A federal law that expands the scope of criminal liability for workplace accidents has rapidly gained a place on the radar screen of Canadian risk managers.

The amendment to the criminal code, known as Bill C-45, makes it easier to charge supervisors at every level of an organization and the organization itself with a criminal offense for workplace accidents that injure or kill people.

The law became effective in March 2004, and only one individual has been charged with a violation so far. But observers say they believe that more prosecutions are inevitable, and employers are being encouraged to take steps to ensure they are in full compliance with legislative and regulatory requirements.

"I think employers need to be aware of the large risk of undermanaging or poorly managing health and safety issues in the workplace," said Norm Keith, a Toronto-based partner in the employment and labor group of Gowling Lafleur Henderson L.L.P.

Bill C-45 imposed a legal duty on all those who direct work to take reasonable measures to protect employee and public safety. Under Bill C-45, wanton or reckless disregard of this duty that causes death or bodily harm could result in a charge of criminal negligence.

The C-45 amendment was the federal government's response to a 2002 report on workplace safety and corporate liability that was prompted by the Westray mine explosion that killed 26 miners in Plymouth, Nova Scotia. An inquiry into the accident found that management was repeatedly warned of unsafe conditions but willfully ignored them. Due to limitations of the criminal code, the managers supervising the mine operations were never successfully prosecuted for their part in the disaster. This led to calls to amend the criminal code to facilitate criminal prosecutions against organizations and their employees for workplace accidents that kill or injure people.

Prior to Bill C-45, a corporation could only be found guilty of a crime if its "directing mind" committed the prohibited act and intended, at least in part, to benefit the corporation by the crime. The difficulty in reaching this standard of proof meant criminal prosecutions were rare and unsuccessful, lawyers say.

The federal law now makes it easier to affix a corporation with criminal liability for the failure to take reasonable steps to prevent bodily harm, lawyers say. "It codified a duty to protect in the workplace," said Edward T. McDermott, a partner with the labor and employment department of Osler, Hoskin & Harcourt L.L.P. who is based in Toronto.

Now, for an organization to be found guilty of committing a crime of negligence, the government will generally have to show that a representative of the organization committed the act and that a senior officer should have taken reasonable steps to prevent them from doing so, according to guidelines issued by the Department of Justice Canada.

To establish the intent necessary to find the organization guilty, C-45 requires that the senior officer or officers must have "markedly departed" from the standard of care that could be expected. For example, an organization might be convicted if a supervisor failed to give an employee the basic training necessary to perform his or her job and an accident occurred as a result of the inadequate training.

C-45 also expands the scope of individuals who can be held personally responsible for workplace accidents to include everyone from the supervisors who direct employees at the operational level to high-level executives. Because senior-level executives can be held criminally liable, the education of senior managers and directors on matters of health and safety has become a more immediate priority, said Sheikh Azaad, president of Toronto-based Atworkcanada Inc., which provides solutions for managing workplace disability and absenteeism.

The federal law also expands on health and safety rules to require employers to take all reasonable steps to protect any person who enters the workplace or may be affected by workplace activities. In other words, the responsibility is not just for the safety of employees, but also the general public.

Employers are responding by conducting hazard/risk assessments to determine the nature and extent of public access to the workplace and developing policies and procedures on public access to the work site, Mr. Azaad said. Employers are also putting in place physical measures that identify and communicate the risk potential to the public and expanding health and safety training to workers to include protection of the public, he said.

The amended criminal code raised the maximum fine for less serious offenses to $100,000, but it provides no limits on fines that can be imposed for serious, indictable offenses.

Only one prosecution has been bought under C-45 to date (see related story), but more prosecutions are inevitable, lawyers say. "We will see charges in the next six months, if not sooner," said Mr. Keith, who is currently representing two construction companies in Ontario that are being investigated for possible C-45 violations.

Employers, though, will face C-45 prosecutions only in the most extreme circumstances, with most workplace safety violations continuing to be handled within the regulatory environment, said Jason Beeho, an associate in the labor and employment group of Blake, Cassels & Graydon L.L.P. in Toronto. "Criminal prosecutions will remain unusual in the health and safety sphere," he said.

While the legislation has an impact on risk managers, those with good programs and good due diligence already will have taken the necessary steps to protect workers, said Robert Patzelt, group corporate counsel and risk manager for Bedford, Nova Scotia-based Scotia Investments Ltd.

"Good companies will run their businesses the right way regardless of whether there is a law saying this or that," Mr. Patzelt said. "Those that continue to be lax and casual expose themselves even further."

Risk managers are well aware of the importance of C-45, observers say. The Canadian arm of the Risk & Insurance Management Society Inc. will conduct a session to discuss C-45 issues at its annual conference in Montreal. The session will be conducted in English today from 10:30 to noon and repeated in French at 3:30 p.m.

Nowell Seaman, manager of risk management and insurance services at the University of Saskatchewan, said he believes C-45 has created awareness of occupational health and safety risk issues at the senior levels of many organizations.

"I am not sure that the bill has increased the attention that risk managers devote to OHS risks, because most already treat this area with the highest priority as a key risk category," said Mr. Seaman, who is the former chair of the RIMS Canada Council. "However, I am sure that many risk managers have found that the implementation of C-45 has been positive and has highlighted the importance of managing this area well across the organization."