A year after the new sentencing guidelines for health and safety offences came into force in England and Wales, we review their effect on penalties.
On 1 February 2016, the Sentencing Council’s Definitive Guideline for Health and Safety Offences, Corporate Manslaughter and Food Safety and Hygiene Offences (more commonly referred to in the OSH world as the sentencing guidelines) came into force in England and Wales.
A year on from this, the 20 largest fines imposed on businesses for safety and health offences last year totalled £38.6m, compared with £13.5m in 2015 and £4.3m in 2014.
Since 1 February 2016, when the Sentencing Council’s Definitive Guideline for Health and Safety Offences, Corporate Manslaughter and Food Safety and Hygiene Offences came in to force, there have been 19 fines of £1m or more. In 2015 there were just three fines that exceeded £1m and in 2014 there were none.
Not all fines in the 2016 top 20 involved a fatality. The guidelines state that a large fine can also be handed down in the event of an injury, or if there was a substantial risk of injury or death.
For example, Alton Towers amusement park operator Merlin Entertainments was fined £5m – the highest financial penalty of 2016 and the UK’s third largest safety fine – following a crash on its Smiler rollercoaster on 2 June 2015. No one died but 16 people were injured, five of them seriously.
How the guidelines work
Using the new sentencing guidelines for health and safety offences, a court applies a formula to set the penalty, first deciding whether the defendant’s culpability was very high, high, medium or low. The next factor is a matrix cross-referring the likelihood the safety failing would lead to harm and how bad that harm could have been – from minor injuries to lifelong disability or death. The judge must also consider how many people were exposed to the risk of harm and whether the safety failing was a significant cause of actual harm before setting a final harm rating of 1 to 4.
The harm rating and culpability assessment is then applied to a series of tables with fine ranges for organisations with different levels of annual turnover.
The ranges are as follows:
micro-organisations (turnover less than £2m): £50 to £450,000
small organisations (turnover between £2m and £10m): £100 to £1.6m
medium organisations (turnover between £10m and £50m) £1,000 to £4m
large organisations (turnover £50m and above): £3,000 to £10m.
For each harm category at each culpability level there is a suggested “starting point” fine, ranging from £200 for low culpability, harm level 4, for a micro-organisation, to £4m for a large organisation with very high culpability and harm level 1. Judges can move below these starting points for mitigating circumstances, such as a good safety record and early guilty pleas. Aggravating factors, such as obstructing an investigation or cost-cutting at the expense of safety, will push the penalty up the scale from the starting point.
For further information on the above, please call one of our team on 02920 022495.