Sentencing for health and safety offences – how judges retain considerable discretion

The Guideline sought to implement a fair, proportionate and consistent approach to sentencing. This article explores some of the key cases where the courts have grappled with implementing the Guideline and the significance of judicial discretion, which can make predicting fines in this area particularly difficult.

Liam Jagger: "Appeal courts remain reluctant to interfere with a sentencing judge’s decision."

The Guideline was developed partly in response to continued public disquiet that sentences imposed on organisations and individuals for the most serious offences of this type had been too low. The tariff-based structure, with specific starting points and ranges, follows a stepped process and gives sentencing judges a framework for making their decisions. Some of those steps have provided fertile ground for deliberation between the defence and prosecution over recent years as the outcome can significantly affect the ultimate level of fine.

The first step in the sentencing process involves an assessment of the overall seriousness of the offence (the ‘offence category’), by reference to the degree of culpability and risk of harm, as opposed to actual harm caused. This gives the sentencing judge a starting point and range of possible fines.

Moving from one offence category to another can result in a significant shift in the starting point and range of fine suggested. For example, for a ‘Large Organisation’ (defined in the Guideline as those with a turnover or equivalent of £50 million or more), the starting point for an offence with high culpability, harm category 1 is £2.4 million with a range of between £1.5 to £6 million; whereas the starting point for a medium culpability, harm category 1 offence is £1.3 million with a range of £800,000 to £3.25 million.

Determination of the offence category is therefore extremely important and can lead to extensive negotiation between the parties. Ultimately, however, the decision rests with the sentencing judge who is not bound by any agreement that may have been reached between the parties. In the 2022 case of R v CMB Supply Ltd (formerly Carlsberg Supply Company UK Ltd), although the parties agreed that the level of culpability was high, they disagreed on where it sat within that bracket and on the likelihood of harm as a result. For a ‘Large Organisation’ such as Carlsberg, the distinction meant a difference of over £1 million on sentencing starting points and of over £3 million in the range of potential fines.

The court determined that the case fell within harm category 1 and a fine of £3 million was subsequently imposed.

Starting points and ranges

Different starting points and ranges apply depending on the size of the organisation, determined by reference to annual turnover or equivalent. For example, ‘Large Organisations’ face fines with a starting point of £4 million and a range of £2.6 million to £10 million on conviction for the most serious breaches of health and safety legislation (being very high culpability, harm category 1). In comparison, a ‘Micro Organisation’ (those with a turnover of less than £2 million) convicted of a similar offence would face a starting point of £250,000 and a range of £150,000 to £450,000.

The judge is not bound by any agreement that may have been reached between the parties. Photograph: iStock

Even larger fines are possible where an offending organisation’s turnover or equivalent very greatly exceeds £50 million, with the Guideline providing that: “Where an offending organisation’s turnover or equivalent very greatly exceeds the threshold for large organisations, it may be necessary to move outside the suggested range to achieve a proportionate sentence.”

Quite what amounts to turnover which “very greatly exceeds the threshold for large organisations” has been the subject of considerable debate but there remains no clear judicial guidance on what that threshold looks like in practice. In sentencing Places for People Homes Ltd in 2021, the Court of Appeal confirmed that there is no “bright dividing line” between ‘Large’ and ‘Very Large’ organisations but said that in most cases, it should be “obvious”. Whilst that may be fair comment for organisations with turnovers exceeding £1 billion, it can be far from ‘obvious’ in many other cases.

It is interesting to note that in the Places for People Homes case, with a turnover of £290 million (and assets totalling more than £3 billion), Places for People Homes was sentenced as a Very Large Organisation whilst in the same year, despite having a turnover of more than £200 million, WH Malcolm Ltd was sentenced as a Large Organisation.

This may suggest that the tipping point, if there is one, could be around the £250 million mark. However, that is by no means certain; Places for People Homes’ extensive asset portfolio may well have had a significant impact upon the court’s decision to sentence it as a Very Large Organisation, thereby demonstrating the fact-sensitive nature of each case.

