Managing the various risks arising from business operations has always been a challenge for company directors in all sectors, but a recent change in the law for England & Wales has changed the risk management landscape significantly.
With effect from 1st February 2016 the latest Sentencing Guidelines for health & safety offences allow for the imposition of £multi-million fines, previously an extremely rare occurrence. This change in sentencing protocols has attracted some attention in business circles (but whether it’s been given the attention it really deserves is a moot point). However there has been another seemingly small – yet highly significant – change invoked which could be a real game changer when it comes to practical risk management.
The change I refer to is the fact that Courts now base their sentence not on what actually happened but on what could have happened, i.e. the potential for harm or damage arising from the safety failure.
At first sight this might seem to be a trivial point, but it’s far from trivial.
For example: companies are no longer able to argue that, since there was no damage and nobody got hurt, their fine should simply be a token sum (and, of course, your Honour can rest assured that lessons have been learned … blah, blah, blah). Instead the Court will look at what could realistically have happened and will set the fine accordingly.
I made this point recently when providing a briefing to the Board of Directors of a national company from the gas sector. They use some 400 engineers across the country for work such as the installation and removal of gas meters, and their sphere of operations ranges from domestic installations to large commercial sites such as factories, supermarkets and schools.
The theoretical example I suggested to them was a gas leak arising from a faulty meter installation in a school canteen. Even if we assume for sake of argument that this theoretical leak had been detected quickly, and thus the school had been evacuated without any injuries, how might the prosecution approach the matter?
The prosecution could well argue that the potential outcome could realistically have been a fire or explosion resulting in possibly multiple fatalities amongst the school population – and, realistically, how could the defence argue against that assertion?
The fact that there had been no casualties would be considered the result of pure chance and thus nothing to do with the gas company. The company could not take the credit for blind chance or somebody else’s good fortune.
On the basis that the incident could have resulted in serious injuries and/ or multiple fatalities the Court would probably impose a fine certainly in seven figures and quite possibly eight.
This example (which, I stress again, is theoretical) had a suitable impact on the Board and stimulated a very valuable discussion about the need for effective safety management.
So this Board now understands the implication of sentencing based on potential outcome, but how many more Boards of Directors are blissfully unaware of the new risks they’re taking?
I am currently working with BoardPlus to develop training modules which will address crucial issues such as these – so watch this space!
About the Author
Andy has his own health & safety practice, Management & Safety Training Ltd, and is a highly experienced consultant and trainer (including accreditation with NEBOSH both as a tutor and examiner). He is an accredited accident investigator and is qualified in both the health & safety and training sectors.
A Fellow of the International Institute of Risk and Safety Management (FIIRSM), a chartered safety & health practitioner (CMIOSH) and a member of the UK Occupational Safety & Health Consultants Register (OSHCR), he has a proven track record in fields as diverse as accident investigation, lone worker safety, construction safety, and health & safety training.
Prior to moving into the field of health & safety management he was a specialist investigator with two élite UK law enforcement agencies (including taking responsibility for the management of complex international fraud enquiries).