Corporate Manslaughter and Homicide - Not Crimes - Research Paper Example

 “Despite a gestation period extending over thirteen years, the Corporate Manslaughter and Corporate Homicide Act 2007 is a disappointment. It is limited in its scope, restricted in its range of potential defendants and regressive to the extent that, like the discredited identification doctrine before it, it allows its focus to be deflected from systemic fault to individual fault”. James Gobert's analysis seems pointed, but it is if anything too charitable. The Corporate Manslaughter and Corporate Homicide Act is a good step, but it is nothing like what needs to be instituted to deter widespread corporate manslaughter. George Monbiot puts it more strongly when he argues, “It is better than a poke in the eye with a sharp stick, or a tap on the head with a steam hammer. But only just. The new draft bill on corporate manslaughter is a ghost of what was once proposed. But, for the first time in the United Kingdom, there might now be a chance of prosecuting large companies for killing their workers” (2005). Between 1997 and the 2005 adoption, twelve promises were followed by delays, and five thousand people died as Parliament deliberated (Monbiot, 2005). Home Secretary claims that delays were due to complexity of the law are belied by the rapidity which the Prevention of Terrorism Act was pushed through Parliament, which allows conviction prior to a fair trial (Monbiot, 2005). The law does not allow any individuals to be tried, only companies as a whole to be fined, which when combined with existing law that only direct knowledge and malfeasance on the part of directors can lead to a prosecution means that only small businesses are likely to ever see imprisonments (Monbiot, 2005). “As directors can still be disqualified and imprisoned for a gross breach of their duty of care towards their shareholders' investments, money in the United Kingdom will remain more valuable than human life” (Monbiot, 2005). Worse, the standard for senior management being tried is grossly minimal: It must be proven that the senior manager “sought to cause the organisation to profit” for them to be criminally liable (Monbiot, 2005). When seeking to punish a corporation for their malfeasance, particularly in the case of deaths caused by reckless or dangerous working environments, pursuit of profit or easily-avoidable issues such as quality of chemicals or safety controls for machinery, the legal justifications for pursuing action are a few fold. 1. Deterrent. Both the violating company and its staff and other companies and their staffs need to be put on notice that such behavior isn't tolerated. For example: In a civil suit against a company that willfully harmed an innocent, there should be a toll taken for the life of the innocent, then a toll taken for the psychological harm dealt to the family and loved ones, then finally a toll taken purely as a deterrent cost. 2. Justice. The person who died deserves their fate to be taken seriously, the harm rectified, amends done (Lewis, 2009). 3. Investigative, amends-based and reparatory. The family that died deserves to have someone make amends for and take responsibility for the action. And when it comes to an organization like a corporation, the investigation can bring to light other violations. It is in the first two realms that the Act is so limited. An unlimited monetary deterrent might be appropriate, but there are so many approaches for the defendant to mitigate the harm that it is unlikely that the fine will ever truly be a serious deterrent to companies with massive operating capital and cash flows (Reid, 2010). When it comes to corporate law, punishments need to be extremely severe because big companies have the ability to protect themselves using ties to politicians and communities, deep pockets and powerful lawyers. More importantly, individual managers may think that, if a company faces a billion-dollar fine, the worst that will happen is that they will lose their job or will be demoted or punished, exactly what will happen, immediately, if they fail to push through changes that raise profits. But if the threat is that they could face jail time, the deterrent would be much higher. Executives would have a vested interest in closely investigating safety standards and doing tours and inspections. They would at least have the incentive to do their due diligence so in court they could prove they had done everything they could. Worse, when someone who died because of a company's greed sees the worst punishment be a fine, however large, it degrades them as a person. It is as if, when on the job, they were an asset: If you break it by accident, you have to pay the cost of it. But in the West, we take the stand that individuals are sacred objects, things that are of the utmost importance. By taking the possibility of criminal prosecutions high up the ladder off the table, the Act makes it impossible that retributive justice is done and that someone's fate is given the dire attention it deserves. Socialist Worker (2008) points out that “Since the Health and Safety at Work Act was introduced in 1974, over 10,000 people have been killed in work-related accidents. Only five bosses have ever been imprisoned... But the new act will make it harder to get a conviction and mean even fewer bosses will go to jail for killing workers. It allows the prosecution of firms but not individual bosses and will impose fines instead of jail sentences”. In some ways, it is a step backwards because it forecloses some possibilities for targeting individual executives! “No new sanctions will apply to the new offence and it will be far harder to secure a conviction for corporate manslaughter than for the existing health and safety offences. The only real difference will be the label” (Socialist Worker, 2006). The Hatfield train crash, for example, could have seen health violations pursued, but under the Manslaughter Act alone, such prosecutions would have been difficult to impossible (Socialist Worker, 2006). It is true that the law eliminates the mens rea requirement (Basketter, 2007). This is a good thing. It is absurd for companies to on the one hand claim that