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	Murdoch University Electronic Journal of Law

Legislative Attempts To Imprison Those Prosecuted For Criminal Manslaughter In The Workplace

Author:	Rick Sarre LLB, MA (Criminology) Associate Professor of Law and Criminology, School of International Business, University of South Australia
Issue:	Volume 9, Number 3 (September 2002)

Paper presented to the Law and Social Justice Interest Group at the Australasian Law Teachers' Association annual conference hosted by Murdoch University School of Law, Perth, Western Australia September 29 - October 2 2002

Contents

• Corporate killing
• The Commonwealth Criminal Code Act 1995
• The Bracks Bill 2001
• Initiatives elsewhere
• Conclusion
• Notes

Corporate killing

1. In 1998, 18 year old Anthony Carrick was crushed by a 5-tonne concrete panel on his first day at work at a bulk livestock feed store in Melbourne. Drybulk Pty Ltd was fined $65,000. His family was outraged, and the government pledged to change the law. The question was how, and for what purpose? Would anything be achieved by jailing the principals of the firm?

2. The literature on the preferred type of regulation in these situations is plentiful to say the least. It speaks of those who argue for decriminalisation and deregulation, while at the other end of the spectrum, some commentators call for uncompromising criminalisation of any dangerous acts. Most commentators fall somewhere in between, seeing the value of self-regulation, governments rewarding 'cultures of compliance', while at the same time recognising that punitive sanctions have their place.[1]

3. Most commentators now accept and adopt the notion of the enforcement 'pyramid'. This idea has been around for a decade. According to Fisse and Braithwaite, compliance is best understood within a dynamic enforcement game where enforcers try to get commitment from corporations to comply with the law and can back up their negotiations with credible threats about the dangers faced by defendants if they choose to go down the path of non-compliance.[2]

4. At the base of the pyramid, most matters are dealt with informally, that is, dealt with by cautions, stern warnings and the like. As conduct becomes more serious, so too do civil actions and monetary penalties follow. Further up are prosecutions for more serious malfeasance, and, at the top of the pyramid, severe penalties. It is at this level that the new laws are designed to apply.

5. In Australia, the idea of a specific corporate criminal responsibility has been pursued for a decade.[3] The current law is straightforward. While a corporation is deemed to be a legal 'person' for the purposes of the criminal law in all Australian jurisdictions, a corporation cannot be tried for an offence which can only be punished by imprisonment, and where the persons who made the error of judgment or who acted in a callous way were not the 'guiding mind' of the corporation, or did not 'embody' the corporation.[4] For that reason a corporation can never be found guilty of murder in Australia. There is a preparedness of some prosecutorial authorities, in the last decade, to charge corporations with manslaughter, although the success rate is poor.[5]

   The Commonwealth Criminal Code Act 1995

6. This Act does attempt to give some greater tangibility to the notion of corporate criminal liability.[6] Section 12.1 confirms that the Code applies to corporations, and says that they may be found guilty of any offence, including those punishable by imprisonment. The Code explicitly states that harm caused by employees acting within the scope of their employment is considered to be harm caused by the body corporate, and introduces the crucial concept of 'corporate culture', defined in Section 12.3(6) of the Code as an "attitude, policy, rule, course of conduct or practice existing within the body corporate generally or in the part of the body corporate in which the relevant activities take place".[7]

7. A company with a poor corporate culture may be considered as culpable under this legislation as individual directors or senior managers.[8] The change was designed to catch situations where, despite the existence of documentation appearing to require compliance, the reality was that non-compliance was expected.[9] For example, a company would be guilty of reckless endangerment under the Code where its corporate culture tacitly authorised breaches of the safety codes (for example, by removing equipment guards, or allowing drivers to ingest drugs in order to drive longer hours).

8. There is a limitation to the Code, as it is designed primarily as a model code for States to follow and develop uniformity. If the Commonwealth does not have a criminal law applicable to the activity under question, then the Code cannot apply. There are no Commonwealth manslaughter provisions. It would fall to the State in which the act took place to adopt a similar provision in its criminal code or other legislation.

