THE Sentencing Council’s guidelines on Health and Safety Offences, Corporate Manslaughter and Food Safety and Food Hygiene Offences came into force on 1 February.
At the time of writing this article, we have already seen a much harder approach by prosecutors and the courts. For example, the highest fine in February was £3m, which compares to £1m in January.
We have also seen tougher custodial sentencing, with a company director convicted of gross negligence manslaughter and sentenced to three years and two months imprisonment in February. Another director, from the waste management sector, received a suspended prison sentence following a severe injury to one of his employees.*
The guidelines are based on culpability and harm. There are four categories of culpability based on a person’s knowledge and whether their actions were deliberate, reckless, negligent or otherwise. Harm is determined by considering the risk and level of injury created by the offence. This includes the assessment of the likelihood of harm occurring and the seriousness of the injury.
Starting point penalties are based on business size. These are
– Micro (turnover up to £2m)
– Small (turnover £2m – £10m)
– Medium (turnover £10m – £50m)
– Large (turnover £50m+).
For the most serious offences for micro organisations there is a possible maximum fine of £450,000. For large companies the starting point is £4m increasing to £10m. Where turnover greatly exceeds the threshold for large organisations, courts may move outside the suggested range to achieve a proportionate sentence
Corporate manslaughter offences will attract significantly higher penalties. Where it can be argued that the fine will have an impact on innocent parties, such as employees and service users, it is open to the court to schedule payment over a number of years.
The starting point for breaches of health and safety by an individual director or other employee where the culpability category is deliberate or reckless is a custodial sentence. Deliberate or reckless culpability is subject to a maximum of two years, with longer sentences for gross negligence manslaughter.
These changes make it even more important to have a sound approach to the management of operational risks. Independent scrutiny of working practices will add to this and protect people and profits. Although fines are not insurable, other costs associated with prosecution, including defence can be insured. Insurers and policies do differ in their approach to these costs.
For further information about the above and any other insurance and risk advice, contact
Simon Mitchell, Corporate Account Director at Towergate Insurance on 01604 887325 or email
Towergate Insurance is a trading name of Towergate Underwriting Group Limited. Registered in England Company No. 04043759, registered address Towergate House, Eclipse Park, Sittingbourne Road, Maidstone, Kent, ME14 3EN. Towergate Underwriting Group Limited are Authorised and Regulated by the Financial Conduct Authority.