Corporate groups
110. The question of how the offence would apply
in the context of groups of companies was raised in a number of
submissions. In its 2000 consultation paper, the Government invited
comments on whether it should be possible to take action against
parent or other group companies if it could be shown that their
own management failures were a cause of a death. The Government
reported that "a large majority of witnesses agreed with
this proposal, but in most cases on the basis that the parent
company should only be liable where their own management failings
had been a direct cause of death".[131]
It explained the position taken in the draft Bill as follows:
"a parent company (as well as any subsidiary)
would be liable to prosecution where it owed a duty of care to
the victim in respect of one of the activities covered by the
offence and a gross management failure by its senior managers
caused death".[132]
111. We heard mixed evidence on this proposal. Some
witnesses expressed concerns, including:
- that it was inconsistent with
the principle of limited liability;[133]
- that it could threaten inward investment;[134]
- that it should not be possible for two companies
within the same group to be prosecuted for the same deaths as
this could result in shareholders being punished twice;[135]
and
- that this proposal might discourage large groups
from organising, managing and implementing health and safety on
a group-wide basis.[136]
112. However, others supported the Government's position.[137]
The Royal Academy of Engineering, for example, submitted that:
"The proposal to make a parent company liable
to prosecution is, on the whole, acceptable. If the parent company
ignores the behaviour of a subsidiary, or even pressurises it
to cut corners, the parent company is as much the cause…".[138]
113. We agree that it should be possible to prosecute
parent companies when a gross management failure in that company
has caused death in one of their subsidiaries.
114. We are therefore concerned by evidence we received
which claims that it may not actually be possible to prosecute
a parent company under the draft bill as the law on the duty of
care in negligence currently stands. Serco-Ned Railways, for example,
pointed out that "there is no established principle in English
law that a parent company does in fact owe the relevant duty of
care necessary as a component to the offence".[139]
The Centre for Corporate Accountability also made this point and
argued that the Home Office's statement that parent companies
could be liable to prosecution is therefore "a rather misleading
and disingenuous assertion".[140]
Further, they pointed out, the only legal obligation that parent
companies have is that imposed by section 3 of the Health and
Safety at Work Act.
115. We are concerned by the suggestion that it
may not be possible to prosecute parent companies under the current
law, as courts have not ruled that parent companies have a duty
of care in relation to the activities of their subsidiaries. This
is an additional argument in favour of our recommendation that
the offence should not be based on civil law duties of care.
Contractual relationships
116. A number of organisations questioned whether
contractors would owe a duty of care in relation to the activities
of their sub-contractors or whether employment agencies would
owe a duty of care in relation to agency workers killed in the
workplace.[141] The
Confederation of British Industry believed that the "different
legal and practical structures of corporations will give rise
to different answers to… the organisation that owes the duty
of care to the victim" and warned that this "inevitable
inconsistency risks discrediting the law".[142]
117. The British Maritime Association also expressed
concern that the law would not cover companies which provide professional
management services to a company for a fee. This, they pointed
out, was a common arrangement in the shipping industry.[143]
118. Ms Anne Jones, whose son died on his first day
of work after signing on at an employment agency, told the Sub-committees:
"Everyone knows that on a big construction
site, like Wembley, for instance, there are enormous numbers of
contractors and sub-contractors that are taking on agency workers
and even agencies that have borrowed workers from other agencies.
There was one case, I think it was two years ago, of an Eastern
European who had been killed on a construction site and there
were enormous problems with identifying who was employing him,
because each layer was passing the buck, saying, "He's not
our employee."… Unless we can tighten that up, in the
first place, this bill has got a real problem on its hands".[144]
119. We believe that, where a death of an agency
worker or of an individual in a sub-contracting company was caused
by a gross management failure by an employment agency or main
contractor, it should be possible to prosecute these organisations
jointly to establish either collective or individual corporate
liability. We urge the Government to ensure that the Bill provides
for this.
