In February 2016, the Sentencing Council published its renewed and harder hitting sentencing guidelines. One year on, and we are already starting to see signs that courts are willing to hand down higher fines to businesses, with the amount fined being directly linked to the financial success of the offending company.
Why are businesses being fined?
The Health & Safety at Work Act 1974 requires an employer to ensure the health, safety and welfare at work of its employees, and to also ensure that the public is not exposed to risks to their health and safety as a result of business activity.
Failing to comply with this legislation is a criminal offence with an unlimited fine and the courts now have comprehensive guidance regarding how high a penalty should be.
This guidance notes that more successful companies can expect to receive a fine proportionate not only to the seriousness and severity of the offence, but also to the financial means they have available.
What types of offences are being punished?
In 2014, during rehearsals for the new Star Wars film, Hollywood star Harrison Ford’s leg was broken when the door of the Millennium Falcon spaceship prop was allowed to fall on him, pinning him to the floor of the set. The crew and the actor both believed that when Ford pressed the button to close the steel door that it would not work as it was disabled due to the scene being a rehearsal. However, the door did close, and it was found that Foodles Production (UK) Ltd did not have an adequate safety system in place to protect those on set in this respect. The production company pleaded guilty to offences under the Health and Safety at Work Act and was fined £1.6 million, taking into account the financial success of the business.
Wilko, a household name in retail, turns over around £1bn a year. In a recent case where the retailer was charged with four offences under the Health and Safety at Work Act, the court ordered that a fine of £2.2m was paid. In this case, an employee was left permanently paralysed when a rollcage containing 230kg of paint crushed her as she attempted to move it out of a lift. Wilko’s high culpability in these offences as well as the serious level of harm was taken into account, however the company’s high turnover was also directly linked to the particularly large nature of the fine.
When the Smiler ride at Alton Towers malfunctioned in 2015, the media paid close attention as to how events unfolded. However, the courts paid similar attention also. The courts noted the severity of the incident, but also focused in particular on the high turnover of theme park giant Merlin Entertainments, when handing down its judgement. Merlin was ordered to pay a fine of £5 million as a result of this catastrophic incident which resulted in sixteen injuries, including two teenage girls who required leg amputations.
What can a business do to avoid these fines?
Despite the examples set out above relating to large businesses, all employers are subject to health and safety law and therefore potential fines. Therefore, it is vital that an employer’s health and safety procedures and training is concrete and up to date.
If you are considering tightening up the health and safety side of your business, speak to one of our employment law specialists about what options are available to you, such as health and safety training and the drafting of procedures and policies.