Posts Tagged ‘Bottom Line’

New sentencing guidelines have been brought in for prosecution under the new Corporate Manslaughter and Health & Safety Offences causing death on Tuesday 27th October 2009.

In short, where a serious form of harm or where a death at work occurs, which can be attributable to a failure of the organisations risk management protocols and procedures, a company is looking at a minimum fine of no less than £500,000.00, and possibly an even higher fine of 2.5 per cent to 10 per cent of its annual turnover over the previous three tear period.

The bottom line baseline fine, for a first time offender (an organisation not an individual) pleading not guilty, is very likely to be 5 per cent of the organisations average annual turnover during the three years prior to sentencing.

After taking into account any mitigating factors, the Court would then arrive at a fine that will fall within the range of 2.5 to 10 per cent of the companies average annual turnover over the previous three years.

In addition, a minimum level of fine has also been set which a fine would not fall below. It has been proposed that this minimum fine would be no less than £500,000.00.The Sentencing Council, who published these guidelines on Tuesday the 27th October, stated that: ‘whilst the effect on employment of the “innocent” may be a relevant factor, the effect on shareholders, directors and prices will NOT be considered relevant’.

In short, where a serious form of harm or where a death at work occurs, which can be attributable to a failure of the organisations risk management protocols and procedures, a company is looking at a minimum fine of no less than £500,000.00, and possibly an even higher fine of 2.5 per cent to 10 per cent of its annual turnover over the previous three tear period.

This is in addition to any other proceeding that may be taken against individual directors or members of senior management who may be held responsible for the breach that caused the harm or death. You can view the Sentencing Consultation Guidelines at: http://www.sentencing-guidelines.gov.uk/Report