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Companies Under Threat Of Going Out Of Business After Implementation Of Tougher Laws PDF Print E-mail
Saturday, 28 June 2008

A new piece of legislation will leave thousands of businesses within the transport and distribution sector at risk of folding overnight unless they can demonstrate employee training and health and safety precautions within the workplace are regularly monitored.

The warning comes from Phil Brown, Managing Director of online HR toolkit creators Youmanage, on the back of the Corporate Manslaughter and Corporate Homicide Act 2007 which has now come into effect.

The Act is designed to drive down the number of fatal accidents in the workplace. From now any such accidents will be subject to a police investigation rather than the Health and Safety Executive.

Mr Brown said: “This new piece of legislation now makes it easier for businesses to be prosecuted in the event of an employee being killed at work.

“Before the Act was brought in businesses could only be convicted if its policies were controlled by one individual. As most companies are headed by more than one manager it made it difficult to bring about successful prosecutions. Statistics show there have only been half a dozen successful cases in the last 16 years and none of these were against large companies.

“As of now if a company is unable to demonstrate its management systems are regularly maintained and monitored, and always adhered to, it could face closure overnight.”

In 2006/7 241 people were killed at work.

In the event of an accident, if a company is unable to prove that its employee was given proper information during their induction or that necessary training requirements were kept up-to-date, it could face substantial fines – enough to put some companies out of business overnight.

An advisory panel has suggested fines should equate to around five per cent of the firm’s annual turnover – rising to 10 per cent or more in extreme cases and dropping to 2.5 per cent in cases where company’s can prove mitigating evidence.

Mr Brown urged businesses within the sector to take all reasonable steps to safeguard themselves from legal proceedings under the Act by ensuring that all staff had received the necessary training to do their jobs.

He also highlighted the importance of a business being able to demonstrate its stringent policies and training methods in the event of a tragedy at work. “Companies now have a legal as well as a moral responsibility to make sure that managers follow correct processes and that employees are given proper training.”

The Youmanage solution gives a rounded history of an employee’s life cycle within a company. As well as personal details including full name, date of birth and duration of employment with a company, it also gives details of the training history, personal development and appraisals, all within an easy-to-access single source solution. The system enables New Starter Checklists to be automatically created for all new employees which can be accessed by both managers and HR, making it easier for companies to ensure mandatory induction training is carried out.

Mr Brown said: “With company managers often having to contend with heavy workloads it is often a case of priorities and tasks such as completing an induction or maintaining records of an employee’s training history are very often put on the backburner.

“But with the Corporate Manslaughter and Corporate Homicide Act 2007 coming in it means it is essential now more than ever to keep on top of these issues as it could one day prevent a very hefty payout, or even the closure of a firm.

“Having the necessary tools to simplify the process could prove to be invaluable and mean the difference between a company being able to successfully prove it took all reasonable care to protect that employee, or closing down overnight.”

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