Corporate manslaughter and corporate homicide Act comes into force on 6 April

It will put businesses across all sectors under a lot more scrutiny, as it introduces a new offence, across the UK, for prosecuting companies and other organisations where there has been a gross failing, throughout the organisation, in the management of health and safety resulting in workplace deaths.

The IoD and HSE produced new official guidance for directors or board members on what they should be doing and what their responsibilities are under health and safety legislation, which will not only help reduce the incidence of work-related death and harm, but will also indeed help avoid the actual use of the new law on corporate manslaughter and corporate homicide.

As a professional membership organisation whose members hail from all sectors of the economy, the IoD always seeks to promote the highest standards of performance, across all the many and varied responsibilities that directors have. Over the last seven or eight years the IoD has helped bring about some key developments related to health and safety. The IoD consistently supported what became the Corporate Manslaughter and Corporate Homicide Act 2007 from the moment that the UK Government’s Home Office announced its intention to proceed with a new law – the UK’s Ministry of Justice (MoJ) taking it to fruition several years later. The IoD also lobbied for some of the changes that were made as the legislation proceeded at its excruciatingly slow pace.

Summary of the Act

The offence: an organisation will be guilty of the new offence if the way in which its activities are managed or organised causes a death and amounts to a gross breach of a duty of care to the deceased.

Applies to: all companies and other corporate bodies, operating in the UK, in the private, public and third sectors. It also applies to partnerships (and to trade unions and employers’ associations) if they are an employer, as well as to Government departments and police forces.

The new test: juries will consider how the fatal activity was managed or organised throughout the organisation, including any systems and processes for managing safety and how these were operated in practice. A substantial part of the failure within the organisation must have been at a senior level.

Senior level means the people who make significant decisions about the organisation or substantial parts of it. This includes both centralised, headquarters functions as well as those in operational management roles.

Relevant duties of care: a duty of care exists for example in respect of the systems of work and equipment used by employees, the condition of worksites and other premises occupied by an organisation and in relation to products or services supplied to customers. The Act does not create new duties – they are already owed in the civil law of negligence and the new offence is based on these.

Gross breach: the organisation’s conduct must have fallen far below what could have been reasonably expected. Juries will have to take into account any health and safety breaches by the organisation – and how serious and dangerous those failures were.

The jury may also consider evidence of corporate safety culture (attitudes, policies, systems or accepted practices), any relevant health and safety guidance, and any other factors which the jury considers relevant.

Exemptions: the offence does not apply to certain public and government functions whose management involve wider questions of public policy and are already subject to other forms of accountability. For example, it does not apply to strategic decisions about the spending of public money or military operations.

Other functions, such as policing, the response of the emergency services, child protection and statutory inspection are also exempt, other than where organisations owe responsibilities to employees or for the premises they occupy.

The new offence will apply to the management of custody, but this will come into force at a later date.

Penalty: an organisation guilty of the offence will be liable to an unlimited fine. The Act also provides for courts to impose a publicity order, requiring the organisation to publicise details of its conviction and fine. This will be commenced at a later date when sentencing guidelines are available (expected in autumn 2008). Courts may also require an organisation to take steps to address the failures behind the death (a remedial order).

Jurisdiction: England, Wales, Northern Ireland and Scotland.

Be prepared

It is not possible to know for certain what courts across the nation will do with the Act now that it is in effect. One thing is certain though – companies that comply with existing health and safety legislation and have a robust and practical policy in place have nothing to fear.

The IoD stance has been firmly based on the foundation that helping create and maintain high standards of health and safety performance – and having that led by the board of directors – is an extremely desirable aspiration in its own right:

• Identify potential areas for risk and address them as a matter of utmost importance
• Ensure your health and safety policies are up-to-date and are regularly reviewed
• Train your all senior management in health and safety and make sure that they are aware of the new laws and regulation and their implications

In conjunction with Health and Safety Executive, the IoD published, in October 2007, new official guidance for directors or board members on what they should be doing and what their responsibilities are under health and safety legislation - Leading Health and Safety at work

The guidance sets out good practice for directors, informing Boards and their members in the public, private and third sectors, as to how to provide leadership in health and safety so that their organisations meet their legal obligations as an employer under the Health and Safety at Work etc. Act 1974 and gain the business benefits arising from effective, sensible health and safety management.

The guidance has been underpinned by websites run by the HSE and the IoD- www.iod.com/hsguide. They provide links and material that give more of the detail.

Linking guidance to law

There is a very clear link between the IoD’s involvement with the guidance and the Act. For one thing, high standards of health and safety performance will assist in avoiding deaths associated with work. For another, the Corporate Manslaughter and Corporate Homicide Act 2007 contains explicit reference to the fact that juries will be able to consider to what extent directors and senior management have referred to and used various relevant official guidance from regulators. To quote from the Act [8(5)]:

‘In this section “health and safety guidance” means any code, guidance, manual or similar publication that is concerned with health and safety matters and is made or issued (under a statutory provision or otherwise) by an authority responsible for the enforcement of any health and safety legislation.’

Maintenance of good standards of health and safety require good stewardship. There are – and no doubt there will continue to be – calls for there to be new stringent legal duties on directors, and for more severe penalties. The IoD hopes that ‘Leading health and safety at work’ will not only help reduce the incidence of work-related death and harm, but will also indeed help avoid the actual use of the new law on corporate manslaughter and corporate homicide.

Further Information

• For Northern Ireland health and safety material see: www.hseni.gov.uk
• The Ministry of Justice guidance on Corporate Manslaughter and Corporate Homicide Act 2007
• FAQ’s on the CMCH Act 2007 from the Health & Safety Executive

_{Published: April 2008
To the best of our knowledge the information is correct at the time of publishing. Whilst every care has been taken to ensure that the information provided is accurate, the Institute of Directors cannot accept liability for any errors or omissions. The Institute of Directors is not responsible for the content of any external internet sites listed. All information included on the iod.com site is intended for information purposes only. We make no representations or warranties as to the accuracy of the information contained on the iod.com site, and you should take appropriate steps to verify it. Please see the full Terms and Conditions governing its use.}