1. The information contained within these slides is intended as a guide only. The information is not a substitute for obtaining tailored and appropriate legal advice. Hill Hofstetter takes no responsibility for actions taken based on the information contained in these slides. © Hill Hofstetter Limited. All rights reserved. Legal update 2016 Darren Smith, Partner Hill Hofstetter Limited

2. 2016 a year of firsts and records?  Biggest odds winner of the Premiership  First Woman US president?  First Comb over/ whatever it is for US President?  A new record for Health and Safety Fines?

3. The information contained within these slides is intended as a guide only. The information is not a substitute for obtaining tailored and appropriate legal advice. Hill Hofstetter takes no responsibility for actions taken based on the information contained in these slides. © Hill Hofstetter Limited. All rights reserved. Last year my presentation was entitled “Why Health and Safety should matter?” A review of some of the key areas in respect of health and safety and how they impact on business bottom line costs.

4. This year I will be concentrating on the one issue that will get the people you work withs attention

5. Why now?  Health and Safety Offences, Corporate Manslaughter and Food Safety and Hygiene Offences. Definitive Guideline.Sentencing Council  It applies to all organisations and offenders aged 18 and older, who are sentenced on or after 1 February 2016, regardless of the date of the offence

6. What does the Court have to do?  Every court –  (a) must, in sentencing an offender follow any sentencing guidelines which are relevant to the offender’s case, and  (b)must, in exercising any other function relating to the sentencing of offenders follow any sentencing guidelines which are relevant to the exercise of the function.

7. Structure, ranges and starting points  offence ranges – the range of sentences appropriate for each type of offence  Within each offence the Council has specified a number of categories which reflect varying degrees of seriousness  The offence range is split into category ranges

8. Starting Points  Each Category has a starting point  To the starting point the Court can add aggravating or mitigating factors to adjust the penalty  Starting points and ranges apply to all offenders whether they have pleaded guilty or been convicted after trial. Credit for a guilty plea is taken into consideration only after the appropriate sentence has been identified.

9. Organisations Breach of duty of employer towards employees and non-employees Breach of duty of self-employed to others Health and Safety at Work Act 1974 (section 33(1)(a) for breaches of sections 2 and 3) Breach of Health and Safety regulations Health and Safety at Work Act 1974 (section 33(1)(c))

10.  Triable either way  Maximum when tried on indictment: unlimited fine  when tried summarily: unlimited fine  Offence range: £50 fine to £10 million fine

11. First issue for the Court is Culpability  Very high -Deliberate breach of or flagrant disregard for the law  High -Offender fell far short of the appropriate standard; for example, by:  failing to put in place measures that are recognised standards in the industry  ignoring concerns raised by employees or others  failing to make appropriate changes following prior incident(s) exposing risks to health and safety  allowing breaches to subsist over a long period of time  Serious and/or systemic failure within the organisation to address risks to health and safety

12.  Medium -Offender fell short of the appropriate standard in a manner that falls between descriptions in ‘high’ and ‘low’ culpability categories  Systems were in place but these were not sufficiently adhered to or implemented

13.  Low-Offender did not fall far short of the appropriate standard; for example, because:  significant efforts were made to address the risk although they were inadequate on this occasion  there was no warning/circumstance indicating a risk to health and safety  Failings were minor and occurred as an isolated incident

14. Consider the following  Maintenance worker fell 5 metres out of a restaurant Window  Left tetraplegic  4 employees including the injured party carrying a 168Kg hot cupboard up a staircase  Prosecution S 2 HSAW  Fine £200,000 Cost £58,453.

15. Next determine - HARM  The offence is in creating a risk of harm i.e. no one has to be injured for the offence to occur

16. Guidelines provide a matrix for the Court to:-  identify an initial harm category based on the risk of harm created by the offence The assessment of harm requires a consideration of both:  the seriousness of the harm risked by the offender’s breach; and  the likelihood of that harm arising (high, medium or low).

