FREE BOOK CHAPTER: The Enterprise and Regulatory Reform Act 2013 and the Impact on Employers Liability Claims - Andrew Mckie, Clerksroom
30/06/15. Section 69 of the Enterprise and Regulatory Reform Act 2013 (ERRA) is now in force. The effect of Section 69 is that most employees seeking compensation for injuries suffered as a result of accidents at work on or after 1 October 2013, will no longer be able solely to rely on a breach of health and safety regulations to establish breach of duty. Instead, they will only be able to seek compensation where it can be shown that the employer was breached the common law duty of care.
Under the ‘six pack’ Regulations which came into place in 1992, to allow the UK to comply with various European Directives, the employer could find themselves liable, for example, defective work equipment, even where it had been maintained and inspected properly. The aim of the legislation is to remove the time and cost of the burden of complying with the Regulations from employers. This will arguably make it more difficult for Claimant to succeed in EL claims.
Section 69 of the Act sets out as follows:-
Civil liability for breach of health and safety duties
(1) Section 47 of the Health and Safety at Work etc. Act 1974 (civil liability) is amended as set out in subsections (2) to (7).
(2) In subsection (1), omit paragraph (b) (including the “or” at the end of that paragraph).
(3) For subsection (2) substitute—
“(2) Breach of a duty imposed by a statutory instrument containing (whether alone or with other provision) health and safety regulations shall not be actionable except to the extent that regulations under this section so provide.
(2A) Breach of a duty imposed by an existing statutory provision shall not be actionable except to the extent that regulations under this section so provide (including by modifying any of the existing statutory provisions).
(2B) Regulations under this section may include provision for—
(a) a defence to be available in any action for breach of the duty mentioned in subsection (2) or (2A);
(b) any term of an agreement which purports to exclude or restrict any liability for such a breach to be void.”
(4) In subsection (3), omit the words from “, whether brought by virtue of subsection (2)” to the end.
(5) In subsection (4)—
(a) for “and (2)” substitute “ , (2) and (2A) ”, and
(b) for “(3)” substitute “ (2B)(a) ”.
(6) Omit subsections (5) and (6).
(7) After subsection (6) insert—
“(7) The power to make regulations under this section shall be exercisable by the Secretary of State.”
(8) Where, on the commencement of this section, there is in force an Order in Council made under section 84(3) of the Health and Safety at Work etc. Act 1974 that applies to matters outside Great Britain any of the provisions of that Act that are amended by this section, that Order is to be taken as applying those provisions as so amended.
(9) The amendments made by this section do not apply in relation to breach of a duty which it would be within the legislative competence of the Scottish Parliament to impose by an Act of that Parliament.
(10) The amendments made by this section do not apply in relation to breach of a duty where that breach occurs before the commencement of this section.
The explanatory notes to the ERRA also stated: “The amendment…reverses the present position on civil liability, with the effect, unless any exceptions apply, that it will only be possible to claim for compensation in relation to affected health and safety legislation where it can be proved that the duty holder (usually the employer) has been negligent. This means that in future, for all relevant claims, duty-holders will only have to defend themselves against negligence.”
'Employers' Liability Claims:
An Historical Perspective
In order to look at the impact upon Employers Liability Claims, it is necessary to look at matters from an historical perspective. The new Regulations make changes to section 15 and 47 (2) of the Health and Safety at Work Act 1974 which sets out:-
15 Health and safety regulations.
Subject to the provisions of section 50, the Secretary of State F35. . . shall have power to make regulations under this section for any of the general purposes of this Part (and regulations so made are in this Part referred to as “health and safety regulations”).]
(2) Without prejudice to the generality of the preceding subsection, health and safety regulations may for any of the general purposes of this Part make provision for any of the purposes mentioned in Schedule 3.
(3) Health and safety regulations—
(a) may repeal or modify any of the existing statutory provisions;
(b) may exclude or modify in relation to any specified class of case any of the provisions of sections 2 to 9 or any of the existing statutory provisions;
(c) may make a specified authority or class of authorities responsible, to such extent as may be specified, for the enforcement of any of the relevant statutory provisions.
(4) Health and safety regulations—
(a) may impose requirements by reference to the approval of [F36the Executive] or any other specified body or person;
(b) may provide for references in the regulations to any specified document to operate as reference to that document as revised or re-issued from time to time.
