Select Committee on Home Affairs and Work and Pensions First Report


13  INDIVIDUAL LIABILITY FOR DIRECTORS

299. Under the current common law offence of gross negligence manslaughter, individual officers of a company (directors or business owners) can be prosecuted for gross negligence manslaughter if their own grossly negligent behaviour causes death. This offence is punishable by a maximum of life imprisonment.[410] Between April 1999 and September 2005, 15 directors or business owners were personally convicted of this offence.

300. In addition, under the Health and Safety at Work etc. Act 1974, relevant officers of a company can be prosecuted for a health and safety offence which is committed by the company if that offence was the result of the officer's personal "consent", "connivance" or "neglect".[411] This health and safety offence is punishable with a fine[412] and directors who are found guilty can be disqualified from being a company director for up to two years.[413] Since 1986 only eight company directors have been disqualified on such grounds.

301. The Home Office has decided not to pursue new criminal sanctions against individuals in the draft Bill. It has also decided expressly to exclude secondary liability for individuals who would otherwise be guilty of aiding, abetting, counselling or procuring the offence of corporate manslaughter.[414] It justified this decision on the basis that "the need for reform arises from the law operating in a restricted way for holding organisations to account …and this is a matter of corporate not individual liability".[415] In oral evidence to the Sub-committees, the Parliamentary Under-Secretary of State at the Home Office, Fiona Mactaggart MP, argued that "the individual gross negligence manslaughter and the capacity to prosecute individuals under health and safety legislation do give one a framework where the individual level of responsibility can properly be dealt with".[416]

302. Our witnesses were divided on this issue. Half of the evidence we received agreed with the Government.[417] Representatives from industry argued that it would be wrong to include individual liability in the draft Bill. The British Vehicle Rental and Leasing Association, for example, submitted that:

    "those directors that are grossly negligent in their own right, of causing the death of a person to whom they owe a duty of care, can be prosecuted under the common law offence of manslaughter. It would be wholly inappropriate for the burden of proof or standard to be lowered simply to satisfy calls for a corporate scapegoat or because it may be challenging to prosecute the individual for his own actions or inactions…the Health and Safety at Work Act 1974 (HSWA) already acknowledges the principle of custodial sentences for individuals held responsible for the most serious omissions or acts."[418]

303. The Institute of Directors argued that:

    "The change in the law is intended to close gaps in the application of that law, not to create a wider offence".[419]

304. Industry groups also raised concerns that provisions for individual liability under the corporate manslaughter offence might discourage managers from taking up posts directly managing risk or in high-risk industries.[420]

305. An eminent judge, Lord Justice Judge, also agreed with the Government's position and echoed industry concerns about individual liability. He told the Sub-committees in oral evidence that,

    "We will have, assuming this becomes an Act, an offence of corporate manslaughter. You will not have abolished individual manslaughter, so individual responsibility will remain. I think that it would be very difficult to persuade anybody to take on the responsibility of senior manager within your definition if he were going to be liable to be found guilty for the inadequacy of the operation as a whole…'You will be the fall guy. You are the safety officer/manager or whatever it is. You are responsible for everything that goes wrong in the organisation.' I do not think anybody would do that job, because you are totally dependent on the quality of others, and those people not making mistakes…"[421]

306. However, many other witnesses to our inquiry argued that the lack of proposed punitive sanctions against individuals would provide an insufficient deterrent and would be unsatisfactory for those who wish to see justice delivered for the families of victims.[422] The Communication Workers' Union, for example, commented, "Ironically, Directors and Managers can be imprisoned for …"Cooking The Books" but not for killing workers and members of the public".[423] Witnesses pointed out that the Government had agreed that individual liability would be necessary in its 2000 consultation paper[424] and that individual liability appeared to be supported in surveys by directors themselves.[425] It was also feared that if the proposed offence were introduced it might frustrate proceedings against individuals for manslaughter under the existing common law offence because prosecutors might see companies as an easier target or because simultaneous proceedings might be seen as unfair for the individual.[426]

307. Witnesses suggested various ways of making directors or senior managers individually liable:

  • Automatic liability whenever a company is found guilty of corporate manslaughter.[427]
  • An additional offence of "unlawful killing" should be introduced, that would allow one or more directors and senior managers to be held individually responsible for workplace deaths if they are found to be responsible for the management failings leading to a corporate manslaughter conviction.[428]
  • The offence of aiding, abetting, counselling or procuring an offence of corporate manslaughter should not be excluded in the draft bill.[429]

308. We do not believe it would be fair to punish individuals in a company where their actions have not contributed to the offence of corporate manslaughter and we therefore reject the argument that individuals in a convicted company should be automatically liable. However, we believe that if the draft Bill were enacted as currently drafted there would be a gap in the law, where individuals in a company have contributed to the offence of corporate manslaughter but where there is not sufficient evidence to prove that they are guilty of individual gross negligence manslaughter.

