UK: “Anthropomorphism No More” A Brief Guide To The Corporate Manslaughter And Corporate Homicide Act 2007

Last Updated: 21 April 2008
Article by Markus Esly

Companies can, in principle, be held responsible in criminal law for causing the death of employees or of members of the public. Around 240 people are killed at work in the United Kingdom per year1. The risk of fatal injuries to employees is, of course, greater in some industries: for example, a construction worker faces a risk of death 4.6 times greater than the national average. Large-scale engineering projects can pose considerable risks, though accidents in them are not always widely publicised. More than 15 construction workers died during the construction of the Channel Tunnel. Both fatal accidents of employees and disasters causing the death of members of the public can lead to the imposition of criminal liability on a company. After particularly serious accidents (most recently, a series of rail crashes), there tend to be strong calls for criminal prosecutions due to alleged corporate mismanagement. As we will see, these prosecutions have rarely led to convictions but the law has now changed.

The common law has long since recognised the offence of manslaughter where there is no intention to kill, and companies are not exempt from the criminal law. On 6 April 2008, the provisions of the new Corporate Manslaughter and Corporate Homicide Act 2007 (the "Act") will come into force. The Act will operate in addition to existing health and safety at work legislation (which is not the focus of this article). It reforms the basis on which a company can be found criminally liable for the death of a person to whom it owed a duty of care. The Act applies where the harm resulting in death occurred in the United Kingdom – it does it apply extraterritorially, nor does not apply retrospectively. Any company (whether English or foreign registered) can be made a defendant in a prosecution, provided that the company operates in the United Kingdom.

What does the Act mean for companies and their legal responsibility if fatal accidents occur? This article highlights the key features of the new legislation.

Corporate criminal liability for manslaughter – was it ever a real risk?

The reform of the criminal law leading to the Act originated with a Law Commission report published in 19961. Under the old law, the offence required a corporate defendant to have committed a gross breach of a duty of care owed to the victim.

At common law, criminal offences traditionally require both a "guilty act" (actus reus) and a "guilty state of mind" (mens rea) from the defendant. A company could therefore only be convicted if it could be shown that its "directing mind" was guilty of the offence. A sufficiently senior representative of the company, who by his actions (and thoughts) represented it, was needed. While this "identification" principle has been criticised, it has been consistently upheld by the courts2. Until the recent reform of the law, it remained a constituent of the common law offence, in addition to a duty of care to the victim, a breach of which caused the death.

But past unsuccessful prosecutions for "old" corporate manslaughter have shown the real difficulties in proceeding on such an anthropomorphic basis against large corporations. The more complex the corporate entity and its management structure, the more difficult "identification" is. Lines of responsibility may be blurred, especially where health and safety is not centrally managed. Successful prosecutions for the "old" offence of corporate manslaughter have tended to involve small companies with simple management structures.

In none of the following cases where significant lives were lost, and where accusations of management failures or negligence were made, did prosecutions for corporate manslaughter succeed:

  • "Herald of Free Enterprise" of March 1987 (187 dead)
  • King's Cross fire of November 1987 (31 dead)
  • Piper Alpha oil platform disaster of July 1988 (167 dead)
  • Clapham rail crash of December 1988 (35 dead)
  • "Marchioness" accident of August 1989 (51 dead)
  • Southall rail crash of September 1997 (7 dead)
  • Paddington rail crash of October 1999 (31 dead)
  • Hatfield rail crash of October 2000 (4 dead)
  • Potters Bar rail crash of May 2000 (7 dead)

Instead, fines were imposed on the responsible companies3. Pecuniary penalties alone were, however, strongly condemned by the public. Calls were made for criminal liability to be imposed in the case of these (and other) serious disasters, where the old criminal law appeared to many (including the Crown Prosecution Service) to be powerless4.

The new offence – what has changed and who is caught?

What is the offence?