(5) Health and safety regulations—
(a) may provide (either unconditionally or subject to conditions, and with or without limit of time) for exemptions from any requirement or prohibition imposed by or under any of the relevant statutory provisions;
(b) may enable exemptions from any requirement or prohibition imposed by or under any of the relevant statutory provisions to be granted (either unconditionally or subject to conditions, and with or without limit of time) by any specified person or by any person authorised in that behalf by a specified authority.
(6) Health and safety regulations—
(a) may specify the persons or classes of persons who, in the event of a contravention of a requirement or prohibition imposed by or under the regulations, are to be guilty of an offence, whether in addition to or to the exclusion of other persons or classes of persons;
(b) may provide for any specified defence to be available in proceedings for any offence under the relevant statutory provisions either generally or in specified circumstances;
(c) may exclude proceedings on indictment in relation to offences consisting of a contravention of a requirement or prohibition imposed by or under any of the existing statutory provisions, sections 2 to 9 or health and safety regulations;
(d) may restrict the punishments [F37(other than the maximum fine on conviction on indictment)] which can be imposed in respect of any such offence as is mentioned in paragraph (c) above.
F39. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]
(7) Without prejudice to section 35, health and safety regulations may make provision for enabling offences under any of the relevant statutory provisions to be treated as having been committed at any specified place for the purpose of bringing any such offence within the field of responsibility of any enforcing authority or conferring jurisdiction on any court to entertain proceedings for any such offence.
(8) Health and safety regulations may take the form of regulations applying to particular circumstances only or to a particular case only (for example, regulations applying to particular premises only).
47 Civil liability.
(1) Nothing in this Part shall be construed—
(a) as conferring a right of action in any civil proceedings in respect of any failure to comply with any duty imposed by sections 2 to 7 or any contravention of section 8; or
(b) as affecting the extent (if any) to which breach of a duty imposed by any of the existing statutory provisions is actionable; or
(c) as affecting the operation of section 12 of the M14Nuclear Installations Act 1965 (right to compensation by virtue of certain provisions of that Act).
(2) Breach of a duty imposed by health and safety regulations F132. . . shall, so far as it causes damage, be actionable except in so far as the regulations provide otherwise.
(3) No provision made by virtue of section 15(6)(b) shall afford a defence in any civil proceedings, whether brought by virtue of subsection (2) above or not; but as regards any duty imposed as mentioned in subsection (2) above health and safety regulations F132. . . may provide for any defence specified in the regulations to be available in any action for breach of that duty.
(4) Subsections (1)(a) and (2) above are without prejudice to any right of action which exists apart from the provisions of this Act, and subsection (3) above is without prejudice to any defence which may be available apart from the provisions of the regulations there mentioned.
(5) Any term of an agreement which purports to exclude or restrict the operation of subsection (2) above, or any liability arising by virtue of that subsection shall be void, except in so far as health and safety regulations F132. . . provide otherwise.
(6) In this section “damage” includes the death of, or injury to, any person (including any disease and any impairment of a person’s physical or mental condition).
Thus it was going all the way back to 1974, that statutory duties were imposed upon employers that imposed civil liabilities for breaches of the various employment Regulations, which will be dealt with separately in this book. This has arguably been a policy decision, of a Conservative Government, to reduce the burden of compensation claims upon employers.
How will the changes to Section 69 work in practice?
Section 69 of the Regulatory Reform Act is going to have a number of important changes for those handling employers liability changes as follows:-
It is important to remember that the duties imposed by the various Regulations will still apply. Indeed the Courts when determining whether that has been a breach of the common law duty of care will likely still look to the Regulations to what duties the Regulations impose upon an employer. However, a breach of a Regulation itself will not impose civil liability.
In order for a Claimant to prove a claim in common law negligence, the risk must have been reasonably foreseeable. The number of claims that would previously have succeeded under strict liability under the Regulations, prior to section 69, especially claims under PUWER, may now be reduced, for risks that were not foreseeable. This is discussed in more detail but it prudent to say here that at common law, the overall test for negligence is that of 'the reasonable and prudent employer taking positive thought for the safety of his workers in light of what he knows or ought to know.' (Stokes v Guest (1968) 1WLR 1886). This will be discussed in more detail in other Chapters.
The changes undoubtedly mean that it will be more difficult for Claimants to succeed in EL claims. The changes mean that it is important than ever for the Claimant’s Solicitor to consider whether common law breach of a duty of care is likely to be established, and if it cannot be, close the claim, as it will fail at Trial.
