BARBOUR DIRECTORS’ CLUB 8 TH OCTOBER 2015 LONDON #BarbourDirectors
Agenda 16.30 – Registration 17.00 – Heather Beach, OSH welcome presentation 17.15 – Sentencing Guidelines Presentation – Anne Davies, Special Counsel, Withers LLP – Simon Joyston-Bechal, Director, Turnstone Law – Q & A 18.15 – Barbour presentation 18:30 – Drinks and networking #BarbourDirectors
Heather Beach Director – OSH and Facilities Portfolios, UBM
Sentencing Guidelines Presentation Anne Davies, Special Counsel, Withers LLP Simon Joyston-Bechal, Director, Turnstone Law #BarbourDirectors
Barbour Directors Club 8 th October 2015 Sentencing for Health & Safety Criminal Offences Anne Davies Withers LLP London l Geneva l Zurich l Milan l Padua l New Haven l New York Greenwich l San Francisco l Los Angeles l Rancho Santa Fe l San Diego Singapore l Hong Kong l Tokyo l Sydney l British Virgin Islands
Introduction • Who are the Sentencing Council? • Inconsistency in sentencing practices for health, safety and food offences. • Perception fines too low – average fine in year ending September 2014 £8,225 per offence. • Number of cases prosecuted by HSE 2013/14 - 517. • Estimated 55 fines in that period over £100k. • R v Sellafield C.A. 2014 – reviewed the principles of sentencing corporate offenders. • Guidelines for sentencing environmental offences in place since July 2014. London l Geneva l Zurich l Milan l Padua l New Haven l New York Greenwich l San Francisco l Los Angeles l Rancho Santa Fe l San Diego Singapore l Hong Kong l Tokyo l Sydney l British Virgin Islands
Overview of proposed model for sentencing organisations Step 1 – Determining the offence category Step 2 – Starting point and category range Step 3 – Check if fine proposed proportionate to the means of the offender Step 4 – Other factors that may warrant adjustment Step 5-9 – Reduction for guilty plea; totality of fine; compensation; ancillary orders London l Geneva l Zurich l Milan l Padua l New Haven l New York Greenwich l San Francisco l Los Angeles l Rancho Santa Fe l San Diego Singapore l Hong Kong l Tokyo l Sydney l British Virgin Islands
Health & Safety offences, organisations. Step 1 Step 1 – Determining the offence category – Culpability • Very high • High • Medium • Low – Harm. 2 stages:- (a) Risk of harm created by the offence (b) (i) exposed a significant number of people. (ii) significant cause of actual harm. London l Geneva l Zurich l Milan l Padua l New Haven l New York Greenwich l San Francisco l Los Angeles l Rancho Santa Fe l San Diego Singapore l Hong Kong l Tokyo l Sydney l British Virgin Islands
Health & Safety offences, organisations. Step 1 Seriousness of harm risked Level A Level B Level C • Death • • Physical or mental impairment, All other cases • Physical or mental not amounting to Level A, not falling impairment resulting in which has a substantial and within Level A lifelong dependency on long-term effect on the or Level B sufferer’s ability to carry out third party care for basic needs normal day-to-day activities or • Health condition on their ability to return to work • resulting in significantly A progressive, permanent or reduced life expectancy irreversible condition High Harm category 1 Harm category 2 Harm category 3 Likelihood of harm Medium Harm category 2 Harm category 3 Harm category 4 Remote Harm category 3 Harm category 4 Harm category 4 (start towards bottom of range) London l Geneva l Zurich l Milan l Padua l New Haven l New York Greenwich l San Francisco l Los Angeles l Rancho Santa Fe l San Diego Singapore l Hong Kong l Tokyo l Sydney l British Virgin Islands
Health & Safety offences, organisations. Step 2 Step 2 • Starting point and category range – Micro Not more than £2m turnover – Small between £2m and £10m turnover – Medium between £10m and £50m turnover – Large £50m and over – Very large not defined • Starting point and category range – eg Micro Very high culpability range £150k - £450k – Micro Medium culpability range £60k - £160k – Medium Very high culpability range £1m - £4m – Medium Medium culpability range £300k - £1.3m • Aggravating and mitigating features London l Geneva l Zurich l Milan l Padua l New Haven l New York Greenwich l San Francisco l Los Angeles l Rancho Santa Fe l San Diego Singapore l Hong Kong l Tokyo l Sydney l British Virgin Islands