In summary, under the Act a company will be guilty of an offence if it causes a fatal accident through the way in which it manages its business or activities5. The company's failure in this regard must, however, amount to a grossly negligent breach of a duty of care to the victim. The focus is now no longer on the conduct and knowledge of a particular individual, and instead on processes or systems employed by the company as a whole – and in particular, how health and safety were managed or organised.

It is important to note that the Act itself does not impose new standards or introduce more stringent guidelines. Neither does it create a duty of care on the part of company where there was none prior to the Act. However, any breaches of existing health and safety requirements by the company, and the seriousness or extent of those breaches, will be an important factor6.

Who can be a victim?

The Act does not apply extra-territorially, but only to the United Kingdom. The victim must die as a result of harm that occurred within the United Kingdom7. So a foreign tourist injured in the United Kingdom who dies at home outside the United Kingdom is a victim within the meaning of the Act. However, an English tourist who is injured abroad but dies at home within the United Kingdom is not, however (assuming it is clear-cut when the harm occurred and what the operative cause of death is!).

Which companies are caught?

The Act applies to all companies incorporated in the United Kingdom, and also all foreign corporations that operate in the United Kingdom (whether or not they are registered here – if you commit a criminal offence within the jurisdiction, you are subject to its criminal law). Limited liability partnerships are caught, as are public bodies incorporated by statute (such as local authorities, NHS bodies etc). Companies have distinct legal personalities, so a parent company will not be liable for the failings of a subsidiary if it is the latter who actually managed the relevant activities. Similarly, foreign companies operating through a distinct local subsidiary should not be prosecuted. The Act is not intended to allow the corporate veil to be pierced. Instead, the local operating vehicle would be the defendant. The Act also does not apply to individuals (who cannot be accessories to an offence committed by a company)8.

Senior management at fault

Before a company can be convicted, it must be shown that a substantial part of the failure occurred at a senior level – and senior management means officers of the company who make significant decisions about it as a whole, or about substantial parts of the business, or who actually manage the company (or a substantial part of it). The guide to the Act published by the Ministry of Justice confirms that senior management will include "both centralised, headquarters functions as well as those in operational management roles."9

Membership of the senior management of a particular company will depend on the facts of the case. Directors and those holding positions similar to a directorship will be senior management unless something unusual excludes them. Regional managers, or heads of different operational divisions, are also likely to be caught.

It is important to recall that under the Act, senior management will not be able to plead delegation in its defence. Inappropriate delegation, a "hands-off" attitude or (worst of all) turning a blind eye by senior management can easily constitute a management failure for the purpose of the Act.

A relevant duty of care must be owed

As noted above, the company must owe a duty of care to the victim, and the Act defines10 which duties of care are "relevant". These duties are already owed under the existing law of negligence, so the Act itself does not widen the scope of a company's legal responsibilities. The duty must be an existing one, and must (in addition) relate to the following:

  • the company's own employees or persons working for it or performing services for it;
  • the company occupying premises;
  • the company's business in connection with the supply of goods or services (irrespective of whether this is for consideration or not);
  • the company carrying out any construction or maintenance operations;
  • the company keeping any plant, vehicle or other thing (the first "catch-all");
  • carrying on any other activity on a commercial basis (the second "catch-all").

The Act does not do much to explain the circumstances in which a duty is owed to a particular victim – so the question might be, was the victim a reasonably foreseeable plaintiff? In practice, it would be safest to assume that all of a company's employees, customers, visitors or members of the public who might come into contact with its activities would be owed a duty of care.

Relevant factors for establishing gross negligence

The new offence is based on gross negligence. This means that the company's conduct (always at a sufficiently senior level) must have seriously fallen short of what the law expects. The Ministry of Justice has emphasised this point, stating that:

"Corporate manslaughter/homicide will continue to be an extremely serious offence, reserved for the very worst cases of corporate mismanagement leading to death."

