• • • SAFETY IN ENGINEERING • • •
No room to hide behind the corporate veil
Whilst most employers are familiar with their non-delegable duties under the Health and Safety at Work Act 1974 – to ensure the health, safety and welfare of employees whilst at work and to ensure that third parties are not adversely affected by their undertaking – culpability under the Act goes further, says Bill Dunkerley, director, regulatory at Pannone Corporate
S
ection 37 states that, “Where an offence under any of the relevant statutory provisions committed by a body corporate is proved to
have been committed with the consent or connivance of, or to have been attributable to any neglect on the part of, any Director, Manager, Secretary or other similar officer of the body corporate or a person who is purporting to act in any such capacity, he as well as the body corporate shall be guilty of that offence and shall be liable to be proceeded against and punished accordingly.” In other words, where a company’s offending
under the Act is found to have been committed with the consent, connivance (tacitly permitting, turning a blind eye to) or neglect of a senior manager, or any person purporting to act in that capacity, that individual is also liable to be prosecuted for, and convicted of, the same offence as the organisation. Although the total number of prosecutions
brought by the HSE is dropping year on year, its recent history has seen a steady increase in the number of individuals prosecuted, and its overall conviction rate remains in excess of 90%. Whilst historically prosecutions may have been
initiated jointly against a company and its senior managers for tactical reasons, and to encourage early consideration of appropriate pleas, recent experience indicates that such strategies may be on the decline, with prosecutions proceeding against individuals for substantive offending.
So who is likely to be considered
a ‘senior manager’? Section 37 is targeted at those who have an active managerial role in directing and controlling the corporate mind. It is not aimed at those who are lower down the corporate hierarchy, or those whose role is to follow the direction of others. Whilst directors and senior managers may have the authority to introduce the policies and procedures to be followed within the organisation, with the possible exception of the smallest of organisations, such clear delineation between roles may be rare especially if senior managers delegate responsibility to others within the business. As such there is often a degree of overlap between roles within a business and a resulting lack of clarity as to the scope and extent of any given individual’s authority within an organisation. In my experience, it is often these discrepancies
and lack of evidence which is relied upon by prosecutors in support of proceedings against
individuals, often resulting in a company and individual defendants seeking to place responsibility on one another as part of a cut- throat defence. Given that the boundaries of responsibility and
authority are often less than clear cut or straightforward, what steps can businesses – and individuals within those businesses – take to future- proof themselves against possible investigation should a regulatory investigation commence?
• Clarify the scope and extent of each individual’s authority and role within both the business and decision-making process. For example, it may be useful to review and update job descriptions, to expressly confirm and detail the limits of each given role within an organisation. Clear reporting lines, visually represented in an organogram, may also assist with this task.
• It is important to ensure that all affected individuals are aware of the role definitions and spheres of influence, to ensure that there is no miscommunication or misunderstandings on a day-to-day basis. For example, where responsibilities are shared or divided, this should be made clear.
• Documentation – it is helpful to have in place a clear procedure as to how decisions in relation to discrete issues are to be made and, if appropriate, who is to sign-off more junior decision-making.
• Ensure that staff training, at all levels of the corporate structure, is up to date to ensure that those with clearly defined areas of responsibility have the relevant skills and experience to fulfil that role.
The objective of section 37 is to associate
criminal liability with, “those who are in a position of real authority, the decision-makers within the company who have both the power and responsibility to decide corporate policy and strategy. It is to catch those responsible for putting proper procedures in place; it is not meant to strike at underlings.”i With such a distinct brief in mind, it’s essential
for any business and senior leadership team to put in place a clear corporate structure that is communicated and understood, to ensure that those in charge are aware of their own liability when facing any potential health and safety breaches. After all, there’s no room to hide behind the corporate veil.
16 ELECTRICAL ENGINEERING • DECEMBER 2021/JANUARY 2022
electricalengineeringmagazine.co.uk
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