Löfstedt report and cutting red tape

One of the key recommendations of the Löfstedt report, published back in November 2011, was for the Government to implement a review of existing health and safety regulations. Employers, increasingly fearful of a burgeoning “compensation culture”, felt that over-compliance was rife with health and safety legislation as a result.

In particular, Professor Löfstedt honed in on those regulations which imposed strict liability on employers, making them liable for injuries suffered by their employees at work, regardless of the extent to which the employer in question had sought to comply with its health and safety duties and whether it had taken all reasonable steps to protect its employees from harm.

In making this recommendation, Professor Löfstedt answered the Coalition Government’s clarion call to “cut red tape” and ease the regulatory burden on business, particularly the SME’s it has repeatedly stressed are key to rejuvenating the stuttering economy. Armed with this recommendation, the Government’s speedy response to the Löfstedt report felt that a comprehensive review of the existing legislation, along with the five other key areas for reform, would help to “reclaim the reputation of health and safety that has been so damaged by the excesses of the compensation culture”.

The approach that found favour with Government lawyers was to either qualify the existing duties with the concept of “reasonably practicability” or amend the legislation to prevent civil liability attaching to a breach of the regulations. This would address the perceived unfairness that responsible and safety-conscious employers were being held to a duty that was higher than the common law duty of care.

Government targets amendment of HSWA 1974

The March 2012 Budget reiterated the Government’s commitment to legislate on this topic and in September 2012 a further announcement by the Department for Business, Innovation and Skills (“BIS”) put more metaphorical flesh on the bones of this commitment. The September 2012 BIS announcement (dramatically entitled “Government red tape blitz to boost business growth”) revealed that the Government’s preferred approach was to amend the part of the Health and Safety at Work etc. Act (“HSWA”) 1974 that imposed civil liability for breach of the statutory duties relating to health and safety regulations. The removal of strict liability for employers for civil claims (except in cases where they have been negligent) was to be achieved by the end of the 2012-2013 Parliamentary session.

Enterprise and Regulatory Reform Bill

The amending legislation emerged in the form of the Enterprise and Regulatory Reform (“ERR”) Bill. After receiving its first reading in the House of Lords in October 2012, it eventually received Royal Assent on 25 April 2013.

The promised change to the HSWA 1974 was contained in clause 62 of the ERR Bill, which eventually became section 69 of the Enterprise and Regulatory Reform (“ERR”) Act 2013. Clause 62 sought to amend the existing section 47 of the HSWA 1974, so that a breach of those statutory health and safety provisions which impose strict liability on employers would not allow an employee to bring a civil claim, unless the right is specifically provided for in the legislation.

As highlighted in the Government’s February 2013 progress report into the implementation of the health and safety reforms, clause 62 went further than Professor Löfstedt’s recommendations. Whilst Professor Löfstedt had recommended a “review” of the health and safety provisions (with the potential of restricting the number of situations in which strict liability was relevant), the Government opted to make the single blanket amendment to the HSWA 1974, stating that it achieved the “same overall policy objective”. This was despite Professor Löfstedt himself stating that the Government’s approach was “more far-reaching than I anticipated in my recommendation”.

As a result of the Government’s approach, clause 62 did not have a trouble-free passage through Parliament. At the report stage in the House of Lords, the Government was narrowly defeated. However, the Government dug in its heels and reinserted the provision, with clause 62 eventually voted through the House of Lords at the second time of asking.

Consequently, employees are now more restricted in how they can bring a claim for a personal injury suffered at work. Prior to the passing of the ERR Act 2013 (in addition to any claim based on a breach of their contract of employment), employees could bring a claim against their employer for a breach of the common law duty of care as well as a claim based on a breach of the employer’s statutory duty. Section 69 of the ERR Act 2013 means that the latter route has now been removed (unless the health and safety provision in question specifically provides for a civil right of action), which leaves employees having to rely more frequently on proving an employer’s negligence when bringing a claim based on the common law duty of care.

Commencement date for section 69 to be announced

A commencement date for section 69 of the ERR Act 2013 is still awaited. It is only once this date has been confirmed and a sufficient period of time has elapsed, that statistical evidence can be gathered regarding the number of personal injury claims brought by employees against their employers and their success rates. It will then be possible to ascertain whether the Government has achieved its aim of reducing the regulatory burden on business and bringing “common sense” into health and safety matters. Whether economic growth, which has proved to be stubbornly elusive in recent years, is boosted as a result will be much harder to judge.