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In proposing the amendments, I am grateful to the Centre for Corporate Accountability, which has been quite critical of the new test. The amendments probe whether this Committee can be satisfied that the right test is being applied. The test as it stands does not meet the objectives that the Government have set out. The Government were not correct to say in another place that the “senior manager” test has been removed; it clearly remains in the Bill. A gross failure within the management of an organisation will not result in the organisation’s prosecution, unless a substantial element of the gross failure is at a senior management level. Is that right and should it be the case?
It is not correct that the question at the heart of the offence is whether the organisation as a whole has failed, since no offence will have been committed unless senior management played a substantial part in the gross failure that caused the death. The Government said in another place that an organisation should not be found guilty if there was only a minimal element of senior management failure in the gross breach. A number of people feel that that is the wrong way to put it and that an organisation should not be found guilty if it had taken all reasonable steps to avoid a gross failure at a lower level within the organisation. This articulation, which is at the centre of these amendments, clearly supports the Government’s message that health and safety should come from the top of organisations.
The most significant concern that a number of us have about the new test is that the change from the requirement for all the gross failure to be at senior management level to the requirement that there be a substantial element of the gross failure at senior management level does not ensure that companies where systemic failures cause deaths would be brought to account. Therefore, it does not satisfy the original purpose of the legislation. I look forward to hearing the remarks of other noble Lords, who I know are concerned about this. I urge the Government to look again at this test. I beg to move.
Lord Lloyd of Berwick: I do not know whether it would be for the convenience of the Committee to consider what has been proposed by the noble Lord, Lord Razzall, before coming to an amendment of his with which I have great difficulty, but which he has
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Lord Lyell of Markyate: I draw attention to Amendment No. 7, which a number of bodies have asked us to consider. It would not confine liability to circumstances when an organisation is guilty because of the way in which its activities are,
but would spread liability more widely. We need to explore this very carefully, with an open mind, because it is not as obvious as it sometimes seems to people whether someone junior in an organisation—in other words, someone other than senior management who makes a serious mistake that leads to death—is grossly negligent. Unless there is some gross negligence in how that person was organised by senior management, I am not sure that it would be right to place on the organisation liability for corporate manslaughter. There is a tradition and a sound legal principle to be found in a famous case of a trading standards officer, whose name will come to me in a moment, whereby, provided that senior management have shown that they have carried out their functions properly, an error by junior management does not render the whole organisation liable. We should depart from that only after very careful thought.
Lord Razzall: Before the noble and learned Lord sits down, I make the point that Amendment No. 7, which stands in the name of my noble friend and myself, should be read in conjunction with Amendment No. 4, because that deals with the point that he makes. I know that the noble and learned Lord, Lord Lloyd, wants to criticise Amendment No. 4, and I am happy to concede that it is not necessarily how we should proceed. These amendments are probing, but the gist of what we are trying to achieve is set out in a combination of Amendments Nos. 7 and 4.
The Deputy Chairman of Committees: I remind the Committee that groupings remain at all times informal and that it is entirely up to any Peer, if he so wishes, to speak on any individual amendment where it comes in the Marshalled List.
Lord Henley: I am grateful to my noble and learned friend Lord Lyell for explaining why we would not want to support the amendments. However, I accept the point made by the noble Lord, Lord Razzall, that these are very much probing amendments. From that point of view, I offer the noble Lord a little support and remind him—and, in doing so, remind the Government—that the Government introduced something of the order of 20 amendments at Report and Third Reading in another place, which were inserted into the Bill without any discussion and without any explanation from the Government about what they were about. For that reason, we shall move some amendments later to remove parts of the Bill as it was amended, purely to give the Government an
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Lord Lloyd of Berwick: Perhaps I could say what has been worrying me about Amendment No. 4. The words that it adds to Clause 1(1)(b) would defeat the whole purpose of the Bill, which is to confine corporate manslaughter to cases of gross negligence. Gross negligence has been discussed in many cases, going back over many years. Unlike the noble and learned Lord, Lord Lyell, I have the names of the cases in front of me, so I have not forgotten them—they are Bateman and Andrews, in which there was much discussion about whether gross negligence or recklessness was the right test. Those problems were resolved, happily, in a case before the House of Lords called Adomako, which says that gross negligence is the right test for corporate manslaughter. It went on to say what has been said for many years—that gross negligence requires something more than would be necessary to establish civil liability. The problem with the words that the amendment would add is that they substitute a test for ordinary liability in negligence and therefore undermine the basic difference between ordinary negligence and negligence which is necessary for manslaughter.
