessing an organisation's conduct including a clear link with standards imposed by health and safety legislation and guidance publications. Documents such as the Health & Safety Executive's Guidance on Directors' Responsibilities for Health and Safety will now be directly applicable and organisations who have not appointed a health and safety director are likely to be in difficulty.

All companies, including foreign registered companies, would be subject to the offence if the injury causing the death occurs in any place where the English courts have jurisdiction. The offence applies to incorporated bodies, not individuals, and the only sanction available is a financial penalty. Since corporate manslaughter is outwith the Health & Safety at Work Act regime it will require to be investigated by the Police and prosecutions will be brought by the Crown Prosecution Service not the Health and Safety Executive.

What Is The Cost?

The Government's view is that the new offence will create no additional regulatory burdens and, since the new offence is linked to existing health and safety duties, they claim that the additional costs of compliance ought to be modest. They admit however that they have been unable to put a specific figure on this. The general view from business is that it will have a negative impact increasing bureaucracy and cost and making companies more risk averse.[1]

There appears to be particular cynicism in the energy/utilities sector where it has been reported that 71% of directors/senior managers interviewed believed the Government's primary motivation to be a political manoeuvre to satisfy public outcry and media demands in the wake of several rail and other transport disasters.[2] On the other hand the Bill has the backing of the Trades Union Congress which insists that health and safety standards can only be improved through greater corporate accountability. Indeed the TUC wants matters to be taken further with individual liability for directors and sanctions such as imprisonment.

Will We Be Safer?

Analysis of trends over the last five years suggests that an increased use of the criminal law and enforcement measures has made no difference to the country's safety performance. In 2004 workplace fatalities increased from 227 to 235. The total of reported injuries increased by 9%.[3] The Health & Safety Executive's own assessment of progress towards the targets they set at the start of the "Revitalising Campaign" of 2000 (a 10% reduction in fatalities and major injuries by 2010) is that there is "no clear evidence of any change in the incident rate" of fatalities, major injuries or work related ill-health since 1999/2000.[4] There is no doubt that the tragic loss of life in disasters such as Piper Alpha and the spate of terrible railway accidents has raised important issues. We should however move beyond a culture of blame where for every accident we demand that someone be punished. Introducing a new criminal offence will not of itself improve safety. If there are to be real advances in safety in the workplace, businesses, particularly small and medium sized companies, need greater help with compliance.

There is a glimmer of hope. In the spring the Chancellor, Gordon Brown, announced that the Government would be adopting a new "light touch" in relation to Health & Safety Regulation. He stated that he believed that UK businesses generally act responsibly and that they understand the commercial benefits of effective safety management. Accordingly routine health and safety inspections would be reduced and targeted more where they were needed. The Health & Safety Executive has also announced that it intends to develop its advisory role and the Executive has appointed a number of Health and Safety Awareness Officers who will visit employers and raise awareness of safety issues. Unlike inspectors they will not have direct enforcing powers and the aim is that this will facilitate an open discussion of safety issues.

If there is a requirement for punishment the mechanics are already available and if used appropriately quite sufficient to deal with even the most serious safety breaches. The Health & Safety at Work Act 1974 seeks to balance the need for flexibility and guidance with punitive sanctions as a last resort. These can be applied with force in the, relatively rare, situations where true culpability arises. The sanctions imposed by the 1974 Act apply, not only against corporate bodies but against individual directors where failures are directly attributable to their neglect. In that sense the penal element of the 1974 Act already exceeds the current proposals on corporate manslaughter. "The real need is for a constructive means of ensuring that practical improvements are made and preventative measures adopted. Whatever the value of the threat of prosecution, the actual process of prosecution makes little direct contribution towards this end."[5] These words are lifted from the report of the Robens Committee whose lengthy inquiry into workplace safety led to the creation of the Health & Safety Executive and the 1974 Act. They are as apt today as they were then and, 30 years on, it seems we still have lessons to learn.

1.  The Norton Rose Report on Corporate Killing, February 2004.
2.  Norton Rose Report Supra
3.  HSE's Statistics Highlights for 2003/2004
4.  HSE Statistics Highlights Supra
5.  Robens Report (Supra) - paragraph 621.

By Rona Jamieson - Health & Safety Partner - Paull & Williamsons - Solicitors

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Posted 02/08/05

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