EXCLUSIVE How David Cameron's health & safety reforms will affect food industry
03 February 2012
Author : Peter Forshaw and Chris Green
David Cameron has vowed to kill Britain’s “excessive” health and safety culture and the red tape that he believes is hampering a recovery from economic slow down. Lawyers at Weightmans look at how the proposals will affect the food processing industry and assess the impact on companies and their safety management systems.
Mr Cameron’s plans cover, broadly, two areas: The current “claims culture” with its associated legal fees forming part and parcel of an extremely expensive, time consuming process, together with the enforcement of what Mr Cameron believes are unduly onerous safety obligations on the food industry.
From a claims perspective, the Government’s approach should be cautiously welcomed by employers and insurers in the food sector. The perception of many is that a claims culture exists in the UK. There is no such thing as a genuine accident any longer – if an accident occurs, the ‘blame-game’ begins and this comes at a significant cost.
A report by Datamonitor forecasts that personal injury claims' costs for insurers will rise from £8.4bn in 2010 to £9.7bn in 2014. Not only do such rising costs risk increased premiums for policyholders, such claims involve additional indirect costs through business interruption (on investigation and via procedural compliance), and the risk of copycat claims. Anything that can help deter, particularly spurious, claims and reduce the time, cost and inconvenience of the claims process once instigated should be welcomed.
Perhaps most welcome are the proposals on pre-action disclosure and strict liability. At present, following submission of a letter of claim for a workplace accident, an employer may have to produce anything between 11 and 82 documents to enable a claimant to ascertain if they have a viable case.
The proposal to reduce this list, and limit the number of documents to be collated at an early stage will make it easier and more proportionate for an employer to comply. Likewise there is an apparent unfairness currently to employers who may have to settle claims for say machinery which breaks down, without any fault by the employer who can demonstrate the most diligent inspection and maintenance systems.
Re-examination of the doctrine of strict (no fault) liability may just enable employers to defend such claims going forward and avoid automatic, no fault, pay-outs. However none of this should detract from the need to resolve genuine claims, caused by clear negligence, quickly and efficiently.
Mr Cameron has stated that the public perception of health and safety is that it has gone too far and is regarded as disproportionate in some of the prosecutions that have been brought to date.
Although there are still before the courts at this moment criminal cases following trees falling on motorists’ cars in high wind and fire-fighters while dealing with an operational fire incident, there are plenty more cases where companies are fined after suffering fatal accidents and their convictions are very widely publicised where they have to admit in open court that they could have done more to ensure safety.
Already the coalition has “relaxed” the inspection and accident reporting requirements. Certain accidents where an injured party is off for over 3 days but back at work before the 7th day no longer need to be reported. Health and safety inspectors can now visit food factories and charge for their time in so doing.
Food industry specialists query whether all businesses will in future be as frank and cooperative in reporting incidents to HSE (or in creating records of “near miss” reports) if in so doing their company might be charged for the privilege of HSE’s time in demanding work to remedy any “material breaches”. Given this procedure can be used to demand works are undertaken even when nobody has actually been injured, only time will tell if the new charging regime will achieve any saving of time and costs to business, as all of these proposals were originally intended to do.
Peter Forshaw, Partner in the Commercial Insurance team, and Chris Green, Partner in the Regulatory team at national law firm Weightmans LLP
Peter.Forshaw@Weightmans.com
Chris.Green@Weightmans.com
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