Lord Razzall: I really cannot accept the noble and learned Lord’s point, which would apply equally to Clause 1(3). As I indicated to the noble and learned Lord, Lord Lyell, we are simply deleting subsection (3) and providing a different test. It has nothing to do with the definition of gross negligence; it is to do with the additional requirement that has to apply for corporate manslaughter to apply in a particular situation. I accept that the drafting may not be felicitous, but the noble and learned Lord is not correct about the point that we are making.
Lord Campbell of Alloway: I heard the noble and learned Lord, Lord Lloyd of Berwick, ask what the amendment adds. I have been concerned throughout this affair to discover exactly what it does and how you define it. When you come to definitions, Amendment No. 4 cannot stand. It contains the phrase,
I would not waste the time of the Committee by saying much more about that.
Lord Wedderburn of Charlton: I suggest that there is merit in the thinking behind the amendments of the noble Lord, Lord Razzall, partly because the precise formulae and mechanisms of the Bill as it stands were materially altered by the Government in another
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The Bill is essentially supplanting the old test of directing mind and will, which is required for corporate liability as the law stands. That gives rise to the question of whether the test before us is right in the way that the noble Lord, Lord Razzall, suggested. At the moment, we have to find that some gross error on the part of senior management, as defined, is a substantial element in a causative sense of the death that has occurred and that the other requirements of the Bill are manifest.
There is a problem not only with the amendment, but also with the Bill as it stands in this respect. Unless the failure required for liability is properly framed—and we should remember that it has, by hypothesis, caused the death of a person or persons—it will be easy for those who control small or giant organisations to delegate the issue of safety down to a level other than their own. It is not sensible to allow that without careful conditions, and the Bill might benefit from the approach suggested by the noble Lord, Lord Razzall. The noble Lord mentioned the Centre for Corporate Accountability, which has done a great deal of work in this area. It suggests that the Bill, even as it stands, allows for delegation of issues of safety to some medium or even low level. That would not encompass liability for manslaughter, even if a large number of deaths occurred through failure of the management organisation. Safety is a central issue, which the board of directors and those at a high level should consciously address every time they meet.
Whether the Bill provides for that is something that the amendment tabled by the noble Lord, Lord Razzall, brings before our eyes. Noble Lords should think carefully about the issue of delegation and whether senior management or directors should be allowed to delegate and escape liability for the corporation. I am not sure that the approach of the noble Lord, Lord Razzall, would not make it more difficult to delegate than the Bill now allows.
3.15 pm
Lord Lyell of Markyate: I hope that the Committee will forgive me for intervening again briefly. There is a great deal of force in what the noble Lord, Lord Wedderburn, said. We are expressly asked to consider whether organisations can avoid their responsibility or their liability under the Bill by delegating down.
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On Amendment No. 4, I accept the rebuke from the noble and learned Lord, Lord Lloyd, for not having the case instantly at my fingertips. The case is Tesco v Nattrass. Mr Nattrass was my client on several occasions. He was a very effective trading standards officer and wonderfully litigious. That case gave a let-out to a large company if it has set up a proper system, but somebody more junior has not followed it, so long as it has reasonable control. I am not sure that we should get into all that. I would ask the Minister to think carefully about it, but I think that at the moment we should be cautious in going down that route.
