A significant multi-million pound fine was imposed last week after National Grid Gas plc pleaded guilty to health and safety offences arising from its failure to make available records for hundreds of properties, which resulted in routine safety inspections not taking place.
It is the biggest fine imposed for a health and safety breach since Valero Energy UK Limited was fined £5 million in June 2019 following a fatal explosion at an oil refinery in June 2011.
Facts
In June 2017 the Health and Safety Executive (HSE) requested information from gas distribution network companies about their management of gas networks in high rise multiple occupancy buildings (HRMOBs).
In doing so, the HSE found that when National Grid Gas plc sold part of its operations to Cadent Gas Limited in 2016, the records of 769 buildings were not transferred. This meant that until the issue came to light in December 2017, the HRMOBs had not been subjected to condition surveys, inspections or routine maintenance for years. The HSE investigation also revealed that National Grid Gas had failed to ensure that there were Pipeline Isolation Valves in 112 HRMOBs.
On 9 February 2021, Liverpool Crown Court imposed a fine of £4 million and prosecution costs of £91,805 on National Grid Gas plc, following a guilty plea to section 3(1) Health and Safety at Work etc. Act 1997 ("HSWA 1974"). Cadent had already taken remedial action in 2018 after complying with related enforcement notices issued by the HSE.
The law
Section 3(1) HSWA 1974 imposes a duty on every employer to persons other than their employees:
It shall be the duty of every employer to conduct his undertaking in such a way as to ensure, so far as is reasonably practicable, that persons not in his employment who may be affected thereby are not thereby exposed to risks to their health or safety.
Under section 33 HSWA 1974, it is an offence for a person or an organisation to breach this duty. If proved, the court has no statutory limit on the fine it can impose.
In this case, the HSE considered that residents and members of the public were exposed to risk to as a result of the incomplete records, which directly led to the absence of routine inspections of these buildings.
Lessons learnt?
It is not the first time National Grid Gas plc has been fined under the HSWA 1974. In December 2015 and January 2016 they were subjected to fines of £2 million and £1 million respectively in relation to section 3 HSWA breaches involving insufficient risk assessments and inaccurate records. These followed earlier, much smaller fines in 2012 and 2013 of £17,500 and £20,000 respectively for breaches of section 2 and section 3 HSWA 1974.
The case is a stark reminder to businesses that in the world of health and safety, even errors which result in no actual harm can lead to prosecutions and substantial financial penalties.