their command and control allows them secrecy against outside intrusion, copyrights, and executives to take credit for productivity increases that they are surely not solely responsible for (as if they picked up the hammers or took the overtime), but on the other that they aren't responsible for their decisions that lead to accidents. However, the problem is that “Dozens of firms escape scot free after workplace accidents that badly injure or even kill staff, an internal HSE investigation has revealed. The report found that some firms get just a verbal telling off, or are sent letters, when they should be hauled before courts. Research into 126 of the hundreds of accidents investigated last year found inadequate rulings in 18 of them” (Basketter, 2006). One of the major problems is with enforcement, but the Corporate Manslaughter Act does not change substantial enforcement provisions. Corporations try to have it both ways. Corporations are considered to be immortal persons under US and UK law. This was actually due to an misrepresented comment in a US court case, but unfortunately the doctrine is so well-established that it now is protected by decades of jurisprudence (Adams, 2003). The idea is commonly recognized as a legal fiction, yet it is a potent one: “A sterling example of legal fiction is what's called corporate personhood. Think about it: A corporation isn't a person. It's a business, a pool of investors' money used to conduct transactions and hopefully make a profit. But in order to determine the legality of business proceedings, the legal fiction of treating a corporation as an artificial person was created” (Clark, 2005). This immortal personhood gives them immense advantages: unlike a real person, corporations cannot die, and can allow stock certificates to be passed down over generations. But if a person were to accidentally push someone into an industrial tiller, or cause an accident, they would be held accountable. Yet corporations want to be able to avoid criminal liability. If corporations cannot tolerate the idea that every action under their purview should be treated as if a single person did it, then they must prepare to lose the privileges granted to persons: For example, their charters should be revoked after eight years, they will lose the ability to sue for libel because faceless economic organizations have no reputation worth respect, etc. Some might counter that a fictional entity can't be meaningfully said to “deserve” to be punished. This is a fair point. But this only establishes that it is the people within it should be punished. It was not a “corporation” which killed the people in the Piper Alpha explosion or the sinking of the Herald of Free Enterprise: It was individuals whose derelictions of duty, gross disregard for others, mistakes, miscalculations and/or callous behavior created unsafe circumstances that led to death (Monbiot, 2005). It is people who tell other people to turn the line speed up faster than is safe, or to not repair equipment because it costs too much. The idea of pursuing action against a legal fiction is absurd, but that absurdity is precisely why individuals should be targets. At the same time, history proves that abstractions like governments and corporations can control behavior on a decisive level. Soldiers involved in torture or genocide are not running around before or after the war killing and torturing: They do so in combat due to the circumstances around them and the decisions of superiors and of policymakers. So insofar as a corporation is an institution that orders behavior, provides controls and has permanence, the organization as a whole should be held to account. More importantly, the reason that the corporation and the individual should both pay the price is simple economics. A company will continue to commit malfeasance, seeking profits, until an outside force stops it: Such is the law of corporate inertia. This causes market inefficiencies: A consumer good costing a pound less is not worth several people dying, even in purely economic terms, given the impacts that deaths have on reduced manhours for the country, potential human capital improvements, psychological and practical impacts on families and communities, the costs of funerals and burials, etc. Consumers could punish companies, but this requires knowledge which companies keep secret. The best strategy, then, is to give companies a signal that reduces the profitability of bad behavior. A company that constantly commits violations would have to raise prices beyond what the market could bear in order to compensate, which would lead to their collapse. Further, there is a restorative justice idea at play. The company should never have made the money that they did on the back of workers: Therefore, that money needs to be taken away, ideally given to the workers (or who they would have given it to had they agreed to die, such as next of kin) or to the community. It is possible to argue that shareholders shouldn't be have to see their stocks and wealth decline or have to throw more money into a company to keep it alive because of the decisions of executives and managers. But this is truly noxious buck-passing. If shareholders consistently threatened to withdraw their money for safety violations, companies would clean up their act. When they don't do so, the financial instrument they are investing into should pay the price. It is true that it might be unfair to hold some executives accountable for decisions made by the board or by higher management. Then again, “I was ordered to” has not been a particularly compelling argument ever since Nuremberg. More importantly, the Corporate Manslaughter Act did not simply set a very high bar for executives to be prosecuted, which may have been fair: It set no such bar at all. Even if a leader was caught in a “smoking gun” memo ordering a line-speed increase that he knew would lead to deaths and instructed the company lawyer to settle out of court, or some other direct evidence of willful neglect, the Act does not have any provisions for enforcing such activity. Worse, the Act can be used by the defence as precedent against such a suit. A legitimate Corporate Manslaughter Act