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On 15 February the Sentencing Guidelines Council published guidance for Judges sentencing companies and other commercial bodies for corporate manslaughter and breaches of health and safety legislation which cause death. As a result we can now say the likely starting point for fines for corporate manslaughter is £1/2m and potentially much more.

Corporate manslaughter is committed when an organisation causes a death as a result of a gross breach of duty and where there are significant management failings.

 Health and safety offences vary, but as a general rule do not require a gross breach of duty, but rather a failure to ensure the safety of an employee or other person. Also they do not require any significant management failing.

 Generally corporate manslaughter is a more serious offence and the guidelines reflect this, although any offence which leads to someone's death will always be regarded very seriously by the Courts.

The Guidelines set out the following factors which the Court will take into account when considering the seriousness of the offence. These will include

• How foreseeable was the risk of serious injury
• How far short of the applicable standard did the Defendant fall
• How common is this kind of breach in this organisation. The more common or systemic the more serious the offence
•  How far up the organisation did the breach go
•  Whether there more than one death or other serious injury
• Failure to heed warnings or advice, not just from statutory agencies but also from, for example, employees
• Cost cutting at the expense of safety
• Deliberate failure to obtain or comply with relevant licences
• Injury to vulnerable persons which would include those whose personal circumstances make them susceptible  to exploitation

The following factors are listed as those the Court will take into account as mitigating the offence

• Prompt acceptance of responsibility
• High level of cooperation with the investigation - beyond that which will always be expected
• Genuine efforts to remedy the defect
• Good health and safety record
• A responsible attitude to health and safety such as commissioning expert advice and consulting employees
• Pleading guilty at an early stage

Because of the seriousness of the offences involved it is not surprising that the level of fine recommended by the Guidelines is substantial. In the case of corporate manslaughter the appropriate fine will seldom be less than £500,000 and may be in the millions. For a health and safety offence causing death the starting point will be £100,000 and may be many times that.

In setting the fine a Court will consider

• The effect on the employment of the innocent ie will the size of fine lead to job losses? In contrast the effect on shareholders and directors will not normally be relevant, and neither will be any price rise which may be passed on to consumers
• The effect on the provision of services to the public. If a substantial fine would impact on the delivery of services to the public this would serve to reduce the fine
• Whether the fine may put the Defendant out of business, although the Guidelines say ominously that in some bad cases this may be an acceptable consequence!

The Court will generally not take account of

• The payment of civil compensation which will usually be paid by insurers
• The cost of remedying the relevant defect. This is nothing more than a cost which should have been incurred anyway.

A Court will also consider imposing a remedial order if the breach has not been remedied, and, in the case of corporate manslaughter, a publicity order (although offences of corporate manslaughter are, by their very nature likely to generate significant and adverse publicity for an organisation).

If you are ever in the unfortunate position of experiencing a death in the course of your business we strongly advise you to take immediate legal advice.

Please contact Bruce Howorth for further advice on 0191 232 8345 or email bruce.howorth@hay-kilner.co.uk