UK: Corporate Manslaughter: Should Directors Be Worried?

Following lengthy consultation and Parliamentary debate, the Corporate Manslaughter and Corporate Homicide Act has received Royal Assent and the majority of it will come into force on 6 April 2008. The Act provides for a statutory offence of ‘corporate manslaughter’ (in Scotland, ‘corporate homicide’) where the death of an individual is caused by an organisation. The Act applies to companies operating in the UK, whether established in the UK or abroad, and also to certain charities and voluntary organisations. The common law offence of gross negligence manslaughter is abolished, insofar as it applied to companies.

Crucially, the statutory offence, while designed to provide accountability for very serious mangement failings, only applies to organisations. Individuals cannot be prosecuted under the new Act. This has come as a disappointment to many who have campaigned long and hard for individual liability.

The position of individuals

Although the statutory offence of corporate manslaughter does not extend to individuals, directors and senior managers can ill afford to ignore their responsibilites under the new Act. If directors and senior managers fail properly to manage health and safety risks, their organisations will be vulnerable to prosecution for corporate manslaughter.

In addition, while they cannot themselves be prosecuted under the new Act, directors and senior managers may be prosecuted under common law and will be the focus of attention in determining the adequacy of their organisation’s health and safety procedures in any prosecutions that may ensue.

Directors and senior managers risk prosecution in the following circumstances:

1. Under common law, for ‘gross negligence manslaughter’.

The key test is whether a reasonably prudent person would have foreseen serious and obvious risk of death, and whether the individual’s conduct fell so far below the standard of a reasonably prudent person as to amount to a criminal act or omission. Prosecutions will continue to be brought where the evidence is strong and a prosecution is in the public interest. Convicted individuals face a sentence of up to life imprisonment.

2. Under section 37 of the Health and Safety at Work Act 1974.

An individual may be prosecuted where an offence has been committed by a company with the "consent or connivance" of an individual, or was attributable to any neglect by that individual. Crucially, in order for an individual to be convicted under this Act, the company itself must also be convicted. Convicted individuals face a fine.

Prosecutions against individuals under the existing law are, however, rare. This is because, save in the case of very small companies, it is often difficult to establish a sufficiently close connection between the personal conduct of the director or senior manager and the act or omission causing death or injury. As these will be criminal prosecutions, the elements of the offence have to be proved ‘beyond reasonable doubt’ - a higher threshhold than the usual ‘balance of probabilities’ test under the civil law.


Comment

Directors and senior managers may be relieved that the Act did not create a new offence for individuals. Nevertheless they should be mindful of their considerable responsibilities under existing law. Penalties can be severe, even if prosecutions are rare.

The Act demonstrates the willingness of the Legislature to address the perceived shortcomings of existing health and safety law, particularly in holding companies to account for negligent conduct. Directors and senior managers play a key part both in establishing and maintaining adequate health and safety procedures. The Health and Safety Executive (together with the Institute of Directors) have published the guidance document "Leadership Actions for Directors and Board Members" (see the link below). Senior management would be well advised to pay close attention to such guidance.

Further reading

Please click here for the full Act.

Please click here for the Health and Safety Executive / Institute of Directors Guidance.

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq

Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.



The original publication date for this article was 04/04/2008.

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