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Recently, the Committee for Reforms in Criminal Laws set up by the Ministry of Home Affairs, has solicited responses via a questionnaire highlighting issues in the current legal framework, amongst which lies the question of introducing the offence of “Corporate Homicide” in the Indian Penal Code ( “IPC” ).[i]
Evidently, this suggestion has been put forward in light of similar legislation in the United Kingdom and Australia where specific laws have been enacted to hold corporates and their officials accountable for deaths caused due to serious lapses in industrial safety management.
India has had a considerable number of industrial accidents. Officially, the Bhopal Gas Tragedy of 1984 claimed 5,295 lives, while activists claim that fatalities number anywhere between 20,000 and 25,000.[ii] The Korba Chimney Collapse of 2009 caused 45 deaths. The GAIL Pipeline Blast of 2014 led to at least 15 deaths.[iii] The Vizag Gas Leak in May this year, has claimed 15 lives.[iv] As per data from the Labour and Employment Ministry, 3,562 workers died in factory accidents across India between 2014 and 2016, working out to an average of three deaths per day.[v] Moreover, according to a 2017 study by the British Safety Council, 48,000 workers die of occupational accidents every year in India.[vi]
This preponderance of accidents has evoked demands for a specific offence to deal with industrial deaths and further to serve as a deterrent for rash and negligent management decisions.
This article highlights the legal trammels of adequately punishing errant corporates, more effective modes of punishment and the relevance of a new law in a country struck by a pandemic.
Indian Penal Code Out of Kilter with Industrial Accidents:
Generally, in case of a fatal industrial accident in India, the persons in charge of the factory/plant such as the owners, managing directors, etc. are charged under section 304 A IPC (Causing death by negligence) which mandates imprisonment for up to two years or fine, or both. It is a bailable offence.
This is of course in addition to other sections such as 336, 337 and 338 IPC which deal with endangering life and personal safety of others; however, they provide for even shorter prison terms and paltry fines.
This is especially because of the difficulty of proving that company officials acted deliberately or with knowledge that their acts would lead to fatalities, intention or knowledge being the basic ingredients of section 304 IPC (Punishment for culpable homicide not amounting to murder), which warrants imprisonment for a period up to ten years or life imprisonment, along with a fine.
Moreover, section 304 IPC is a non-bailable offence. The difficulty of securing a conviction under this section is augmented by the convoluted management structures adopted by many modern-day corporates, which has made it challenging to pin responsibility on an individual(s).
Some state governments have issued directives to the police to register cases under Section 304A instead of Section 304. For instance, the Rajasthan Government in 2017 had directed the police not to invoke section 304 IPC routinely in industrial accidents, since it had a demoralizing effect on businessmen.[vii]
The Indian approach is in stark contrast to that in Australia.
In the state of Victoria, section 39G of Occupational Health and Safety Act 2004 (Vic) provides that persons who negligently cause a workplace death shall be punished with imprisonment for up to twenty-five years.[viii] In the Australian Capital territory, section 49D of Crimes Act 1900 provides that a senior officer of a company, whose negligent acts causes the death of a worker, can be imprisoned for 20 years.[ix] Essentially, all that needs to be proved is negligence.
Considering the number of industrial deaths in India, it is safe to say that a two-year prison sentence under Section 304A has proved to be grossly inadequate and a stricter punishment regime is the need of the hour.
The Occupational Safety, Health And Working Conditions Code, 2019 – An Inefficacious Move:
The Occupational Safety, Health And Working Conditions Code, 2019[x] (“Code”) was introduced in the Lok Sabha last year, to consolidate and amend laws regulating occupational safety in India; however, the Code has fallen way short of the desired objective.
Section 96 (1) of the Code provides that any person who commits an offence under the Code, causing the death of another, shall be punished with imprisonment for a term which may extend to two years or with a minimum fine of five lakh rupees or both. While the fine may be a welcome change, as far as imprisonment is concerned, things have not really changed as Section 304A too provides for a maximum of two years.
