London Criminal Courts Solicitors Association. Response to Consultation Paper on Sentencing For Corporate. Manslaughter

Transcription

1 London Criminal Courts Solicitors Association Response to Consultation Paper on Sentencing For Corporate Manslaughter 1

2 The London Criminal Courts Solicitors Association (LCCSA) represents the interests of specialist criminal lawyers in the London area. Founded in 1984, it now has over 1000 members including lawyers in private practice, Crown prosecutors, freelance advocates and many honorary members who are circuit and district judges. The objectives of the LCCSA are to encourage and maintain the highest standards of advocacy and practice in the criminal courts in and around London, to participate in discussions on developments in the criminal process, to represent and further the interest of the members on any matters which may affect solicitors who practice in the criminal courts and to improve, develop and maintain the education and knowledge of those actively concerned with the criminal courts including those who are in the course of their training. Any questions in relation to this response should be referred to either: Judy Teplitzki ( Chair of the Sub-Committee and Chair of Law Reform ) Fraud Prosecution Service CPS London 3 rd Floor Rose Court 2 Southwark Bridge London Se1 9HS Judy.Teplitzki@cps.gsi.gov.uk Telephone No : Fax No: The following members of the Association s Law Reform Sub-Committee have assisted with this Response: Judy Teplitzki Fraud Prosecution Service Guy Bastable - BCL Burton Copeland Solicitors Judith Seddon Russell Jones & Walker Solicitors Jonathan Grimes Kingsley Napley Solicitors 2

3 All members of the sub-committee participated as individual members of the LCCSA and the views expressed do not necessarily reflect those of any of their firms. Introductory remarks The Corporate Manslaughter Act 2007 comes into force on 6 April It represents the culmination of a long process aimed at codifying the law regarding the criminal responsibility of corporations for manslaughter with the ultimate ambition of improving the prospects of prosecutions that are brought in such cases. The difficulties that have previously existed in respect of the prosecution of such cases have also previously been reflected in a confused and inconsistent approach to sentencing. Members of the Association have experienced a wide range of sentences for both corporate manslaughter and health and safety cases which result in death. These sentences include financial penalties that seem disproportionately high or low in relation both to the means of the defendant companies and their perceived level of culpability. For these reasons the Association welcome this consultation process and the opportunity to consider and debate appropriate types and levels of penalty in such cases. In particular the Association welcome the move towards a more transparent and reasoned framework for the setting of financial penalties. Before turning to the questions posed by the Sentencing Advisory Panel (SAP), the Association has the following general observations: 1. While the Association welcome fresh consideration of the means of calculating financial penalties, we remain unconvinced that a simple calculation linked to turnover is appropriate. Many companies have complex financial structures that make it hard to assess what their means might be for the purposes of financial penalties. Given the importance of this issue, we consider it warrants further consideration by SAP, perhaps looking more broadly at other indicators, such as how the company might be valued for sale purposes. 2. The Association are disappointed that the opportunity has not been taken to give consideration to the practical issues arising from the imposition of publicity orders. As the paper points out these are almost entirely novel in UK criminal law and there is therefore no guidance available. We have no doubt that the court would welcome further guidance, possibly drawn from the experiences in Canada, USA and Australia (referred to in para 75). Equally, there may be guidance from other areas of 3

4 regulation. For example the Press Complaints Commission (PCC) can order a publication to publish an adjudication and similar issues therefore presumably apply. With the public relations resources available to many large companies, the Association are concerned that the imposition of a publicity order could, if not carefully controlled, be an opportunity for advertising. We wonder whether consideration should be given to the following questions, none of which appear to be answered within the legislation: (a) Who is responsible for the content of the publicity resulting from the order? (b) Would the prosecuting authority commission the piece with an expectation that the defendant pay or would the defendant commission and pay for it? (c) To what degree would the defendant be allowed to go beyond the facts required to be publicised (s.10(1) (a) (d))? For example could they refer to the fact that the terms of a remedial order had been met and what the cost had been? It is easy to see how the focus of such a piece could shift from the fact of the punishment to the suggestion of the company s positive attitude. (d) Would the judge or prosecuting authority be able to vet the piece before broadcast or publication, and if so, what action would be available to them if they felt it put across the facts inappropriately? Question 1 Do you agree with the approach to the assessment of seriousness? The Association agree with the Panel s approach to the assessment of seriousness. It is essential as part of the assessment exercise to consider the culpability of the offender, focussing on the actual, intended or foreseeable harm involved in the offence as stated at paragraph 13 of the consultation paper. The Panel correctly state that the culpability of the offender is the first factor to be considered. Crucially, the extent to which the conduct of the offender falls below the appropriate standard will increase the degree of culpability. The degree of risk and exposure to danger has to be assessed against the significant features of each case, covering cases of death arising out of isolated breaches of duty, series of breaches occurring over a defined timeframe, or breaches occurring over an extended period. All these factors have been in our view correctly identified and commented upon in the consultation paper. 4

