Corporate Manslaughter and Corporate Homicide Bill

My Lords, I beg to move that this Bill be now read a second time. I am very pleased to be opening our debates on what is a small but significant Bill. It is small in thatit has a single aim—to establish a new offenceof corporate manslaughter—and a relatively small number of clauses. But it is very significant because it tackles an area of the law that has given rise to much concern: the effectiveness of present laws to establish when a corporate body can be guilty of manslaughter. Each year, more than 200 workers and many more members of the public are killed as a result of work-related incidents. Some are extremely serious incidents, in which the companies involved are strongly criticised. In the case of the ““Herald of Free Enterprise”” disaster, Lord Justice Sheen found that from, "““top to bottom the body corporate was infected with the disease of sloppiness””." Last year, Mr Justice Mackay described the circumstances of the Hatfield crash in 2000 as one of the worst examples, "““of sustained industrial negligence in a high-risk industry””," that he had ever seen. The law of manslaughter can already be usedto prosecute companies in these circumstances, as distinct from any individual who has committed offences. That principle was firmly established in the early 1990s in a prosecution of P&O Ferries following the sinking of the ““Herald of Free Enterprise””. However, that case also established that the appropriate basis for attributing liability to the corporate body was the ““identification”” principle. A prosecution for manslaughter can proceed against the corporate body only if gross negligence manslaughter can also be proved against individual senior managers. This means that the courts must judge corporate negligence on the basis of individual liability. In our view, that is a narrow and artificial basis for assessing corporate negligence. In practice, it means that only a handful of corporate manslaughter prosecutions have ever been brought successfully—all against small companies. The consequence is that prosecutions under health and safety law are the only viable prospect in respect of larger organisations, no matter how serious the corporate failing. We fully acknowledge the important foundation that the Health and Safety at Work etc. Act 1974 provides for the management of safety across organisations in this country. There was an interesting debate in the other place about whether the 1974 Act provided the better basis for reform. We acknowledge that the matter was not pressed and that the debate was raised to question the nature of the Government’s reform. However, to seek to sidestep the difficulties that the identification principle has brought about for establishing gross corporate negligence would be a mistake. Rather than withdrawing liability for manslaughter from these cases, we need to ensure that the law is working properly. The issue was succinctly put by my honourable friend in the other place, the Parliamentary Under-Secretary of State, Mr Gerry Sutcliffe. Shortly before the Bill arrived in this House, he said: "““Given the complex nature of organisations today, in many circumstances it is not possible to lay responsibility for the failings behind a death at the door of one individual and charge them with manslaughter. Neither is it right simply to place an organisation’s failings on one person’s shoulders. That makes it all the more important that the law ensures that sanctions, such as a conviction for manslaughter, are available for use against ""companies, so that we recognise that what has happened is not a regulatory breach but homicide. That is the justice that those cases deserve””.—[Official Report, Commons, 4/12/06; col. 115.]" My right honourable friend the Home Secretary underlined the need for reform on the Bill’s Second Reading in another place by quoting the words of the mother of a young person killed at work to the Home Affairs and Work and Pensions Select Committees. She had said: "““A successful prosecution brings into the public domain all the failings that led to a preventable death and, very importantly, it shows that this country values all human life and is prepared to punish those who are negligent or indifferent to the lives of workers””." The House will know that the Bill aims to create a clear and effective criminal offence that serves those aims. The Bill will move the law on in two significant ways. First, it will provide a new test for the application of corporate manslaughter to companies. This will allow the courts to look at collective management failure within an organisation, enabling for the first time a proper examination of corporate negligence. Secondly, it will remove Crown immunity. This is a far-reaching development. For the first time, government departments and other Crown bodies will be liable to prosecution in the criminal courts. At the heart of the new offence is a new approach to establishing that a corporation has been grossly negligent. In summary, it moves away from the question of who managed the company to the question of how the fatal activity was managed. Our approach follows, to a large extent, the recommendations of the Law Commission in 1996 and represents a fundamental change in the way in which these cases can be approached. No longerwill a successful prosecution depend on provinggross negligence by isolated individuals. Instead, investigators, prosecutors and the courts will be able to consider the cause of a fatality in the round: the immediate circumstances of the death and the factors that led to those circumstances occurring. They will then be able to ask whether this represented a gross failure in the management arrangements put in place by the organisation for discharging the duty of care that it owed to ensure that that activity was carried out safely. However, since the intention is to target truly corporate negligence, we are concerned that organisations should not be prosecuted on the basis of isolated or unrelated management failings at relatively low levels of the organisation. We have sought to achieve this by requiring that the relevant failing be among the senior managers of the organisation. The Bill was published in draft on that basis. This, as many noble Lords will know, generated a good deal of discussion on consultation and we have kept the matter under active review. We accept that there are drawbacks to this approach, not least that it would potentially give a very narrow application to the offence. The Bill has been subsequently amended in the other place to introduce a wider and more effective test, which seeks to strike a balance between taking into account the management of the fatal activity generally within the organisation and not allowing a prosecutionto succeed unless a substantial element of the organisation’s failure lay at a senior management level. Noble Lords will appreciate that that will give a greater degree of flexibility. I turn to the question of who can commit the new offence. I shall deal with three issues: the restriction of the offence to organisations and not individuals; the position of unincorporated associations; and, lastly, how the offence applies to some public bodies. The new offence is, first and foremost, about corporate liability for corporate failings. It establishes an offence that corporate bodies and other organisations will be capable of committing, based on failings across the organisation. Evidence from the Health and Safety Commission during pre-legislative scrutiny identified that many incidents arose from systemic failures rather than from the action of one individual. The new offence reflects that and is not contingent on any specific individuals committing any specific acts. It is not, therefore, a basis for convicting individuals or for imposing sanctions on them. An important area of debate has been whether the Bill should, none the less, go further and establish a new framework for holding individuals to account for work-related death. The Government are not tempted to go along that route. The mischief that this Bill seeks to address is the restricted approach that the law has applied for assessing corporate liability for manslaughter. If individuals have acted recklessly or grossly negligently or in a way that contravenes health and safety law, they will be guilty of a criminal offence under existing laws. The new offence is intended to sit beside those offences and to provide a more effective means of attributing manslaughter to companies. It is not a part of that aim for the new offence to be a vehicle for redefining when individuals are guilty of offences. The offence will apply comprehensively to corporate bodies, which means not only companies in the private sector but also incorporated bodies in the public sector, such as local authorities, National Health Service hospital trusts and a wide range of statutory organisations. All such bodies are already subject to prosecution for corporate manslaughter. However, the new offence does not apply to unincorporated bodies, such as partnerships, clubs or societies. That has generated a good deal of interest and debate. Our position primarily reflects the fact that unincorporated bodies do not have a separate legal identity, and the question, therefore, of finding a separate corporate liability takes on an odd character in this context. However, we recognise that there is concern that the new offence might leave a lacuna in the law in that regard, and my honourable friend in another place, the Parliamentary Under-Secretary of State, has indicated that we will consider the issue further. If—and I emphasise the word ““if””—a sensible way can be found for the Bill to take a wider position here, we will seek to bring forward amendments as the Bill progresses through this House. The third important area here is the application of the new offence to government departments and other Crown bodies. This removes the anomaly created by Crown immunity and means that the public sector across the board, as well as the private sector, will be liable for the new offence. This is an important step and one that has been widely welcomed.