UK: How To Avoid A Finding Of Systemic Failure And Achieve Proportionate Fines For Health And Safety Offences

Over 600 cases against defendant organisations have now been sentenced since the Sentencing Guidelines for Health and Safety Offences, Corporate Manslaughter and Food Safety and Hygiene Offences (the Guidelines) came into force on 1 February 2016.

A finding of 'high' culpability for any organisation significantly increases the level of fine. The highest fine to date under the Guidelines of £5 million followed a finding of high culpability against Merlin Attractions Operations Limited (which subsequently moved further up the offence range due to aggravating factors), after the court held that there was a "catastrophic failure to assess risk and have a structured system of work".

There are a number of factors that the court will take into account in determining whether an offence is one where 'high' culpability can be attributed to an offending organisation, namely:

  1. The offender fell far short of the appropriate standard; for example, by:
    • failing to put in place measures that are recognised standards in the industry
    • ignoring concerns raised by employees or others
    • failing to make appropriate changes following prior incident(s) exposing risks to health and safety
    • allowing breaches to subsist over a long period of time
  2. There is serious and/or systemic failure within the organisation to address risks to health and safety.

The impact of a finding of high culpability has meant that these factors have been the subject of increasing scrutiny, and we have seen a number of arguments and counter-arguments posed before the courts on the correct interpretation of the different factors outlined above. We focus in particular, on the final factor.

When is a failure 'systemic'?

Is it when there is a failure of a specific system? Or does it refer more broadly to a failure by a defendant organisation to establish good health and safety systems generally?

Prosecuting authorities argue that a systemic failure should be found in relation to a single failure to carry out a risk assessment. The proposition is as follows:

  1. The law requires a systemic approach to the management of health and safety in the workplace, as set out particularly within the requirement to conduct risk assessments under the Management of Health and Safety at Work Regulations 1999.
  2. The starting point therefore is that a suitable and sufficient risk assessment of all the risks to which employees and non-employees may be exposed must be carried out. An employer must then identify and implement appropriate steps to control the risks identified.
  3. The employer should then ensure that a safe system of work is established through providing appropriate training, instruction, information, supervision and monitoring.
  4. A failure to carry out a risk assessment is therefore a failure of a system, therefore, a 'systemic' failure.

The premise is that in considering whether a failure is systemic, the court must focus on the specific breach, and should not look more widely at other issues and matters associated with a defendant organisation's operations.

Taking the above example of a failure to carry out a specific risk assessment, it has been contended before the court that the fact that other parts of a defendant's operations may have all been risk assessed, and in relation to which there were safe systems of work, is irrelevant to an assessment of systemic failure in respect of the offence in question. The submission has been supported by the contention that the prosecuting authority, if they are investigating a specific incident, will largely have not investigated, and therefore not criticised, any other part of a defendant's operation.

However, taking this example to its logical conclusion, if that were correct then the outcome that would surely follow would be that all failures to carry out any risk assessment would always be a systemic failure, and therefore always land an offending organisation in high culpability territory. This restrictive approach cannot have been intended by the Guidelines and must surely be incorrect.

"Risks within the organisation"

Culpability will be high if there was "a serious or systemic failure to address risks within the organisation": the use of the word "risks" (rather than "risk") makes it plain that the court is entitled to consider the offender's health and safety systems generally - and not just the specific failure or breach.

Prosecuting authorities have sought to undermine this interpretation by arguing that if the court always has to consider "risks", plural, then no case could ever fall within the high culpability bracket where there was no other risk when looking at an offender's health and safety systems generally in any given situation.

To our knowledge, this has not been accepted by the courts. A finding of "systemic" failure has only been made where the court has concluded that the breach was attributable to a widespread failure in the systems that had been put in place to manage the risks that arise from an organisation's activities; not merely a failure in relation to risks which arose from a singular breach.

The clear wording "within the organisation", also evidently directs the court to consider the quality of systems more widely.