Lord Boyd of Duncansby: I, too, have been troubled by this aspect relating to senior management, for the same reasons as the noble Lord, Lord Wedderburn. There is merit in what the noble and learned Lord, Lord Lyell, said about whether delegation would work; I rather suspect that if I was advising a client, I would not suggest that he did that. However, I am troubled by what might happen where there is a certain obfuscation of lines of responsibility and senior management simply fail to take decisions about where lines of responsibility for safety lie.
I ask the Government to look carefully at the issue of senior management. I am thinking of decisions taken by foremen in the course of ordinary day-to-day business, and whether the foreman has been given the right training, level of responsibility and resources to enable the employee to carry out in safety the work tasked to him or her. If something happens as a result of decisions not being taken at a senior level, it would be right to hold the organisation responsible. But this is something that needs to be teased out, and I ask the Government to consider the matter.
Lord James of Blackheath: I have listened to this debate with mounting concern, because I see this from the point of view of how it is all going to work in a realistic boardroom and not the ideal world that appears to exist in your Lordships’ imagination in this debate. It does not happen as noble Lords think it does; there is not usually the formality of everybody’s preconception that they have clear delegations of authority. I have gone through the 13 case studies on my list to see which if any of them might occur in the situations that we have discussed. I cite my case F, which relates to the third fence on the back straight of Cheltenham race course. Noble Lords must bear with me, as the example does work.
The back straight of Cheltenham race course has an incline with three fences. At certain times of the year, the horse and rider come straight into the setting
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In that case, you would go for the authorities running the Cheltenham race course for having failed to doll off and having caused manslaughter, but they would say that they had delegated that task to the groundsman and that he did not do it. His defence would be that he had not been properly trained; he had not been told the full significance of the task and had no experience of such an incident happening previously, so it was a failure of the board for not having instructed and trained him well enough.
That is a straightforward and easy case for that race course, but a similar principle will run through the argument every time there is an attempt to say that such incidents are down to delegation. The delegated party will claim that he has been inadequately trained for the task, while the board may say that he has failed in his delegation or that he had no delegated authority and acted outside his authority, either in being deficient in not doing something or in being overzealous in doing it the wrong way.
We need much greater clarity than we are getting close to providing here. If your Lordships in this debate have such trouble in defining this point, how on earth will a board interpret the Bill when it becomes law so that it can serve—as the noble Baroness, Lady Scotland, said at Second Reading—to save lives? It will not do that; it will just cause more confusion. We must get greater clarity so that the Bill can be understood by all its ultimate users in practice when it becomes an Act.
Lord Brennan: The creation by this House of a new offence of unlawful killing is a very serious step. The caution mentioned by the noble and learned Lord, Lord Lyell, and the contributions of my noble friend Lord Wedderburn and my noble and learned friend Lord Boyd will have indicated, I am sure, to the Minister that we are concerned that this clause as it stands or as amended should not become the same source of legal debate as has led to the unfortunate results of prosecutions in the past 10 or 15 years. It would do Parliament no good to enact yet another such saga into our criminal law. I submit to your Lordships that the two tests that we shall be applying to the clause as it stands and to these amendments are, first, whether there is created an offence that fairly and reasonably attributes criminal liability to a corporation, and, secondly, whether, once drafted, it can be effectively prosecuted.
I draw the attention of the Committee to the fact that at the moment the corporate manslaughter cases that have failed have done so mainly because it was
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The noble Lord’s amendments illustrate the concern that we should be prepared for legal dissection of the clause with passionate intellectual intensity. Let me give some examples, which the amendments of the noble Lord, Lord Razzall, seek to avoid, and very nearly successfully do so. What is the difference between “directing mind” and “senior management”? Here the test of the offence requires involvement of senior management and, lest we forget, “senior management” is defined in Clause 1(4) as,
“(i) the making of decisions about how the whole or a substantial part of its activities are to be managed”.