5 Convictions for corporate manslaughter will always arise from conduct that has fallen far below what can be expected of the organisation in the circumstances 1. Whilst it is acknowledged that offences of corporate manslaughter and /or breaches of HSWA resulting in death involves the worst possible harm to the victim, in the vast majority of cases death will not have been foreseen. However, the extent of the risk of death posed by any breach of Health & Safety legislation can be objectively assessed and considered and is a factor, which the Panel correctly identify as being one that the jury must consider when determining if any offence of corporate manslaughter has been committed. The extent of foreseeable harm will be a key factor to be taken into account, when assessing the seriousness of the offence for the sentencing exercise. Question 2 Is each of the above aggravating and mitigating factors relevant to sentencing for a) an offence of corporate manslaughter and b) an offence under the HSWA involving death? Are there any other factors which may aggravate or mitigate either or both of these types of offence? The Association are of the view that as there is a substantial degree of overlap as between an offence of corporate manslaughter and offences under the HSWA resulting in death, logically the same aggravating and mitigating factors are relevant for both types of offences. However, it is important to bear in mind the key distinction between offences under HSWA resulting in death which are strict liability offences, and offences of corporate manslaughter, in respect of which causation and the concepts of intentionally, knowingly or recklessly 2 are relevant. Despite the above qualification the Panel in our view has correctly set out all the appropriate aggravating factors in paragraphs of the paper. Offences resulting in a number of deaths which have occurred as a result of reasonably foreseeable breaches will rightly be considered more aggravating than a similar breach result in a single death. The purpose of the new legislation is to send out a message to organisations that they must organise and conduct their activities according to the safest possible working systems. Therefore, any breaches resulting in a greater number of deaths or serious injuries to a number of people as well as death, are correctly identified by the Panel as aggravating factors. 1 Consultation Paper page 7 2 Paragraph 52 5

6 Other aggravating factors which the Panel has identified and with which we agree, are a company s failure to act upon advice, cautions and warnings from regulatory authorities, as well as other sources of warnings. Such warnings will encompass failure to taken on board concerns of employees and/or customers. Similarly, failures of organisations to operate within an appropriate license will increase culpability. Organisations failures to comply with a licensing regime undermine the purpose of licensing, which as correctly identified by the Panel at paragraph 24, has been put in place to create an additional check to ensure the safety of employees and other members of the public, within the workplace. We concur with the Panel s view that where there is evidence that the appropriate standard of care has been deliberately breached due to a drive for increased profit margins, this will constitute a very serious aggravating factor. Other aggravating factors mentioned are the attitudes, policies and systems deployed by the offending organisation. A prevailing culture of systematic breaches will correctly constitute an aggravating factor. The Association agree with the mitigating factors identified by the Panel in paragraphs inclusive. The Panel in our view correctly applies the emphasis for those cases involving employee behaviour as a contributory factor for breaches, rather than breaches arising out of failure of systems and/or equipment alone. In reality the vast majority of cases will to a varying degree include both failure by an employee and system failures, resulting in death. The Panel correctly state at paragraph 29 if a death has resulted from the actions of a maverick employee acting outside authority, in most cases the offence of corporate manslaughter will not be made out. Often the court has to apply a balancing exercise, taking into account both the gross breach of the relevant duty of care by the organisation, and the employee s contributory actions. The other mitigating factors referred to include an organisation s willingness to co-operate at an early date with the relevant authority and to put in place remedial action at the earliest opportunity. Previous good safety records are a key mitigating factor enabling the current breach to be assessed within the context of the organisation s wider safety record. The Association has not identified any other factors which may aggravate or mitigate which have not already been addressed in this Paper. Nor have we formed the view that certain aggravating and mitigating factors only apply to corporate manslaughter offences, as apposed to HSWA offences resulting in death. 6

