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Posted By Robert S Woods
I understand that directors of companies are exempted from certain parts of HASAW 1974 and subsequent legislation. If anyone can supply information or clarify the position I would be grateful.
Bob Woods
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Posted By Dave Daniel
Not true - Directors are actually singled out for special treatment and hold duties over and above those of mere mortal employees - We're talking of proper "Companies House" Directors here though not someone who is merely called a "Director" and has no board membership or shareholding.
Becoming a Company Director is a poisioned chalice as not just the HSE but also the Inland Revenue and Customs & Excise set special store in making you "guilty as charged", and that's before Corporate Killing.....
Dave Daniel
Technical (and Board) Director
Practical Risk Management Ltd
PS - Pass the handcuffs & leg irons!
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Posted By Sean Fraser
Without exception, all employers have to comply with the provisions of HASAWA as described in section (2), as below:
"2. (1) It shall be the duty of every employer to ensure, so far as is reasonably practicable, the health, safety and welfare at work of all his employees.
(2) Without prejudice to the generality of an employer's duty under the preceding subsection, the matters to which that duty extends include in particular
(A) the provision and maintenance of plant and systems of work that are, so far as is reasonably practicable, safe and without risks to health;
(B) arrangements for ensuring, so far as is reasonably practicable, safety and absence of risks to health in connection with the use, handling, storage and transport of articles and substances;
(C) the provision of such information, instruction, training and supervision as is necessary to ensure, so far as is reasonably practicable, the health and safety at work of his employees;
(D) so far as is reasonably practicable as regards any place of work under the employer's control, the maintenance of it in a condition that is safe and without risks to health and the provision and maintenance of means of access to and egress from it that are safe and without such risks;
(E) the provision and maintenance of a working environment for his employees that is, so far as is reasonably practicable, safe, without risks to health, and adequate as regards facilities and arrangements for their welfare at work. "
There is also guidance on the HSE website, under "Managing Health and Safety" in the free leaflets section, specifically -
Directors Responsibilities (HSC booklet)-
http://www.hse.gov.uk/pubns/indg343.pdf
FAQ on Directors Responsibilities -
http://www.hse.gov.uk/pubns/indg343faq.htm
I would also strongly suggest you make reference to the Introduction to Health and Safety booklet on the same website -
http://www.hse.gov.uk/pubns/indg259.pdf
This booklet has a question - "Do H&S laws apply to me" for which the reply is - "Yes. To all business, however small. . ."
There one only one exception criterion relating to number of persons employed and only applies to two specified conditions - employers with less than 5 employees do not require a written policy statement and do not require to record the significant findings of any risk assessment (note, it doesn't exempt the requirement to actually undertake assessments!). As an illustration, a self-employed person is still required to undertake Risk Assessments, although not necessarily required to record the outcomes, assuming they actually act on any findings of course!
A final recommendation is the guidance document "Managing Health and Safety: Five Steps to Health" (from the same source) -
http://www.hse.gov.uk/pubns/indg275.pdf
All you need to know are in the documents recommended - if in doubt, ALWAYS apply it until specifically advised to the contrary, that way you cannot go wrong!
Hope that helps.
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Posted By Sean Fraser
Sorry, title for the final document should have said "Success", not "Health"!
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Posted By Robert S Woods
The question arises from a comment made by the MD of a safety consultancy. He said that company directors were exempt from certain legislation such as the working time directive. He said these exemptions were laid out in the 74 act (obviously not for working time). I've not found them yet.
Bob
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Posted By Paul Leadbetter
The non-application of certain parts of the Working Time Regulations to those such as company directors is covered by Reg 20 of the 1998 Regs - 'unmeasured working time'.
Paul
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Posted By Sean Fraser
John,
I'm afraid you've lost me with your reference to Directors responsibilities report - there is no reference to any exemptions or derogation of obligations and responsibilities in it. It only covered large organisations (>250 employees) and was to establish the extent to which H&S was being directed at board level.
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Posted By David Sinclair
Sean,
Very interesting by Dave might be right in what he says.
S. 2 HSWA duties refer to those of the "Employer", who is generally the company and not its directors.
Under the Companies Act 1985, individual directors have no statutory duties with regard to the health and safety of employees, which is one of the main reasons it has been so difficult to prosecute them.
To add confusion to the question it depends on the type of contract the director has (i.e. whether he has a "contract of service" or a "contract for service") as to what duty he owes to the company and its employees.
You will often find that a director owes more of a duty to shareholders than he does to employees of the company.
If a director is a non-executive director, he may only have section 3 HSWA duties to the company.
Regards.
David
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Posted By Sean Fraser
Dave,
Interesting point and it certainly explains John's reference now. It was interesting to note that the findings were that the maojority of organisations reported H&S being directed at board level, but there was room for further improvement in terms of the extent of application.
