The new Health and Safety (Offences) Bill could prove costly for directors in more ways than one if it is passed. It looks very likely to become law in the near future, having received pretty resounding general support in both the House of Commons and House of Lords.
At the moment, there are few health and safety offences which could result in custodial sentences for directors and the majority of fines against both directors and companies are relatively low if the case remains in the Magistrates Court.
Into the breach
Regulatory breaches currently attract a maximum fine of £5,000 in the Magistrates Court, but that is set to change with the new Bill. The stated purpose of the Bill is to increase the financial penalties for more health and safety offences in order to act as a better deterrent and to increase the number of offences carrying potential custodial sentences for directors.
In its few short pages, the Bill makes the following pretty radical changes to existing sentencing:
• The maximum fine for regulatory breaches will increase to £20,000 in the Magistrates Court. For the majority of offences where directors can be personally prosecuted, there will be a custodial sentence of up to 12 months in the Magistrates Court and up to two years in the Crown Court, together with a fine of up to £20,000 in the Magistrates Court and an unlimited fine in the Crown Court.
• Even though many more offences could result in custodial sentences for directors, the existing reversed burden of proof will not be changed. This means that directors at risk of a custodial sentence will not be given the presumed innocence that exists in every other facet of criminal law. Once the prosecutor has established that a duty of care was owed by the director, it will be for the director to show that he or she did everything that was reasonably practicable.
The Bill suggests that even with the increased custodial sentence options, the impact on the prison population is not likely to be significant. This must be right, given the actual number of health and safety prosecutions each year. Even if every prosecution resulted in a custodial sentence, it would not have a significant impact on overall prison numbers.
With the increased attention of the HSE towards directors that our regulatory team has noticed in the past couple of years, we have no doubt that this Bill could make a very real difference to the way many businesses operate.
Hand in hand with the Bill goes an initiative between the HSE and IOD to provide a single document guidance note for directors on their general health and safety responsibilities.
The guidance note contains a very helpful set of must-dos but it still does not provide the holy grail for directors to know exactly what they have to do to comply with the complicated facets of health and safety regulation.
Ruth Armstrong is head of regulatory at law firm HBJ Gateley Wareing