Whirlpool successfully appeals health and safety fine at the Court of Appeal – a trend in reducing "manifestly excessive" health and safety fines?
Overview
Whirlpool UK Appliances Limited ("Whirlpool") has successfully appealed a £700,000 fine, having earlier pleaded guilty to an offence contrary to Section 3 of the Health and Safety at Work Act 1974 following an accident at Whirlpool's premises resulting in the death of a worker, Mr Clive Dalley.
Section 3 of the HSWA 1974 imposes a duty on an employer to conduct its undertaking in a way to ensure that, so far as reasonably practicable, those persons not in their employment are not thereby exposed to risks to their health and safety.
Background
Mr Dalley was a self-employed fire alarm and telecom contractor and was frequently contracted by Whirlpool to work in their factory in Yale, near Bristol.
On the 19 March 2015, two days before the accident date, Mr Dalley had discussed his work with the maintenance co-ordinator at the factory. Mr Dalley was to complete maintenance work on a fire and heat detection system from a mobile elevated working platform on an overhead conveyor system.
It was agreed that Mr Dalley would return on the weekend when fewer people were at the premises. It was explained that the in-house maintenance team would be working on the conveyor system at the same time and their work would take priority over his. A general risk assessment was carried out in relation to working at height and it was agreed that Mr Dalley would tell the other workers when he wanted to do his work to enable them to turn off the conveyor system.
On 21 March 2015, Mr Dalley told the maintenance workers that he was going to take a short break before starting his work from the working platform. Unfortunately, Mr Dalley failed to notify the maintenance workers of his return and the overhead conveyor system was set in motion by an employee of Whirlpool who was working elsewhere on the conveyor. The platform on which Mr Dalley was working on was struck by a hanging basket operated by the other workers. The impact caused Mr Dalley to fall 5 meters to the ground and he later died from his injuries.
Prosecution
The failures which gave rise to the breach of section 3 of the HSWA were that Whirlpool did not require Mr Dalley to prepare a job-specific risk assessment for the work he was to carry out on the accident date and Whirlpool could have prepared a more detailed Permit to Work which specifically identified the potential risk posed by a working platform being used in the vicinity of the overhead conveyor.
At trial in March 2017, Whirlpool pleaded guilty to breaching Section 3 of HSWA. During sentencing, His Honour Judge Patrick sitting at the Crown Court at Bristol passed sentence for Whirlpool to pay a fine of £700,000. HHJ Patrick also ordered Whirlpool to pay costs of £11,466.
Appeal
When passing sentence, HHJ Patrick would have referred to the Sentencing Council Definitive Sentencing Guideline on Corporate Manslaughter, Health and Safety and Food and Safety Hygiene Offences (the "Guideline").
In English law, appeals against sentence are usually based on when the sentence given is wrong in law (i.e. there is no legal power to pass the sentence given) or more usually that the sentence is manifestly excessive (i.e. a fine is too high or too onerous). In this case, the appeal against sentence brought with leave from a single judge was on the ground that the judge erred in his application of the Guideline and as a result that sentence was manifestly excessive.
Applying the Guideline, the Court of Appeal reviewed the steps enshrined in the Guideline in determining sentence. At Step One, the Court is required to assess the offence category by reference to culpability and harm. At Step Two, the Court is required to review the starting point and category range of sentence by reference to Company turnover with aggravating and mitigating features influencing where in the range the starting point lies. Step Three requires the court to check whether the proposed fine based on turnover is proportionate to the overall means of the offender. This means to determining the financial realities of the offender i.e. a downward adjustment on sentence would be suitable for a company with a high turnover but relatively small profit margin.
The Court of Appeal agreed with the first instance judge in that Whirlpool's breach was one of low culpability in that Whirlpool's policies did not fall far short of the appropriate standard. The Court of Appeal also agreed that the risk of harm category should be placed at Harm Category 3 at a starting point, but should be adjusted upward to Harm Category 1 due to the actual harm being loss of life, which places the fine range between £180,000 - £700,000 for a very large company which Whirlpool was categorised as having a turnover of £50 million and over.
The Court of Appeal held that the judge at first instance did not consider Step Three of the Guideline which requires the judge to consider the financial circumstances of the offender. The Court noted that there is a significant difference between an organisation with a consistent history of losses compared with consistent profitability and Whirlpool had suffered significant losses in 2015.
Applying the Guideline, the Court came to the conclusion that the appropriate fine should be one of £300,000 and that the original sentence of £700,000 was manifestly excessive.
The Future
It remains to be seen whether more organisations will appeal against their sentences for health and safety violations. Given that the Guideline (which came into force on 1st February 2016) is relatively recent, there have been limited cases in which the Court of Appeal has scrutinised how first instance judges apply the Guideline. However, given the very large fines that can be imposed on organisations, it is expected that more businesses will consider lodging appeals where their health and safety policies and procedures only fell slightly short of the required standard and their sentence for health and safety breaches seem too onerous.