would continue to move up the chain until the last person who had meaningful command and control responsibility and involvement was found, no matter how high it went. In this sense, the Act is a serious dereliction of justice because it puts a prima facie limit on how far a prosecution can go. Without such accountability, individual executives are never likely to face personal responsibility that extends beyond being sacked or demoted. If enforcement was frequent enough so that workplace injury and death led frequently to senior management being threatened with jail time and companies frequently and routinely seeing massive fines, it might be enough. But unfortunately, companies with deep pockets, political influence and the ability to engage in regulatory capture are not likely to face signals often enough. If executives were afraid of jail time for instituting an act, they may be willing to resign or blow the whistle, their freedom and safety more important than company profits. When a mugger kills someone in the process of robbing someone's chequebook, that is murder; when an executive pushes for a death for far less money vis-a-vis their income, they do not face serious trouble. It is also arguable that punishing a company just harms its workers. Yet the person who died was not an abstract set of workers but a real individual. No individual should be sacrificed for the good of the many, not even their fellow workers. Further, is anyone really benefited from more unsafe working environments? It stretches the bounds of believability when people claim to care about workers while arguing for their continuing peril. In any respect, it doesn't matter: Justice must be pursued. It is also true that punishing someone with prison for a crime they committed doesn't restore their victims and just puts someone into a terrible place, but that is no argument to allow people to do whatever they please either. Actions have consequences. The irony is that the pro-marketeers who offer this argument are offering an argument for market inefficiency to protect workers, which means they are either disingenuous or hypocritical given their regular stand. The idea that only the blameworthy are punished sounds good in theory, but it is absurd in practice. Most criminals have mothers, wives, children, brothers, sisters or friends who will be unhappy that their child is in trouble. The law always has impacts outside the immediate circle of the people involved. It also seems that the fact that the law does not provide for Corporate Assault or Corporate Battery is a serious limitation. Why does a company that maims an arm or a leg not have their senior management imperiled? Should death be the bright line for preventable accidents permitted to occur to lower an item's price by a few shillings? One of the maxims is “irreversible ill” (Lewis, 2008). But the loss of a limb or an appendage is just as “irreversible” as death, and from the perspective of a poor family could be worse as the family member who is injured is unable to work or bring in income. That having been said, the law does allow substantial punishment for the violating corporations. “The penalties for violating the act are quite interesting. First, a court can impose unlimited financial penalties on the organization, once it is convicted. Second, a court may issue a "publicity order," which requires the organization to publicly announce (through advertisements, it seems) that it has been successfully prosecuted for corporate manslaughter and is subject to any other penalties the court may have ordered” (Sebok, 2007). These two are deeply appropriate. In the American experience, limited fines have led to situations where the cost of the fine or of settling out of court is less than the cost of averting the criminal behavior (Naiman, 2003). Unlimited fines make it so companies can be prosecuted according to their size (Reid, 2010). Unlike with fixed fines, this means that small businesses will not be put out of business for a single tragic accident while companies making millions or billions of pounds go on their merry way. Further, many companies after being forced to issue public notice of their restitution use the opportunity to pass themselves off as responsible citizens, benefiting from their malfeasance. This approach prevents companies from benefiting in such a manner; it makes it so they must announce their responsibility. Perhaps the most interesting, though, is the third enforcement arm of the legislation. “The third and final potential penalty is that the court can order the organization to publicly take remedial steps to correct the conditions that led to the breach of duty. This penalty could have potentially far-reaching consequences, depending on how the courts choose to interpret it. For example, under this remedy, suppose a court decides that a design defect was the result of conscious indifference to the safety of others (such as in the famous Ford Pinto case). The court could simply order a manufacturer to change the design of their product--a power that no American court currently possesses” (Sebok, 2007). An issue with American law is that, once a company is caught, they can keep on doing the criminal act until they are caught again, once more paying the fine. This law prevents that: Once they are caught once, there is a chance their entire operation will be changed. What is the actual scale of the UK epidemic of industrial accidents? As we've seen, from 1997 to 2005, around five thousand people died. Let's compare this to UK police deaths (Police Memorial, 2010). The most death-intensive eight years were from 2001 to 2008, with a total of 149 deaths (Police Memorial, 2010). However, these deaths include natural causes deaths connected to some duty, which may arguably throw the figures off somewhat. But even if we take all of these deaths at face value, that is thirty times less than industrial accidents in the country. And remember that industrial accidents are only part of the Corporate Manslaughter Act's picture, since there are also consumer deaths as well (Sobok, 2007). It is far less dangerous to be a cop on the beat than it is to be a worker in Britain. The law does seem