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Your responsibilities under the Corporate Manslaughter Act

The first conviction against a UK company under the Corporate Manslaughter Act 2007 occurred last month, highlighting the need for businesses of all sizes to review and improve their health and safety procedures.

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The first conviction against a UK company under the Corporate Manslaughter Act 2007 occurred last month, highlighting the need for businesses of all sizes to review and improve their health and safety procedures. It's vitally important that all directors are aware of their responsibilities under the Act and take steps to ensure their business complies. Last month, Cotswold Geotechnical Holdings Ltd, a small business with only four employees, became the first company to be charged under the Act after an employee was killed when a pit excavated as part of a site survey collapsed on him whilst he was taking soil samples. The court found that the system of digging pits used by the company was unnecessarily dangerous and that industry guidance had been ignored. The company was found guilty of corporate manslaughter and fined £385,000 to be paid over 10 years. The Sentencing Advisory Panel, the body responsible for advising courts on sentencing under the Act, had previously issued guidelines stating that fines will "seldom be below £500,000", but the Court took into account the company's financial situation and size. The outcome of this case, should shed some light on how this legislation is likely to be interpreted by the courts in the future. The offence Under the Act, which came into force in April 2008, an organisation is guilty of the offence if "the way in which its activities are managed or organised causes a death and amounts to a gross breach of a duty of care to the person who died". A substantial part of the breach must have been in the way activities were organised by senior management. A company owes a duty of care to its employees and others working for it and to any other person who enter its premises or who uses its goods or services. As well as the potential for unlimited fines if found guilty, the judge may also give convicted organisations a publicity order, forcing them to publish the offence on their own website, or remedial order requiring them to correct management failings. Directors' individual liability Although the Act does not apply to individuals, directors and senior managers remain at risk of prosecution for the common law offence of manslaughter, which carries a maximum sentence of life imprisonment, and numerous offences under health and safety legislation. Practical steps This tragic case is a timely reminder for businesses of all sizes that failure to keep employees safe is liable to lead to prosecution, potentially crippling fines and irreversible damage to your business's reputation. So you should take this opportunity to review your approach to safety management. Companies that follow sound health and safety practices are less likely to be in the unfortunate position of being responsible for the loss of life and all that this entails. If you are in any doubt about your responsibilities and how you should implement safe working practices then you should seek professional advice. Members of the Forum can call our helpline on 0845 130 1722 for more information. Insurance If a criminal prosecution is successful, insurance cover will not be available for any fine or costs against the organisation. If a defence is successful, there may be cover for the legal costs incurred. This should not prevent a company from being covered under its employers' or public liability policies in relation to civil claims arising from death. Directors' and officers' insurance may be available to individuals for defence costs in the event of a defence being successful. Directors must also be aware that any indemnities given by a company will not cover any criminal fines or costs incurred by them in the defence of criminal proceedings where a director is found guilty. How the Forum can help Members of the Forum can take advantage of our comprehensive and cost-effective insurance services, including directors' and officers' insurance. Plus, ensure your business is compliant with the latest health and safety regulations by subscribing to our practical Practical Health and Safety package.