In the event the HSE elects to proceed with enforcement action by way of prosecution against the company (and/or directors) for alleged breaches then the charge(s) are usually by virtue of: 

1. failing to comply with the general overarching duties conferred within sections 2 and 3 of the HSWA 74; and/or

2. pursuant to a breach of Regulations constituting an offence under the provisions of section 33 of the HSWA 74.

The prosecution for offences pertaining to breaches of health and safety legislation is triable either way, thus they can be heard in the Magistrates or Crown Court. In the event such charges are pursued before the court, and the relevant company is convicted of such an offence (either by tendering a guilty plea or following verdict where the allegation has been contested), the court will proceed to impose a financial sanction (that legally has no upper limit) upon the organisation concerned, pursuant to the relevant sentencing guidelines in force.  

The Sentencing Council introduced new sentencing guidelines for health and safety offences, corporate manslaughter and food safety and hygiene offences, which came into force on 1 February 2016 (“Guidelines”). The Guidelines apply to organisations that are sentenced for health and safety offences on or after that date, regardless of when the offence was committed.

The Sentencing Council has broken down the sentencing process into 9 steps, which are to be followed to determine the appropriate, and just, sentence for an offence in respect of breaching health and safety legislation.

• Step 1: determine the offence category. The court must determine the offence category considering factors of culpability and harm. Where there are elements of the case that fall in different categories of culpability, the court should balance these factors to reach a fair assessment of the defendant's culpability.

• Step 2: starting point and category range. Once the offence category has been decided the court will refer to the tables for different sized organisations which are included in the guideline. The court will assess the organisation's annual turnover, or equivalent, to reach a starting point for a fine. The court should then consider further adjustment within the category range for aggravating and mitigating features.

• Step 3: adjustment of the fine. The court must check whether the proposed fine based on turnover is proportionate to the overall means of the defendant. The fine must reflect the seriousness of the offence but the court must consider the financial circumstances of the defendant in accordance. The fine should reflect the extent to which the defendant fell below the required standard; it should not be cheaper to offend than to take the suitable precautions.

• Step 4: consider other factors that may warrant adjustment of the proposed fine.

• Step 5: factors that indicate a reduction. The court must consider any factors that indicate a reduction, such as assistance to the prosecution.

• Step 6: reduction for a guilty plea (up to a maximum of a third reduction of the sentence).

• Step 7: compensation and ancillary orders.

• Step 8: totality principle. The court must consider whether the total sentence imposed for several offences is just and proportionate to the offending.

• Step 9: give reasons. The court must give reasons for the sentence imposed.

In view of the above, there is a range of factors that can be taken into consideration when identifying the relevant starting point and any upward or downward adjustments that can properly be made to determine the final sanction imposed. As part of this process, and pursuant to conflicting case law, the court can in, specific circumstances, take into consideration the resources and finances of any parent associated companies.

As mentioned, the court will have regard to the potential for harm to be caused as opposed to their being a need for actual harm. Thus, the extent of these seemingly hypothetical risks, and any relevant mitigating features, will undoubtedly become a contested point, likely to lead to prolonged sentencing hearings involving the introduction of expert evidence.

Implications for the construction industry:

The construction industry, by virtue of the nature of work it entails, is more vulnerable than most industries when it comes to fines for health and safety offences. There has been an array of notable cases with large fines in the construction sector since the implementation of the sentencing guidelines. They include:

• £2.8m fine imposed on Costain and Galliford Try in September 2019 after a worker lost toes in an accident on a water project in March 2015. The worker’s foot became trapped during work upgrading a water treatment works in Cheshire. The HSE investigation found that both companies had failed to properly plan and manage the commissioning work, and each was fined £1,400,000 and ordered to pay a total of £101,046.20 in costs.

• £2.6m fine imposed on Balfour Beatty in May 2016 after an employee was killed when he became trapped in a trench after it collapsed on him. The fine was given after James Sim, 32, was killed working under subcontract for Balfour Beatty Utility Solutions on 14 April 2010.

• Kier MG was one of three contractors fined a total of £2m in December 2016 after Vincent Talbot suffered serious injuries when his leg was crushed when a trench collapsed on him in an incident at Fleet Street, Holbeach, Lincolnshire, on 9 March 2012. 

The introduction of new and very clear step-by-step sentencing guidelines for courts has notably increased the size of fines for health and safety breaches. The guidelines link them to the size of the company, sending a very clear signal to businesses and organisations that they must give the highest priority to protecting human lives, or face severe consequences for failing to do so.

It is worthy to note that in addition to organisations being more vulnerable to increased fines for breaches of health and safety, custodial sentences for individuals are also now becoming more common. In addition to being liable for such a term of imprisonment, these individuals can also be penalised with a director disqualification (maximum period of 15 years), costs and victim surcharge payments.

A proactive approach:

Courts should follow the principles of sentencing when determining the fine and this considers the objectives of punishment, deterrence, and the removal of any gain through the commission of the offence. The potential for huge fines reflects the need to ensure that they are sufficiently substantial to have a real economic impact and encourage managers and shareholders to comply with health and safety law.