18. 1 fatality, 1 serious injury  Concrete staircases toppling onto employees  First: 17 year old trying to push the moulding to rest on the raised forks of a FLT luckily only suffered severe bruising  Second: 3 tonne stair case fell on a 37 year old employee.  HSE concluded failure to have a safe system of work and inadequate risk assessments  Total fines £180,000 cost £60,636

19. The Court must then ask and answer these 2 questions.  1. Whether the offence exposed a number of workers or members of the public to the risk of harm. The greater the number of people, the greater the risk of harm.  2.Whether the offence was a significant cause of actual harm  If one or both of these factors apply the court must consider either moving up a harm category or substantially moving up within the category range

20. Employer and Principal contactor  Construction firm and roofing Company  Employee fell through a roof  Wholly avoidable  Safety nets removed 2 weeks before the incident  Principal fined £50,000 Contractor £8,000

21. Step Two: Starting point and category range  the court is required to focus on the organisation’s annual turnover or equivalent to reach a starting point for a fine  Four/ five categories of organisation:-  Large  Medium  Small  Micro

22. Extra category  Very large organisation where an offending organisation’s turnover or equivalent very greatly exceeds the threshold for large organisations, it may be necessary to move outside the suggested range to achieve a proportionate sentence.

23. Remember  Largest Health and safety fine in UK Transco’s £15 million  Total fined £1.125 million for gas leak exposing 238 personnel to a risk of explosion no one was injured  HSE prosecutions rose 2% in 2014/15 to 586 cases 52 Complex cases  2015/16 69 £100K+ health and safety fines ( a new record!) 20 of which were for £400K or more and 8 for over £1 Million  TATA find £180,000

24. Turnover  Large £50 Million and Over  Medium between £10 Million and £50 Million  Small between £2 and £10 million  Micro not more than £2 million

25. Fine ranges  Large with very high Culpability Harm category 1 starting point £4 million range £2.6 million to £10 million  Micro Low culpability harm category 4 starting point £200 range £50 to £2,000

26. Additional factors increasing seriousness of the offence Statutory aggravating factors: Previous convictions, having regard to a) the nature of the offence to which the conviction relates and its relevance to the current offence and b) the time that has elapsed since the conviction. These MUST be taken into account by the Court

27. Other aggravating factors include  Cost-cutting at the expense of safety  Deliberate concealment of illegal nature of activity  Breach of any court order  Obstruction of justice  Poor health and safety record  Falsification of documentation or licences  Deliberate failure to obtain or comply with relevant licences in order to avoid scrutiny by authorities  Targeting vulnerable victims

28.  Port Operator fined £1.8 million for worker injured by a capstan  Company alerted to risks by employees  Waste Firm fined £100k after ignoring warnings  ConocoPhillips fine £3million ( £1 million per offence) after 3 gas releases over 2 days

29.  No previous convictions or no relevant/recent convictions  Evidence of steps taken voluntarily to remedy problem  High level of co-operation with the investigation, beyond that which will always be expected  Good health and safety record  Effective health and safety procedures in place  Self-reporting, co-operation and acceptance of responsibility Factors reducing seriousness or reflecting mitigation

30. Step Three- step back and review to ensure  That the fine is sufficiently substantial to have a real economic impact which will bring home to both management and shareholders the need to comply with health and safety legislation

31. Step four  court should consider any wider impacts of the fine within the organisation or on innocent third parties; such as (but not limited to):  the fine impairs offender’s ability to make restitution to victims;  impact of the fine on offender’s ability to improve conditions in the organisation to comply with the law;  impact of the fine on employment of staff, service users, customers and local economy (but not shareholders or directors).  Where the fine will fall on public or charitable bodies, the fine should normally be substantially reduced if the offending organisation is able to demonstrate the proposed fine would have a significant impact on the provision of its services.

