November 16, 2007
By Steve Doughty
Social Affairs Correspondent
COMPANIES whose neglect results in deaths should face fines running to hundreds of millions of pounds, Government law advisers said yesterday.
Firms found guilty in court should be hit with penalties of as much as ten per cent of their annual turnover, according to the Sentencing Advisory Panel.
After the Hatfield train derailment which claimed four lives in 2000, health and safety convictions led to maintenance firm Balfour Beatty being fined £7.5million and Network Rail £3.5million. If it was fined ten per cent of its latest annual turnover, Balfour Beatty would have to pay up almost £200 million and Network Rail £600million. A new law on corporate manslaughter is to be introduced next April, bringing in a legal principle of ‘senior management failure’.
The Sentencing Advisory Panel said yesterday that a firm convicted of a first offence of corporate manslaughter after pleading not guilty should pay a fine of five per cent of its turnover, averaged over three years.
Depending on how badly the company had behaved, the fine could range between 2.5 and ten per cent of turnover, it added. In its consultation paper, the panel said: ‘The offence of corporate manslaughter has been created for the most serious instances of management failure resulting in death.’
It said judges should also name and shame guilty companies, even making them take out adverts to publicise their convictions. These ‘publicity orders’ will hit firms’ share value and order books, the advisors said.
After the consultation is over in February, the panel will hand its recommendations to the Sentencing Guidelines Council, chaired by Lord Chief Justice Lord Phillips, which will draw up the final rules for judges.
Comment added by John Donovan