The court's assessment of culpability must therefore be informed by the nature and quality of the organisation's general approach to health and safety, and in our experience, a court will find that, for a company to fall into the 'high' definition of systemic failure there would need to be a more widespread failure within the organisation.

A consistent approach

Prosecutors have also argued that to take into account anything other than the breach in assessing culpability necessarily amounts to an element of double-counting, given that consideration of effective health and safety procedures in place is a mitigating factor to reduce the seriousness of an offence, which is considered at a later stage in the Guidelines.

However, this approach would be inconsistent with the way in which the categories at all other levels set out in the Guidelines are outlined in terms of assessing culpability. For example, culpability is likely to be "very high" if there has been a "deliberate breach of or flagrant disregard for the law". The court is therefore entitled to look at the nature and extent of health and safety compliance generally - and not just at the breach in question - in order to form a view as to whether or not the organisation has disregarded the law - and, if so, whether it has done so flagrantly.

This approach is wholly consistent with the Court of Appeal's remarks in R -v- Balfour Beatty Rail Infrastructure Services Ltd in which there was a finding of systemic failure within the organisation.

"A breach of the duty imposed by s.3 of the 1974 Act may result from a systemic failure, which is attributable to the fault of management. It may, however, be the result of negligence or inadvertence on the part of an individual, which reflects no fault on the part of the management or the system that they have put in place or the training that they have provided. In such circumstances a deterrent sentence on the company is neither appropriate nor possible. Where the consequences of an individual's shortcoming have been serious, the fine should reflect this, but it should be smaller by an order of magnitude than the fine for a breach of duty that consists of a systemic failure."

A proportionate sentence

The Guidelines provide a series of starting points and ranges for fines that are based on the size of the company: micro, small, medium and large. Large companies are those with a turnover of £50 million or more.

For very large organisations (VLOs) the Guidelines provide: "Where an offending organisation's turnover or equivalent very greatly exceeds the threshold for large organisations, it may be necessary to move outside the suggested range to achieve a proportionate sentence."

The key word here is "necessary".

The onus is on the defendant organisation to persuade a court that it is not necessary to move outside of the range.

There are a number of practical steps that a defendant organisation can take to help the court reach this conclusion:

  • A move outside the range is only appropriate if the court concludes that an increased fine is "necessary" in order to bring home to the organisation the need to comply with health and safety obligations. Evidence of an organisation's commitment to health and safety and its remorse in relation to an incident should be submitted. Consider statements expressing these sentiments directed to the court from directors and senior managers, who should also attend the sentencing hearing to underline that the message from the court will hit home, without the need to escalate the level of fine.
  • Whilst turnover for VLOs may greatly exceed £50 million, the profit margin, cash flow and challenges facing the particular industry for the organisation will always require putting into context so that the court can accurately consider what is truly necessary to achieve a proportionate sentence - statements from forensic accountants and finance directors should be prepared to ensure that company accounts are fully explained and understood by the court.
  • A defendant organisation's reaction to an incident, as well as evidence of other strong mitigating factors, will also impress upon the court that a large fine is not necessary to ensure that appropriate actions will be taken by the organisation. Evidence that a review of any relevant practices has taken place promptly and voluntarily post-incident, that any steps required to be taken have been implemented and kept under review and that any victims have been sufficiently supported, will all go towards reassuring the court that going outside of the ranges of fines suggested by the Guidelines, is neither necessary nor proportionate.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
26 Sep 2019, Seminar, London, UK

Providing GCs, Heads of Legal and senior in-house lawyers with timely, topical and practical legal advice on a variety of topics.

8 Oct 2019, Seminar, Birmingham, UK

Supporting the development of paralegals, trainees and lawyers of up to five years' PQE by providing valuable knowledge and guidance together with practical tips.

10 Oct 2019, Seminar, London, UK

Supporting the development of paralegals, trainees and lawyers of up to five years' PQE by providing valuable knowledge and guidance together with practical tips.

In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions