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Following the successful prosecution and conviction of Cotswold Geotechnical Holdings earlier this year, a second company, Manchester based Lion Steel, is being prosecuted under the Corporate Manslaughter Act (the “Act”).
The prosecution follows the death of employee Steven Berry in May 2008. Mr Berry fell through a fragile roof panel at an industrial site and died as a result of injuries sustained in the fall.
In addition to the prosecution under the Act, three of Lion Steel’s directors have been charged with the common law offence of gross negligence manslaughter. Both the directors and Lion Steel are also charged under the Health and Safety at Work Act for failing to ensure the safety of employees at work.
The penalties for corporate manslaughter are an unlimited fine, a remedial order (i.e. an order that the company remedy a particular management failing) and a publicity order (i.e. an order that the company publicise its conviction). Sentencing guidelines state that the appropriate fine will seldom be less than £500,000 (Cotswold was fined £385,000, which was more than 10% of annual turnover), and could be millions of pounds. In some cases, putting the company out of business will be an unavoidable consequence of the fine. Additionally, if found guilty of gross negligence manslaughter, the company directors may also be looking at prison sentences of several years.
The Cotswold case did not provide much guidance as to how the Act will be applied by the courts, partly because Cotswold was such a small company (with only 8 employees). Lion Steel is a medium sized company with more than 100 employees. This case is therefore much more likely to provide a useful indication as to how the Act will be applied in practice.
Our Corporate Risk Management Group is a cross-departmental group which advises and represents clients in all health and safety matters. If you would like to speak to a member of our Corporate Risk Management Group then please do contact either Peter Stewart or Rhys Griffiths.