Corporate Manslaughter: Sentencing Guidelines Finally Published

The long awaited sentencing guidelines for corporate manslaughter and health and safety offences involving a fatality have been issued.

Gone are the suggestions that fines should be linked to a percentage of gross annual turnover (proposed at up to 10%) and in its place the courts are advised that:

• For corporate manslaughter the appropriate fine will seldom be less than £500,000 and may be measured in millions of pounds
• The appropriate fine will seldom be less than £100,000 for Health and Safety offences involving fatality and may be measured in hundreds of thousands of pounds or more.
• Publicity Orders should ordinarily be imposed in a case of corporate manslaughter.

The guidelines emphasise that the aim of sentencing for these offences is punishment and deterrence.

So what will this mean in practice?

Over the last few years fines for health and safety offences have certainly increased.  A few years ago ‘exceptional fines’ (over £100k) were rare.  Now this is simply not the case.  Even without these guidelines the courts are treating health and safety offences with increasing seriousness; the new guidelines simply formalise this.

As a practitioner, the axing of the ‘percentage test’ is certainly a welcome move.  Many businesses will have high turnover and low profit and whilst the guidelines re-emphasise that a wealthy defendant should pay a larger fine than a poor one, it should generally be a fine that the defendant is capable of paying.  If the percentage test had been adopted, quite often a defendant would have been left unable to pay the penalty imposed and thus would go out of business.  The guidelines remark that in some bad consequences this may be an acceptable consequence, but it would certainly not be in many instances due to the effect on employment of the innocent.

Publicity Orders for offences of corporate manslaughter are encouraged.  In practice, we can see that these will be particularly useful to the courts when dealing with public bodies such as local authorities.  The guidelines emphasise that “If a very substantial penalty will inhibit the proper performance by a statutory body of a public function that it has been set to perform, that is not something to be disregarded”; meaning that the penalties for public bodies are likely to be less than that of corporate defendants.  However, where a court is unable to impose a substantial financial penalty for this reason, a Publicity Order would certainly have a punitive (as well as deterrent) effect.  The reputation of public bodies is as important as ever; particularly in the tendering process or budget allocation.  Bad publicity can have a significant impact on public bodies as much as private corporations.  We wait to see how the courts will use this power in practice but it is certainly likely to depend on the size and nature of the particular defendant.

It should be emphasised that these are simply guidelines and, whilst the courts are encouraged to follow them, the true impact of the Corporate Manslaughter Act will not be felt until the first cases are dealt with.  We wait with baited breath…

One thing is for sure - a company disregards health and safety at its peril!

For further advice on this, or any other health and safety issue please contact Laura Thomas in our Corporate Criminal Defence Team on 01473 299173 or laura-thomas@birketts.co.uk.

The content of this article is for general information only.  As always, specific professional advice should be taken on each individual matter.© Birketts LLP 2010.  Solicitors regulated by the Solicitors Regulation Authority.