Moreover, section 2 ( u ) manifestly states that the Code is only applicable to establishments with 10 or more workers, thereby completely excluding from its purview, a large part of Indian industry composed of units which employ fewer workers.
Punishing Corporates
The Corporate Manslaughter and Corporate Homicide Act 2007[xi] (“Act ) in the United Kingdom, can potentially serve as a reference point for legislators in India. This enactment has introduced innovative penalties for companies which have been found responsible for causing deaths of employees and members of the public.
The Act preponderantly focuses on scrutinizing general corporate procedures and processes rather than individual action and decision-making.
The Act provides for imposition of unlimited fines on companies while bearing in mind factors such as, whether the breach of duty was with a view to profit, the degree of risk and the extent of danger involved. The courts may also issue remedial orders directing the organization to remedy the causes of the circumstances which led to the fatal accident.
Most importantly, the corporation may also be compelled to publicize the fact that it has been found guilty of Corporate Homicide, by taking out adverts in local newspapers and publishing notices on their websites giving relevant details, the amount of any fine imposed and the terms of any remedial order made.
Regrettably, only a few of the many industrial accidents in India make it to the news. Many accidents with lower death counts escape the stigma of publication. Publication orders issued by courts could be instrumental in improving the situation.
Justice G.P. Mathur in The Assistant Commissioner, Assessment-II, Bangalore and Ors. v Velliappa Textiles Ltd. and Ors.,[xii] has opined that,
“The conviction of a company for an offence by itself is bound to affect its reputation and in the long run may affect its business interests…..The publication in newspapers about prosecution and conviction of a company is bound to bring bad name to the company and lower its image before public at large. ”
The 47th Report of the Law Commission of India (February 1972) had highlighted,
“ The real penalty of a corporation is the diminution of respectability, that is, the stigma. It is now usual to insert provisions to the effect that the Director or Manager who has acted for the corporation should be punished. But it is appropriate that the corporation itself, should be punished. In the public mind, the offence should be linked with the name of the corporation, and not merely with the name of the Director or Manager, who may be a non-entity. ”[xiii]
It is the delinquent corporation itself which needs to be effectively castigated for inadequate risk assessment and lapses in standard operating procedures (SOPs) at work and newer and more effective modes of punishment must be considered.
COVID-19 And Corporate Homicide
The Pandemic has created several new challenges for businesses looking to reopen. Today it is incumbent upon the senior management of companies to take necessary steps such as ensuring that their facilities are disinfected, keeping employees sufficiently distanced from one another and not allowing employees who are known or suspected to have the virus to return to work until they test negative, etc. If proper measures are not implemented promptly, deaths are inevitable.
Also, there is fierce competition between pharmaceutical companies for finding a cure/vaccine against the virus. The financial rewards for those who discover the vaccine cannot be ignored. While there is no reason to assume that corners may be cut in terms of rushed clinical trials, insufficient trials, etc, yet their possibility cannot be completely ruled out.
Improper trials could be fatal.
Many frontline workers are falling prey to the virus on account of a shortage of personal protective equipment (PPE) at hospitals. This is another area of concern for India and hospitals must be held accountable for consequent deaths. In fact, there is already talk of launching criminal[xiv] investigations against hospitals under Corporate Manslaughter laws in the United Kingdom, for failing to provide proper PPE to staff.
Theses unfortunate circumstances created by COVID-19 have made the need for a specific offence dealing with corporate deaths more important than ever before.
Final Word
Not only do new regulatory standards need to be complied with to meet the challenges posed by COVID-19, but corporates must also be compelled to ensure that they meet current duties with regard to health and safety.
Unfortunately, many a times adequate safety measures are not implemented by corporates for the sole purpose of cutting costs. A new law will be instrumental in ensuring that businesses all over India strike the right balance between profit and human life.
The time is ripe for our legislators to put their heads together and carve out an all-encompassing offence dealing with corporate deaths, which in turn is bound to have a profound impact on making our industries safer for those working therein as well as for the public in general.
(The author is a final-year student at the Government Law College, Mumbai)