7 Question 3 What do you consider should be the main aim of sentencing an organisation for an offence of corporate manslaughter or an offence under the HSWA involving death? Should there be any difference between the two types of offence and, if so, why? Whilst we acknowledge the distinction between corporate manslaughter offences involving causation and gross breach of duty, and offences under the HSWA involving death which are strict liability offences, the Association takes the view that the aim of sentencing should be the same for both categories of offences. An organisation will be guilty of the new offence of corporate manslaughter if the way in which it managed its activities both caused the death of a person and the breach constituted a gross breach of duty which the organisation owed to the deceased. Apart from this distinction both categories of offending in our view should be sentenced according the same principles and guidelines. We acknowledge that there are three sanctions available to the court when sentencing for the offence of corporate manslaughter, namely an unlimited fine, publicity order and remedial order. Conversely, under the HSWA regime an unlimited fine and remedial order are available sentences, but not the making of a publicity order. Whilst the HSE are able to operate a name and shame list by publishing the names of convicted organisations on the public database since 2000, we acknowledge that the purpose of the new publicity order is to generate wider knowledge of the organisation s offence of corporate manslaughter to punish the organisation, as well as send out a deterrent message to other organisations, who might otherwise act in a similar fashion. We agree with the Panel s assertion that deterrent sentencing involving a degree of adverse publicity can be a very effective means of punishing corporate offenders. The Association concurs with the four key purposes of sentencing as stated in the Criminal Justice Act (CJA) These factors are set out in paragraph 36 of the paper as follows: 1. Punishment of offenders and; 2. Reduction of crime through the punitive and deterrent effects of fines and publicity Order; 3. Reform and rehabilitation of offenders through remedial orders; 4. Protection of the public through both deterrence and remedial action. 7

8 A fifth aim identified by the Panel, in paragraph 36 (which we support) is reparation by offenders to those affected by the offence, and we agree that this aim can be achieved by means of a remedial order or compensation order. We disagree with the Panel s view that when considering the five aims of sentencing, the aims will vary in importance according to whether the sentence is imposed for an offence of corporate manslaughter, as opposed to a HSWA offence, resulting in death. The Association takes the view that the sentencing aims are fact specific rather than offence specific. Whilst we accept that in numerous cases the level and type of sentence imposed for corporate manslaughter offences may be harsher, due to the need to recognise a higher degree of culpability by senior management of the offending organisation, we do not accept that the distinction between offences of corporate manslaughter and HSWA offences resulting in death is so clear cut. Each case must turn on its unique facts. For both types of offences, there will invariably be competing factors and conflicts between the five identified aims for sentencing. The court must apply the aims to achieve the appropriate sentence, taking into account all the relevant facts of each case for both HSWA offences resulting in death, and the new offence of corporate manslaughter. Question 4 Do you agree that the aims of the fine should be to ensure future safety and reflect serious concern at the unnecessary loss of life? Should there be any difference in aim when imposing a fine for corporate manslaughter or for an offence under the HSWA involving death? The Association agree that the aim of imposing a fine should be to ensure future safety and simultaneously reflect the serious concern at the unnecessary loss of life as stated in the case of Howe. We additionally concur with the views expressed in the Balfour Beatty judgement when the court endorsed the statement in Howe that the ultimate objective of a fine for a health and safety offence in the workplace is to achieve a safe environment for employees and the public, through encouraging compliance with the offender s legal duties. These aims are at least as pertinent to an offence under CMA, which will involve a gross breach of an organisation s duty of care, indicating a high degree of culpability. Whilst we support the view that one key aim of imposing a fine should be the elimination of any financial gain or benefit arising from the non-compliance with safety standards, there is a need to 8

