Company prosecutions will rise from July after new change in “senior manager” law
1st June, 2026
Directors and senior managers have just one month before the law will make their companies guilty of criminal offences when they commit offences of their own.
In one of possibly the biggest changes in how corporate entities can be criminalised since the Corporate Manslaughter and Corporate Homicide Act 2007(CMCH), boards need to act now to consider the scope of the “senior manager” test and understand how their organisation can be found guilty for all breaches of duty by its senior people for any offence that their businesses might commit.
Crime and Policing Act 2026
On 29 June, the Crime and Policing Act 2026 comes into force and widens the scope and circumstances where the conduct of the senior individuals can make a company guilty of criminal offences. Until now it has been rare for the “senior manager” test to create liability on the company when individuals fail to meet their own duties other than for corporate manslaughter and some economic crimes such as fraud and prevention of bribery.
The new offence is committed by the organisation when the senior manager is guilty of any type of personal offence even including when the individual in question was not highly negligent or seriously blameworthy. If for example an employee fails to follow company safety policies after 29 June, they can be in breach of legal duties that they owe and that failure could ironically create liability on the company, even where it might have good safeguards and procedures in place which are usually followed across its business. Prosecutors will much sooner target a company, with greater resources to pay a fine and costs than a senior manager and to send out a stronger public message to other companies about how important it is to ensure regulatory compliance in the course of all business-related activities.
Who is considered a ‘senior manager’?
The principle has been borrowed from the CMCH and extended so that where a senior manager acting within the actual or apparent scope of their authority commits an offence, then so does the company. Many companies will recall how wide the definition extends down into and within the business. Someone who is in fact managing or organising even a substantial part of the company comes within that test and prosecutors will point to case law from 1963 which shows that certain individuals and roles will have “ostensible authority” to act on behalf of the business unless they and the company have expressly extinguished it.
Some regulators armed with new powers will invest heavily in the first investigations after 29 June to bring a case under the new provisions and publicise the message about what is now expected of senior managers. Those enquiries will undoubtedly reveal more offences on the part of individuals and them being prosecuted alongside their companies, so that a prosecutor can establish the corporate guilt based on the errors of the relevant senior managers. Expect legal arguments about how in some cases a manager committing an offence of their own might still be within the apparent scope of their authority.
The senior manager test states expressly that a job title may assist to identify seniority but regulators can look much further down the corporate structure chart to find individuals who had no idea that their conduct could lead to offences being committed by the business or that they were a “senior manager,” regardless of their job title or role. Companies should at least consider how they would characterise the roles of their own individuals even if a prosecutor may disagree.
Many of the prosecutions that the author has defended have floundered on the Boal test; under section 37 of the Health and Safety at Work Act an individual can only be criminalised if they had actual responsibility for the corporate strategy and decision making. The senior manager test does not require this and so in practice, those caught may not in fact be regarded as very “senior” within the structure and operating systems of many companies, organisations, and partnerships.
What businesses need to consider
When the CMAH came into force it was clear that to try to prove an offence against organisations, prosecutors would have to look more deeply than before at the conduct of individuals. Directors and middle management can expect far more scrutiny of their conduct and how they comply with various regulatory obligations on them long before an adverse event occurs. It is relatively easy for senior managers to commit offences without having any idea that they are failing in their duties and prosecutors will want to identify offences by individuals so as to make the company liable.
So an Act which is predominantly designed to deal with “anti-social behaviour, offensive weapons, offences against people (including sexual offences), property offences, the criminal exploitation of persons, sex offenders, stalking and public order; to make provision about powers of the police, the border force and other similar persons” may also end up potentially making it far easier than ever for companies to be held criminally liable when a member of its staff is itself guilty of a regulatory or any other criminal offence.
Companies should consider the implications of mistakes and compliance lapses right across the “senior management” levels and brief out the implications of the new offence. Directors should appreciate how the company can be held liable far more widely going forwards, take advice and review their systems as well as having a robust and tested response and incident management protocol embedded and ready to implement in the event of an adverse regulatory incident occurring at any time from 29 June 2026.
For more information or of you would like to discuss the new law, please contact Chris Green in our Regulatory Compliance and Investigations team.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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