£4m fine - why keeping accurate health and safety records matters
It is often thought that a health and safety offence will involve injury or death, or the immediate potential for those to happen. However, a recent case has shown that even when no harm is involved, prosecutions and subsequent fines can result.
What happened?
The Health and Safety Executive (HSE) had asked gas distribution network companies for information about how they managed gas networks in high-rise multiple occupancy buildings (HRMOB).
National Grid Gas operates the nationwide gas transmission system and gas distribution systems supplying gas to almost 50% of the UK's domestic and industrial gas customers. This included gas pipes in HRMOBs.
National Grid Gas sold a part of its operations to Cadent Gas Ltd. As part of the sale, it also transferred its records but those records were incomplete and had not been subject to any audit or review when the issue was discovered over a year after the sale.
Because of this, Cadent was carrying out inspections based on the existing database. This meant that 769 buildings were missing, and as a result of that, gas risers in those buildings had not been inspected or routinely maintained for a number of years.
As well as this, the HSE investigation discovered that National Grid Gas had not taken steps to make sure that over a hundred of the buildings involved in the sale had Pipeline Isolation Valves (PIVs), which would enable gas supplies to be shut off if an incident occurred.
What does the law say?
Section 3(1) of the Health and Safety at Work Act 1974 says that:
“It shall be the duty of every employer to conduct his undertaking in such a way as to ensure, so far as is reasonably practicable, that persons not in his employment who may be affected thereby are not thereby exposed to risks to their health or safety.”
'Reasonably practicable' is a legal term that balances a risk against the effort, time and money needed to control it. Under Section 33 of the Act, it is an offence for a person or an organisation to breach this duty, and there is no statutory limit on the fine it can impose.
The outcome
The HSE issued enforcement notices against Cadent, requiring it to take remedial action to rectify the problem, which it did, completing that action five months after the notices were issued.
National Grid Gas pleaded guilty to breaching Section 3(1) of the Health and Safety at Work etc. Act 1974 and the court fined it £4m with £91,805 costs.
National Grid Gas plc has been fined for this kind of offence before – in December 2015 and January 2016 it was subject to fines of £2m and £1m respectively in relation to section 3 HSWA breaches involving insufficient risk assessments and inaccurate records.
Legal issues
It is a legal requirement for gas engineers to provide existing building owners and tenants with a copy of the gas safety check record within 28 days of the check being completed. A copy of the gas safety check record must be provided to prospective tenants before they move into a property.
But it’s not just gas servicing records that need keeping up to date. For many companies, things like machine maintenance records, information on chemicals used or stored, or medical records need to be retained, either to prove a particular procedure has been carried out, to give information for future employees or because the law requires it. The need to maintain up-to-date records becomes all the more important if a company, or part of a company is being sold. The new owner may well conduct a rigorous audit process to determine what records are held and may discover that vital information has not been provided during the sale.
What do businesses need to do?
As can be seen from this case, health and safety offences don’t just relate to harm caused; they can also centre around omissions in administrative processes that have the potential to cause harm, but have not, as yet, done so.
In this case, National Grid Gas clearly overlooked the gaps in its records when the sale took place, but Cadent had also not checked the records until the HSE investigation revealed what had happened. If National Grid Gas had operated a review and audit system, it is likely that it would have uncovered the problem with its record system a lot earlier and been able to put it right.
Companies that operate in areas where detailed records are needed should regularly audit the records they hold and update them where needed. Similarly, processes and procedures surrounding the production of those records need to be examined, reviewed and updated if it’s found necessary to do so.
As a matter of course, all company records should be kept on a shared drive, where access to them can be controlled and through which maintenance can easily be carried out. The system should be consistent and logical so that employees who need to enter or update records can find them easily, and in the event that a regulator needs to access them, this can be done quickly and with no unnecessary delay.
rradar is a specialist litigation and commercial law firm.
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