309. The small number of directors successfully prosecuted for individual gross negligence manslaughter shows how difficult it is to prove the individual offence. Currently the only alternative would be to prosecute individuals for the less serious offence of being a secondary party to a health and safety offence. We believe that, just as the Government has taken the decision that when a company's gross management failing caused death it should be liable for a more serious offence than that available under health and safety legislation, so it should be possible to prosecute an individual who has been a secondary party to this gross management failing for a more serious offence also. We therefore recommend that secondary liability for corporate manslaughter should be included in the draft Bill. (We believe that it would not be problematic to prosecute individuals for being a secondary party to a corporate offence - after all it is possible, under the current law for a woman to be a secondary party to rape.)

310. One way of achieving the inclusion of secondary liability would be simply to remove clause 1(5) of the Bill which expressly states that an "individual cannot be guilty of aiding, abetting, counselling or procuring an offence of corporate manslaughter". However, it would not be simple to convict an individual under this approach because the standard rules on participation in crime are not designed to deal with such activities. As Ms Sally Ireland from JUSTICE pointed out to us,

    "…It should be made clear that the standard concepts of accessorial liability in participating in the offence may not be appropriate here because the level of culpability required could be very low. It is one of the characteristics of this offence that it is made up of a chain of actions by a large number of people. What you do not want is somebody being labelled with a manslaughter conviction who objectively has only committed something of very low culpability. Having looked at the current law on accessorial liability on counselling and procuring, I think it should be necessary that the defendant intended that the offence or an offence of the same type should be committed. That is the law. That makes it quite difficult".[430]

311. The rules on participation in crime are currently being examined by the Law Commission which is scheduled to issue a consultation paper in 2006. This could lead to a change in the law with an unknown impact on the applicable rules in relation to corporate manslaughter.

312. A better alternative might therefore be to insert clauses into the draft Corporate Manslaughter Bill based on sections 36 and 37 in the Health and Safety at Work Act. This might take the following form:

    "(1)Where an offence of corporate manslaughter is proved to have been committed with the consent or connivance of, or to have been attributable to any neglect on the part of, any director, manager, secretary or other similar officer of the organisation or a person who was purporting to act in such a capacity, he as well as the organisation shall be guilty of the offence of corporate manslaughter.

    (2) Where the affairs of a body corporate are managed by its members, the preceding subsection shall apply in relation to the acts and defaults of a member in connection with his functions of management as if he were a director of the body corporate

    (3) Where the commission by any person of corporate manslaughter is due to the act or default of some other person, that other person shall also be guilty of the offence, and a person may be charged with and convicted of the offence by virtue of this subsection whether or not proceedings are taken against the first-mentioned person"

This option was suggested to us by the London Criminal Courts Solicitors' Association.[431]

313. We note that the Government has accepted in other proposed legislation that it would be appropriate to prosecute directors and other company officers of a serious criminal corporate offence if it was committed with their consent or connivance. Clause 18 of the Terrorism Bill reads:

    "18 Liability of company directors etc

    (1) Where an offence under this Part is committed by a body corporate and is proved to have been committed with the consent or connivance of -

    (a) a director, manager, secretary or other similar officer of the body corporate or,

    (b) a person who was purporting to act in that capacity,

    he (as well as the body corporate) is guilty of that offence and shall be liable to be proceeding against and punished accordingly".

314. We believe that in cases where an individual has been found guilty of this secondary offence, they should be liable to the full range of sentences available. Consideration needs to be given to the maximum term of imprisonment for the offence. This would need to be less than the maximum available for gross negligence manslaughter (life imprisonment). By analogy with the offence of causing death by dangerous driving the maximum term of imprisonment could be set at 14 years. Further, in such cases we believe that it would be appropriate to bring disqualification proceedings against such convicted individuals.