9 ensure that imposing a fine for this purpose will not have an adverse effect on the organisation s future ability to improve its safety systems and ensure responsible governance. We agree with the Panel s conclusion that attempts to eliminate any financial benefit from an offence whilst desirable, will not in reality always be achievable. We concur that the court should where available request information calculating any obvious financial gain from the offence. The Association has concluded that the objective of ensuring that the company operates safe working practices in the future, to eradicate the risk of future offences must take priority over the desire to erase the financial benefit from the offence. There will therefore be many instances where a remedial order will be more appropriate then imposing a substantial fine. The aims of a fine should be the same for HSWA offences resulting in death and corporate manslaughter offences. To this end we agree with the aims for imposing a fine, as articulated in the Paper at paragraph 49 with one qualification, namely that we would have four primary aims, the first one being the need to punish the offender and pass a deterrent sentence to dissuade other organisations from committing similar offences. We would additionally include the aims as identified in paragraph 49 as set out below: 1. To reflect serious concern at the consequences of the breach resulting in death; 2. Ensuring good governance of an organisation and an awareness of the need to ensure a safe environment; 3. Lastly, if possible, to eliminate any financial benefit from the offence. However, the Association is firmly of the view that in the vast majority of cases it will not be possible to quantify the financial benefit derived from the offence. In each case the Panel rightly concludes that for HSWA offences resulting in death and corporate manslaughter the court will always consider both the seriousness of the offence and the financial circumstances of the offender, before imposing a fine. Question 5 Do you agree that a fine imposed for an offence of corporate manslaughter or an offence under HSWA involving death should aim to eliminate any financial benefit resulting from the offence? If so, what information would be necessary, and how could this be obtained? The Association agree with the Panel (para 48) that while it is a sound principle that it should not be cheaper to offend than to offend or prevent the commission of an offence, it is unlikely 9

10 to be achievable in every case. Cases where it might be possible would include ones where there is simple causation: for example the failure to provide expensive safety equipment that leads directly to a death that would have been avoided had the safety equipment been provided. However, it is likely that in most cases there is no way of making such a calculation. Most cases of corporate manslaughter and health and safety related deaths involve failings unrelated to cost savings, even if they also involve cost related failings. Cases where there is a clear cost benefit that can be calculated from the offending will generally be evident on their facts. In such cases the prosecution will undoubtedly bring this to the attention of the court, which will give it such weight as it deems appropriate. Question 6 Do you agree with the Panel s proposed starting points and ranges for a) offences of corporate manslaughter and b) offences under the HSWA involving death? If not, what alternative approach would you suggest for the fining of organisations for these offences? The general principles and options The Association agree with the Panel that, when sentencing for offences of corporate manslaughter or offences under the HSWA involving death, a consistent method of calculating the fine to reflect the seriousness of the offence and the financial circumstances of the offender is desirable and that consistency of approach rather than outcome (i.e. quantum) is the aim, as the organisation s ability to pay must be taken into account (Paragraph 50). However, it is respectfully submitted that it ought to be recognised that it is often the case that an organisation s financial circumstances are very different at the time of the offence, as opposed to at the time of sentence (particularly as prosecutions often take years to conclude). An organisation s financial circumstances at the time of the offence are relevant to culpability and seriousness, but irrelevant to its ability to pay a fine. Whereas, an organisation s financial circumstances at the time of sentence are relevant to its ability to pay a fine, but irrelevant to culpability and seriousness. It is respectfully submitted that the distinction is an important one and experience suggests that such a distinction has often not been made in the past. Failure to recognise the distinction may result in inappropriately low/high fines. We also agree with the Panel that the optimal penalties model is ill-suited to the sentencing of these two types of offences. Models and methods that are suited to offences relating to 10

11 breaches of environmental, financial services and anti-competition legislation are unhelpful (See below). In particular, as is acknowledged by the Panel, it is not possible to incorporate a financial measure of the value of human life (Paragraph 44). For similar reasons, we also agree with the Panel that the US Federal Sentencing Commission s organisational guidelines are ill-suited to the sentencing of these offences. In particular, we agree that the guidelines would leave little room for judicial discretion and lead to undue rigidity (Paragraph 53), neither of which is appropriate in these circumstances or compatible with the way sentencing is carried out in England and Wales. It is also worthy of note that offences committed by organisations under the HSWA are ones of strict liability; the concepts of intentionally, knowingly or recklessly are irrelevant (Paragraph 52). Is turnover (or profit) the correct measure? Turning to the concept of a fine being expressed as a percentage of turnover or profit, we agree with the Panel that fines should be devised to have an equal economic impact on organisations of different sizes (Paragraph 55). However, we do not agree that either turnover or profit is the appropriate means by which to ascertain an organisation s ability to pay in order to achieve such equality. Turnover, as the Panel acknowledges, is the aggregate of all sums of money received by an organisation during the course of its business (whether a private company, charity or public body) over an annual period (Paragraph 57). Although turnover does compare somewhat loosely with the income of an individual, we do not accept that it is its equivalent. For example, an organisation incurs operating costs / costs of sales, which are not accounted for in the turnover figure and in relation to which there is no equivalent so far as an individual is concerned. In addition, although we accept that broadly speaking the income of an individual is typically the primary measure used to assess an individual offender s ability to pay a fine (Paragraph 57), it is important to note that the calculation of an individual s ability to pay a fine and the resultant fine is a complex process involving the consideration of various factors, whether directly or indirectly; it is not just a percentage of income. In that regard, we note that section 164(3) of the Criminal Justice Act 2003 states: In fixing the amount of any fine to be imposed on an offender (whether an individual or other person), a court must take into account the circumstances of the case including, among other things, the financial circumstances of the offender so far as they are known, or appear, to the court. (Emphasis added) Our experience is that, in practice, the financial circumstances of an offender that are taken into account can be more accurately equated to disposable income, after deductions for tax, living expenses, dependant s expenses, loan repayments, etc. As the Panel are no doubt 11

