Whirlpool appeal does not undermine trend for increasingly large health and safety fines, says expert

Whirlpool was fined £700,000 at Bristol Crown Court in April 2017 for breaches of the Health and Safety at Work Act (HSWA) which led to the death of self-employed contractor Clive Dalley in a fatal fall. The fine, which was calculated based on the health and safety sentencing guideline which came into force on 1 February 2016, has been reduced to £300,000 on appeal.

The appeal court was, however, "at pains to point out that the reduction was due to the particular circumstances of this case", according to health and safety law expert Kevin Bridges of Pinsent Masons, the law firm behind Out-Law.com.

"Although the fine in this case was reduced substantially, it should not be taken as a retreat from the trend for increasingly large fines for the most serious health and safety offences," he said. "On the contrary, the appeal court's comments will provide little comfort for very large organisations that breach their health and safety obligations."

"Of particular significance is  that although the breach was deemed low culpability, category 3 harm, the fact that it involved a fatality was enough of itself to justify a move not only into the next category but to the top of the next category range. The court then increased this further to take account of the organisation's status as very large," he said.

"The appeal court did not wish to set down a formula to decide when an organisation should be deemed 'very large' - instead, each case should be decided on its own facts - but with a turnover of around £700 million, Whirlpool was deemed very large, resulting in a substantially increased starting point for the fine. An arithmetic approach to sentencing was also discouraged in favour of the exercise of judgement structured by the guidelines," he said.

"The key point of the case is not the fact that the appeal succeeded, but the warning it sends to organisations – and, in particular, very large organisations where their breach results in a death. Here, Whirlpool had an unblemished health and safety record, cooperated fully and had decent procedures in place. Things are likely to have been very different otherwise," he said.

Whirlpool was prosecuted by the Health and Safety Executive (HSE) after an incident at the site of the former Indesit factory in Yate, near Bristol, in March 2015. A self-employed contractor, who had been installing revised fire detection equipment from a height of nearly five metres, fell from a mobile elevated work platform (MEWP) and later died from his injuries.

The HSE's investigation found that Whirlpool had no effective control or supervision in place to prevent conflicting work tasks from being carried out at the same time. The contractor fell after Whirlpool maintenance workers started up an overhead conveyor, unaware that he was working nearby. The movement caused the MEWP to tip over and the contractor to fall onto the factory floor.

Giving his sentencing remarks, the trial judge concluded that this was a case of low culpability and of harm category 3. Given the company's £700m turnover, the trial judge decided the appropriate starting point for the fine should be £1.2m. The Court of Appeal agreed that the company should be treated as a "very large organisation" for the purposes of the guideline, meaning that it was "permissible to move outside the appropriate range [set out in the guideline] in order to achieve a proportionate sentence". It arrived at a £500,000 starting point, finding that the substantially higher starting point would only be appropriate "were the culpability or harm category greater".

The Court of Appeal followed the trial judge's approach by reducing the starting point to reflect the "strong mitigation" in this case, taking it down to £450,000. It then reduced this by one third to reflect Whirlpool's guilty plea. The appeal court heard evidence that the company had made a loss in the relevant year, however it decided against taking this into account as the loss was the result of "two exceptional items" and the loss did not reflect the company directors' pay.

Giving the judgment of the appeal court, Lord Justice Burnett of Maldon noted that there was a "temptation" to approach the application of the sentencing guideline in an "arithmetic way". However, this approach should be resisted, he said.

"In this area, as much as any, the court should not lose sight of the fact that it is engaged in an exercise of judgement appropriately structured by the guideline but, as has often been observed, not straightjacketed by it," he said.

The judge also explicitly stated that the successful appeal should not be seen as "alter[ing] the policy in this court in recent times ... of ensuring that organisations are made to pay fines that are properly proportionate to their means".

"That of course does not relieve the court of a duty to enquire carefully into the facts of each case so as fairly to reflect different levels of harm and culpability," he said.

"The circumstances of this case are unusual in flowing from an offence of low culpability and low likelihood of harm. Had they involved any increased culpability or likelihood of harm the appropriate fine would have been very much larger," he said.