SHE Regulatory News - Summer 2012

Welcome to Clyde & Co's Safety, Health and Environment Regulatory Newsletter.

Our SHE Regulatory Team is one of the largest and most recognised in the UK specialising in regulatory defence work.

We are only too aware of the difficulties that face businesses today with an ever increasing burden of regulation and legal duties. A workplace incident or a breach of those duties often culminates in an investigation and potentially criminal prosecution of a business, its management or staff.

With the stakes so high, it is essential that you and your organisation are kept up to date with changes in the law to protect the reputations of your business, its directors and employees.

Our quarterly newsletter provides a topical update on recent key developments in our areas of specialism:

Corporate Manslaughter/Health and Safety Road Traffic and Transport Environmental Fire safety Trading law Food safety CORPORATE MANSLAUGHTER / HEALTH AND SAFETY

84% of health and safety Regulations to be scrapped – radical change or damp squib?

The Government has promised a shake-up of health and safety after announcing that 84% of Regulations will be scrapped or improved.

Whilst the announcements of the 2012 Budget have been heralded by some as the biggest change in direction ever seen in health and safety legislation, closer examination reveals that the changes may not be quite as radical as they first appear.

The Government has so far confirmed that 167 of the 199 health and safety Regulations considered as part of the Red Tape Challenge [which we reported on in the Spring edition of this enewsletter] will either be withdrawn or improved. The HSE Board has already approved the scrapping of seven pieces of legislation that it believes are either obsolete or have been superseded by modern legislation.

To help businesses make sense of this potentially huge streamlining exercise, the Health and Safety Executive ("HSE") has confirmed it will redesign information on its website this year which will provide guidance on the changes.

Whilst the Government's intentions are clearly admirable, further information is needed on what proportion of the 84% figure cited will be improvement of Regulations and what proportion will be removal of redundant Regulations. For example, Regulations such as the Pottery (Health and Welfare) Special Regulations 1950 and Regulations for the use of locomotives and wagons will be abolished, whilst legislation which most affects employers on a daily basis, such as the Management of Health and Safety at Work Regulations 1999, will remain intact.

With little information currently available on the detail of the proposals, it remains to be seen quite how the changes will impact on businesses.

Network Rail hit with largest ever fine

The largest ever fine ordered to be paid by a company for rail-safety failings has been imposed on the United Kingdom's railway provider, Network Rail. Such significant fines are clearly intended to act as a stark warning to organisations, irrespective of who ultimately pays the price.

On 4 April 2012 Network Rail was fined £4 million, and ordered to pay costs of £118,000, by Preston Crown Court following the Grayrigg train derailment which resulted in one fatality and 86 injuries.

The derailment occurred when a high-speed train from London Euston to Glasgow Central derailed after hitting a set of badly-maintained points. Stretcher bars holding the moveable rails a set distance apart when the points are operated had failed, causing the train's wheels to come off the tracks. The Office of Rail Regulation found during its investigation that Network Rail had failed to provide and implement suitable and sufficient standards, procedures, guidance, training, tools and resources for the inspection and maintenance of fixed stretcher-bar points.

The penalty comes after Network Rail was recently fined £1 million for the deaths of two teenage girls at a level crossing in Essex in 2005. In May last year, Network Rail was also fined £3 million for its safety failings over the Potters Bar Rail crash in May 2002.

In imposing the most recent penalty, the judge commented "the fine is imposed in order to mark the seriousness of the offence and to emphasise the fact that those who bear responsibility for ensuring the safety of the public must exercise proper care."

All these fines are of interest since Network Rail is a government-backed body, with no shareholders and its debt guaranteed by the government. This means that the money will effectively be paid out of the public purse, ironically leaving less available to be spent on upgrading Britain's railways. The fine reminds organisations that, whatever their standing, they cannot ignore their health and safety responsibilities.

*STOP PRESS

As part of its crack-down on reforming health and safety Regulations, the Government has also reaffirmed that changes in strict liability will be brought in this year, so that health and safety law will no longer hold employers to be in breach of their duties in civil law where they have done everything that is reasonably practicable and foreseeable to protect their employees.

In response, the HSE will provide more help for businesses by this summer on what is "reasonably practicable" to assist in understanding how they can comply with the law. This is an area where limited guidance and advice is available and any clarity which can be provided will no doubt be welcomed by all.

CDM – Building for the future or falling to pieces?

Criticisms that for a long time have been levelled at the Construction (Design and Management) Regulations 2007 ("CDM") have come to a head following a recent evaluation of the legislation.

The evaluation shows that whilst CDM has gone a long way in meeting its objectives, there remain areas for improvement. Whilst the review is helpful in drawing attention to the key issues, no recommendations have been made. This begs the questions "What was the purpose of the evaluation?" and "What can we expect for the future?".

What was the purpose of the evaluation?

The evaluation was commissioned in order to fulfil the recommendations set down in the Löftstedt report, which emphasises the need for clearer expression of duties, a reduction of bureaucracy, and tailored guidance for small projects.

The evaluation was based on surveys by parties in the construction industry conducted in 2006 and 2010 and aimed at answering two key questions:

To what extent has CDM met its stated objectives? What are the cost implications for the construction industry of CDM? Broadly speaking, the results of the evaluation show that:

CDM has gone a long way to meeting its objectives, but some concerns remain within the industry construction, design, management and site practices have improved between 2006 and 2010 a cost impact was associated with CDM, but respondents rated the benefits obtained higher than costs, and industry practice was found to have a significant influence on how CDM is implemented What were the key findings?

What is clear is that CDM has gone a long way towards clarifying duty holders' roles and responsibilities. This was considered to be one of the positive aspects of the legislation.

However, there remain concerns regarding the interpretation and implementation of the Approved Code of Practice. A common theme that featured was that parties were satisfied with the Regulations, but some did not appreciate their applicability or understand what was required of them. For example, some small organisations thought that since their role on a project was relatively minimal, CDM did not apply to them.

The recent economic downturn has also led to much of the work undertaken since the introduction of CDM being done under difficult commercial circumstances. This has resulted in instances of price being more important than competence, early starts on site and compressed timescales. These all limit the time and resources available for coordination and cooperation. In the current economic climate, Contractors, Designers and Coordinators are not always confident enough to say 'no' to a Client. The report stresses that parties must take their CDM responsibilities seriously to avoid breaching the Regulations; commercial pressures will not be an excuse.

What can organisations expect for the future?

Whilst the report makes no recommendations for changes to CDM, the evidence produced will support policy development, and the Health and Safety Executive has announced that it will be re-drafting the Regulations for reissue in 2014. At present, no further detail is available on the changes to be made, however it is envisaged that CDM will be given the necessary attention to ensure that its key objectives do not fall by the wayside.

A toothless bite or a hidden danger? – Coroner's reports

At every Inquest, there lurks the prospect that a Coroner will order a report – this is known as a Rule 43 report.

For an organisation to receive such a report after the daunting experience of a fatality and an Inquest can be a frightening prospect. But what is a Rule 43 report and can it be detrimental to a business?

This article looks at whether Rule 43 is a toothless bite or a hidden danger that could have potentially far-reaching ramifications for a business.

What is Rule 43?

At the conclusion of an Inquest, a Coroner who believes that action should be taken to prevent the recurrence of fatalities similar to those in respect of which the Inquest is being held...