I accept that my assumption was that the term director, in particular the Managing Director or CEO or whatever title El Presidente goes under, would be the one considered to be "the employer", but then managers to most extents come under that classification as well (if, for example, they have hire & fire responsibility).
The Controlling Mind, the critical aspect in seeking responsibility for some horrendous incidents in the past, can indeed be considered to be a board composed on individuals, not an individual in their own right.
Let us not forget though that the majority of organisations in the UK (and elsewhere in the 'developed' countries) are SME's, many being micro-businesses. In those cases it is not hard to identify who, rather than what, is the controlling mind. In that case they are directly associated with being the "employer" and as such all obligations and duties will apply. As I mentioned before, only the very small companies can be absolved of the documentary requirements in specified and limited respects - the overall ethos of the Act and attendent Regulations will apply.
At least, that is my interpretation!
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Posted By David Sinclair
Sean,
I agree generally with your interpretation.
However, just because companies report that health and safety is directed from board level, it does not follow that individual directors are responsible or liable for that direction ( I cite P & O Ferries and many other corporate manslaughter investigations).
It is perfectly normal for the "controlling mind" to be the board as a whole, not individual directors.
Moreover, No CEO, Chief Exec or MD should be accepting individual liability for health and safety and he/she should not be a scapegoat if something goes wrong (a point we lawyers, or in my case lawyer to be have been arguing for some time).
Even where you have three or four directors, following an accident, it can be almost impossible to identify one [or more] directors who were responsible/liable, unless the health and safety documentation has been badly drafted so as to point the finger directly at them. This should of course never happen if the H & S practitioner is doing his/her job.
It is certainly a point for discussion, but it appears to me that whether directly employed or contracted as a consultant, a company's health and safety practitioner is under a contractual duty to act in the best interests of the company and its board (unless there is a conflict of interest).
This duty includes protecting the board members [and other officers/managers] from individual prosecution.
Finally, it is worth noting that Executive Directors, who are employees of the company will have the same "vicarious liability" protection as other employees, subject to s. 37 HSWA (which again can be difficult to prove).
Non-executive Directors are unlikely to owe the employees a higher duty of care than is required by s.3 HSWA and Donoghue -v- Stevenson.
Regards.
David
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Posted By Sean Fraser
David,
This is indeed turning into an interesting debate!
I found unsettling the assertion that a duty of the H&S professional, in protecting the organisation against the risk of future prosecution, lies not in the application of best practice and ALARP risk management, but in obfiscating the roles and responsibilities of those who to all intents and purposes are in charge so that they cannot be held to account for their decisions (or lack of them) when safety is compromised or health is harmed. After all, if the largest of organisations makes significant losses and experiences a consequent collapse of shareholder confidence and in turn the share price falls, we know who is most likely to fall on their sword (with or without assistance!). How is it then that the similar acceptance of responsibility for multiple deaths in a single incident is not treated as the same? One for the philosophers and business analysts among us, I suspect.
Putting H&S aside for a moment, how does it compare to the requirements of part II s57 of the Environment Act 1995, where the specific duty of the enforcement authority is to find the person(s) responsible in relation to a polluting incident. These individuals are required to make suitable remediation and failure to do comply within the time limit will lead to prosecution and risk of custodial sentencing - considering that prosecution will probably follow for the event simply having ocurred anyway.
I find it uncomfortable to think that efforts are being made to alleviate the responsibility of individual persons who receive the benefits of their position as an "employer" but are protected against their moral and ethical responsibilities to society and the workforce, when it is known to all and sundry just who is in control and pulls the purse strings. After all, he who pays the piper calls the tune!
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Posted By David Sinclair
Sean,
Interesting, I agree.
My assertion is not that the duty of the H&S professional lies in implementing best practice, clearly it.
My assertion is that the H&S practitioner also has a "contractual" duty to protect the company and its board.
In the case of an employee, this may be duty, which is expressed or impled into their contract of employment. But in the case of a consultant, it is almost certain that the duty will be expressed in the contractor for service.
Unfortunately, it is often forgotten by health and safety practitioners exactly what [contractual and other] duties they owe and to whom.
Gone (sadly) are the days when it was our job simply to improve health and safety within our organisations to the best of our ability, with the resources we were provided.
As the enforcing authorities [and families] increasingly seek individual liability following a fatality or serious accident, I can assure you (from personal experience)that any director or manager in the firing line will look to somebody [anybody] else to take the fall.
In addition, as compensation and legal costs rise, insurance and other organisations are increasingly looking to contractual obligations elsewhere, to avoid paying claims.
I can't make the comparison with the EPA, since I am not well enough versed in the workings of environmental law.
As for alleviating the responsibilities of individuals, lawyers, like H&S practitioners owe a duty to act in the best interests of their clients.
