Casualty risk engineering

EL & Enterprise & Regulatory Reform Act 2013

Background
There has been concern for many years about the mounting cost of civil litigation. This prompted Lord Justice Jackson’s review of the civil justice system and the recent package of reforms. It also sparked a debate within successive administrations about the extent to which the UK was in the grip of a ‘compensation culture’.

The present government commissioned two reports, the first by Lord Young and the second by Professor Lofstedt of Kings College, to investigate the compensation culture and whether our health and safety laws contributed to the perceived problem. While the two reports differed in tone and academic rigour, both cited the Court of Appeal case of Stark v The Post Office as evidence of the injustice of safety regulations that impose strict liability on employers.

Strict liability in health and safety regulations
In this case, Mr Stark, a postman, was seriously injured when a component of the front brake of his bicycle snapped, jamming the wheel and throwing him over the handlebars. The bicycle, which was provided by the Post Office, had been properly maintained and the metal fatigue that led to the accident could not have been detected by routine inspection. Mr Stark lost his case in negligence but, because the Provision and Use of Work Equipment Regulations (PUWER) 1992 impose a strict liability duty on employers to provide work equipment that is “in an efficient state, in efficient working order and in good repair”, the claim succeeded under the regulations. Although it had done everything reasonable to maintain and service the bicycle, the Post Office was still found liable for Mr Stark’s injury.

On the face of it, this seems manifestly unfair. However, as the TUC pointed out, without strict liability, Mr Stark would have been left without compensation for a serious injury at work, sustained through no fault of his own while using equipment supplied by the Post Office to do his job. Unfairness, argued the TUC, would not be eliminated by removing strict liability; it would merely shift from one blameless party to another.

Nonetheless, Professor Lofstedt recommended that regulations which impose strict liability should be reviewed. There are very few. In addition to PUWER, they include the Work at Height Regulations 2005 and the Workplace (Health, Safety and Welfare) Regulations 1992. With these few exceptions, most regulations offer employers a defence of reasonable practicability. In simple terms, if a company can show that it has taken all reasonably practicable measures to protect its employees, it cannot be held liable if one of them is injured at work.

Section 69 and the presumption of civil liability
The government’s response went far beyond Lofstedt’s recommendation. Instead of simply amending a handful of regulations to provide a defence of reasonable practicality, it introduced a clause into the Enterprise and Regulatory Reform Bill that effectively reversed the long-standing presumption that, unless expressly stated to the contrary, a breach of regulations not only imposes criminal liability but also confers civil liability.

After a controversial and contested passage, The Enterprise and Regulatory Reform Act (ERRA) became law. Section 69 of ERRA reverses Section 47 of the Health and Safety at Work Act (HSWA) 1974 and means that any breach of regulations is no longer civilly actionable unless the regulations specifically say otherwise. To date, the only excepted regulations concern pregnant workers and new mothers.

Employers’ Liability (EL) claims
Consequently, for accidents that occurred on or after 1st October 2013, claimants cannot rely on a breach of regulation by for their case to succeed. Instead, they will have to show negligence on the part of their employer, based on failure to discharge the common law duty of care owed to employees. The burden of proof is now always on claimants. Under regulations, the burden was sometimes on employers to prove that they had taken reasonably practicable steps to meet their legal obligations.

It is still early days for the new regime and the first claims for accidents since 1st October are only now starting to trickle through. In the short term, we can expect a period of uncertainty. The common law duty of care owed by employers to their employees will need to be tested in the courts, as will the extent to which regulations can still be used as evidence of where the benchmark for negligence is drawn. Whether an employer has taken reasonable steps to make the workplace safe is more difficult to determine than a simple regulatory breach. Investigations may become more complex and the number of litigated cases may increase.

It is also unclear how disease claims will be handled if exposure to the injurious agent (noise, dust, vibration, etc) took place both before and after 1st October.

In addition, there are a number of challenges and apparent anomalies that remain to be resolved. For example, opponents of Section 69 could argue that removing civil liability for breach of regulations contravenes the UK’s EU treaty obligations. Furthermore, some claimant lawyers have suggested that Section 69 cannot be applied to civil cases brought against ‘emanations of the state’. Broadly speaking, these are public bodies such as government departments, local councils, health authorities and the police. This is because claimants against emanations of the state can directly allege breaches of the relevant EU Directive, rather than the national regulations that implement them. The contention is that Section 69 creates a two-tier system, with different treatment for public and private organisations.

Most commentators seem to think that such arguments are unlikely to succeed. Nonetheless, there may well be delays and additional costs as these issues work their way through the courts.

Future impact
In the longer term, removing the concept of strict liability from EL claims should improve the position of employers and their insurers. Employers should be able to avoid liability if they have taken all reasonable steps to provide a safe workplace. Consequently, some cases where liability would previously have been conceded might now prove defensible. Over time, as the reforms stabilise, the number of new EL notifications should reduce.