The Corporate Manslaughter Act could herald a new era for corporate accountability

Organisations operating in the UK will soon be open to prosecution for a new criminal offence of corporate manslaughter. Debate has raged in recent years over codifying the offence but the scope of the Corporate Manslaughter and Corporate Homicide Act 2007 has now been finalised and it will come into force on 6 April, 2008.

The intention of the Act is to make it easier to hold organisations to account after a fatality has been caused by significant internal failures. The Act is also intended to secure greater public confidence that organisations will be held accountable in these circumstances.

The Act will apply to all companies operating in the UK and some government departments. The Act also applies to other organisations in the UK when they employ staff including partnerships, trade unions and employers' associations.

Under the existing common law, a company can only be convicted of corporate manslaughter if a director or company officer is guilty of manslaughter, and identified as the 'controlling mind' of the company.

This test was clarified when a UK ferry company was prosecuted following an incident where 187 people died. The prosecution against the company failed as there was insufficient evidence to convict the seven individual defendants prosecuted.

The UK Law Commission recommended that a special offence of 'corporate killing' be introduced. Twelve years after this proposal, the Act implementing these recommendations will come into force and the current common law offence will be abolished.

Under the new Act, a company will be guilty of corporate manslaughter (or corporate homicide, as it will be called in Scotland) if:

l the way the company's activities are managed or organised causes a person's death, and amounts to a gross breach of the company's relevant duty of care to the deceased; and

l the company's senior management was involved in a substantial element of the breach.

The Act will apply if the death occurs in the UK, within the UK territorial sea and on certain UK craft.

The 'relevant' duties of care are those owed under the law of negligence, including:

l duties to employees, other workers or service providers;

l duties as an occupier of premises;

l duties owed in connection with supplying goods or services (e.g. customers and passengers);

l duties owed when carrying out construction or maintenance operations; or

l duties owed when carrying out commercial activities (e.g. farming and mining).

It will only be when the alleged conduct falls far below what could reasonably be expected of a company in the circumstances that a 'gross breach' will have occurred. The individuals who constitute 'senior management' will vary depending on the nature of the company but will generally include decision-makers significantly involved in deciding how the organisation's activities are administered.

If a prosecution is successful, an unlimited fine can be imposed and the organisation can be required to comply with remedial or publicity orders. A remedial order will require the organisation to take specified steps to remedy the breach and any health and safety deficiencies. Publicity orders will require the organisation to publish details of the offence, that it was found guilty, the amount of the fine and what actions are required under any remedial order. This provision is in line with other UK legislation that aims to 'name and shame'.

There is no liability for individuals under the Act. The Act specifically states that an individual cannot be guilty of aiding, abetting, counselling or procuring the commission of the offence. The liability of individuals will not be increased by the new legislation but individuals can still be prosecuted under the common law offence of gross negligence manslaughter.

There is no Crown immunity under the Act but it will only apply to specified government departments, including the Department for Transport, Home Office, Ministry of Defence, Cabinet Office and Department of Health. However, the public sector will only owe 'relevant' duties of care in certain circumstances, including as an employer and occupier of premises.

Any decision on the allocation of public resources or formulation of public policy is excluded from the scope of the Act. Certain operational and military activities are also excluded, including dealing with terrorism, civil unrest or serious disorder.

The Act is not intended to increase the regulatory burden on organisations operating in the UK. If an organisation complies with existing UK health and safety legislation then, broadly, nothing further will need to be done. If you have any concerns that your health and safety policies and procedures in the UK are lacking or if there have been any 'near misses', you should consider taking action now.

It has taken a long time for the Corporate Manslaughter and Corporate Homicide Act 2007 to be finalised and it should be expected that the Health and Safety Executive will want to ensure that the new law is used wherever necessary to bring organisations to account. n

Emily Peters is an associate at SJ Berwin.