The implementation of the Building Safety Act 2022 (‘the Act’), aimed to reform building safety legislation following the Grenfell Tower fire in 2017, is now well underway. The requirements set out in the Act will affect everyone in the built environment industry, and not just in respect of higher-risk buildings.
Parts of the Act have implications for all buildings; the Building Safety Regulator (‘BSR’) will be responsible for the performance of the building control sector, setting building standards and ensuring such standards are met.
The Act gained Royal Assent on 28th April 2022, and since then numerous consultations have and are being undertaken that highlight the significant implications for the industry. At the heart of the change is the legal obligation for all individuals and organisations to be competent to ensure compliance with the building regulations in both design and construction, and the Act introduces tougher penalties for those who fail to do so.
In this article, we look at offences and potential liability (both for individuals and organisations) under the Act, in the context of the new BSR and what we might expect from its approach to enforcement. We also consider the recent Government consultation on implementing the new building control regime for higher-risk buildings under Part 3 of the Act, identifying potential concerns in respect of the proposed approach from a regulatory perspective. Routine enforcement action under the Act is on the horizon, and businesses need to be aware of the potential consequences of non-compliance, and take action now to avoid it.
Offences and Liability
The Act establishes and extends criminal liability in relation to the construction process, including in relation to breaches of building regulations and breaches of compliance and stop notices. Part 3 of the Act sets out a proposed regime of dutyholders for the design, construction and refurbishment of higher-risk buildings, in similar roles to the CDM Regulations. Dutyholders will have legal obligations in respect of their duties in relation to higher-risk buildings, and those who fail to meet key building safety obligations will be guilty of criminal offences.
Section 39 of the Act provides that any breach of the building regulations will be a criminal offence, triable either way. If tried in the Crown Court, the penalty is imprisonment for a term not exceeding two years and/or a fine. In addition, a further fine may be imposed for each day on which the default continues after the initial conviction. The Act also creates criminal offences for obstructing or impersonating an authorised officer of the BSR, failure of an Accountable Person to register a higher-risk building, failure of an Accountable Person to apply for a Building Assessment Certificate within the specified timescales and failure of an Accountable Person to keep “prescribed information” in accordance with “prescribed standards.”
Section 40 provides that where a dutyholder is a corporate entity, individuals within that organisation may also be prosecuted where the breach was committed with their consent, connivance or as a result of their neglect.
Section 38 empowers the BSR to issue notices during the design and construction phase of higher-risk buildings, comprising:
- compliance notices, requiring issues of non-compliance to be rectified by a set date; and
- stop notices, requiring work to be halted until serious non-compliance is addressed.
A person who without reasonable excuse contravenes a compliance or stop notice is guilty of a criminal offence, triable either way. If tried in the Crown Court, the penalty is imprisonment for a term not exceeding two years and/or a fine. In addition, a further fine may be imposed for each day on which the default continues after the initial conviction.
It is clear that the extent of criminal offences, and potential liability, under the Act is considerable. For organisations, this could result in a significant fine or prosecution of individuals within the business (where the breach was committed with their consent, connivance or as a result of their neglect) and the associated risk of imprisonment. It is therefore imperative that all businesses understand and comply with their obligations under the Act, but it is useful to understand the role of the new BSR and how it might approach enforcement.
The BSR and Enforcement
Part 2 of the Act establishes a new national BSR, a role that is to be undertaken by the Health and Safety Executive. The BSR will oversee the safety and performance systems of all buildings in England and assist in encouraging the improvement in building standards and competence in the built environment industry. The BSR is also responsible for implementing and managing a new and more stringent regulatory regime for “higher-risk buildings” and will become the building control authority for all such buildings. The BSR will oversee the inspection of higher-risk buildings during their design and construction, and has express powers to authorise remedial works, stop non-compliant projects, impose special measures for failing projects, and order the replacement of key officers. It will also be responsible for registering higher-risk buildings and assessing safety cases for those buildings during their occupation.
The Government Guidance in respect of the BSR’s approach to enforcement states that the use of enforcement powers will be set out in a published Enforcement Policy Statement (’EPS’). The EPS will set out the following five enforcement principles:
- Proportionality in how the BSR applies the law and secures compliance;
- Targeting of enforcement action;
- Consistency in the BSR’s enforcement approach;
- Transparency about how the BSR operates and what stakeholders can expect; and
- Accountability for its actions
It states that enforcement action will be proportionate to risk and to the seriousness of any breach of the law - this will include any actual or potential harm arising from any breach, its likelihood, and the impact of the action taken. Enforcement activity will be focused on the most serious risks and/or breaches of the law, and on those who are responsible for and best placed to control those risks. The degree of risk and the seriousness of any breach, including the attitude and competence of management, incident history and previous enforcement action, will inform the exercise of the BSR’s discretion. It is perhaps this last statement that businesses need to be particularly alive to; failure to take a robust approach to building safety (and previous incidents and enforcement action arising as a result) are all factors that will make enforcement action by the BSR more likely.
As mentioned above, the seismic impact of the Act is highlighted by the many consultations being undertaken in respect of it. In July 2022, the government launched a consultation on its proposals for implementing changes to the building control regime for England under Part 3 of the Act, as set out in our previous article Building Safety Act 2022: Government consultation outlines proposed changes. Shoosmiths’ specialist construction and regulatory teams provided a detailed response to that consultation, the headline points of which are outlined in Shoosmiths’ consultation response on the Building Safety Act 2022. That consultation ended on 12 October 2022 and its conclusions are yet to be published.
Some of the key points arising out of the consultation from a regulatory perspective were:
- The challenges likely to be faced by clients in obtaining the proposed information to satisfy the competence requirements for the appointed Principal Designer and Principal Contractor;
- The potential dangers of attributing undue significance to previous convictions in determining competence (in particular the impact this may have on larger contractors);
- The potential pitfalls if detailed guidance is not provided to those who take on the dutyholder role of the client on how to satisfy themselves as to the appropriateness of any person appointed for building work; and
- The risk of a lack of objectivity and independence in the proposed appeal and review processes.
We will have to wait and see how the Government responds to these concerns, and how much heed is given to industry voices in shaping the way in which the provisions of the Act will be implemented in practice.
The Act places extensive obligations on all those working in the built environment industry, and makes provision for a number of criminal offences for those who fail to meet the relevant standards. Due to the sheer volume of construction projects taking place, and the exposure of corporate officers and directors to criminal liability, those active in this field must act swiftly to put in place fail-safe systems to protect both the company and its individuals.
Although secondary legislation is still in development, in October 2022 the first enforcement action was taken by the Government against a block owner who failed to carry out necessary cladding works. This should be seen as a warning to the industry that the Act is being enforced - the BSR has been clear in its messaging to the sector; prepare now and play your part in making buildings safer, regardless of whether you are working on higher-risk buildings or not.