Liability of running business is becomimg more onerous

The Corporate Manslaughter and Corporate Homicide Act 2007, which came into effect in April last year has made it easier to convict a company of criminal liability for Corporate Manslaughter if it commits a gross breach of a duty of care that causes death. Companies convicted of Corporate Manslaughter may have to pay unlimited fines and be ordered to publicise details of their offence and the resultant fine within the public domain. Also all senior management (not just directors) will be closely scrutinised. The Act may prompt subsequent actions such as individual directors being prosecuted by the Health & Safety Executive or civil actions for compensation against the company or the individuals who run it.

At Coulter Hurst & Co our commercial brokers can arrange insurance to cover defence and investigation costs with a variety of insurers. Moreover most insurers will help their policyholder from before, during and after proceedings with professional advice, either in-house or referral to a competent third party.

The Health & Safety Offences Act came into effect in April 2008 and imposes tougher penalties for Health & Safety offences including imprisonment for the most serious of breaches. Maximum fines in the magistrates courts have been increased to £20,000 and in the Crown Court they continue to be unlimited. It must be born in mind by all employers that in addition to these stiifer penalties you are guilty until proven innocent! The onus is on you as the director or manager to prove you are not guilty of the alleged offence and that can mean proving you were not even aware of the alleged breach! Do not forget it is, arguably, easier to prosecute the small business run by one or two directors than it is to take action against a large corporation where there will be many executives and managers.

Again,  Coulter Hurst & Co can arrange policies for companies, directors and managers, with insurers, to cover defence costs, the costs of legal representation for individual directors  at any HSE investigation and emergency defence costs. Also a range of professional advice, both from the insurer and appointed third parties, will be offered to help you through the prosecution process and how to handle it.

Should you require insurance protection please contact one of our commercial brokers, as listed under People Profiles, for a quotation and any advice you may require.