A prosecution under the new legislation will therefore not only look at a particular level of management within the organisation, but would review health and safety across the board. Factors likely to be relevant include:

  • As mentioned, any breaches of existing health and safety requirements, generally accepted codes of conduct or practice, but also guidance11.
  • The "corporate culture" – or general attitudes towards health and safety. For instance, were obvious breaches regularly overlooked, was there a lax attitude?
  • What is the company's approach to auditing and monitoring health and safety? Are risk assessments prepared, and if so, how are they reviewed and implemented?
  • How health and safety systems or processes were actually operated "on the ground" – this may show whether "senior operational management roles" were effectively carried out.
  • What training was made available to employees? Do they understand the equipment or processes they use? Is the equipment itself safe, and regularly maintained?
  • Is there immediate and effective supervision where risks are such that this should be the case?

Penalties

An organisation convicted of the new offence can receive:

  • A fine. There is no upper limit to this.
  • A publicity order. This requires an organisation to publicise the fact of its conviction and certain details of the offence, in a way specified by the court. Publicity orders are not being brought into force on 6 April 2008, but will be commenced when supporting guidelines are available.

In addition, the court can set a remedial order, requiring the organisation to address the cause of the fatal injury. These are not currently available for organisations convicted of manslaughter/culpable homicide, although they can be imposed under health and safety legislation.

Conclusion

Corporate manslaughter has received a statutory overhaul, and compared to its weak, anthropomorphic predecessor now seems to have teeth. However, it is important to note that while there has been a shift away from individuals being responsible within a company to the adequacy of management across the board (but at a senior level), the Act does not introduce an expectation of higher standards of conduct from companies, and does not impose any wider duty of care than the law of negligence. The offence is still based on gross negligence, and will only be relevant where there has been a serious failing. The most severe penalty that can be imposed is an unlimited fine, but in addition the stigma of criminal responsibility will attach to the organisation (but not individuals, which are specifically excluded from the Act).

Footnotes

1 See the Health and Safety Commission's statistics for fatal injuries for 2006/2007 (from July to July).

1 "Legislating the Criminal Code: Involuntary Manslaughter" (Law Com 237).

2 See for instance the Court of Appeal in the Southall rail disaster case (upholding the acquittal of the rail company at first instance), Rose LJ stated that: "... in any event, the identification principle is in our judgment just as relevant to the actus reus as to mens rea. In Tesco v Nattrass at 173D Lord Reid said "The judge must direct the jury that if they find certain facts proved then, as a matter of law, they must find that the criminal act of the officer, servant or agent, including his state of mind, intention, knowledge or belief is the act of the Company." .... In our judgment, unless an identified individual's conduct, characterisable as gross criminal negligence, can be attributed to the company the company is not, in the present state of the common law, liable for manslaughter." Attorney-General's Reference (No 2 of 1999) [2000] 3 All ER 182.

3 For example, for the Hatfield (Balfour Beatty £7.5m, Railtrack £3.5m), Paddington (Thames Trains £2m) and the Southall train crashes (Great Western Trains £1.5m).

4 See for example "Director of Public Prosecutions calls for change in law after Euromin manager acquitted of manslaughter" - CPS press notice 137/01, 29 November 2001.

5 It is suggested that the general test of causation in criminal law would apply. Was the company's act or failure to act an operative cause of the death? Or, alternatively, would the death have occurred "but for" the management failure? It may be that in some circumstances an intervening act breaks the chain linking the management failure to the death in question, making the latter too remote a consideration.

6 Section 8 of the Act requires juries to consider the extent and seriousness of failures to comply with health and safety obligations, and the degree of danger resulting from this. This relates to existing obligations only.

7 The harm resulting in the death must be sustained in the United Kingdom – Section 28(3) of the Act.

8 See Section 18 of the Act. Of course, individuals can already be prosecuted at common law for manslaughter.

9 A Guide to the Corporate Manslaughter and Corporate Homicide Act 2007, Ministry of Justice, October 2007.

10 Section 2

11 A jury may reasonably consider relevant health and safety guidance. This would capture statutory Approved Codes of Practice and other guidance published by the regulatory authorities tasked with enforcing health and safety laws. While guidance is of course not mandatory, it may very well be helpful to a jury when considering the question of gross negligence

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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