   The Bracks Bill 2001

9. In late November 2001, the Bracks government introduced the Crimes (Workplace Deaths & Serious Injuries) Bill into the Victorian parliament.[10] Under this Bill, if an employer has failed to provide a safe place of work, a corporation could be fined up to $600,000 (up from $250,000) and an individual up to $120,000 (up from $50,000) and serve a maximum term of 12 months imprisonment. Where an employer has obstructed health and safety inspectors, discriminated against employees for health and safety activities or failed to comply with prohibition notices issued by WorkSafe, maximum fines will increase to $750,000 (up from $250,000) for a corporation and $150,000 (up from $50,000) for individuals.

10. The Bill was designed to allow a Court to look at the conduct of the corporation as a whole, rather than just the conduct of one person who was the "directing mind and will" of the corporation (which is the case under the current law). A court will be able to consider and add together the negligence of any number of employees/ agents/ officers of the corporation. If the combined conduct amounts to gross negligence, the corporation may be found guilty. A guilty corporation will be able to be fined up to $5 million for a death and up to $2 million for a serious injury. A court will also be able to order the company to publicise its wrongdoing.[11]

11. If the company is found guilty, the new law will allow prosecutions of "senior officers" of corporations where they knew about the high risk to their workers' safety and were able to do something to prevent the death or serious injury but did not. Maximum penalties for senior officers found guilty are $180,000 fine or 5 years imprisonment where a death has occurred; $120,000 fine or 2 years imprisonment were a serious injury has occurred.

12. The Bill was rejected in the Upper House in May 2002, following sustained pressure from the Australian Industry Group and the Victorian Employers Chamber of Commerce. The feeling was that there was insufficient requirement of a causal nexus between the prescribed conduct and the serious injury or death.

    Initiatives elsewhere

13. The Australian angst has been mirrored overseas. Following sustained public pressure at the failure of the courts to secure convictions arising out of the Southall rail crash in September 1997, [12] and a Law Commission Review in 1996, the Home Office explored the idea of a new crime of 'corporate killing', an offence that would correspond to the (proposed) individual offence of killing by gross carelessness.[13]

14. 'Death by corporate killing' would be alleged to have occurred when there is 'management failure', that is, where the corporation's conduct in causing death fell far below what could reasonably have been expected (e.g. where the entity's activities are so poorly planned and organised that they fail to ensure the health and safety of employees or those affected by its activities). According to the Law Commission, such a failure should be regarded as causative of death even if the more immediate cause is the act or omission of an individual. In that case, both individual and corporate liability could flow from the same incident. In its response,[14] the UK government, in accepting the thrust of the Law Commission's recommendations, proposed that any individual who could be shown to have had responsibility for the circumstances in which management failure fell far below what could reasonably be expected should be disqualified from carrying on business henceforth.[15]

15. Finally, it is interesting to note that European civil code countries, where non-human liability under the penal law has been historically unacceptable, have enacted a raft of administrative penalties for corporate wrongs. France has had corporate criminal liability since 1 March, 1994 with rules that apply not only to corporate entities but also to other entities such as trade unions and local authorities.[16]

16. Portugal, Spain, Norway, Finland and Denmark, to name a few, have all incorporated criminal punishments against errant corporations under their new or revised penal codes.[17] Two Council of Europe treaties include corporate criminal liability.[18]

    Conclusion

17. The above initiatives are a response to the challenges thrown to law-makers by those keen to reduce the numbers of workplace deaths. There are grave limitations of the criminal law as a regulatory tool. But there is something satisfying about the ability to imprison someone in circumstances that demand it, even for those of us who are committed to imprisonment as a last resort and who see the futility of imprisonment as a rehabilitative tool.

18. Whether harsh sentences act as a deterrent is another question, as is the dilemma for law-makers of accumulating causal acts where there is no evidence of a direct nexus. One can argue strongly that, at the top of the pyramid, imprisonment for those whose corporate culture is 'appalling' does provide the sort of 'teeth' that regulators often feel they need in order to do justice in situations that seem to demand more than the usual responses.

Notes

[1] Pearce, F. and Tombs, S (1990), 'Ideology, hegemony and empiricism: compliance theories and regulation'. British Journal of Criminology 30(4): 423-443.

