Safety First

A recent decision of the Court of Appeal illustrates a growing awareness by the Courts of the need to impose suitable punishments for health and safety offences in the workplace and to provide guidance for assessing the level of fines to be set in such cases.

An engineering company, F Howe and Son, was prosecuted for offences under the Health and Safety at Work Act 1974 and other related legislation, when one of its employees was fatally electrocuted using an electric vacuum cleaner. The case had been referred by the magistrates’ courts to the Crown Court and fines of £48,000 and costs of £7,500 were subsequently imposed.

The company appealed against the level of fines on the grounds that this amount was beyond its financial means. Whilst unable to afford to employ specialist health and safety personnel the company had previously had a good record on safety. They had accepted responsibility for the accident and had rewired their premises after the accident. After consideration of the case the appeal judges reduced the fine to £15,000.

Public concern has been expressed that the level of fines imposed in health and safety cases has been too low and may not provide sufficient deterrence to corporate offenders. Magistrates’ courts, who would ordinarily hear this type of case, are able to set fines of up to £20,000, however half the fines imposed for health and safety offences in 1997/8 were for less than £5,000, whereas the average fine in the Crown Court for these offences was nearer £18,000.

In this particular case, however, the fine set by the Crown Court was threatening the financial viability of the company and the case was referred to the Court of Appeal in anticipation that guidance would be given on the appropriate balance between offence and penalty.

The Court of Appeal welcomed the opportunity to give guidance on the factors to be taken into account in setting fines for health and safety offences. Whilst not able to set a tariff, they felt that the law should be able to impose a fine which is large enough to emphasize that a safe environment for workers and visitors is paramount.

Factors that the Court of Appeal felt should be considered when setting fines include:

• the facts of the accident,
• the attitude to and record of health and safety within a company, and
• whether shortcuts might have been taken to save money.

Financial information such as company accounts can be presented to the Courts to assist in determining the suitable level of fine to be imposed in proportion to the financial means of the company.

This case sadly highlights the tragic consequences of failing to establish adequate safety systems for inspecting equipment, especially electrical machinery. Limited financial resources may account for more accidents occurring in smaller rather than larger companies but health and safety legislation imposes the same responsibility of care on all companies.

The disparity between resources available to large and small companies to ensure a safe workplace has to an extent been matched by a haphazard approach from the Courts in setting fines for health and safety offences.

The Court of Appeal has clarified the guidelines for assessing fines and has reaffirmed the importance of health and safety issues. The message to be conveyed not only to managers but also to shareholders is that financial strength and size cannot affect the degree of care required by a company towards its employees. Safety cannot be compromised in the quest for profit.

For further information please contact Paul Bratt, Trinity Court, 16 John Dalton Street, Manchester M60 8HS, UK, Tel: +44 161 830 5000

This article was first published in the July 1999 Hammond Suddards Commercial Dispute Resolution Newsletter.

The information and opinions contained in this article are provided by Hammond Suddards. They should not be applied to any particular set of facts without appropriate legal or other professional advice.