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Steel Manufacturer Pays £1.5 Million Price of Health and Safety Breaches

Fines imposed for health and safety breaches at work are supposed to hurt and send a deterrent message to management and shareholders. However, the Court of Appeal has ruled that a £1,985,000 penalty imposed on a steel manufacturer following two accidents in which workers were badly injured was excessive.

In the first accident, a worker had two of his fingers crushed by heavy steel pipes. In the second, which occurred at the same plant a few months later, another man’s finger was sliced off by an inadequately guarded lathe. The fine was imposed after the manufacturer admitted offences under the Health and Safety at Work etc. Act 1974. In passing sentence, the judge said both accidents had involved workers putting their hands into patently hazardous machinery and were entirely avoidable.

In challenging the fine, the manufacturer’s lawyers pointed out that, despite having a turnover in excess of £4 billion in the relevant year, it had lost more than £850 million after tax. However, the Court noted that the fine represented only about 0.6 per cent of that overall loss and would not threaten to put the manufacturer out of business.

There had been a previous accident involving the lathe, but that had occurred 15 years earlier and there was evidence that the machine had thereafter been used for 15,000 man hours without incident. In the circumstances, the judge had been wrong to categorise the likelihood of an accident as high, rather than medium. The fine was therefore reduced to £1,500,000.



 
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