[2] Fisse, B. and Braithwaite, J. (1993) Corporations, Crime and Accountability, Cambridge: CUP, 143, cited in Croall, H. (2001) Understanding White Collar Crime, Buckingham: Open University Press, 117.

[3] For example, Tomasic, R. and Bottomley, S. (1995) Corporations Law in Australia, Sydney: Federation Press, Ch 11. Also Foster, N. 'Personal Tort Liability of Company Officers for Company Occupational Health and Safety Breaches', unpublished paper presented to the 2001 ALTA conference, Port Vila USP, July 2001. Also Hill, J. (2002), 'Corporate Criminal Liability in Australia: an evolving corporate governance technique?, in Low, C.K. (ed), Corporate Governance: An Asia-Pacific Critique, Hong Kong: Sweet and Maxwell, 519-566.

[4] Findlay, M., Odgers, S. and Yeo, S. (1999). Australian Criminal Justice, 2nd edition, South Melbourne: Oxford University Press, 89 ff.

[5] Bronitt, S. and McSherry, B. (2000), Principles of Criminal Law, Sydney: LBC, para 2.3. See the failure of manslaughter in R. v A.C. Hatrick Chemicals Pty Ltd, Supreme Court of Victoria unreported, Hampel J., No. 1485 of 1995.

[6] See Woolf, T. (1997), 'The Criminal Code Act 1995 (Cth) - Towards a Realist Vision of Corporate Criminal Liability', 21 Criminal Law Journal 257.

[7] As an example, Justice Heerey, in the Australian Federal Court in June, 2000 referred to the 'appalling' culture of Simsmetal Ltd, in a case dealing with alleged violation of Australian Trade Practices legislation (The Risk Report, 2000).

[8] Refer Criminal Code Act, Part 5: Para 501.2.1; Goffee, R. and Jones, G. (1998). The Character of a Corporation: How your company's culture can make or break your business, London: Harper Collins.

[9] See generally Sarre, R. (2001), "Risk Management and Regulatory Weakness" in Ramsay, I. (ed) Collapse Incorporated: Tales, Safeguards and Responsibilities of Corporate Australia, Sydney: CCH, Chapter 10, 291-323.

[10] According to a report in The Australian 30/4/02 p 9, the Beattie government in Queensland is drafting legislation to introduce a new crime of 'dangerous industrial conduct', with penalties of up to seven years' jail and fines of $500,000 for criminally negligent managers. The ACT has an amendment to its Crimes Act currently being debated, WA has a draft paper on work safety laws, and NSW has recently overhauled its health and safety laws but has not pursued the notion of corporate killing offences.

[11] The idea is that damage to a company's reputation can often be a more effective deterrent to large companies than any financial penalty.

[12] Wells, C. (2001) 'Corporate Criminal Liability: Developments in Europe and beyond' Law Society Journal, 39(7), 62-65 at 64. Refer Attorney-General's Reference No. 2/1999 [2000] 3 All ER 182 (Court of Appeal).

[13] Home Office (2000). Reforming the Law in Involuntary Manslaughter: The Government's Proposals, UK, May, 2000. Part 3: 'Scope of the Proposals - A new offence of corporate killing'. http://www.homeoffice.gov.uk/consult/invmans.htm.

[14] Ibid at p.19, para 3.4.9

[15] In the United Kingdom, a corporate manslaughter prosecution must show that someone who represents the 'controlling mind' of the company is also guilty of the offence: Tesco Supermarkets Ltd v Nattrass [1972] AC 153. Given that 'controlling mind' is such an amorphous term in common parlance, the chance of a corporate conviction in that case was always going to be slight. See Croall, op cit 119.

[16] Cahill, S. and Cahill, P. (1998). 'A Killer Abroad', Chartered Secretary, November, 22-23. Wells, 2001 op cit notes that the Penal Code was amended in 1991 to remove the general principle that liability cannot attach to non-human entities.

[17] Wells, 2001 op cit, 64.

[18] One dealing with environmental crime and the other with corruption (Wells, 2001 op cit 65).