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Medium-sized merchants in Health & Safety fines warning

The Impact of the Health and Safety Sentencing Guidelines 1 Year On from Southalls on Vimeo.

Builders’ merchants are at increasing risk of significant Health and Safety fines following last year’s changed H&S guidelines, especially those merchants turning over between £10m and £50m a year.

That’s the new warning from specialist Health and Safety consultancy Southalls and international law firm Gowling WLG.

Since the new guidelines were introduced a year ago, there have been an unprecedented number of sanctions and fines for breaching the Health and Safety at Work Act etc (1974). It has now become commonplace to see fines of more than £1m for non-fatal cases for example, which previously would have been dealt with in a magistrates’ court.

Andrew Litchfield, partner, Gowling WLG, says: “A major factor in the size of these sentences is the turnover of the defendant organisation. What we’re seeing currently is a disproportionate effect on medium sized organisations, rather than those with a turnover of excess of £50m for example.

“For very large organisations the sentencing guidelines do not include sentencing tables, and we have yet to see commensurate fines for the largest businesses. The highest industry fine so far was to UK leading builders’ merchant Travis Perkins for £2 million after the death of a customer in Milton Keynes – this may well encourage the Courts to set even higher penalties.

He continues: “The purpose of the sentencing is to remind offending business owners and shareholders that they simply cannot break health and safety legislation – it’s got to hurt, that’s the point of the sentence. It is our belief that it is only a matter of time before we see fines in excess of £10m.”

Many more individuals are also being investigated and prosecuted far more frequently for Health and Safety offences. According to an IOSH report published last month, ‘in 2015-2016, 46 company directors and senior manager were prosecuted under health and safety law, compared to an annual average of 24 in the five previous years’.

The intention of the new sentencing Health and Safety guidelines is to make sentencing more transparent; judges have a series of steps they must follow to arrive at the ultimate sentence. As it is possible for businesses to see which category they fall into based on their turnover, they can then work out what a possible fine may look like. The logical decision therefore, is for businesses to invest time and funds up front reviewing their procedures to prevent an incident occurring.

John Southall, director, Southalls adds: “When you are putting in possible outcomes in a risk assessment, say the risk of injury, if you err on the side of caution and state that an outcome is ‘death’ from falling down the stairs. If the HSE investigate the incident, you may be setting yourself up for a significant fine. It’s very difficult to argue that you’re not in Harm Category 1 according to the guidelines, if your own risk assessment contains that conclusion.

Andrew Litchfield continues: “Risk assessment and safe system of work documents therefore, must reduce risk and help to prevent the accident happening in the first place. They must be practical and realistic too. Culpability is important here, making sure the control measures are actually being followed through properly.

“If you can show that you have discharged that duty and that you are working towards a recognised industry standard then that’s even better. Failing to respond to complaints or near misses would put a business in the higher culpability bracket. If unsure you must seek professional guidance.

“Businesses must review the systems they have in place to identify and manage risk. Do they accurately reflect current business practice and are they being operated on the ground? Prevention is going to be far less costly than trying to deal with it once it has gone wrong.”

With builders’ merchants having to manage far more health and safety issues than most other retailers, the importance of full compliance is particularly important for both companies and individuals.

About Fiona Russell-Horne

Fiona Russell-Horne
Group Managing Editor across the BMJ portfolio.

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