32. Step five  Consider any factors which indicate a reduction, such as assistance to the prosecution

33. Step six  Reduction for guilty pleas

34. Step seven  Compensation and ancillary orders  Remediation  Forfeiture  Compensation

35. Step eight  Totality principle  Step Nine  Reasons

36. Individuals  Very similar principles  Triable either way  Maximum: when tried on indictment: unlimited fine and/or 2 years’ custody  when tried summarily: unlimited fine and/or 6 months’ custody  Offence range:Conditional discharge – 2 years’ custody

37. Starting points for individuals  Very High Culpability Harm Category 1 starting point 18 Months Custody range 1-2 years  Low Culpability Harm Category 4 starting point Band A fine (50% of relevant weekly income) range conditional discharge to Band A Fine

38. Need to be aware  2014/15 27 Custodial sentences related to Health and Safety at Work.  Poitr Kowalczyk 6 months suspended for 2 years.  William Ryan Evans 6 months suspended for 2 years  Brian Roberts 26 Weeks  Paul Priestley 18 months suspended for 2 years  Paulo Mule 18 months suspended for 2 years his father was left in a wheelchair  Allan Thompson 6 years

39. Corporate Manslaughter  Indictment only  Unlimited fine  Range £180,000 - £20 Million fine

40. Step one – determine the seriousness of the offence  How foreseeable was serious injury?  How far short of the appropriate standard did the offender fall?  How common is this kind of breach in this organisation?  Was there more than one death, or a high risk of further deaths, or serious personal injury in addition to death?

41.  Offence Category A: Where answers to the questions indicate a high level of harm or culpability within the context of offence.  Offence Category B: Where answers to the questions indicate a lower level of culpability.

42. Organisations classed the same as for health and safety offences  Large Cat A staring point £7,500,000 range £4.8 to £20 million. Cat B start £5 million range £3 to £12.5 million.  Medium Cat A start £3 million, range £1.8 to £7.5 million. Cat B start £2 million range £1.2 to £5 million  Small Cat A start £800,000 range £540,000 to£2.8 million. Cat B start £540,000 range £350,000 to £2 million  Micro Cat A start £540,000 range £270,000 to £800,000. Cat B start £300,000 range £180,000

43. Step seven  Compensation and Ancillary orders  Publicity orders  Remediation  Compensation

44. Linley Developments first Publicity Order  Fine £200,000  Had to take out an add in the Construction Enquirer detailing the prosecution and also that the ad remain on the publication website for a month

45. What did it say?  Linley Developments Ltd was convicted on 7 September 2015 of Corporate manslaughter arising out of the death of Gareth Jones, a subcontracted employee, at a development in St Albans on 30 January 2013.  Lindley Developments Ltd admitted acting in a gross breach of their duty by failing to take sufficient care for his safety. Failings included failing to prepare a risk assessment for excavation works, failing to assess and monitor the stability of the wall and failing to ensure that the wall did not become unstable as a result of the excavation work.  http://www.constructionenquirer.com/2015/12/01/hse- publicity-order-linley-developments/

46. Considering the following if coming to court now  National Grid £2million following schoolboys death  Down Hall Country House Hotel Fined £200K  Baldwins Crane Hire £900,000  Cemex fined £700k and Cape £600K for the same incident

47. Not Corporate Manslaughter but still significant  Hugo Boss fined £1.1 million for death of a 4 year old.  Care Home Boss Jailed for Manslaughter his company fined for Corporate Manslaughter (first conviction under the new guidelines)  Andrew Stocker “Scuba Diving for apples” 2 ½ years

48. Public Bodies  Fatality at Fareham Health Centre, conviction of NHS Litigation Authority  Reading Borough Council convicted following legionella death

49. Most significant Corporate Manslaughter case yet?  CAV Aerospace  Parent Company found guilty where death was at one of it’s subsidiaries

50. Will we see a record Health and safety fine soon?  Merlin Entertainment and the Smiler accident?

51. A Few quick issues  What will the impact of the new guidelines be on insurance cost?  You can be Vicariously Liable even without an employment Contract

52. Looking forward, Back and a bit sideways  What impact would a Brexit have on Health and safety? Or Indeed what if we remain?  Rio 2016 – Has Zika gone away?  Recent research has shown that half of all fatal accidents in Tudor Times were in the workplace but even then someone was trying to do something about it

53. And Finally  I started by mentioning the possibility of a first female US president these are some recent reports on how the US differs from us.  Gun Deaths outpace Motor Vehicle deaths in 21 states  As of 1 January 2016 visitors to Texas State Mental health hospitals can openly carry guns!

54. Questions? Darren Smith 0121 210 6116 dsmith@hillhofstetter.com