Corporate manslaughter: relevance of the new act to the construction industry

More deaths at work occur in the construction industry than any other. Last year there were 241 workers killed at work, a rise from 217 the year before, with 77 of those from the construction industry, a 28% increase on the previous year. 23 deaths (30%) were due to falls from a height and 16 (21%) were due to being hit by a moving or falling object.

On 6 April 2008 the Corporate Manslaughter and Corporate Homicide Act 2007 comes into force. The likely result is that it will be easier to obtain convictions against larger organisations for corporate manslaughter.

More about the new Act

The new Act covers offences by organisations. There is no new offence being created of which an individual may be guilty. The existing common law offence of gross negligence manslaughter is unaffected. In addition, individuals can also be held to account through existing health and safety laws. Being found guilty as an individual can lead to imprisonment and or/fines.

The existing law for corporate manslaughter required a "directing mind" of the organisation (i.e. a senior individual who could be said to embody the company in his actions and decisions) to be guilty of gross negligence manslaughter. Separate negligent acts by several people could not be aggregated.

Under the new Act, an organisation is guilty of corporate manslaughter if the way in which its activities are managed or organised causes a death and amounts to a "gross breach" of a relevant duty of care owed by the organisation to the deceased. A company will be guilty of corporate manslaughter if the systems and procedures of that company are such that they fall "far below" what can be reasonably expected of the organisation in the circumstances and they cause a death.

The category of people to which a company owes a duty of care is much wider than just employees. It would include all workers on site and any visitor to the site. It will also include trespassers.

The organisations which are covered by the Act are also very wide and include companies operating in the UK, whether private or public (and whether incorporated in the UK or not), local authorities, partnerships and PFI consortiums.

Falling foul of the Act

An organisation will be guilty of corporate manslaughter if the way in which its activities are managed or organised by its senior management is a substantial element in the breach of duty.

"Senior management" includes anyone who:

• plays a significant role in the making of decisions about how the whole or a substantial part of activities are managed or organised or
• undertakes the actual management or organisation of a substantial part of the activities.

This includes those in the direct chain of management as well as those in strategic or regulatory compliance roles.

Companies will no longer be able to avoid liability by inappropriate delegation of decision making or management to a lower level of employee because inappropriate delegation itself will be a breach of the new legislation. Senior management has the ultimate responsibility for checking that the health and safety function across the organisation is being adequately carried out. Appointing a health and safety officer or delegating these issues to a site manager will not absolve the company from liability if no one within senior management is checking that the delegated employee is performing his role properly.

If a death occurs

If a death occurs on site and a breach of the Act is suspected then the police will investigate. They will investigate both individuals and the company and will:

• Shut down the site while the investigation is being conducted. This could be for a significant period of time.
• Arrest and interview under caution at a police station all involved persons.
• Look into all the company's systems and procedures in order to establish if a breach has taken place.

The investigation is likely to be highly disruptive to the running of any business. Sanctions available to the Court if the company is found guilty of corporate manslaughter include:

• Fines
  The fine will be significantly higher than for breaches of other health and safety legislation. The fine is unlimited and will be linked to turnover. The Court will have the ability to look at the turnover of an involved parent or associated company should the factual circumstances dictate and the guilty company has limited turnover. It has been indicated that a first time fine is likely to be in the region of 5% of average annual turnover during the previous 3 years.
• Publicity Orders
  The Court can order the company to publicise details of its conviction and fine. This sanction is likely to be extremely damaging to any company. Publicity orders are not coming into force in April 2008 but will be introduced when supporting guidelines are available.
• Remedial Orders
  The Court can order the breach to be rectified, although it is likely that by the time this point is reached the company has taken steps to rectify the breach itself.

Particular concerns for the construction industry and some steps to take

The construction industry needs to take note of this new legislation. Due to the dangerous nature of its activities the industry is at greater risk of intervention by the authorities empowered to investigate and enforce health and safety regulations. An investigation will check not only that systems and procedures exist but that they are in operation and adequate.

With a variety of different potential dangers on site, the training needs of the construction workforce is greater than for most other industry sectors. The industry uses many migrant workers who often have little understanding of the English language. Consideration must be given to ensure that all workers have understood any training. This may necessitate the presence of a translator at training sessions or an assessment/test to ensure the worker has understood the training. Both are likely to increase costs and reduce profit.

Profit margins are notoriously tight in the construction industry. However, any failure to manage health and safety systems and procedures, in an effort to increase profits, will be viewed as an aggravating factor by the court when considering sanctions. Other aggravating factors include the company failing to heed warnings, exposing large numbers of workers to a high risk for a long period of time and the company having a poor health and safety record.

To reduce the risk of death and ensure compliance with health and safety regulations every company should:

• Create a health and safety conscious environment
• Undertake risk assessments and make sure everyone on site is aware of them
• Provide sufficient training to workers
• Provide adequate supervision, which will vary depending on the expertise and experience of the worker
• Review health and safety policies and procedures regularly and carry out health and safety audits
• Identify and properly plan jobs that involve working at height to ensure that appropriate precautions are in place
• Ensure all equipment is correctly installed / assembled / inspected and maintained and being used properly by qualified personnel
• Check that sites are well organised to avoid slips, trips and falls
• Ensure walkways and stairs are free from obstructions and work areas are clear of unnecessary materials and waste.
• Catalogue, discuss and learn from near misses. Record the changes to procedure that you implement as a result.