The Guideline makes it clear that there is no obligation to move beyond the table for Large Organisations when sentencing a Very Large Organisation. The decision to do so, or not, will depend on the sentencing judge’s assessment of the facts, bearing in mind the need to achieve a proportionate sentence. This can make it difficult to identify consistent themes in their sentencing. For example, some sentencing judges have decided that despite an offending organisation’s turnover putting them in the Very Large category, the table applicable for Large Organisations should still be applied.

However, in other such cases, the sentencing judge has doubled the starting point, moved beyond or to the top of the range for a Large Organisation or even moved up one or, on at least one occasion, two harm categories altogether.

Considerable discretion of sentencing judge

While there is undoubtedly merit in retaining flexibility in sentencing, and not applying the Guideline in a rigid or mechanistic way, the lack of real guidance on this point makes it difficult to predict the approach a sentencing judge will take in any given case. However, it does illustrate the extensive scope of options available on sentencing, and the considerable discretion the sentencing judge retains.

The sentencing of Northern Gas Networks Ltd following a fatal gas explosion illustrates this discretion. Gas had leaked from a faulty pipe causing an explosion. One person died and a care home had to be evacuated. On sentencing Northern Gas Networks Ltd following a guilty plea, the sentencing judge held that the offence was of medium to high culpability, harm category 1, which for a Large Organisation produced a starting point for a fine of £2.4 million with a range of between £1.5 to £6 million.

The sentencing judge considered that with a turnover of £400 million Northern Gas Networks Ltd was a Very Large Organisation and increased the starting point to £7.5 million. After taking account of the company’s guilty plea, the ultimate fine was reduced to £5 million.

Northern Gas Networks Ltd appealed. Several grounds of appeal were advanced, including that the sentencing judge had erred in determining the offence was of high culpability, harm category 1, that he had not set out how he arrived at the starting point of £7.5 million and he should have “given a clear view as to how he has arrived at the figure”.

All grounds were rejected, and the Court of Appeal was reluctant to interfere with the sentencing judge’s decision. In particular, it held that although the sentencing judge’s remarks were succinct, “he did set out reasoning and explained how the sentence was arrived at. He took into account the need to make it proportionate, sufficiently substantial to have a real economic impact which will bring home to both management and shareholders the need to comply with health and safety legislation. We consider that the Judge applied all of those factors appropriately. There was no need for him to set out arithmetic.”

The Court of Appeal’s reluctance to interfere with the sentencing judge’s decision reflects a position taken in previous appeals, including that of Tata Steel UK Ltd in 2017.

Aggravating or mitigating factors

The range of circumstances which may be considered as aggravation and mitigation has also provoked discussion.

The Guideline provides a non-exhaustive list of factors which leaves it open to the sentencing judge to consider “other relevant factors”. What these may be will depend on the facts of each case. However, it is interesting to note the 2021 sentencing of WH Malcolm Ltd, following the company’s conviction for health and safety failings which led to the death of a child. While previous relevant convictions are expressly included in the Guideline’s list of Aggravating Factors, in that case the sentencing judge (confirmed on appeal) expanded this to consider not only convictions but the company’s general enforcement history. The sentencing judge was of the view this demonstrated a pattern of failures in safety management and increased the starting point of the fine.

For Mitigating Factors too there is considerable discretion and whilst cooperation is expressly included, what this looks like in practice may be trickier to predict. For example, in the Northern Gas Networks case mentioned above, waiving privilege to share an investigation report with the regulator did not make the cut as it had not in fact advanced the regulator’s knowledge.

The Guideline was introduced to ensure fines for health and safety failings are “fair and proportionate to the seriousness of the offence and the means of the offender” and to ensure a consistent approach to sentencing. While there is little doubt that its aim of increasing fines for serious and systemic failure is being met, uncertainty remains. Notwithstanding the structured framework provided by the Guideline for duty holders, their lawyers and the courts, the sentencing judge still has a very wide-ranging discretion on sentencing which makes predicting the level of fine extremely tricky.

What is clear is that the trend for increasingly hefty fines for the most egregious health and safety failings shows no sign of abating and appeal courts remain reluctant to interfere with a sentencing judge’s decision.

Health and Safety Offences, Corporate Manslaughter and Food Safety and Hygiene Offences Definitive Guideline can be found here

Liam Jagger is an associate at Pinsent Masons law firm. Contact him at:
pinsentmasons.com
[email protected]