to be bringing some attention to the corporate world: “Most importantly, however, senior management must thoroughly understand their obligations, what they need to do to comply, what questions to ask and what action to take. In our experience if high standards are set by senior management in organisations, risk can be significantly reduced” (Reid, 2010). What might an alternative arrangement that is more just look like? First of all: Corporations and individuals would always be targeted. Justice demands that both the company as a whole and the individual in particular suffer the cost of their decision. A defence should be made for when someone was just executing their job, but this should be a weak defence barring something more: After all, they could have quit. And companies won't change until they see consequences: Even an approach focusing on rehabilitation would still end up punishing both companies and individuals. Second: Responsibility would be automatically on the company's head until proven otherwise. This does not violate “innocent until proven guilty”, which is not a uniform UK standard anyways (it certainly doesn't apply to libel cases); rather, it is res ipsa loquitur (Palast, 2004; Schlosser, 2003). The prosecution must prove the facts of a death, e.g. that someone died on company premises, but once they have done so, the company must prove that they weren't responsible. If I tell someone to do something for me, and it is proven that they did it, I am responsible. A company that hires a person takes responsibility for their behavior unless it is clear that the person was actually acting against the mandates of the company. “We never told him to do that” is not a sufficient defence. What would be a defence might be “We never told this employee to do that, and had no way of knowing they did. We have a company policy preventing such violations [or couldn't anticipate, reasonably, that such violations would ever even come up]. They acted without our knowledge and alone”. Even if individual managers and executives had to start paying fines, the deterrent would increase. A mere 20,000 pounds, nothing compared to the fines levied on companies, would be a substantial chunk out of most paychecks except for executives. Faced with such a loss, many people facing prosecution would blow the whistle and testify against their bosses, helping the prosecution move up the chain. Ultimately, then, the Corporate Homicide and Corporate Manslaughter Act is deeply flawed. It does not treat murder and manslaughter as murder and manslaughter. Criminal enterprises can be charged as a group: The same logic applies to companies. It's time to get tough on corporate crime. Works Cited Adams, Cecil. 2003, “How can a corporation be legally considered a person?”, The Straight Dope,September 19. Basketter, Simon. 2007, Socialist Worker, “Health and Safety Executive: toothless watchdog idles as workers die” August 4. Clark, J. 2005, “Why do corporations have the same rights as you?”, HowStuff Works. Corporate Manslaughter and Corporate Homicide Act 2007. Chapter 19. Lewis, J. 2009, “Corporate manslaughter legislation”, Personneltoday, May 1. Magloff, L. 2010, “Why Is a Corporation Considered an Artificial Person Under the Law?”, Ehow, March 14. Monbiot, G. 2005, “The Business of Killing”, Z Net, March 29. Police Memorial. 2010, Available at: “UK Police Line of Duty Fatalities by Cause of Death” http://www.policememorial.org.uk/Rolls_of_Honour/Statistics/Statistics_2000-2009.htm Reid, R. 2010, “Corporate Manslaughter Act: Sentencing guidelines”, World Services Group, February. Sebok, AJ. 2007, “The U.K.'s "Corporate Manslaughter" Statute: British Versus American Approaches to Making Firms Responsible for Deaths Resulting from Gross Negligence”, FindLaw, July 31. Socialist Worker. 2006, “Corporate manslaughter law will change little but the label”, December 9. --- 2008, “Corporate manslaughter: another toothless act”. Research Trail My research methodology was to run with my gut instinct, which is that Gobert is correct. If I didn't find compelling evidence, I was completely prepared to switch gears and approach the problem from another direction, but I found extensive evidence. First, I decided to investigate how many industrial accidents there are. I had heard that, in the US, more people died in industrial accidents than as a result of police duty: It's commonly used to establish that it is more dangerous to be black in America than it is to be a policeman. I found that, while it certainly hadn't achieved US levels, Europe and the UK certainly had lots of industrial deaths, and unsurprisingly those exceeded yearly police deaths by a colossal margin, orders of magnitude in fact. Second, I wanted to examine the weaknesses of the law. George Monbiot's research was incredibly useful in this vein, and led me to the other sources I used in the paper. My whole argument, then, was to try to unravel the legal contradictions of the corporate opposition to the Manslaughter Act. Ideas like corporations being unable to have mens rea and opposition to the aggregation principle seemed to me to be extraordinarily cynical special pleading. Corporations are able to run the way they do and stay in business because they are considered immortal persons. In the UK's libel system, they can achieve widespread deterrent to dissent and criticism. I looked at some relevant statutes, but I felt that the hypocrisies were transparent to even a moderately educated observer once exposed. In line with the criticisms I was seeing, I wanted to find people who would be predisposed to find flaws in the law and see if they were compelling. I looked at socialist and progressive sources because I felt that their critique of the law would likely be the most forward-looking. I then looked for legal opinions on the matter, such as that of Sobok. What I found interesting was that even a defence firm critical of the law in some ways advised that companies increase their responsibility. This was a promising sign, so I included it in the paper. I wanted to pursue philosophical arguments and give the best defence I could to those against the law or deal with some of the legal complexities. Read More