Directors' duties

315. Currently directors have no positive obligations to ensure that their companies are complying with health and safety legislation. Some witnesses argued that the Bill should be used to introduce statutory health and safety duties on directors.[432] For example, the Fire Brigades Union argued:

    "These proposals are an essential part of any corporate manslaughter legislation if it is to be effective. They are not included in the draft Bill. This is a serious shortcoming."[433]

However, the Centre for Corporate Accountability, although supportive of such statutory duties, believed the Bill "was not the right vehicle for such a reform".[434]

316. In June 2000 the Government published its strategy for 'revitalising' health and safety.[435] One of the action points in this document was that the Health and Safety Commission would advise Ministers on how the law needed to be changed to make directors' responsibilities with respect to health and safety statutory.[436]

317. However, in its report into the work of the Health and Safety Commission and Executive the Work and Pensions Committee noted that the Government appeared to have changed its mind. The Committee recommended that the Government should "reconsider its decision not to legislate on directors' duties and that it bring forward proposals for pre-legislative scrutiny in the next Parliament".[437] In response the Government said that it had "asked HSC to undertake further evaluation to assess the effectiveness and progress of the current measures in place, legislative and voluntary, and to report its findings and recommendations by December 2005".[438]

318. The Government's Companies Law Reform Bill introduced on 1 November 2005, introduces duties for directors but makes no mention of responsibilities for the management of health and safety in their company.

319. A recent review of published research commissioned by the Health and Safety Executive found that "the evidence available provides a strong, but not conclusive, basis for arguing that the imposition of 'positive' health and safety duties on directors would serve to usefully supplement the liability that they currently face under section 37 of the Health and Safety at Work Act".[439]

320. We acknowledge that statutory health and safety duties could be introduced outside the Bill, but believe that since they might help clarify directors' duties with regard to corporate manslaughter law the Government should aim to introduce them either in the Bill, alongside the Bill, or as closely as possible afterwards.


410   Offences against the Person Act 1861, Section 5 Back

411   Section 37(1) Back

412   Health and Safety at Work etc. Act 1974, section 37 Back

413   Company Directors Disqualification Act 1986, section 2(1) Back

414   Clause 1(5) Back

415   Draft Corporate Manslaughter Bill, p 17 Back

416   Volume III, Q 557 Back

417   Volume II, Ev 14, 42, 43, 16, 40-50, 47, 54, 63, 78, 240-1, 92, 103, 113, 115, 190, 204, 210, 213, 252, 268, 271, 274, 295, 299 and 327 Back

418   Volume II, Ev 13 Back

419   Volume II, Ev 45 Back

420   Volume II, Ev 78, 53,103, 240, 338 and Volume III, Q 512 [Rt Hon Sir Igor Judge], Q 231 {Mr Commins] and Q 252 [Ms Peter] Back

421   Volume III, Q 517 Back

422   Volume II, Ev 7, 11, 17, 26, 31, 43, 56, 60, 66, 79, 81, 190, 193, 222, 235, 262, 283, 298, 306, 314, 319, and 326, Volume III, Q 445 [Mr Stoddart] Back

423   Volume II, Ev 257 Back

424   Volume II, Ev 7, 172 and 286 Back

425   Volume II, Ev 11 Back

426   Volume II, Ev 314 Back

427   Volume II, Ev 8 and 58 Back

428   Volume II, Ev 61 and 133  Back

429   Volume II, Ev 7, 11, 26, 61 and 144  Back

430   Volume III, Q 473 Back

431   Volume II, Ev 145-6 Back

432   Volume II, Ev 7, 26, 83, 218, 325, 278, 264, 316 and 398 Back

433   Volume II, Ev 217 Back

434   Volume III, Ev 130 Back

435   Department of the Environment, Transport and the Regions, Revitalising Health and Safety: Strategy Statement, June 2000  Back

436   Department of the Environment, Transport and the Regions, Revitalising Health and Safety: Strategy Statement, June 2000, para 68 Back

437   Work and Pensions Committee, Fourth Report of Session 2003-04, The Work of the Health and Safety Commission and Executive, HC 456-I, para 60 Back

438   Work and Pensions Committee, Third Special Report of Session 2003-04, Government Response to the Committee's Fourth Report into the Work of the Health and Safety Commission and Executive, HC 1137, p 5 Back

439   Philip James, Middlesex University Business School for the Health and Safety Executive, Directors' Responsibilities for Health and Safety - A Peer Review of Three Key Pieces of Published Research  Back


 
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Prepared 20 December 2005