Corporate manslaughter - is your business at risk?
CORPORATE manslaughter has been high in the news agenda in recent weeks. The offence was created to ensure businesses and organisations can be held properly accountable for very serious health and safety failings resulting in death.
Last month, the director of Wood Treatment Ltd, which ran Bosley Mill in Cheshire, a wood flour mill which made wood chip products, was charged with gross negligence manslaughter following the explosion and devastating fire at the mill in July 2015 which left four employees dead and others injured.
The firm has been charged as a corporate body with corporate manslaughter and both the firm, its director and two managers have been charged with health and safety offences.
So who does corporate manslaughter apply to? Company directors can be held personally liable when there is a gross breach of the duty of care owed to employees where directors have both a collective and individual responsibility towards health and safety.
An organisation may be charged with the offence of corporate manslaughter if there is evidence that it had a duty of care towards the individual and has been grossly negligent in breaching that duty of care resulting in the death of the individual. There must also be evidence that senior directors in the organisation played a large part in that breach.
All employers have a duty of care to their employees or any member of the public. Directors and board members will need to take action in ensuring that the health and safety of employees or members of the public is protected at all times, ensuring that health and safety is recognised as a key business risk and health and safety management is fully integrated into all business decisions.
Organisations should also engage their workforce to promote health and safety conditions, encouraging effective communication at all levels and high-quality training.
Once health and safety risks are effectively identified and managed maintenance through competent advice, monitoring, reporting and review through auditing should be diligently carried out.
There are significant benefits to properly assessing health and safety risks including reduced costs, reduced risks, lower employee turnover rates, fewer accidents, better reputation for corporate responsibility among investors and avoidance of legal action resulting in fines for both the organisation and individuals.
If convicted of corporate manslaughter, organisations will face hefty fines depending on their turnover. For example, those with a turnover of between £10m and £50m can face fines of up to £7.5m while those with a turnover of less than £2m can see fines of up to £800,000.
The extent of the fine will be dependent on the degree of risk assumed, the extent of the danger, the size of the organisation and the scale of the offence. Company managers or directors found guilty of breaching their duty of care towards their employees can also be imprisoned for up to two years.
In one case, an employee crushed by a dangerously high stack of aircraft parts resulted in a fine of £600,000 for the employer. In another case, a geologist died when an unsupported trial pit he had been working in alone caved in at a development site, resulting in a fine of £385,000 for his employer.
These fines are imposed to reflect the gravity of the offences and to have a deterrent effect on companies who are encouraged to adhere to health and safety guidelines as set by the Health and Safety Executive.
It's vital that companies and organisations carry out regular risk assessments and keep their health and safety procedures up to date to avoid a grave situation. If this is not something already in place, you need to act now.
:: Sam Francey (email@example.com) is a solicitor in John McKee (www.jmckee.co.uk) specialising in health and safety law and insurance disputes