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Safeguard OSH Solutions - Thomson Reuters

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Safeguard Magazine

Legal Issues—Seeking accountability

In the wake of Pike River, many are pressing for a law change to enable corporate decision-makers to be held accountable. JACKIE BROWN-HAYSOM, who looked at corporate manslaughter in our Nov/Dec 2012 edition, revisits the legislative options.

It’s almost 20 years since a junior detective sought union lawyer Andrew Little’s advice about a workplace fatality, yet the memory remains vivid.

A worker had been found dead in a blast freezer, apparently after injuring himself in a fall and being unable to summon help before hypothermia took its toll. The police had referred the matter to the regulator, OSH, which decided not to prosecute. The officer who consulted Little was disturbed by this, and wanted to know if there was anything the union could do to reactivate the case.

“The freezer had a mushroom button for summoning help,” Little recalls. “It was a metre or two away from the guy, and not easy to access. He was found with his arm fully outstretched, and had obviously been crawling towards it, but died before he could get there.

“The police tipped me off because they were horrified that the matter wasn’t going to court. They believed there was clearly something wrong with the location of the button and thought the matter ought to go for hearing.”

In the end there was nothing Little or his union could do to initiate a prosecution, but the discussion he had with the detective has stuck in his mind.

“He told me that, where there is any suspicion that death had resulted from a failure by someone else, police policy is to prosecute and let the courts decide.”

It’s a stance that Little believes has many advantages over the health and safety regulator’s established practice of avoiding prosecution unless conviction is likely.

“The police approach means that someone is called to account, even if they go on to successfully explain themselves and are not convicted.

“When you’re dealing with the family of a worker who’s died, often the most distressing thing is that if there isn’t a prosecution they won’t ever know the full circumstances of why things happened as they did.”

CORPORATE MANSLAUGHTER?

In 2012, post-Pike River, this lingering belief that sometimes justice must be seen to be done, prompted Little – now a Labour MP and party spokesman on labour issues – to draft a member’s bill seeking to establish the offence of corporate manslaughter in New Zealand.

Since the tragedy at Pike River there has been much debate about the need for such a law. Some see it as the only appropriate response to what was an avoidable catastrophe, yet neither the Royal Commission which investigated the disaster, nor the Independent Taskforce which examined the regulatory and legislative flaws which precipitated it, went so far as to recommend its introduction. Indeed, the Taskforce went into some detail to explain why it did not favour such a step, citing the “very limited success” of similar laws in comparable jurisdictions, and the risk of creating an anomalous situation where, with identical facts, it would be easier to obtain a conviction for manslaughter than for other less serious offences.

It acknowledged, however, the need to “substantially [raise] the profile of corporate offending” and recommended a combination of tougher OHS laws, with a particular focus on individual decision-makers, and amendments to both the existing offence of criminal manslaughter and the corporate liability framework.

Under current law, corporations can be prosecuted for reckless, or intentional, wounding, but not for manslaughter. Merely extending the parameters of the existing offence would have little impact, however, as corporations are only criminally liable if the individual who commits the offence is both acting for the company, and sufficiently senior to be regarded as its “directing mind and will” – a level of association almost impossible to establish in anything other than a small enterprise.

The Taskforce report suggested a law change to make all organisations liable for the acts or omissions of employees, contractors and other agents acting within the scope of their authority, or for the conduct of two or more senior officers, in situations where their behaviour would have been criminally liable had it been attributable to one person.

In the wake of the report Labour Minister Simon Bridges referred these matters to the Ministry of Justice, which began an international review of both corporate culpability and corporate manslaughter. At the time of going to press the ministry had made no comment on the possibility of changes to the corporate liability framework, but a January 2014 statement from Justice Minister Judith Collins’ office reiterated the Taskforce’s advice on corporate manslaughter, saying: “Overseas experience indicates that … charges have resulted in very few successful prosecutions, particularly against larger corporates involving multiple decision-makers.”

Prime Minister John Key has also made it plain that for him, corporate manslaughter is “off the table”, despite continued pressure – from the media, lawyers, Pike River families, and even some of his own cabinet – for its introduction.

ANDREW LITTLE’S BILL

In such a climate what does Little’s bill, The Crimes (Corporate Manslaughter) Amendment Bill, have to offer? As Little sees it, its biggest selling point is accountability.

“I want the statute to send a signal to the corporate world that the responsibility for health and safety is going to be sheeted home to the highest levels of the company,” he says. “We need a law that says if the company you’re responsible for is negligent, and as a consequence somebody dies, you will be held responsible.”

This, he believes, is an area where the HSE Act has consistently failed.

“Board members and senior managers make decisions that ultimately determine whether there is the right health and safety equipment in the workplace, whether the right training is happening, or whether the right systems and procedures are in place, but we haven’t yet seen a single prosecution that genuinely reflects this.”

He acknowledges the “conceptual difficulty” of applying the criminal code to a collective entity, but has modelled his bill on the UK’s Corporate Manslaughter and Corporate Homicide Act 2007, which requires prosecutors to prove that the way an organisation’s senior managers organised or managed its activities caused death, in circumstances that constitute a gross breach of a relevant duty of care owed to the deceased.