It is important to remember that even thought breach of the Regulations imposes strict liability, it will still be important to consider the Regulations and plead the Regulations in the Particulars of Claim, as guidance to the likely standard of duty to be applied by the Court at Trial. All too often all the Regulations are pleaded in either the Claim Notification Form or the Particulars of Claim, or not at all. It is important to consider, which Regulations are likely to apply and why to the Particular factors of a case. All the Regulations are considered in detail in other Chapters.
It is very important to remember that the Regulations only apply to accidents occurring on or after 1 October 2013. Although the old cases are now running out, it is important to note that any case, where the date of the accident is before 1 October 2013, some Regulations still impose strict liability and breach of some Regulations impose civil liability, so it is essential that these are still pleaded in the Particulars of Claim, where appropriate.
It may be argued that there will be an increased need for expert evidence in areas such as engineering as claimants try to meet the requirement of showing what happened and why it was negligent. The provision of engineering evidence in various types of accidents will be discussed in other Chapters and this will be an area this book will look at in detail.
Section 69 : A Case in Point – Reasonable Foreseeability v Breach of Statutory Duty
An example of this can be found in HIDE v STEEPLECHASE CO (CHELTENHAM) LTD & ORS (2013) EWCA Civ 545.
The facts are as follows:-
He was riding a horse called “Hatch a Plan”. The race was 2 miles in length and included several hurdles. A guard rail about 4 feet high ran around the outside of the track primarily to contain loose horses. A rail also ran intermittently on the inside of the track. Due to their intended purpose, the rails were built to be quite strong; they were made of PVC or some plastic material and secured into the ground by upright posts also of plastic on top of metal spigots. The upright posts were padded for 20 to 25 yards following each hurdle. Mr Linley, the Senior Inspector of Courses for the British Horseracing Authority, gave evidence that the padding was 2 to 3 centimetres thick.
The first of the hurdles was located approximately 100 yards from the start. It was 20 yards wide and set up towards the outside of the track; there was a distance of approximately 4 feet between the outside edge of the hurdle and the guard rail. The hurdle itself was described as being “fairly modest”. The total width of the track where the hurdle was positioned was 46 yards.
During the race, Mr Hide jumped over the hurdle towards its right hand side approximately 13 feet 6 inches (or 4 and a half yards) from the outside guard rail. After clearing the hurdle, his horse stumbled and fell. The horse careered sharply to the right, which caused Mr Hide to fall from his mount; he hit the ground and then moved (at speed) side ways or backwards into contact with one of the guard rail upright posts hitting it with his left hip. The judge found that it was a very unusual type of fall which would not have been expected or reasonably foreseen. Mr Hide sustained a fractured pelvis and a head injury. Happily he has made a good recovery. Damages have been agreed at £58,000 if the defendant is liable.
In an action which was not commenced until 9th November 2009, and regrettably not brought to trial until June 2012, Mr Hide sought damages against the management of the racecourse. Three bodies were joined. The second defendant, Jockey Club Racecourses Limited, is the correct defendant and nothing turns on the joinder of the other two defendants.
Mr Hide relied largely upon regulation 4 of the Provision and Use of Work Equipment Regulations 1998 (“the Regulations”) which provided that work equipment is to be so constructed or adapted as to be suitable for the purpose for which it is provided.
The Trial Judge’s conclusion on the facts:-
11. Having set out the relevant terms of the Regulations he then reached the following conclusions:- (1) both the railings and the hurdles were work equipment from the point of view of the employees who put them up; (2) Mr Hide used the hurdle but not the railings; (3) there was nothing wrong with the hurdle; (4) the railing was a suitable railing; (5) Mr Hide had not established that the padding was unsuitable; and (6) the relative disposition of the hurdle and the railing did not make either of them unsuitable for the purpose for which they were used or provided.
However, the Judge then went onto infer a test of reasonable foreseeability into the Regulations where he said:-
He described the question whether the relative disposition of the hurdle and railing rendered them unsuitable for the purpose for which they were used or provided as lying at the heart of the case and said this at his point of decision:-
“51. The answer must I think be found in the phrases “suitable for the purpose for which it is used or provided” and “reasonably foreseeable”. The purpose of a racing obstacle is to provide a test of nerve and skill for horse and rider and thus a pleasure for the spectator, not to mention profit for the betting industry. In deciding what is a suitable jump or course layout, a course designer can and should bear in mind what is reasonably likely to happen. Is there a reasonably foreseeable source of harm? This must be a matter of judgment and degree. If a jump was so dangerous as to make injury probable, as opposed to merely foreseeable, then it would, strongly arguably, be unsuitable within the meaning of the regulation.