12 aware, this is supported by the current Magistrates Court Sentencing Guidelines, which make it clear that, in relation to assessing the offender s financial circumstances, the relevant starting point is the offender s weekly take home pay. The guidelines also recognise that the statutory limits or levels take into account ordinary living expenses and go on to acknowledge that every offender s means must be individually considered and that the court should also be aware of other information including level of outgoings, whether the offender has savings or other disposable or realisable capital assets or liability to pay outstanding fines. It is also interesting to note that the recent advice from the Panel to the Sentencing Guidelines Council in relation to its review of the Magistrates Court Sentencing Guidelines acknowledges that since 1997 the guidelines have recommended that fines should be determined with reference to the offender s net weekly income. In that report, the Panel also identified savings, debts, expenditure and dependants as other relevant factors and noted that the majority of those who expressed a view following consultation broadly supported an approach based on net weekly income, considering it to be fair, flexible, familiar to sentencers, and most likely to fulfil the court s statutory obligation to have regard to an offender s financial circumstances. The Panel further noted that, overall, there is a desire for a methodology that is not too different from current practice and strongly recommended that the Sentencing Guidelines Council consult more widely than usual in respect of the proposed approach to the assessment of fines and that the amount of deemed relevant income should be a key aspect to be explored in the consultation. The Panel also noted that the advisory group considered that guidance should be provided regarding the relevance of factors such as an offender s outgoings, savings, additional household income, and potential earning capacity and that it was appropriate also to establish an upper limit to ensure that, where an offender is in receipt of a very high income, the fine is not disproportionately high when compared with the seriousness of the offence. This last point is of particular importance. Irrespective of the above, we respectfully submit that the use of turnover would not achieve an equal economic impact on organisations of different sizes (ibid). The significance of the turnover of one organisation can be, and often is, extremely different, depending on the organisation s size and the market in which it operates. For example, a large organisation with a very large turnover, but with small profit margins, could be equally as profitable as a small organisation with a very small turnover, but with large profit margins. Although the turnover represents the money coming into the organisation, it does not necessarily represent the money that is available to be spent on health and safety provisions or to pay a fine. On a preliminary view, profit after tax may be a more appropriate measure and more akin to an individual s take home pay. However, there are similar problems to those set out above, not 12

13 least because many organisations in the ordinary course of business re-categorise or manipulate the profit figures in their statutory accounts. Finally, so far as the reference to the OFT using turnover as a measure when imposing financial penalties is concerned, we submit that it is worth noting that, as mentioned above, models and methods that are suited to offences relating to breaches of environmental, financial services and anti-competition legislation, where breaches often lead to profits, are unhelpful. In particular, we respectfully submit that the OFT s concept of having regard to the the product market and geographic market affected by the infringement (Paragraph 57) is irrelevant to offences of corporate manslaughter or offences under the HSWA involving death. Anti-competitive behaviour can clearly inflate turnover; whereas, experience suggests that, in relation to work-related deaths, there is often no direct link between the circumstances of the death and an increase in turnover. We respectfully submit that offences of corporate manslaughter or offences under the HSWA involving death are materially different to breaches of environmental, financial services and anti-competition legislation. In the light of the above, we respectfully disagree with the Panel s assertion that annual turnover is the most appropriate measure of an organisation s ability to pay a fine. We are of the view that the use of turnover (or, indeed, profit) as a measure is too crude and inexact, and is unlikely to achieve an equal economic impact on organisations of different sizes or with different business profiles. In addition, we doubt that the opportunity for the prosecution or the defence to provide evidence of particularly high profitability or low liquidity respectively would be sufficient to address the concerns that we have set out above. It may be that a business analyst or an expert in the valuation of an organisation would be best suited to identifying the most appropriate means by which to assess the financial circumstances of an organisation. Separate starting points and ranges So far as separate starting points and ranges are concerned, we take the view that it would be preferable for there to be one starting point and one range, with the rebuttable presumption being that offences of corporate manslaughter would ordinarily feature at the top of the range. In that regard, we respectfully submit that it ought to be borne in mind that each work-related death is entirely facts-specific and very different from the next; it is not inconceivable that an offence under the HSWA involving death could be far more serious than an offence of corporate manslaughter, and we note that the Panel acknowledges that there is a potential overlap between the two types of offences (Paragraph 16). Furthermore, it may be worth bearing in mind that there may be instances where it is not in the public interest to prosecute or where the DPP refuses to give consent to a prosecution. 13