120. The Union of Construction Allied Trades and
Technicians argued that on a construction site the only
company that should be liable to prosecution is the main contractor:
"decisions about the overall standards on
the site lie with the principal contractor and it is they who
should be held responsible whether or not they actually employ
any staff".[145]
In a similar vein, Ms Anne Jones argued that employment
agencies should have primary responsibility for employment agency
workers:
"If only we could insist on saying to an
agency, which effectively is a sub-contractor supplying labour,
"Right, you are the principal employer, health and safety
law says that you are responsible,"…until we tighten
up this, placing a responsibility plainly on the people sending
out the workers, then all that will happen is that the host employer
will argue, "This isn't my duty of care, this isn't my responsibility,"
and they will walk free".[146]
121. Under the Construction (Design and Management
Regulations) 2003, principal contractors are obliged to co-ordinate
and manage health and safety during the construction work, developing
a health and safety plan before work starts on site and then keeping
it up to date throughout the construction phase. Employment agencies
are responsible for an employee's training and health and safety
at work, but it is the responsibility of the host employer to
provide a safe system of work.
122. We believe that principal contractors and
employment agencies should take responsibility for the health
and safety conditions of their sub-contractors and workers but
that it is a step too far to provide that they should always be
liable when a death has occurred. Mr Commins from the Construction
Confederation told the Sub-committees: "If a main contractor
had carried our all the good practices and the subcontractor had
just blatantly disregarded them, I do not see how you could hold
the main contractor totally responsible for the subcontractor's
actions".[147]
We agree. Principal contactors and employment agencies should
only be liable when their own management failure is at fault.
Anything more than this might encourage sub-contracting companies
and those employing agency workers to ignore their health and
safety responsibilities.
112 Clause 4 Back
113
Home Office, Corporate Manslaughter: The Government's Draft Bill
for Reform, Cm 6497, March 2005, para 16 Back
114
Volume III, Q 581 [Mr Fussell] Back
115
Volume II, Ev 230 and 339 Back
116
Volume II, Ev 188 Back
117
Volume II, Ev 57 and 246, and Volume III, Ev 117 and Q 59 [Mr
Bergman]. We were a little confused by the Law Commission's memorandum.
The Law Commission's original proposals did not restrict the offence
to duties of care owed under the law of negligence. The Commission
then argued that "the terminology of "negligence"
and "duty of care" is best avoided within the criminal
law because of the uncertainty and confusion that surround it"
However, the Law Commission's memorandum stated: "The Government's
Bill makes explicit the need for a breach of a duty of care owed
to the deceased, clause 1(1). We believe this was implicit in
the Commission's Bill, but we see the value of making it explicit."
Ev 261 Back
118
Volume II, Ev 221 Back
119
Volume III, Ev 117 Back
120
[2003] 1 Cr App R 329 Back
121
Volume III, Q 96 Back
122
Volume II, Ev 206 and 287, and Volume III, Q 94 [Mr Antoniw] and
Q 159 [Mr Waterman] Back
123
Volume III, Q 163[Mr Welham] and Volume II, Ev 9 Back
124
Volume II, Ev 9 Back
125
Volume III, Q 60 [Mr Bergman] Back
126
Clause 4(1) Back
127
Volume II, Ev 141 Back
128
Volume II, Ev 246 Back
129
Volume III, Q 61 Back
130
Volume III, Q 584 [Mr Fussell} Back
131
Draft Corporate Manslaughter Bill, para 37 Back
132
Draft Corporate Manslaughter Bill, para 37 Back
133
Volume II, Ev 41, 91, 240 and 273 Back
134
Volume II, Ev 91 and 214 Back
135
Volume II, Ev 190, 212, 224 and 240 Back
136
Volume II, Ev 240, 273, 275 and 328 Back
137
Volume II, Ev 212 and 224 and Volume III, Q 193 [Mr Nelson] Back
138
Volume II, Ev 224 Back
139
Volume II, Ev 328 Back
140
Volume III, Ev 118 Back
141
Volume III, Q 384 [Mr Roberts] and Volume II, Ev 234 Back
142
Volume II, Ev 252 Back
143
Volume II, Ev 327 Back
144
Volume III, Q 14 Back
145
Volume II, Ev 8 Back
146
Volume III, Q 14 Back
147
Volume III, Q 226 Back
