A "New Dawn" for construction health and safety?

Health and safety within the construction industry has long been on the radar, and never more so than now. The Grenfell Tower tragedy in London earlier this year has brought the safety of completed buildings to the forefront, but there have also been a number of recent developments concerning the health and safety of construction workers on site.

While Grenfell has prompted a comprehensive review of the standards required of completed buildings, the industry has already seen a number of recent changes affecting the safety of the construction site itself, and of the men and women working within the sector.

With the introduction of new sentencing guidelines for health and safety offences, the Construction (Design and Management) Regulations 2015 (CDM 2015), and the Modern Slavery Act 2015, the legal framework in England has undergone significant change in the last two years that reflects not only ongoing efforts to advance the industry’s safety record but also to improve conditions for those involved in it. Client accountability is a notable feature of these developments, as evidenced by the emphasis on proportionate fines for health and safety offences, increased responsibility under CDM 2015, and transparency requirements under the Modern Slavery Act. While much is positive, many in the construction business believe there is still more to be done.

Sentencing regulations

Those in the industry will be familiar with the new sentencing guideline, effective since 1 February 2016, for health and safety and corporate manslaughter offences (the Guideline).¹ In the period since the introduction of the new regime, the impact on the construction sector has been dramatic. Already a costly sector for health and safety offences, in 2016 fines were more than double the figure of the previous year, rising to almost £14 million from £6.6 million in 2015.

Under the Guideline, courts now consider culpability, seriousness and likelihood of harm and the size of a business and its turnover when imposing fines. Fines for businesses with a turnover in excess of £50 million can now reach beyond £10 million for health and safety offences, and corporate manslaughter fines could be more than £20 million.

A recent Court of Appeal decision, R - v - Tata Steel UK Ltd, demonstrates the approach the courts will take towards big businesses, in particular, when it comes to the sentencing requirement that “the fine must be sufficiently substantial to have a real economic impact which will bring home to both management and shareholders the need to comply with health and safety legislation”.²

This was a case involving two incidents where Tata employees suffered severe hand injuries while using machinery. When calculating the fine, the judge in the Crown Court, at first instance, had to take into consideration Tata’s status as a “very large organisation” with a turnover of some £4 billion; however, the Guideline only provides guidance on fine levels for “large” organisations with much smaller turnover. This made the judge’s function more challenging in terms of imposing a fine that would have “a real economic impact”. But the judge found a way of achieving a suitable level of fine by elevating the “harm category” of the offences.

In its observations on the sentence at first instance, the Court of Appeal noted that the resultant fine was out of proportion to penalties imposed in the past but the Guideline had, in the words of the Crown Court judge, “marked a new dawn”. The calculation of the fine was heavily dependent upon turnover and organisations potentially affected by the Guideline “had better wake up to this fact”.

In reviewing the case, the Court of Appeal disagreed with the Crown Court judge in relation to the categorisation of one of the offences, and consequently Tata’s fine in respect of that offence was reduced (to £1.3 million from £1.8 million), but endorsed his approach towards achieving a proportionate fine.

As noted in the judgment, the Guideline marks a new dawn in terms of health and safety offences. The emphasis on economic impact, and not just on the severity of the offence, means that it is not only small contractors that need to be concerned. The Guideline does not rule out the possibility of a fine so severe that it would have the effect of putting the offending company out of business; however, this is only likely to be an acceptable consequence if the offence is so bad that the courts feel it is warranted to prevent further injuries or offences. In other instances, the Guideline allows for a downward adjustment if financial circumstances warrant it (for example, if the business is loss-making) and gives the courts flexibility to allow time for payment or to order payment by instalment.

CDM

The primary regulatory vehicle for the management of health, safety and welfare, when carrying out construction projects, is CDM 2015. Breach of the regulations is a criminal offence by virtue of section 33(1)(c) of the Health and Safety at Work Act 1974 and the Guideline will apply when determining the sentence. CDM 2015 replaced CDM 2007 in April 2015. The earlier version was considered to be overly bureaucratic and costly to administer. CDM 2015 is intended to be simpler to use and streamlined. It applies to almost all building and construction work, including new builds, demolition works, refurbishment, extensions, conversions, repair and maintenance.

One of the most striking changes in CDM 2015 was the increased responsibilities imposed on the client who must now take a more proactive and involved role from the beginning to the end of the project. While it is the client’s responsibility to appoint others with health and safety duties, such as the “principal designer”, whose role includes embedding health and safety in the evolution of the project from inception and ensuring that all designers comply with their duties under CDM 2015, ultimate responsibility for any breach of duty may well rest with the client, who has an overarching duty to make suitable arrangements for managing a project, including the allocation of sufficient time and other resources. The Health and Safety Executive (HSE) specifies, for example, that “suitable arrangements” include a duty to make sure designers and contractors have the skills, knowledge, experience and organisational capability to manage the project’s health and safety risks.