14 Question 7 Do you agree that it is for the prosecution and the defence to raise issues of profitability and liquidity? What impact should these factors have on the calculation of the fine? Whatever measure is used in order to assess the organisation s financial circumstances, the Association agree that it is appropriate for the prosecution or the defence to be able to raise issues of profitability and liquidity with the court, particularly bearing in mind the issues that we have identified in our response to Question 6. However, it is important that any such representations are put forward on a sound evidential basis, rather than merely speculative, to avoid the other side being put to unnecessary expense in rebuttal. Upon the finding of the court as to the true position relating to profitability or liquidity, we respectfully submit that the court ought to take account of the same and adjust the fine accordingly. However, in order to ensure that the public and third parties appreciate the effect of the concepts of equal economic impact and consistency of approach, it may be preferable for the court, when passing sentence, to set out what the fine would have been, before making any adjustment; with the same being set out in the publicity resulting from any publicity order. Question 8 Do you consider that there should be a minimum fine for a) offences of corporate manslaughter and b) offences under the HSWA involving death? If so, what amount do you think would be appropriate? The Association do not agree that there should be a minimum fine for either offences of corporate manslaughter or offences under the HSWA involving death. Such a concept is contrary to the general principles and practice of sentencing and would, using the Panel s words, leave little room for judicial discretion and lead to undue rigidity (Paragraph 53). It would be particularly troublesome in relation to cases where the offending organisation was either a public body or impecunious, where the effect of a conviction alone would be significant. It is respectfully submitted that it is also worth bearing in mind, particularly in relation to offences under the HSWA, that the fact that a death occurred can be more due to chance rather than the seriousness of the breach. As mentioned above, each case needs to be 14

15 viewed on its own facts. Also, as mentioned elsewhere in this response, we do not accept that a distinction between the two types of offences is warranted. In addition, we respectfully submit that the desire expressed by the Panel to ensure that the harm involved in such offences is properly reflected in sentence (Paragraph 63) could equally be achieved by the court, when passing sentence, setting out what the fine would have been, before making any adjustment, with the same being set out in the publicity resulting from any publicity order. Again, in order that the public and third parties can appreciate the effect of the concepts of equal economic impact and consistency of approach, and to address the situation where prosecutors during the sentencing process make reference to previous first instance sentences, we respectfully submit that it would be extremely beneficial if the entire calculation (including the position before any reductions/increases) was set out expressly both by the court and in any publicity resulting from any publicity order. Question 9 Do you consider that a report on each offender should be prepared for the court with the full details of financial status? If so, how would this be provided? Bearing in mind our response to Question 6, it may be more appropriate for further consultation to be undertaken once the position in relation to the measure that will be used when assessing an organisation s financial circumstances has been finalised. Nonetheless, if the measure is to be something as straightforward as turnover, there seems little point in a court being provided with a form of pre-sentence report setting out the full details of the organisation s financial status. In the absence of representations by the prosecution or the defence, a court would only need the relevant figure in order to pass the appropriate sentence. In such circumstances, the provision of full details would be otiose and would lead to unnecessary delay and unnecessary costs being incurred by the defence. However, as is currently the case, if the relevant figure was unrepresentative, the prosecution or the defence could make representations to the court or provide further information, with the other side being given the opportunity to respond. (Again, as mentioned above in our response to Question 7, such representations must be put forward on a sound evidential basis.) In that regard, bearing in mind the Panel s suggestion that the expense of the preparation of a form of pre-sentence report should be borne by the defence, it is worth noting 15

