A recent trend to bring criminal charges in occupational health and safety matters, and an increase in the amount of corporate fines imposed in those cases - Judgment R 12/1350 issued in August 2012 by the District Court of Central Finland

- Impact date: August 2012

In this occupational safety-related criminal case (decided by the District Court of Central Finland in August 2012), the prosecutor demanded that three employees in a managerial position of a large public listed company and a representative of the company's subcontractor should be convicted of work safety offences and that the company itself should be sentenced to a corporate fine of EUR 200,000.

An employee of the subcontractor had suffered burns to his upper body from boiling water and steam due to the managements' alleged negligence of appropriate safety instructions and supervision. According to the prosecutor, the accident which occurred on the company's premises resulted from inadequate cooperation between the company and its subcontractor.
The District Court sentenced the company to a corporate fine of EUR 50,000. In its judgment, the Court stated as one of grounds for the conviction that the defendant company was a publicly listed company in good financial standing.

Both the prosecutor and the company have appealed the judgment, and among other things, the question of the amount of the corporate fine shall be reassessed by the competent Court of Appeal. Regardless of the outcome of the appeal, the recent trend of criminal charges pressed in occupational health and safety matters and the increasing amount of the corporate fines imposed in those cases is expected to continue.

Legal entities where work safety offences have been committed may, on the prosecutor's demand, be sentenced to a corporate fine of at least EUR 850 and at most EUR 850,000 - Finnish Criminal Code (39/1889), as amended

- Impact date: 1 November 2012

Under the Criminal Code, a legal entity may be sentenced to a corporate fine if a person who is part of its statutory organ or other management, or who exercises actual decision-making authority therein has:

  • been an accomplice in the work safety offence or allowed the commission of the offence; or
  • if the care and diligence necessary for the prevention of the offence have not been observed in the operations of the corporation.

A corporate fine may be imposed on a legal entity in addition to the criminal sanctions imposed on a representative of the legal entity, i.e. a physical person who has intentionally or negligently violated occupational health and safety regulations. A corporate fine may be imposed on a legal entity even if no representative of the employer was found guilty of a work safety offence.

Under the Criminal Code, the amount of the corporate fine shall be determined in accordance with the nature and extent of the neglect or the participation of the management and the financial standing of the corporation. Until recently, the corporate fines imposed on work safety offences have been fairly moderate, on average EUR 10,000. Recently, however, the amounts of corporate fines both demanded by prosecutors and actually imposed by the courts have grown notably.

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.