We have seen from the previous section of this article that fines have dramatically increased since the introduction of the new Guideline. Although clients have always been potentially criminally liable, in reality contractors were more likely HSE targets. This is expected to change, with clients more often pursued for not fulfilling their duties under CDM 2015; for example, by failing to take steps to check contractors are fit to undertake a contract safely. While some in the industry perceive CDM 2015 as onerous and unwelcome, others have responded positively, seeing it as an opportunity to overhaul their health and safety practices in a proactive and collaborative way.

Health

The HSE has reported that the year to March 2017 saw the lowest number of construction workrelated fatalities on record. This is encouraging news. However, there is a growing awareness that although the industry is proactive when it comes to the “safety” element of “health and safety”, the “health” element has not received the attention it needs.

It is well known that construction is one of the most dangerous sectors in which to work, but what is often left unsaid is the prevalence of illness. According to the HSE, statistics reveal that construction workers have a high risk of developing diseases from a number of industry-related issues. Occupational cancer is more common in construction than any other industry sector, accounting for over 40 per cent of occupational cancer deaths and cancer registrations. The most significant cause is asbestos (70 per cent). Other causes include silica, paint and diesel engine exhaust emissions. Inhalation of hazardous substances can also cause other health problems including breathing difficulties, lung disease and dermatitis.

Physical health risks are prevalent within the industry. Back injuries and upper limb disorders are common. Manual handling and repetitive work are frequently the cause. Noise levels can also lead to disorders, such as hearing loss, and ringing in the ears. Regular use of vibrating handheld power tools and machinery can result in a number of conditions, including HAVS (hand-arm vibration syndrome).

Mental health is topical at the moment in society more broadly. This is opportune for the construction industry, which has seen an increasing awareness of the risks associated with poor mental health. Recent research carried out by Construction News, a leading UK industry publication, into mental health in the sector revealed that one in four construction workers had considered suicide, and that 55 per cent of participants in their research have experienced mental health issues.³ Construction News has launched a campaign, “Mind Matters”, to raise awareness of mental health in construction, and break down the stigma surrounding mental wellbeing within what remains a male-dominated industry. According to some industry insiders, a “macho ethos” is ingrained in the fabric of the business, creating a challenging environment in which to talk about issues such as stress and anxiety.

In the current political climate, with its greater focus on compassion and corporate accountability, we are likely to see occupational health continue to feature as an area for further improvement.

Modern slavery

At the risk of depicting the construction sector as a particularly bleak place to work, it must nevertheless be acknowledged that it is an industry that is also susceptible to modern slavery. As one commentator put it, the public face of the global construction business is all about creating inspirational buildings and pushing the boundaries of architecture and technology.⁴ The dark side is the systematic exploitation of millions of vulnerable migrants.⁵ This is not just a problem in less-developed nations. In the UK officials report illegal abuse of vulnerable labour, for example, by acceptance of obviously forged documents, payment of lower wages, and requirements for labourers to work unreasonable hours or to live in unsanitary conditions. And, of course, these issues leave aside exploitation and abuse that may be taking place within the global supply chain of UK players in the industry.

Section 54 of the Modern Slavery Act 2015, which came into force in October 2015, attempts to address the problem by imposing a transparency requirement on businesses to show that modern slavery is not taking place in their company or their supply chain. While this was a worthwhile starting point, the legislation has been criticised - not least by the Government’s Joint Committee on Human Rights - for not going far enough. In particular, because the Government does not police the publication of statements, and because the legal sanctions for noncompliance are limited in the first instance to an injunction compelling the organisation to report.

A Private Members' Bill is currently awaiting its second reading in the House of Lords to strengthen and broaden the application of transparency in supply chains. In the meantime, there has been a shift in momentum towards those in the industry itself. Earlier this year, a best practice toolkit was launched by The Chartered Institute of Building (CIOB) in conjunction with industry alliance Stronger Together, to help construction businesses shape their response as they tackle modern slavery. Furthermore, a coalition of leading construction sector institutions and associations, including the Building Research Establishment (BRE) and the British Standards Institution (BSI), has formed to raise awareness and eradicate modern slavery in construction supply chains. There are a number of other initiatives, including the BRE’s “Ethical Labour Sourcing Standard,” which provides a framework for verifying ethical labour sourcing.

A “new dawn”?

The issues currently facing the UK construction industry are significant, not only in terms of economic uncertainty, Brexit and technological change, but also safety and human welfare. As this article has shown, while to some extent it has been forced upon the sector by legislation, there is also evidence of an increasingly proactive and collaborative approach within the industry itself towards what are undoubtedly critically important subjects. With health and lives at stake, every step in this direction is to be welcomed.

1. Sentencing Council, Health and Safety Offences, Corporate Manslaughter and Hygiene Offences, Definitive Guideline.

2. [2017] EWCA Crim 704.

3. “Mental Health issues account for third of industry’s absences”, Construction News, 16 May 2017.

4. We looked at exciting technological innovation in the last edition of Built Environment.

5. “Modern Slavery: The Dark Side of Construction”, Chris Blythe, Chief Executive CIOB, July 2015

Ashurst and the Built Environment 

Our Built Environment industry provides a one-stop shop for investment, development, construction, financing and dealing in and with public and private buildings and infrastructure. To find out more about our Built Environment offering, visit our Built Environment expertise page.