Faltec Europe Ltd v Health And Safety Executive (Rev 1)

In sentencing health and safety offences, the likelihood of harm must be assessed from the scientific evidence rather than impression. Its classification as high, medium or low remains an evaluative judicial exercise, but must reflect that evidence.

Under the relevant Guideline, where actual harm has occurred at a lower level than the harm risked, the court may not move up a harm category. That restriction applies even where many people were exposed to risk. A linked company’s resources may exceptionally be considered where the offender’s economic reality shows dependence on that support, but group membership alone is insufficient.

Faltec Europe Ltd, a manufacturer of motor-vehicle parts, pleaded guilty to three offences under the Health and Safety at Work Act 1974. Two counts concerned legionella contamination, which caused five cases of Legionnaires’ disease. The third concerned an explosion in a flocking machine, injuring an apprentice employee.

Recorder Wood QC at Newcastle Crown Court imposed fines totalling £1.6 million. Faltec appealed against the amount of the fines. The central questions concerned the correct application of the Health and Safety Offences Definitive Guideline, including culpability, the likelihood and category of harm, aggravation, the company’s financial position, and totality.

1. Appeal allowed in part. The court reduced the fines for the legionella offences to £380,000 concurrent on counts 1 and 2, but upheld the £800,000 fine for count 3. The total fine was therefore reduced from £1.6 million to £1.18 million.
2. For the legionella offences, the recorder was entitled to find medium culpability at the top of that category. Faltec’s failures were serious and systemic. It had failed to remove or control the danger from dead legs and had no adequate written scheme for supervising its water-treatment contractor.
3. The likelihood of Level A harm had to be assessed by reference to the scientific evidence, consistently with R v Squibb Group Ltd [2019] EWCA Crim 227. A risk of up to four deaths per 10,000 persons exposed in a densely populated urban area was neither low nor high. It was medium. The proper initial categorisation was therefore medium culpability and harm category 2.
4. The Guideline permits, but does not require, an upward movement where many people were exposed or the offence significantly caused actual harm. Its concluding restriction applied to both factors. Since actual harm was caused at a lower level than the Level A harm risked, the court could not move the legionella offences up to harm category 1.
5. In applying step 3 of the Guideline and Criminal Justice Act 2003 section 164, the court could take limited account of the holding company’s resources. Faltec’s continuing ability to trade on a going-concern basis depended on that company’s support. This was exceptionally part of Faltec’s economic reality. A prudent accounting reserve for a potential fine should, however, be left out of the proportionality assessment.
6. The flocking-machine offence remained one of high culpability and harm category 2. The recorder was entitled to select a starting point at the top of the range. Although the statutory aggravating factor of cost-cutting at the expense of safety required consideration of motive, the other aggravating features overwhelmingly justified the sentence.

• Court of Appeal (Criminal Division): Allowed Faltec’s sentence appeal in part, reducing the fines on counts 1 and 2 while upholding the fine on count 3.
• Newcastle Crown Court: On 17 May 2018, Recorder Wood QC imposed fines totalling £1.6 million following guilty pleas to three health and safety offences.
• Magistrates’ Court: On 3 April 2017, Faltec was committed to the Crown Court for sentence.