Member Article

A new Act which comes into force on 16 January 2009 imposes serious new penalties for directors, employers and employees who are convicted of a health and safety offence.

The Bill received Royal Assent on 16 October 2008 and unlike the Corporate Manslaughter and Corporate Homicide Act, this has had a relatively easy journey through the parliamentary stages. The Act entitled Health & Safety (Offences) Act 2008, does not create any new offences, but raises the maximum penalties available to the courts in respect of many health and safety offences, including significantly increased

powers to imprison, by altering the penalty framework set out in the Health and Safety at Work etc Act 1974.

At present, the majority of breaches of the Health and Safety at Work etc Act 1974 are only punishable by way of financial penalty. The proposals under the new Act are that most offences, including a breach of section 2, 3, 7, 37 or any of the regualtions made under the Health and Safety at Work etc Act, will also carry a sentence of a term of imprisonment of 12 months for a conviction in the Magistrates Court and 2 years for conviction in the Crown Court. The Act will increase the maximum penalty available in the Magistrates Court to £20,000 for most health and safety offences. The Sentencing Advisory Panel has already consulted upon sentences for the new Corporate Manslaughter and Corporate Homicide Act 2007 and the Sentencing Guidelines Council will be asked to update its guidelines to ensure that the courts have up-to-date advice once this new Act comes into force.

All employers owe a duty of care to their staff in the workplace which means they have to do all that they  reasonably can to protect their employees’ health and safety at work. This duty extends to protecting employees’ mental health and employers who fail to do so can be liable for unlimited damages for psychiatric injury. With depression expected to be the second leading cause of disability world wide by 2020, occupational stress is a topical and important issue to address. A recent and important Court of Appeal decision, Dickins v O2, has rejected previous judicial guidance which allowed for damages for psychiatric injury to be reduced in relation to stress which had its cause outside of the workplace.

It has now been suggested that psychiatric injury is truly undividable. Where an employer has been found liable for causing occupational stress and this accounts for more than a minor contribution to the claimant’s psychiatric injury, the employer will be liable for the whole injury, rather than just a part.

In the Dickins case Ms Dickins made repeated requests to her employer for a change in her role, or to be moved into a less stressful position. In March 2002 she was told there were no such roles currently available and that the matter would be reviewed in three months. By April 2002 Ms Dickins had became increasingly stressed and she requested a six month sabbatical from work. She was told her request for a sabbatical would be assessed and was referred to her employers counselling helpline. A month later she repeated her concerns and was eventually referred to an occupational health specialist, but prior to any appointment Mrs Dickins suffered a breakdown and was unable to return to work.

In an earlier Court of Appeal case, Hatton v Sutherland, the Court suggested that if an employer made available a form of confidential counselling service (such as the counselling helpline in this case), it would be difficult for them to be found to have breached their duty of care. However recent case law has dispelled this notion and found that such services are insufficient in discharging an employer’s duty in its entirety.

It has always has been the employer’s duty to monitor the stresses of employees and to recognise when an employee is becoming unable to handle the normal stresses of the job - it has a positive duty to take steps to identify and address employees’ concerns. Following the judgment in Dickins v O2 it is now absolutely clear that speed is of the essence and employers must act as soon as they are aware of problems to ensure compliance with their duty of care. Employers who get it wrong face will now face a potentially much larger bill for damages where an employee suffers illness as a result of stress in the workplace. It is  therefore essential that employers take seriously tell tale signs of stress, anxiety and depression from their employees. If you need any further guidance on stress in the workplace and how it may affect you as an employer please contact either Ron Reid in the Regulatory team, or Peter Duff in our Employment team.

Following a serious accident or fatality in the workplace, an organisation will no doubt want to carry out an internal investigation to try to ascertain the root causes and prevent future accidents. The conclusion of an internal investigation will most likely highlight failings of the organisation of some sort. Any enthusiastic enforcement officer will be very keen to get their hands on the content of this investigation, and has the power to order the organisation to hand over such information, providing it is not legally privileged.

Legal privilege is a form of protection preventing the enforcement officer discovering the content of written or verbal instructions, advice or opinion, between an organisation and its solicitor. There has previously been some uncertainty as to the extent that internal investigation reports, submitted to a client’s law firm, qualify for the status of legal privilege. The recent decision in West London Pipeline and Storage and another v Total UK Ltd, a Queens Bench decision, has laid down further guidelines for this. This case relates to a civil claim, but has important implications for both civil and criminal actions. The decision established that only if the primary purpose of the report was to instruct the company’s solicitors would the document qualify for legal privilege. The key principle in establishing whether the document was privileged or not seems to be whether it was prepared to meet an explicit statutory requirement or had been prepared for another purpose.

In this case the relevant regulation was the Control of Major Accident Hazard Regulations 1999 (COMAH). The claimant alleged that there was a duty to report the findings of the investigation and, in fact, meeting that duty was the primary purpose of the report. If that had been the case, then legal privilege could not be claimed. However, the defendants stated that the primary purpose of the report had been to give a complete account of the incident to their solicitors in order that they could fully prepare for any subsequent litigation.

The courts held that whilst there might be an implied duty to report under COMAH, there is no explicit duty, and the report could well attract legal privilege if the primary purpose of the report was to instruct the solicitor. Clearly, companies at risk of proceedings need to be fully aware of the key purpose of any reports regarding an investigation to ensure that they are protected by the principle of legal privilege. In order to argue successfully that a report attracts legal privilege, a company will need to prove that they contacted and instructed their solicitors at the earliest opportunity, and that the report was prepared on their advice.

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