Under his draft bill public authorities, crown entities and businesses of all sizes would be eligible for prosecution and on conviction would face fines of up to $10 million, plus the possible imposition of a publicity order, to tell the world what went wrong.

Senior managers who have “contributed materially” to any offence would be liable for up to 10 years imprisonment.

The penalties seem harsh when compared to those available under the HSE Act, but the British legislation that was Little’s starting point sets no upper limit for fines, and its sentencing guidelines say penalties may be measured in millions of pounds. The UK law does not extend to individuals, so carries no prison term, but all cases to date have included other charges laid under health and safety or gross negligence manslaughter laws, both of which are punishable by imprisonment.

At the moment Little’s handiwork is just one of about a hundred member’s bills waiting to be heard, and its passage through the house will not begin unless it is selected in one of the periodic bill ballots. With only around 20 member’s bills picked out for debate each year, and the general election now just months away, the odds are against it seeing the light of day. If it is picked out before the election, however, the timing could prove critical. In the face of strong public support for corporate manslaughter – in a TV3 survey 74% favoured its introduction – MPs might be reluctant to oppose it, while a possible change of government could see the bill become official policy for any Labour-led coalition.

EXPERIENCE IN UK/CANADA

What would its introduction mean for New Zealand workplaces? There is no clear answer, but the similarities in the legislative model mean the place to look for indications must be Britain.

Here, despite the scepticism of the Taskforce, Justice Ministry and Prime Minister, the law is now gaining momentum, with two convictions in as many months in late 2013, and four more cases awaiting hearing. Statistics from the Crown Prosecution Service – the government agency responsible for determining whether to lay charges – show the number of cases being considered for prosecution under this law is rising steadily, now totalling more than 60 a year.

True, the charge has only been laid in nine cases to date, there is yet to be a case involving a large employer, and some lawyers doubt that conviction would be possible if one did occur, but all five of the cases heard since 2008 have resulted in conviction, with fines of between £100,000 and £480,000.

Canada, the only other Robens-style jurisdiction to have pursued criminal prosecutions for OHS failures1, has a much worse track record. On paper its law seems to offer better coverage because prosecution is available for both injuries and fatalities resulting from work-related criminal negligence. However in almost ten years there have been only eight prosecutions, most of which took between four and seven years to get to court, and only four of which resulted in convictions.

In the other cases charges were dropped, the defendants were acquitted, or convictions were entered under health and safety law.

The highest fine to date is C$750,000, awarded on appeal for an incident in which four construction workers died and two others were critically injured after an insecure work platform collapsed. In the most recent case a ferry navigation officer was sentenced to four years in prison after two people died when the ferry he was steering went aground, apparently while he was distracted by a former lover. He is currently on bail, pending an appeal.

The UK’s higher success rate for corporate manslaughter is more a reflection of how the law is used than the quality of the law itself, however. In all but one of the cases heard so far, companies have admitted corporate manslaughter in return for the withdrawal of other charges – often ones of gross negligence manslaughter, which carries a mandatory prison term – against managers or directors.

THE ARGUMENT AGAINST

The flaws in the British legislation have been widely debated. Legal commentators say all those so far convicted could have been prosecuted under the old manslaughter law because they are small or medium-sized companies where senior managers are directly involved in day-today events. Many believe that the less direct chain of command in a larger company will make prosecution very difficult, and suggest that the CPS may even shy away from the higher costs of constructing, and arguing, such cases.

While no fines have yet reached the £500,000 starting point advocated by the UK’s Sentencing Council, penalties have often been high enough to put the company’s continued survival in doubt. Critics say this too may prevent large companies from being convicted, with both prosecutors and courts opting for health and safety convictions as the penalties are less likely to jeopardise a large workforce’s continued employment. Add to this the lower standard of proof required for OHS prosecutions – balance of probability rather than beyond reasonable doubt – and it not surprising that the CPS has so far adopted a cautious approach to manslaughter.

In both Canada and the UK, however, serious OHS offences are now receiving much steeper penalties than was once the case, and pundits suggest criminal case law has had an impact in this.

CHANGE IS NEEDED

In the end, however, the real value of corporate manslaughter can’t be measured in convictions or fines. It’s more about climate change at a national level. For most senior managers the possibility of being questioned at their desk by a police officer would be a powerful deterrent, while the widespread publicity accorded to Britain’s corporate manslaughter cases has raised awareness of workplace safety across the board.

Does New Zealand need an offence of corporate manslaughter? Perhaps not, but we do need a better system for prosecuting health and safety offences – one that is robust, highly visible, and recognises that sometimes we need to call someone to account for what has happened, even at the risk of losing a court case.

JACKIE BROWN-HAYSOM

Footnotes

  1. 1Australian Capital Territory has a corporate manslaughter law, but because government employees, which make up the bulk of ACT’s workforce, are exempt, no charges have yet been laid.
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