At the end of the day if the only way to get our client [whether company or individual] "off the hook" is to put somebdoy else there instead, I am afraid that is life.
It should be regarded as a lesson for all H&S practitioners however, and one which I have been trying to get accross for years.
Regards.
David
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Posted By Sean Fraser
This is precisely the reason I have been reticent to advocate the proposed Corporate Manslaughter law.
You nailed the issue directly, David - the director(s) will set simply attempt to set up a potential scapegoat for if and when the axe falls, turning H&S not into a challenge but a poisoned chalice, denegrating the issue and all that we as a society have achieved to date. It is a step backwards, not forwards.
Superficially the proposed law is very attractive, but once examined and compared against actual business practices the difficulties in application begin to emerge. For one thing, there are many different types of commercial and public enterprise, with a plethora of cultures within these. Although organisational set-ups and cultures can be identified and described, each organisation is an entity unto itself. Even businesses in the same sector can be run in completely different ways.
The fact is that, as you have said, if the organisation wishes to wriggle out of their present difficulty then they will exploit each and every way of doing it. The purpose of their legal representative is to help them do it. As you and I know, justice is not always served, but I still believe that British justice remains an example that others would do well to emulate. It is an unfortunate side affect of the adversarial system that the "bad guy" may not always lose and the "good guy" triumph. Those of us who have studied law to any extent know that there are depths to legal argument that the headlines cannot portray and reporting cannot convey. It is not until the full facts and deliberations are scrutinised the the reasons for judgements are understandable.
I think that the issue is less to do with hammering an individual and more to do with better enforcement of the existing laws. More legislation is not better legislation - if you are a driver, just think over the last week and count how many times you have seen other drivers blithely chattering on their mobiles. Chances of being accosted, prosecuted and being suitably chastised that they don't do it again? You know the answer.
We tend to think in our profession that the law is a motivator for good behaviour. Wrong. It is only a deterrent against poor behaviours, and only works if there is a chance of being caught and after that, punished. Like the fire triangle, take away any of the 3 elements and the fire is prevented or quickly dies out. Legislation, proceedings and punishment. Take one away, the rest fail. And fail they do.
Directors need to be convinced that good health and safety is good business. Once we get that message across, the legal aspect pales into insignificance. If a director asks "what can I get away with, or get away with not doing" it is fairly evident where their commitment and drive lies! Should we be assisting these efforts? After all, it's your conscience . . .
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Posted By Stuart C
I may be being naive but my understanding is that the controlling mind of the organisation may be the board but may also be CEO's. Enforcing authorities are more regularly issuing notices at this and even Director level under Section 37 of the Act. Even with an explicit declaration within a policy or other document re personal responsibilities it is still possible to establish that individuals in this position are in fact the controlling mind. "If the CEO says something is to be done it gets done, if it is not their priority it rarely becomes the organisations" type of thing.
The difficulty as i understand it in taking leagal action in these situations is that these individuals are so far removed from the events in questions that it is difficult to establish a causal link and therefore proof of consent, connivance or neglect.
The HSE continues to promote allocation of responsibility explicitly in job descriptions/policies etc as this makes such links easier.
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Posted By David Sinclair
Stuart,
You are substantially correct in what you say.
However, a CEO (as opposed to the board as a whole) will generally only be shown to have been the directing mind if the health and safety (in the main anyway) documentation has put him in that position.
Such documentation will have been drafted (in the main) by H&S practitioners.
Just because the enforcing authorities would like us to put "names to jobs" to make it easier for them to identify and prosecute individuals does not mean that we, as H&S practitioners have to do it.
In fact, (as you will have noted if you have been following this thread) there are extremely good contractual reasons for not doing so.
If a health and safety practitioner drafts documents in such a way as to leave directors and officers open to prosection, those individuals (and companies) may be liable in contract for breach of duty.
Regards.
David
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Posted By Rakesh Maharaj
David,
Your arguments are very meaningful. However, the issues that concern me are:
1. How do Practitioners successfully change the attitude of guiding minds if these 'minds' are resistant to traditional approaches e.g. training and awareness?
Most often, as a last resort, many practitioners are forced into a position where they make individuals (directors) accountable by naming them in documentation. (The increased number of H&S Professionals calling upon external support in presenting the proposed Corp. Killing legislation clearly demonstrates that scare tactics have to be employed to overcome corporate inertia)
2. Secondly, as a practitioner, I have an obligation not only to my employer, in terms of my employment contract, more importantly, my duty and obligation to my profession takes precedence. I know and understand that this is merely my naieve opinion, however, first principles always dictate that a successful practitioner is one who has the health and safety of employees at heart (see page 3 of the IOSH Code of Professional Conduct).