52. The concept of reasonable foreseeability, a classic common law phrase, is imported in regulation 4. This, in my judgment, enables the manager of a racecourse appropriately to consider not whether a layout is a conceivable or “foreseeable” cause of injury, but whether the injury is “reasonably foreseeable”, viz whether the injury is likely or unlikely in the circumstances. If in the view of those with knowledge and experience of racing a layout is not thought likely to be a cause of danger, then it is likely to be “suitable”. It might also be observed that regulation 4(4) uses the expression suitable in any respect which it is reasonably foreseeable “will”, not “may”, affect health and safety. It must be harder to establish that a state of affairs will affect safety than that it may.
53. This racecourse was, I find, administered by experienced and conscientious people who were alive to safety issues. They did “have regard to the working conditions and to the risks of safety” which existed (regulation 4(2)). Their intention was, as was the purpose of the regulations, “to promote a culture of good practice with a view to preventing injury” (per Lord Hope in Smith supra at paragraph 15). The course was invigilated by an inspectorate with similar qualities. Mr Hide called them
good people. The hurdle and rails were erected under the hand and eye of a suitably experienced and knowledgeable groundsman who understood the behaviour of horse and rider. It was used by experienced jockeys, always alive to the risks of falling from or with their horses. The jockeys have safety representatives.
54. The considerations which the organisers and their staff gave to the arrangements was, I am satisfied, at least as efficacious as a formal risk assessment as envisaged by the regulations, which may or may not have taken place. I have no doubt that the views of these people alone and in combination, were and are the best indication of what disposition of hurdle and fence was “suitable”, including suitable in respects in which it was reasonably foreseeable would affect the safety of any person. All had safety in mind when fulfilling their respective roles and all had a good understanding of what was likely and unlikely to happen. None thought that an accident of this kind was at all likely, though of course it was possible, and in that sense foreseeable. None had any doubts about the suitability of the arrangements at the material time.”
12. As I read the above paragraphs the judge is applying the phrase “reasonably foreseeable” as a common lawyer would in resolving a case of negligence and then says that the layout of the hurdle and the rail is likely to be suitable
“if in the view of those with knowledge and experience of racing a layout is not thought likely to be a cause of danger.”
The question is whether the judge was correct to use the concept of reasonable forseeability in the classic common law manner when assessing liability under the regulations. It might also be a question whether the judge’s use of the word “likely” unacceptably dilutes the concept of reasonable foreseeability in any event. A yet further question is whether the views of the organisers of the racecourse and their staff can truly be “the best indication of what disposition of hurdle and fence was “suitable”” as the judge states in paragraph 54, even though the judge accepted that an accident of the kind that occurred was possible “and in that sense foreseeable”
However the Court found the judge had erred in importing the common law phrase of "reasonable foreseeability" into the PUWER when deciding whether a perimeter rail at a racecourse was suitable work equipment. Once a claimant had shown that he had suffered injury as a result of contact with a piece of work equipment which might be unsuitable, it was for the defendant to show that the accident was due to unforeseeable circumstances beyond his control, or to exceptional events, the consequences of which were unavoidable despite the exercise of all due care on his part.
The Court said:-
Once, therefore, the claimant shows that he has suffered injury as a result of contact with a piece of work equipment which is (or may be) unsuitable, it will be for the defendant to show that the accident was due to unforeseeable circumstances beyond his control or to exceptional events the consequences of which could not be avoided in spite of the exercise of all due care on his part. The fact that an injury occurs in an unexpected way will not excuse the defendant unless he can show further that the circumstances were “unforeseeable” or “exceptional” in the sense given to those words by the Directive.
Itfollows from all this that the judge was, with respect, incorrect to import into Regulation 4 the “classic common law phrase” of “reasonable foreseeability” and then dismiss the claim on the basis (1) that the way in which Mr Hide was injured was very unusual and (2) that the defendant had abided by all the requirements of the BHA and could not be expected to do more. Those factors might once have excused a defendant in a case brought at common law (although the relevance of the first factor may even then be questionable in the light of Hughes v Lord Advocate  AC 837) but the Directives and therefore the Regulations exist in a world different from the common law. Adapting the words of Lord Rodger in Robb the primary purpose of the relevant regulations is to ensure that employers (and other defendants) take the necessary steps to prevent foreseeable harm coming to their employees in the first place and the defendant’s obligations are triggered if it is reasonably foreseeable that an employee might injure himself. As the judge himself said (para 54) an accident of the kind that happened to Mr Hide, while not at all likely, was possible and in that sense foreseeable. If it happens, it will be for the defendant to show that it was due to unforeseeable circumstances beyond his control or to exceptional events the consequences of which could not be avoided.
