On Tuesday 15 February 2011 Cotswold Geotechnical Holdings Ltd became the first company to be convicted of corporate manslaughter under The Corporate Manslaughter and Corporate Homicide Act 2007 (“the Act”). The case was brought following the death of Alexander Wright on 5 September 2008, an engineer, who was killed while collecting soil samples in an unsupported trench which collapsed on him. In this article, we consider why have there not been more corporate manslaughter prosecutions since the Act came into force and ask what we can expect following the Cotswold case.
The company was ordered to pay a fine of £385,000 but allowed 10 years within which to pay having regard to the company’s limited means. The judge, Mr Justice Field, commented in the course of sentencing remarks that the fine might put the company into liquidation, going on to say, “If that is the case it’s unfortunate but unavoidable. But it’s a consequence of the serious breach”. Both the level of the fine and this remark are consistent with guidance issued last year by the Sentencing Guidelines Council. This recommended a starting point of around £500,000 for convictions for corporate manslaughter. As to the effect on the company of a fine the guidance stated, “whether the fine will have the effect of putting the defendant out of business will be relevant; in some bad cases this may be an acceptable consequence.”
The significance of the case lies as much in what it represents as in what it achieved. Cotswold Geotechnical Holdings Ltd was a small company effectively under the control of a single director. The breaches of safe practice were stark. Given the virtual indivisibility as between company and senior management and the significant failings that were revealed the jury had little difficulty in reaching a decision, returning a guilty verdict within 2 hours. Nonetheless, the case demonstrates that the Act can provide a framework within which prosecutions can succeed. The CPS stated in its press release that it “is currently considering a number of other files of evidence in relation to further possible prosecutions for the offence.”
One would hope that for the responsible operator in the Licensing, Leisure and Hospitality industry the risk of a fatality in the workplace would be relatively low. However, be warned, if there is a death in the workplace, investigators will inspect your business to identify the the underlying causes of the accident. With that in mind there are, a few simple steps that can be taken to minimise your risk:
- Identify the hazards and take immediate steps to rectify them;
- Ensure you have a full set of risk assessments and make sure they are up-to-date;
- Ensure that your training programmes are effective and keep full copies of your training records;
- Review your accident records and make improvements on those areas that regularly appear;
- Ensure that your property is well maintained;
- Conduct random audits on your safety standards and staff compliance with those standards; and
- Ensure you invest appropriately in creating a health and safety culture in your workplace.
In the two years after April 2008, when the Act came into force, about 500 people were killed in accidents at work. The HSE starting point is that all workplace deaths are preventable, and it is unusual for such a death to occur and for no fault to be found in the conduct of the relevant undertaking. In some such cases, there may be no fault at a senior management level, in others the degree of fault will be trivial, in which case a charge of Corporate Manslaughter may not be justified. But even if only half of cases involve fault on the part of senior managers, and if in only one in ten of those is the consequence a serious breach of duty, that leaves 20 or 30 potential corporate manslaughter prosecutions since the CMCHA came into force. So why has there been just one corporate manslaughter prosecution and can we expect more following the Cotswold case?
The first possible cause of reluctance by prosecutors to bring corporate manslaughter prosecutions is the hangover from the pre-Act days, when corporate manslaughter prosecutions were regarded as ambitious, inherently difficult and prone to expensive failure. The failures of prosecutions following disasters such as Herald of Free Enterprise and Hatfield are better known than the handful of successes. With the new Act attracting criticism for failing to address all of the problems with the previously existing common law offence, the sense that corporate manslaughter contains traps for the unwary has persisted, and must have put off many prosecutors inclined to caution.
A related factor may be a reluctance to be the first. It seems to have been assumed that the Act would need a disaster or other high-profile case to launch it. The very ordinary, sadly ordinary, Cotswold Geotech case was dismissed by some as a bit disappointing, almost as if it was unworthy to be the first case under the Act. It was (rightly) pointed out that this was a case which could just as well have been prosecuted under the common law, and (wrongly) suggested that it was not what the Act was intended for. The Act repealed common law corporate manslaughter, and the section 1 offence is intended to meet any case in which such a charge could have been brought, as well as some in which it could not. It was always envisaged that it would be used most on the most common kind of case, where death has resulted from the dangerous activities of a small company run by a few individuals who are close to the action.
Now there has been a conviction, what will change? Take a moment to consider the Cotswold Geotech case: as things turned out, the case was stayed against the sole director of the company, and the trial was therefore of the company alone, without a human defendant. Although in fact the company’s guilt was based on the actions of one person, it was not necessary in law for the jury to convict him before convicting the company. And the trial was neatly conducted, occupying a total of just 13 sitting days, with a significant fine at the end of it.
That case shows that the Act works perfectly well for what will continue to be the most common type of case. Without a human defendant, the charge is simply of a managerial fault for a bad breach of duty which caused death. Experience tells us that this is a routine case. Of course there will be cases which explore the limits of who are the “senior managers” and other legal matters, but those will be few. And of course, when the Act comes to be employed in a case involving a large company, like the great train crash cases, the trial will be long, difficult and expensive. Fortunately those cases will be rare. For the vast majority of prosecutions arising from workplace death, the Act is workable and effective. This conviction will give heart to prosecutors to charge when the facts suggest a falling far below the required standard in a workplace death. Indeed, some decisions (one hopes not many) may even have been awaiting the outcome of the case. Not a stampede of such cases, but five or ten a year at least. And more convictions will follow.
Finally, while the CMCHA was the single most over-hyped piece of legislation (at least until the Bribery Act), the Health and Safety Offences Act 2008 was one of the most overlooked. But on the very same day that Cotswold Geotech was convicted in Winchester, at the Chelmsford Crown Court another little bit of history was quietly made: Phillip Dutton, a former health and safety manager, became the first person to receive a custodial sentence for a breach of section 7 of the Health and Safety at Work Act 1974 (duty of an employee to take reasonable care for the health safety of himself and others). On 3 February 2009, just three weeks after the custodial penalty became available, he had poured an accelerant onto a skip fire which caused an explosion in which he suffered serious injuries, for which he was sentenced to four months’ imprisonment, suspended for two years. Consider this as the shape of trials to come: a company charged with manslaughter, with its senior managers facing prison for simple breaches of duty. That is a newly available and highly attractive proposition to a prosecutor trying to balance the desire to hold a company to account, while recognising the difficulties of proving against decent men and women the fault necessary to constitute gross negligence.