Take a national construction company with 10,000 employees. That definition immediately restricts the senior management test to the ones on top—those who command the whole or a substantial part of planning or management and who are supposed to deal with safety. What is the difference between that and the directing mind? The Government have to consider that.
On delegation, the noble and learned Lord, Lord Lyell, was hoping that no one could get away with saying, “I delegated it”, but why not? A company exists to delegate its functions down the line in order to make the exercise of its activities for shareholders effective and profitable. The only way in which one will catch delegation is in Clause 1(3), by being able to show that the way in which senior management dealt with the activities of the company was,
That is an extremely nebulous phrase. It possibly goes backward a step. First, one has to get over the effect of a directing mind; if one has shown that there was such a directing mind in senior management, the way in which senior management had done things would then be an additional factor to be proven.
Like the noble Lord, Lord Razzall, I wonder whether we ought not simply to consider deleting the word “senior” from subsection (3). If we do not, we must consider what the provision adds. If we do, why should we not simply delete subsection (4)(c) as well in due course? I do not suggest that we do that now, but I am convinced that the trade unions that represent people in the construction industry will be very concerned about the fact that what the ordinary worker does in his daily activities is the responsibility of the company, and not of its senior management or directing mind, provided that the company is held firmly liable.
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These are very serious matters. I am grateful to noble Lords for the patience that they have shown in listening to me. Prior to Report, I hope that those who are interested in this matter can seek to come to a definitions section that accords with the wishes of all.
3.30 pm
Lord Lyell of Markyate: As I have spoken once or twice on this matter, I shall make only a brief intervention. The noble Lord, Lord Brennan, put his finger on a tremendously important point. I am not sure that I want to go down the route that he suggested, but will the Minister ask the Attorney-General to place in the Library the report—I vividly remember it because I was Attorney-General at the time—of what was said in open court by the judge in the “Herald of Free Enterprise” case? Of all the cases that have been bandied about in the context of this Bill, that of the “Herald of Free Enterprise”—I am not for one moment saying that anyone was guilty; they certainly were not guilty under the law at that time—provides a pretty good benchmark of where we might be going. If those papers could be put in the Library, and we were to hear the views on them of, for example, the noble Lord, Lord Brennan, that might assist our debates.
Lord Bassam of Brighton: I have listened with great interest to this debate. As ever, the lawyers have set my mind working on how best we can respond. Obviously, some concerns about the drafting have been expressed, which we well appreciate. I shall try to set out as fairly as I can the Government’s thinking on this matter. As the noble Lord, Lord Henley, said, there was not perhaps as full an opportunity in another place as we would have liked to explain why the Government had made their amendments. I shall take us through some of those reasons and try to address some of the issues that have been quite fairly raised today. The amendments certainly go to the heart of the new offence. It is important to make clear how the Government intend the new test of liability to work. We are grateful that the amendments have been tabled to enable us to set out our intentions.
The current law fails because it requires the full fault in a case of corporate manslaughter to be found in one individual. This simply cannot reflect the way in which decisions are made in modern organisations, other than in very small ones, which is why only very small organisations have ever been convicted under the current law. The intention of the new test, as I am sure all Members of the Committee will understand, is to ensure that all the circumstances that led to the death can be put before the court, rather than just the actions of a single individual.
We want the new test to ensure that gross failures that are properly the responsibility of the organisation can form the basis of liability, but we want also to ensure that not every work-related death will result in a conviction for manslaughter, even where there has been gross negligence by some individuals. For example, companies should not be blamed where individuals have behaved in grossly
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The new test in the Bill is the Law Commission’s test; it introduces an entirely new way of attaching criminal liability to corporations based on failures in the way activities were managed or organised by the organisation. In looking at how an activity was managed or organised by the organisation as a whole, the prosecution would have to examine how the activity was being managed at all levels, including the senior level. Without further amendment, we doubted that gross negligence would be found in the organisation overall unless there were failures at the senior level, but we were concerned that this was not clear in the Bill.
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