This the defendant cannot do. Quite apart from the fact that the defendant did not plead any such unforeseeable circumstances or exceptional events (which is perhaps understandable since the potential difficulties raised by the transposition of Directives into the Regulation only emerged fully in the supplemental skeleton filed on behalf of Mr Hide shortly before the hearing), it is difficult to see what unforeseeable circumstances or exceptional events could be relied on. I do not myself see that an unusual fall could be classified as either. Even if it could, the circumstances of that fall cannot be said to be beyond the control of the defendant or to have engendered events which could not be avoided despite the exercise of all due care. The padding of the uprights of the guard rail could have been thicker; the hurdle could have been placed at a greater distance from the guard rail. The defendants cannot show that if either or both precautions had been taken, Mr Hide would inevitably have suffered the injury which he did. I should perhaps add that not only the hurdle but also the guard rail were, in my view, being “used” as “work equipment”. The fact that Mr Hide did not expect to come into contact with the guard rail does not mean that he was not using the guard rail”
Thus in Hide, which was a pre section 69 ERRA case, the Court found on Appeal for the Defendant, by applying the strict liability test under PUWER. However, if there were a post section 69 EERA case, the situation may have been different given strict liability would no longer apply, and the reasonable foreseeability test would be correct. The Court said:-
“It is true that a breach of the Regulations can give rise to criminal liability. But the Regulation is to be regarded as giving rise to a form of liability which is a stricter liability than at common law. It would be wrong to dilute the liability aspect of the Regulations when questions of the degree of fault can always be taken into account in sentencing”
It is now of course the case that had this accident happened on or after 1 October 2013, the test implied in this case, would have been one of reasonable foreseeability, and the claimant may not have succeeded, as he could not have relied upon section 4 of PUWER in respect of strict liability.
Employer’s Liability (Defective Equipment) Act 1969
This Act is not amended by section 69 of ERRA and sets out:-
Extension of employer’s liability for defective equipment.
(1) Where after the commencement of this Act—
(a) an employee suffers personal injury in the course of his employment in consequence of a defect in equipment provided by his employer for the purposes of the employer’s business; and
(b) the defect is attributable wholly or partly to the fault of a third party (whether identified or not),
the injury shall be deemed to be also attributable to negligence on the part of the employer (whether or not he is liable in respect of the injury apart from this subsection), but without prejudice to the law relating to contributory negligence and to any remedy by way of contribution or in contract or otherwise which is available to the employer in respect of the injury.
(2) In so far as any agreement purports to exclude or limit any liability of an employer arising under subsection (1) of this section, the agreement shall be void.
(3) In this section—
“business” includes the activities carried on by any public body;
“employee” means a person who is employed by another person under a contract of service or apprenticeship and is so employed for the purposes of a business carried on by that other person, and “employer” shall be construed accordingly;
“equipment” includes any plant and machinery, vehicle, aircraft and clothing;
“fault” means negligence, breach of statutory duty or other act or omission which gives rise to liability in tort in England and Wales or which is wrongful and gives rise to liability in damages in Scotland; and
“personal injury” includes loss of life, any impairment of a person’s physical or mental condition and any disease.
(4) This section binds the Crown, and persons in the service of the Crown shall accordingly be treated for the purposes of this section as employees of the Crown if they would not be so treated apart from this subsection.
The Act arguably has not been used in work equipment cases since 1992, given the use of PUWER, but may be a useful pleading in case of negligence for defective Work Equipment cases, where the accident happens on or after 1 October 2013.
There is no doubt that section 69 of the ERRA, will create difficulties for Claimant Solicitors, especially with reference to work equipment cases, under PUWER, which for accidents before 1 October 2013, imposed strict liability. There will undoubtedly be further arguments before the Courts as to how the interplay between the Regulations as evidence of negligence is played out. Claimant Lawyers will now have to be more careful than ever to show there has been a breach of duty of the common law duty of care and that breach caused the accident. This will be discussed in more detail in other Chapters.