16 that a convicted organisation would also be liable to an order to pay the prosecution s costs, as well as being responsible for its own costs. Question 10 Do you agree with the Panel s approach to the impact of the fine on the offender, its employees, customers and shareholders? If not, why not? The Panel proposes (para 74) that the fine is sufficient to have the required impact, in most cases without imperilling either the existence of the organisation or the funds necessary to remedy defective systems. They highlight the dangers of the deterrence trap (para 66), a fine set so high as to make it difficult or impossible for the organisation to effect improvements to health and safety, and the spill-over effect (paras 67 70), of reduced staffing budgets, increased cost to consumers, unfairly penalising uninvolved shareholders, or imperilling the commercial survival of the company. The Association agrees that these are all factors that the court should take into account in setting the fine level. They are factors that will turn on the circumstances of each case and they are therefore only factors that a court can be encouraged to take into account in appropriate cases. Since they are factors that are likely to reduce the level of the fine it is to be expected that they will be brought to the court s attention by the defence in mitigation. The defence will therefore have the burden of demonstrating both that the factors apply and what effect they are likely to have on the defendant company. Of the factors referred to, the Association are least persuaded by the relevance of the interests of shareholders. By investing in a company, a shareholder takes a calculated risk on the fortunes of the company. That calculation can include consideration of the company s exposure to prosecution for corporate manslaughter and health and safety related deaths. Moreover, the Association are not aware of evidence that suggests a link between fine levels and share prices. Question 11 Do you agree that the court should treat offenders consistently, whether or not they are publicly funded or providing a public service? If not, how do you think the considerations specific to public bodies should be reflected? The Association agree that where the defendant is either a public body or is providing what is considered to be a public service, special considerations may apply. Examples provided in 16

17 the consultation paper are of rail disasters, but the recent case of Southampton NHS trust, which was fined only 100,000 also serves to illustrate the issue. For public bodies, such as the NHS, the argument for reducing the fine is clear: any fine imposed simply represents circulation of public money and any consequent budgetary shortfall either results in a reduction in public service or in the need to make good the shortfall with further public money. The argument in relation to private entities providing a quasi public service turns on the circumstances in each case. In most cases it would be appropriate to consider the factors outlined under question 10 above, rather than affording them special status. With the exception of railway companies (both rolling stock and infrastructure) it is hard to think of many examples where the company provides a quasi public service to the extent that special considerations should apply. Where a court considers that special consideration should be given on account of the organisation being a public body, the Association consider that the following approach should be taken. The starting point should be for the court to establish the level of fine that would be imposed were it not for the fact of its public status. This calculation should therefore apply all the other sentencing factors relevant to the case. The fine can then be reduced to reflect the organisation s public status. This approach would enable the true fine level to be publicised as part of the Publicity Order, along with an explanation of the reasons for the fine being reduced. The association consider that this would provide an appropriate balance between the need to reflect the true seriousness of the offence in the level of the fine, and preventing the senseless circulation of public money. It is possible that, given the financial circumstances specific to public bodies, special consideration might be required in determining both the type of publicity that is ordered and whether the cost of this should be deducted from any fine imposed. Question 12 Do you agree that, when sentencing an organisation for an offence of corporate manslaughter, the court should impose a publicity order? The Association considers the imposition of a publicity order to be a valuable tool when sentencing an organisation for an offence of corporate manslaughter. We consider that publicity orders will have the deterrent effect envisaged by the Panel. As the Consultation 17

