Directors' Liability For Health And Safety Incidents.

Supreme Court decision

Board of directors' liability today

Comment

Supreme Court Decision 38991, which was issued on November 4 2010, has established that a board of directors may be held liable in respect of duties of health and safety in the workplace.

Supreme Court decision

The court considered events that resulted in injury and which occurred in a company with a complex structure. In its decision it distinguished between two types of injury event: an event arising from a structural dysfunction in the company and one arising from a chance dysfunction.

The court stated that all members of a board of directors are liable for a breach of the duty to monitor potential injury incidents, unless such incidents are the result of a chance dysfunction. This view is consistent with the requirement to monitor the company's general performance as set out in Article 2392 of the Civil Code, which was in force when the facts of the case occurred. Where the incident arises from a chance dysfunction, only the managing director or the officer in charge of the site is considered liable.

However, the case that the Supreme Court considered dated back to the 1970s; therefore, its decision should be considered in light of the regulations that applied at that time.

Board of directors' liability today

Attempting to interpret the case in the current regulatory context is difficult, as there have been a number of fundamental legislative changes since the events of the case occurred. Two changes are particularly significant:

Law 626/1994, which was replaced by Legislative Decree 81/2008, introduced a specific regulation on health and safety that requires a company to nominate an 'employer' - that is, the person in charge on health and safety. Legislative Decree 6/2003 amended Article 2392 of the code by repealing the general duty of each director to monitor the company's general performance. The general duty of monitoring and supervision was replaced by specific obligations and liabilities that apply to directors to whom specific functions and relevant powers have been delegated - Article 2381 of the code outlines the basis of these obligations and liabilities. Defining the 'employer' under Article 2(b)

In accordance with Article 2 of the legislative decree, the employer ('datore di lavoro' in Italian) is the party that is liable for the employment relationship with the employee or, in any event, bears liability for the business organisation of the department to...

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