This includes 19 fines of £1m or more, compared with three in 2015 and none in 2014, according to a report compiled by the Institution of Occupational Safety and Health and law firm Osborne Clarke (Health and safety sentencing guidelines one year on).
The largest fine, £5m, was imposed on Merlin Attractions Operations after the Smiler crash at its Alton Towers theme park in which five people were seriously injured, two of them requiring life-changing surgery.
Another three of the £1m-plus fines were for more than £3m.
Previously large fines were only issued for disasters involving fatalities such as rail crashes or the Buncefield fire, but the new guidelines and judgments reflect growing disapproval of serious corporate failures that lead to injury and illness, as well as death.
“Prospect welcomes the tougher sentencing,” said Sarah Page, Prospect research officer.
“The deregulation of health and safety in recent years, under-resourcing of the Health and Safety Executive and political interference that has stymied HSE’s proactivity have compromised the regulator’s potency. Fines that now have the potential to ‘hurt’ a business provide a new incentive for compliance.”
According to the report, the largest 20 fines imposed in 2016 amounted to £38.6m and exceeded the total of all 660 preceding successful HSE prosecutions brought in 2015-16 (£38.3m).
“It seems that penalties are finally starting to have the economic impact required to bring home to directors and shareholders the need to meet their health and safety duties,” said Page.
Individuals are under the spotlight and face tougher penalties too, including a greater likelihood of imprisonment where gross negligence is found.
In 2015-16, 46 company directors and senior managers were prosecuted, compared with an annual average of 24 in the previous five years, according to the report.
Prospect is reminding members and potential members of their personal responsibilities.
“Members, such as engineers and authorised personnel, who put people to work need to be aware of the impact of the sentencing guidelines,” said Page.
“We have sought to emphasise to them the need to follow their company protocols or, if they are concerned a procedure is inadequate or flawed, to alert their senior management.
How the fines work
Using the 2016 sentencing guidelines, a court applies a formula to set the penalty, first deciding whether the defendant’s culpability was very high, high, medium or low.
The next factor is a matrix cross-referring the likelihood the safety failing would lead to harm and how bad that harm could have been – from minor injuries to lifelong disability or death.
The judge must also consider how many people were exposed to the risk of harm and whether the safety failing was a significant cause of actual harm before setting a final harm rating of 1 to 4 (with 1 being the highest rating).
The harm rating and culpability assessment are then applied to a series of tables with fine ranges for organisations with different levels of annual turnover.
The fines ranges for prosecutions under the Health and Safety at Work etc. Act 1974 are as follows:
- micro-organisations (turnover less than £2m): £50 to £450,000
- small organisations (turnover between £2m and £10m): £100 to £1.6m
- medium organisations (turnover between £10m and £50m): £1,000 to £4m
- large organisations (turnover of £50m and above): £3,000 to £10m.
For each harm category at each culpability there is a suggested “starting point” fine, ranging from £200 for low culpability, harm level four for a micro-organisation to £4m for a large organisation with very high culpability and harm level one.
Judges can move below these starting points for mitigating circumstances, such as a good safety record and an early guilty plea.
Aggravating factors, such as obstructing an investigation or cost-cutting at the expense of safety, will push the penalty up the scale from the starting point.
A set of separate guidelines for corporate manslaughter offences sets fine ranges from £180,000 to £20m.