Health & Safety offences, organisations. Steps 3 & 4 • Is fine proportionate • Other factors to adjust fine • not for profit nature of organisation • where turnover sits London l Geneva l Zurich l Milan l Padua l New Haven l New York Greenwich l San Francisco l Los Angeles l Rancho Santa Fe l San Diego Singapore l Hong Kong l Tokyo l Sydney l British Virgin Islands
Corporate Manslaughter Step 1 Offence Category • How foreseeable was serious injury. • How far short of the appropriate standard did the offender fall. • How common is this kind of breach in this organisation. • Was there more than one death/and serious injury. London l Geneva l Zurich l Milan l Padua l New Haven l New York Greenwich l San Francisco l Los Angeles l Rancho Santa Fe l San Diego Singapore l Hong Kong l Tokyo l Sydney l British Virgin Islands
Corporate Manslaughter Step 2 Starting point and Category Large Turnover more than £50 million Offence category Starting point Category range A (more serious offences) £7,500,000 £4,800,000 - £20,000,000 B £5,000,000 £3,000,000 - £12,500,000 Medium Turnover £10 million to £50 million Offence category Starting point Category range A (more serious offences) £3,000,000 £1,800,000 - £7,500,000 B £2,000,000 £1,200,000 - £5,000,000 Small Turnover £2 million to £10 million Offence category Starting point Category range A (more serious offences) £800,000 £540,000 - £2,800,000 B £540,000 £350,000 - £2,000,000 Micro Turnover £2 million Offence category Starting point Category range A (more serious offences) £450,000 £270,000 - £800,000 B £300,000 £180,000 - £540,000 London l Geneva l Zurich l Milan l Padua l New Haven l New York Greenwich l San Francisco l Los Angeles l Rancho Santa Fe l San Diego Singapore l Hong Kong l Tokyo l Sydney l British Virgin Islands
Understanding the New Sentencing Guidelines for Health & Safety 8 October 2015 Barbour Directors’ Club Dr Simon Joyston-Bechal
Speaker Dr Simon Joyston-Bechal Turnstone Law sjb@turnstonelaw.com Mobile: +44 (0) 7880 684 781
Overview – New Sentencing Guidelines for Health & Safety – Part II • Surprising consequences • Impact of Court of Appeal – £100million fines • New imprisonment thresholds • Practical legal tips to reduce exposure to prosecution
Surprising consequences • Understanding the impact of culpability factors
Culpability Factors for Health & Safety Offences by Organisations
Surprising consequences • Assessing ‘Likelihood of Harm’ • The difference between basing fines on ‘harm risked’ and on actual harm
Surprising consequences • What about ‘very large organisations’?
Corporate manslaughter
Court of Appeal – Fines in excess of £100m for very large companies R v Thames Water (June 2015) • How to interpret guidelines for organisations with turnover that “ very greatly exceeds ” £50m? • There must not be a “ mechanistic extrapolation ” of tariff fines • Court not bound by starting point and ranges for “Large organisations” • Fines for environmental and H&S breaches have often not been adequate to bring home the appropriate message to directors and shareholders • “ This may well result in a fine equal to a substantial percentage, up to 100%, of the company’s pre - tax net profit … even if this results in fines in excess of £100m. Fines of such magnitude are imposed in the financial services market for breach of regulations .”
Culpability Factors for Health & Safety Offences by Individuals
Health & Safety Offences by Individuals
Practical Legal Tips to Reduce Exposure to prosecution Before an incident occurs: • Senior executive training to understand the importance of ‘setting the right tone at the top’ • Health & Safety legal review of H&S policy statement and roles and responsibilities document • Accident response protocol • Avoid aggravating features After an incident: • Challenge inappropriate enforcement notices • Obtain legal privilege over incident investigation report • Support for HSE interviews
Senior executive training to understand the importance of ‘setting the right tone at the top’ • Senior executive offence of neglect under s37 HSWA ( not as proactive as someone in their position ought to have been ) • Corporate manslaughter offence requires senior management failing, particularly if poor “ attitudes, policies, systems or accepted practices ” • Understanding relevance of IOD Guidance (Leading H&S at Work) - http://www.hse.gov.uk/pubns/indg417.pdf
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