In May of this year, the Health and Safety Executive ("HSE") published research on Directors' Health and Safety Responsibilities. The report looked at the Health and Safety duties imposed upon Directors across 9 other countries and whether these duties assist in the prosecution of Directors. The 9 jurisdictions considered were: Germany, France, Italy, Sweden, Japan, Canada, Australia, USA and Holland. The principal finding of the report was that 7 out of the 9 countries contained safety legislation that imposes positive safety obligations upon either Directors or Senior Managers of a company. The UK position is described as "unusual" for not imposing positive duties on Directors.
The publication of this research highlights the need for Directors to be aware of their responsibility for Health and Safety matters within the businesses they operate.
Summary of Current Health and Safety Law in Britain
Health and Safety legislation in Britain is contained mainly within The Health and Safety at Work Act 1974 (the "Act") which imposes obligations principally on "employers". In most cases, it is therefore the company as the employer which is subject to most of the obligations imposed by the Act. However, an employee is also subject to certain duties in terms of Section 7 of the Act which include the duty while at work (a) to take reasonable care for the health and safety of himself and of other persons who may be affected by his acts or omissions at work; and (b) as regards any duty or requirement imposed upon his employer or any other person by or under any of the relevant statutory provisions, to co-operate with him so far as it is necessary to enable that duty or requirement to be performed or complied with.
These provisions lead to a potential distinction between executive and non-executive directors as regards responsibility for health and safety. On the face of it, the section imposes duties upon executive Directors who have an employment relationship with their company as well as a fiduciary relationship as a Director. However, executive Directors may take some comfort from the fact that HSE has never prosecuted a Director for breach of this duty. This makes it difficult for Directors to judge what actions might be required by them to ensure compliance.
By contrast, section 37(1) of the Act allows not only Directors, but also Managers and other office holders, to be prosecuted. Managers being people who are in a real position of authority and decision-makers within the company who have power and responsibility to decide corporate policy and strategy.
In terms of this section, a Director can be prosecuted either for neglect or for consent or connivance when an offence under a relevant statutory provision is committed by his body corporate. The Director may be liable where the offence can either be attributed to his neglect or permitted with his consent or connivance. In order for a Director to be prosecuted for neglect, he would have to have failed to take some steps to prevent the commission of the offence by the corporation to which he belongs, if the taking of those steps falls within the scope of the functions of his office.
The question of whether a Director is guilty of neglect can depend on whether he had a duty to inform himself of the facts or a duty to act in relation to facts and would depend on the scope and functions of his job at the company and his own knowledge. For Directors, this should be borne in mind when agreeing the terms of their service contracts.
By contrast, consent requires a person's awareness that an offence is taking place and their agreement to it. Connivance also requires awareness and turning of a blind eye rather than agreement. Essentially, if a Director becomes aware of a risk attached to the conduct of a company and of the steps required to remove or mitigate that risk he has a duty to take those steps to stop the company committing an offence. In addition, he also has a duty not to allow the company to commit an offence through neglect on his part. In determining whether the Director in question owes such a duty, the courts will look at the scope of his duties within the company. Again, the terms of his service contract will be relevant.
It is also important to note that the duties contained in Section 37 exist as indirect duties in the context of a prosecution only. HSE have an enforcement policy statement dictating when it would be in the public interest to prosecute a company: a breach by the company must be either serious or have resulted in a death when prosecuting a Director. Account should be taken of his personal awareness of the circumstances surrounding or leading to the events, whether he failed to take obvious steps to prevent the offence, whether he had had previous advice of warnings regarding matters relating to the offence, or whether he was personally responsible for matters relating to the offence and that he knowingly compromised safety for personal or commercial gain of the body corporate in the absence of undue pressure from the body corporate to do so.
Also relevant in the area of health and safety will be the Corporate Manslaughter and Corporate Homicide Bill which has moved away from the introduction of "individual offences". These were proposed originally to catch directors and senior managers in circumstances where an individual was already responsible for a death. However, significant opposition to the introduction of individual offences both by business and HSE has resulted in a move towards a unified approach in both Scotland and England with a statutory criminal offence for corporate bodies constituted through the English doctrine of gross negligence manslaughter.
In short, Executive Directors must ensure that they comply with Section 7 of the Act in their capacity as employees and all Directors (Executive and Non-Executive) must ensure that they take appropriate action to stop the company committing an offence where they are aware that the company is committing an offence and of the reasonable and practicable steps that could be taken. In addition, they should not neglect obligations imposed upon them by the company.