If my primary role was to protect the behinds of my employers rather than manage and guide the upkeep of health, safety and welfare amongst the greater workforce, I probably won't accept that job!
Regards
Rakesh
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Posted By Sean Fraser
David,
Has this potential for breach of duty actually been realised in precedent? It would certainly be an interesting case to pursue, where a conflict of duty would be between the stated and implied requirements of the employer and the duty of the individual to their profession and society as a whole (at community, national and perhaps even international level).
I also draw attention to the May issue of SHP, page 14 "'Across the board' failings cost firm £110K". This case entailed concurrent prosecution of the director under s.37 of HSWA, where an officer (note the term) of a company can be charged with the same offences as a company, if neglect is involved. The relevant section reads like so:
"37. (1) 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 was 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.
(2) Where the affairs of a body corporate are managed by its members, the preceding subsection shall apply in relation to the acts and defaults of a member in connection with his functions of management as if he were a director of the body corporate."
This automatically allows for the officer to be subject to the conditions and hence punishments of associated Regulations - including a custodial sentence. So if this power has and continues to be available, why is is not being used? Lax enforcement? Insufficient evidence? And what would a Corporate Manslaughter bill add? Very little, unfortunately. Yet another waste of parliamentary time for legislation that is unlikely to be enforced.
The onus is on the courts, not the lawmakers. Punishment should be proportional to those who carry out their activities conscientiously and responsibly, and those who seek only profit whatever the consequences.
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Posted By John Murgatroyd
I think you will find that any contract that involves any breach of law, or ignoring of same, is void.
Your contract of employment not only involves you in obligations to your employer but also to law.
If there is any conflict, law wins.
Your contract cannot call upon you to ignore law, nor to withold notifying the necessary authorities, in cases of breach of law.
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Posted By David Sinclair
Rakesh,
I am afraid that as public opinion towards fatalities and accidents at work has changed in recent years [note the rise in compensation and the move towards individual prosecutions] so the attitude of those in the firing line will also change.
More and more lawyers are being asked to advise boards and senior managers on protecting themselves.
Innevitably, H&S practitioners are caught between a "rock and a hard place".
Not only do I agree with what you say Rakesh, I sympathise with your position (since as a H&S practitioner I have been there). However, the world has changed and we now face a whole raft of new challanges.
Regards.
David
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Posted By David Sinclair
Sean,
I am not sure it has. The matter has only really raised its head since the publication of the HSC's updated enforcement policy and in particular since the indictment of the Railtrack directors and managers last year.
Using the scenario you have outlined of the s. 37 prosecution, let me give you an example of how the situation could unfold.
As I have previously stated, it is extremely difficult to successfully prosecute somebody for a s. 37 breach, unless the enforcing authorities [the prosecution] have clear evidence that the failure in health and safety was due to that Officer's consent, connivence, or due to his neglect. The burden of proof against an individual is therefore very high.
Assume an "Officer" is prosecuted and convicted of a breach of s. 37 because the organisation's health and safety document was drafted in such a way that he could be held individually liable (e.g. it contained a statement "X is ultimately responsible for the implementation of Y" and a fatality occurs due to the non-implementation of Y).
As a result of the prosecution the organisations insurers have to pay £300,000 in compensation and legal costs.
The insurer pays but then seeks to recover its losses from the organisation and the Officer (since there has been a breach of law allowing it to avoid the claim).
The organisation will argue that the Officer was not in the course of his employment (since he was not employed to break the law) and sue the health and safety consultant (if he is a contractor) for the recovery of its losses as a result of its failure to draft the documentation correctly.
I agree the situation would be slightly different if the H&S practitioner was an employee (as the organisation would be vicariously liable for his actions) however, I don't think he would be employed for long afterwards.
If I was acting for the Officer, I would have to advise his to sue the H&S practitioner (and the organisation, who would be vicariously liable) to try and recover his losses. This would be on the grounds that his negligent drafting had caused my loss.
Scary isn't it?
Regards.
David
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Posted By David Sinclair
John,
I totally agree with your comments, but we are referring primarily to civil [contractual] liability for health and safety breaches rather than attempts to avoid criminal liability in contracts.
Can I suggest that you look at the previous thread between myself and Sean.
What I am trying to put forward is that there will be an express or implied term in contracts, which require the H&S practitioner to use all reasonable "skill and care" to protect the Company, its directors and officers and its employees.
This includes preventing [where possible] the Company and its directors/officers being prosecuted.
My point is that poorly drafted health and safety documentation may breach this duty.
Regards.
David
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Posted By David Sinclair
Sean, John and Rakesh,
Thank you all for a very stimulating debate, which I hope we can continue [on this or another subject] in the future.
Unfortunately, I start my final Legal Practice Course exams today so I will not be able to particpate further in this discussion for some time.
Regards.
David
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