The new Health and Safety, Corporate Manslaughter, Food Safety and Hygiene Offences Guidelines: ready or not here they come!
We wrote last about this in November 2015 (read here). Well, the day has arrived – on Monday 1 February 2016, the new Sentencing Guidelines for a range of regulatory offences come into force.
They apply to all offences sentenced on or after this date, regardless of when the offence was committed. For convicted corporate Defendants, one can expect to see a significant increase in the level of fines imposed.
For health and safety offences, the Guidelines focus on the turnover of organisations in order to scope the range of fine. One is then required to consider culpability, seriousness of harm and likelihood of harm, the assessment of which enables the Sentencing Court to arrive at a category prescribing ranges of fines. For example, a company with a turnover of £9m, which is regarded as committing an offence of medium culpability but with a high likelihood of serious harm would face a fine in the range of £100k-£600k. Without a doubt then, the stakes for corporate Defendants are now higher.
However, perhaps the greater novelty is the express reference in the Guidelines to the need to focus on the ‘economic reality’ of the corporate Defendant. Whilst this may assist high turnover/low profit organisations, given the current jurisprudence on such matters, it could also, prompt the Court to take into account the assets of other group or parent companies to ensure that the sentence fulfils its punitive function of sending a message out to shareholders. Piercing the corporate veil? Welcome to the new economic reality.
Further detailed briefings will follow.