Directors in the firing line

By Dr Anna Willetts, President of the Chartered Institution of Wastes Management and Co-Convenor of UKELA’s Waste Working Party

THANK you to Skip Hire & Waste Magazine for inviting me to join the Business Clinic column (sadly not, I note, the Skip Chick page…).

I’ll get straight in with an article which seems to me to be particularly relevant at the moment. As an environmental lawyer, I act mainly for SMEs in the skip hire and recycling industry. These businesses are often targets of enforcement action by the waste regulator, the Environment Agency.

It’s extremely easy to fall into non-compliance in the waste industry – almost impossible not to – in my view, for many reasons. This is not helped by the fact that the legislation which governs the waste industry is highly technical, voluminous, open to wide interpretation, and described by a High Court Judge in one of my cases in the Court of Appeal (which we won…!) as ‘an absolute nightmare.’

When the Agency prosecutes businesses, they now frequently also prosecute the directors, and sometimes managers (including TCMs) of those businesses. This is particularly relevant to SMEs, my clients, as it is relatively easy for the Agency to demonstrate that, in an SME as opposed to a large corporate, the directors and managers had day-to-day knowledge and understanding of the business and its operations. They are then able to use a part of the legislation (in the Environmental Permitting Regulations 2016) to prosecute individuals for ‘consent, connivance or neglect’ in their duties as directors, in the commission of an offence by the company.

Whilst it’s annoying enough for a company to face a prosecution, the issue for individuals is that the penalties can be much worse, including loss of liberty, director disqualification and a criminal conviction which has implications for travel (particularly to the US), insurance policies, future declarations for tenders and so on. The stakes are a lot higher for directors and managers, and should not be underestimated.

The buck, sadly, always stops with the directors in these cases. Even if a company has had an employee off on a frolic of his own (for example, taking a company vehicle home, using it to transport waste and dump it in a ditch at night for cash), the company will be held liable by the regulator and from there, potentially, the director for neglect. All environmental offences are ‘strict liability’ which in law means that you do not need to have knowledge of the offence to be guilty of it.

The above example is an actual case I dealt with last year. The employee was caught on CCTV footage loading the company 8-wheeler with waste, accepting cash, then the waste was later found dumped in a farmer’s field. My client – the company – was prosecuted along with the two directors. Thanks to my brilliant legal skills (!) we managed to deal with it sensibly, but it took a lot of time and effort, and no doubt my clients found it very stressful and worrying at the time, facing a potential conviction for a criminal offence.

This article is not meant to put the fear of God into readers, but to draw your attention to liabilities of SMEs and individuals in the waste industry, as this is an issue I am seeing more and more as a waste defence lawyer. More to follow in future editions!

Anna is an environmental criminal lawyer, specialising in defence work in the waste and recycling industry. She is dual-qualified, having completed a PhD in geochemistry and worked as an environmental consultant for 5 years before qualifying as a lawyer.

Anna represents waste and recycling businesses and directors who are prosecuted by the regulators for environmental and waste offences.

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