18 Paper notes, most cases of corporate manslaughter are likely to attract publicity in any event. The larger the company, the greater the likely publicity. Therefore, the Association agrees with the more focussed approach envisaged by the Panel which will mean that news of the conviction would reach the appropriate and relevant audience. This will be more important in cases where smaller companies are convicted of the offence, attracting less publicity. The Association agrees that the option of a publicity order also gives the courts an additional tool in sentencing convicted organisations in situations where the court has reduced the fine due to the organisation s financial circumstances, where the organisation has a poor record of compliance with the law (because, in those circumstances a publicity order may increase the pressure on an organisation to comply) and where it is considered that new coverage is likely to be insufficient. The Association considers a publicity order in the first of these situations (where an organisation lacks the financial means to pay a fine which would otherwise be deemed appropriate or where, for example, the organisation is a public body and the fine is lower to avoid the recycling of public money) to be particularly useful in explaining to the public why the organisation has received a lower fine than would otherwise be the case. The Association does not agree that the imposition of publicity orders in every case would have a desensitising effect bearing in mind the Government is not anticipating many prosecutions and agrees with the Panel s provisional view that a publicity order should be imposed in every case where an organisation is convicted of corporate manslaughter. In those cases where the offender is providing a local public service in relation to which the public cannot exercise choice, the Association nevertheless believes that a publicity order should be imposed particularly in light of the fact that public bodies will often face lower fines because of the fact that they are public bodies for the reasons set out in our response to Question 11. This is something that the Association believes could and should be explained in a publicity order. Furthermore, if the guidelines were different in relation to those providing a public service, it would lead to allegations of double standards and inconsistency. Whilst clearly it would not have the same impact in terms of its effect in relation to that offender versus its competitors (although the Association believes that people do exercise some choice in relation to public services even if not to the same degree as in the private sector), the Association considers that it would maintain pressure on those managing the organisation to adhere to proper standards. Finally, the Association refers to its introductory remarks concerning the practical issues which are likely to arise upon the imposition of a publicity order and reiterates its view that 18

19 courts should be given guidance to ensure that publicity orders do not become an advertising opportunity for the organisation concerned but rather achieve their proper aim. Question 13 What should the extent of the publicity be and how (if at all) will this differ between offences of corporate manslaughter? The Association agrees that a wide range of options should be available to courts in making a publicity order. In respect of large organisations, the Association agrees that publication in the national press is appropriate whereas clearly that would not be appropriate for smaller organisations. The publicity should reach the target audience. So, for example, it should reach the customers and shareholders and anyone else who could legitimately be expected to be concerned with the organisation. Therefore use of notice to shareholders, letters to customers etc. will be important. The Association considers that prominent publication on an organisation s website will be an increasingly strong deterrent, as the internet becomes the first port of call for many. Question 14 Do you agree that the making of a publicity order should not lead to a reduction in the level of fine imposed on an organisation for an offence of corporate manslaughter? The organisation does not agree that the direct costs to the offender of placing an advertisement are always likely to be small. For instance, if an organisation were required to take out an advertisement in a prime time television slot, this could cost many thousands of pounds. A large advertisement in a national newspaper will not be an insignificant cost to many organisations. These costs are quantifiable and the Association believes that as long as the costs of a publicity order are quantifiable, they should be taken into consideration when imposing the ultimate fine. However, as identified by the Panel, it will usually be impossible to calculate or estimate the indirect costs for an organisation associated with complying with a publicity order. Consequently taking the indirect costs of publicity orders into account in determining level of fine would be an impossible and arbitrary task and risk unfairness and inconsistency in sentencing. 19

20 Furthermore, it would lead to an inconsistency of approach in sentencing for corporate manslaughter offences as compared to health and safety offences. Given that these may overlap, any inconsistency is clearly undesirable. Paragraphs 42 and 43 of the Enforcement Policy Statement of the Health and Safety Commission, which all local authority and HSE staff who take enforcement decisions are required to follow, refers specifically to publicity both at the start and conclusion of a case. This requires those enforcing to publicise the names of all the companies and individuals who have been convicted in the previous 12 months of breaking health and safety law as well as making publicly available information on convictions and on improvement and prohibition notices which have been issued. The policy goes on to require that consideration be given to any conviction which could serve to draw attention to the need to comply with health and safety requirements, or deter anyone tempted to disregard their duties under health and safety law. [ ] There is no suggestion that indirect costs of publicity associated with a conviction for a health and safety offence should impact on the level of fine imposed. For these reasons, the Association agrees that the making of a publicity order should not other than in respect of any direct costs associated with them - lead to a reduction in the level of the fine. Question 15 Do you agree that the making of a remedial order should not lead to a reduction in the level of fine imposed on an organisation for an offence of corporate manslaughter or an offence under the HSWA involving death? The Association agrees that the making of a remedial order should not lead to a reduction in the level of fine imposed, for the reasons given by the Panel. As the Panel sets out, by the time an organisation is sentenced for an offence, the regulatory authorities will, in the majority of cases, have taken any action required. Furthermore a remedial order simply requires compliance with the law. Therefore it would be wholly wrong for the level of fine to be adjusted in those circumstances. Finally, as with publicity orders, altering the level of fine where a remedial order is imposed would lead to inconsistency with the approach taken by the HSE. 20