Fines of up to £20 million could be imposed against organisations found guilty of corporate manslaughter offences under new sentencing guidelines which have been proposed by the Sentencing Council. The draft guidelines were issued on Thursday 13 November 2014 and, for the first time, they include guidance on sentences for all health and safety offences, irrespective of whether they caused a death and also food safety and food hygiene offences. The second significant development compared to existing guidelines is that the new proposals would apply to individuals as well as organisations.
The Sentencing Council states that the purpose of the new guidelines is to ensure greater consistency in sentences issued in both Magistrates and Crown Courts, recognising that the number of sentences issued for theses regulatory offences is relatively low in comparison to other criminal offences (in 2013, only 420 offenders were sentenced for health and safety offences and 280 for food offences that would be covered by the guidelines). Importantly though, the Sentencing Council has also recognised that there continue to be several examples of sentences imposed at levels which remain too low to properly fulfil the true purpose of sentencing offenders: to act as both a punishment and a deterrent by ensuring that the sentence “removes any economic gain” from an offender.
The consultation document published with the draft guidelines is emphatic in highlighting that sentences should be set at a level which should be “sufficiently substantial to have a real economic impact, which will bring home to both management and shareholders the need to comply with legislation and achieve a safe environment for workers and members of the public”. Inevitably, in the vast majority of cases this will cause sentences to increase (and in some instances increase dramatically) as compared to current trends.
Implications for business
For each of the offences covered in the proposals, the guidelines provide separate bands of appropriate sentence for different categories of offender, based on their size (which for organisations is measured in terms of turnover) and the offender’s culpability.
The guidelines distinguishes between micro (turnover less than £2million per annum), small (£2 million - £10 million turnover), medium (£10 million - £50 million turnover), large (over £50 million turnover) and very large organisations (turnover greatly exceeds £50 million). This close reference to turnover is a step closer to proposals which were considered but ultimately abandoned in preparation of the current sentencing guidelines for corporate manslaughter and health and safety offences causing death, but it will undoubtedly mean that the appropriate sentence for many offenders, particularly medium, large and very large organisations will be significantly higher than the current suggested minimum penalties of £500,000 for corporate manslaughter and £100,000 for health and safety offences causing death. Indeed, the new guidelines suggest that a medium sized organisation found guilty of a health and safety offence which has caused death or serious life changing or life limiting injuries could expect to receive a fine of between £130,000 and £3.25 million, depending on the financial means and level of culpability of the defendant.
In relation to individual offenders, for example self-employed workers found guilty of a health and safety offence, or a director or senior manager found guilty of the “consent, connivance, neglect” offence: the appropriate penalty will be determined on the same principles used to assess fines for organisations. Culpability will be graded as low, negligent, reckless or deliberate and any financial penalty will be based on a percentage of weekly income (ranging from 25% to 700% depending on the seriousness of the offence and culpability of the offender). Individuals can also face custodial sentences for more serious offences.
It is clear from these proposals that the Sentencing Council is issuing a strong signal that safety related offences are recognised as potentially very serious criminal offences which merit the imposition of tough sentences. There is particular focus on increasing sentences for larger organisations to ensure that the punishment is appropriate and effective in changing future behaviours and attitudes. The guidelines are now subject to public consultation and any comments on the proposals can be submitted to the Sentencing Council before 18 February 2015.