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Penalties in construction


The £500,000 fine imposed on Costain and Yarm Road (formerly Kvaerner Cleveland Bridge) in November 2001 for the death of four workers in a catastrophic suspended gantry accident was the heaviest penalty for a case of its kind. But friends and family of the dead men were horrified that the two construction giants could get away with paying so little.

This week we ask: can we expect the legal system to deliver the penalties deserved by those who break health and safety law?

Yes Kevin Myers, Health & Safety Executive chief inspector for construction Courts have considerable scope to punish offenders and deter others through unlimited fines and, in some cases, imprisonment. However, the punishments imposed by the courts do not always reflect the seriousness of health and safety offences - a view shared by Health & Safety Commission/ Executive, the government and the courts themselves. The case R versus F Howe & Son (Engineers), said straightforwardly, that fines were too low. What can be done?

Government wants to extend the range of offences that attract up to £20,000 in magistrates' courts and is also seeking wider powers of imprisonment.

The Magistrates' Association has issued new guidance advising members to reflect increasing public concerns so that fines make an impact on shareholders and take account of aggravating factors such as:

deliberate or reckless breaches of the law;

financial motives - corner cutting in pursuit of profit or cost savings;

disregarding warnings from regulators and workers;

previous offending; and ldeath, serious injury or ill health.

It is too early to judge the impact of these developments, although more cases are now referred to crown courts. Prosecuting authorities also need to think about how they present their cases in the light of this guidance and case law.

Sentencing adequacy is brought into sharper focus following deaths at work. It is difficult for any penalty to reflect the concerns of the bereaved or society at large in these circumstances. However, government proposals to change the law on corporate manslaughter might go some way to answer those concerns.

But in questioning whether the penalties for construction accidents are severe enough, we should not forget the wider impact of convictions: long term damage done to the business through lost reputation and adverse publicity, time and financial losses resulting from investigation and remediation of working practices, and the high cost to companies of hiring legal advice.

No David Bergman, executive director of the Centre for Corporate Accountability There is no point in the Health & Safety Executive going to the trouble of prosecuting companies if, when they are convicted, the courts impose sentences that are neither punitive nor deter other companies from committing similiar offences.

Though the severity of a sentence is decided by magistrates or judges, the HSE has an important role in ensuring it is as punitive as possible. It must ensure that sentencing for cases involving serious breaches or serious consequences like death or major injury, and where companies with high profits/turnover are at fault, take place in the crown court, not a magistrates' court.

Magistrates' courts cannot impose fines of more than £20,000 for breaches of statutes, and a mere £5,000 for breaches of regulations. Crown courts can impose unlimited fines.

When companies plead guilty to health and safety breaches, as they do in most cases, sentencing is normally carried out in the magistrates' court. However, the HSE inspector can set out reasons why sentencing should take place in the crown court. This often fails to happen and, as a result, cases are heard, inappropriately, in the magistrates' court, with low fines resulting.

When cases are being sentenced in the crown court it is crucial that, prior to sentencing, the HSE employs a forensic accountant. It needs to analyse the defendant's accounts and provide information to the court on its true worth. Companies all too often use their accounts to plead that, despite their large turnover, the courts should only be considering its low profits.

Forensic accountants would show that low profits are not always an indicator of the company's true wealth. As yet, the HSE does not have a practice of using forensic accountants.

In the end, failure of the courts to impose sufficiently punitive sentences should motivate HSE inspectors to see whether evidence will allow for prosecution not only of companies but also their senior officers. It should also motivate government to look at changing the law to allow the courts to impose more innovative sentences. Using 'equity' fines, the court would be able to order publicly limited companies to issue a set number of shares into a government fund.

'Adverse publicity orders' would require the company to publicise its conviction through the media.

The facts

Contractors in charge of upgrading the M5 Avonmouth Bridge, Costain and Yarm Road (formerly Kvaerner Cleveland Bridge), were fined £500,000 for breaching the 1974 Health & Safety at Work Act and ordered to pay £525,000 costs (NCE 6 December 2001).

At Avonmouth, four men plunged 25m to their deaths on 8 September 1999 when the underslung gantry from which they were working collapsed.

They were replacing runway beams from which the gantry was suspended.

Until recently, the average fine for industrial accidents was just £5,038. In November 1998 the Court of Appeal agreed that fines were too low and crown courts are now regularly fining from £10,000 to £100,000.

Accidents involving or endangering the public attract far higher fines than those affecting only employees.

Penalties have topped £1M.

A new law that would enable company directors to be charged with corporate manslaughter was proposed in 1997 but is yet to be delivered.

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