No man is an island, but being a sole director might come close
It is often quoted that 80% of businesses affected by a major incident, such as fire, close within 18 months and that 90% of businesses that lose data from a major incident are forced to shut within 2 years.
These are quite shocking figures and would no doubt encourage many to ensure that their business continuity and resilience plans are robust. However, when it comes to the issue of fire, the role of a director is far greater than just resilience planning and dealing with the impact on the business. Many directors do not realise that they may be liable as the ‘Responsible Person’ under the Regulatory Reform (Fire Safety) Order 2005 (“The Order”) and what this means for them.
The Order came into force on 1 October 2006, replacing previous legislation and applies to non-domestic premises in England and Wales. The responsibility for complying with the Order rests with the Responsible Person. So who is that? In a workplace, it is the employer, if the workplace is to any extent under his or her control. Otherwise, it is the person who has control of the premises in connection with the carrying on by him or her of a trade, business or other undertaking (whether or not this is for profit). Where that person does not have such control, the Responsible Person is the owner. It is common for there to be more than one responsible person, making the situation all the more complex.
In May 2018 Dame Judith Hackitt published her final report ‘Building a Safer Future- Independent Review of Building Regulations and Fire Safety.’ Following the Grenfell Tower fire, Dame Hackitt was asked by the Secretary of State for the Department for Communities and Local Government (“DCLG”) and the Home Secretary to conduct an independent review of Building Regulations and Fire Safety, with a particular focus on high rise residential buildings. Whilst the report focuses on high rise residential buildings, Dame Hackitt identified that the ideas she proposes have broader application to a wider range of buildings and she recommends a drive for change more broadly. The report identified that the current system of building regulations and fire safety is not fit for purpose and that a culture change is required.
One of the issues Dame Hackitt identified within the report was that identifying the appropriate Responsible Person or Persons can be ‘highly complex and time‑consuming’. In addition she recognised that Responsible Persons are often not aware of their responsibilities under the Order and often assume they are for someone else to do.
Despite this confusion and lack of awareness, under the existing legislation, all Responsible Persons are required to comply with their obligations under the Order. It is far reaching in its effect and offences that can be committed by the Responsible Person include failing to comply with the requirements of the order where that failure places one or more relevant persons at risk of death or serious injury in case of fire [Article 32(1)(a) Regulatory Reform (Fire Safety) Order 2005].
Such requirements under the Order include, for example, undertaking a suitable and sufficient fire risk assessment to ensure the safety of all ‘relevant persons’ which includes those who are or may be lawfully on the premises and any person in the immediate vicinity who is at risk from a fire on the premises. A further example, is a requirement to provide employees with comprehensible and relevant information on the risks to them identified in the risk assessment and the procedures and measures to be followed in the event of serious and imminent danger [Article 19(1)]. This provision of information requirement extends to ensuring that the employer of any employees from an outside undertaking, who are working in or on the premises, is provided with comprehensible and relevant information on the risks to those employees and the preventive and protective measures taken by the Responsible Person [Article 20 (1)].
In similar vein to a director’s liability when it comes to health and safety offences, a director can be personally liable for fire safety offences committed by or in connection with their company under the Order. The Order specifies that where an offence is committed by a body corporate and it is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any director, manager, secretary or other similar officer of the body corporate, (or any person purporting to act in any such capacity), the individual, as well as the body corporate is guilty of that offence, and is liable to be proceeded against and punished accordingly [Article 32(8)]. On top of that similar officers could be prosecuted by virtue of article 5(3), which states that any duties under the Order imposed upon the Responsible Person(s) shall also be imposed on ‘every person, other than the responsible person, who has, to any extent, control of those premises so far as the requirements relate to matters within his control.’ The Order is broad and far reaching in this regard.
The consequences of non-compliance can be serious, those found guilty of offences under the Order are liable to a fine or imprisonment for up to two years.
Looking to the future, the Hackitt review has recommended the introduction of a ‘clear and identifiable 'dutyholder’ with responsibility for building safety of the whole building. She recommends that the dutyholder during occupation and maintenance should maintain the fire and structural safety of the whole building. Such a dutyholder would be required to present a safety case to a regulator on a regular basis, to check that risks are being managed. That regulator would hold dutyholders to account and impose ‘robust sanctions’ where necessary. The Government has committed to taking forward the recommendations in the Hackitt Review but has stated this will take time, so we will have to see how the dutyholder role is implemented in due course and how this impacts on those responsible. In the meantime, the role of the Responsible Person remains.
Understanding your responsibilities is first and foremost. The legislation and guidance is complex and can be confusing, but the key is understanding your responsibilities and acting on them by ensuring you meet the requirements of the Order. Work with the relevant authorities to ensure that you are compliant; take advice as early as you can as to what your responsibilities are and how you can ensure they are met; and continuously review your practices. Few realise they may be deemed the ‘Responsible Person’, nor the consequences should they fail to comply with the Order, recognising this and dealing with it will place you and those you are responsible for in a much safer position all round.
If you have any concerns or require further information about directors’ duties and their potential implications, please contact a member of our directors and officers team.
Hannah Eales is an experienced advocate and a regulatory, health and safety and criminal law specialist. Hannah has a particular expertise in Fire Safety law having prosecuted on behalf of Fire and Rescue Authorities in the Magistrates’ and Crown Courts and the Court of Appeal. She currently is acting for a core participant in the Grenfell Tower Inquiry.
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