Health and Safety Fines Must Match Ability to Pay

Employers whose breaches of health and safety rules result in injury to workers are hit hard in the pocket – but, as with individuals, penalties levied are tailored to the seriousness of offences and ability to pay. In one case, a £1.8 million fine imposed on a port operator was reduced to £500,000 by the Court of Appeal.

The company was prosecuted following a Health and Safety Executive investigation into an incident in which a dock worker’s arm was caught in an electric capstan. He suffered multiple fractures of the limb and remained unable to bend and straighten his arm properly 18 months after the accident. The company was hit with the fine and ordered to pay £14,238 in prosecution costs after pleading guilty to a breach of Section 2(1) of the Health and Safety at Work etc. Act 1974.

On appeal, the company’s lawyers pointed to its otherwise good safety record and its early guilty plea. It had rectified safety issues relating to the capstans immediately after the accident. It was also facing challenging trading conditions, its pre-tax annual profits having fallen from £13 million at the time of the accident to £2.7 million in its most recent accounts. In the circumstances, the Court found that the fine was manifestly excessive and allowed the appeal.