Fire Safety Regulations: How much will non-compliance cost your company?

fire safety

In challenging economic times, SME managers and business owners are always on the look out for ways to save money and cut costs, and one area that is often the first to go is staff training. But if that training is mandatory under health and safety legislation, it could turn out to be a false economy of the worst possible kind.

Failing to comply with your obligations under the Regulatory Reform (Fire Safety) Order 2005, and the Fire Safety (Scotland) Regulations 2006, exposes your company to significant fines, and possibly even a jail term. It also exposes you to a wide range of other risks and losses that could add up to far more than you will ever save by cancelling your fire safety training or fire marshal courses.

What are your obligations?

Under the regulations, companies are responsible for fire safety in the workplace, ensuring all staff have basic fire awareness training. It also mandates the nomination of a set number of fire marshals, according to the size and nature of your business and the layout of your premises, as follows:

Low risk

  • 1 fire warden for up to 50 people
  • 2 fire wardens for 50 -100 people
  • 1 fire warden for every additional 100 people

Medium risk

  • 1 fire warden for up to 20 people
  • 2 fire wardens for 20 -75 people
  • 1 fire warden for every additional 75 people

High risk

  • 1 fire warden for up to 15 people
  • 2 fire wardens for 15 – 50 people
  • 1 fire warden for every additional 50 people

You must then add 25-50% to allow for holidays, sickness and other absences, also ensuring there are sufficient fire marshals to cover all shifts for businesses operating outside of office hours.

Why is fire safety training neglected?

When every penny counts, it is natural for managers to look for cuts that are easy wins. If your company has never had a fire, it is tempting to think that fire safety training and the appointment of fire marshals is a low priority and perhaps even a waste of money. Hard-pressed managers are reluctant to spend money on something that might never happen, especially when they are faced with very real costs from things that are actually happening right now.

Fines for non-compliance

However, if a fire does happen, and you have not prepared in accordance with the regulations, then the costs can be enormous. Retailer, New Look was fined £400,000 when their Oxford Street store burnt down, with insufficient staff training cited as one of the offences. Similarly The Co-op in Southampton was fined £210,000 for ‘failing to ensure that the store manager was provided with suitable and sufficient fire safety training’, amongst other fire offences.

There has been no limit on the fines that can be imposed by a court in regard to health and safety breaches. Fines for minor breaches can be as high as £5,000, with major breaches facing unlimited fines and a jail term of up to 2 years. As well as facing a substantial fine, your company could also face a large bill for prosecution costs if you are found guilty of breaching the fire regulations in court.

Other direct costs of non-compliance

If you are found guilty of breaching the law, and someone is injured or killed as a result, you could also face substantial compensation costs. It could be argued that your company has insurance to cover this, but this may not be valid if you have not met your statutory obligations. Even if your policy does pay out, you will have to fund the excess and face a much higher premium when it comes to renewal.

You also risk damage to your premises and stock from a fire. Once again, while your insurance might pay out for the damage and loss, there will inevitably be many indirect costs that will not be covered, such as loss of business while you are waiting for new deliveries or loss of key company records or customer data.

Hidden costs

Not all the costs of failing to comply with fire regulations are as obvious as fines and compensation payments. Injuries to key staff can also have a serious knock on effect on productivity, cash flow and even your business reputation.

If staff are off work due to injuries, you will not only have to pay sick pay, but also the cost of replacing them through overtime or extra staff. If the injured party is a key staff member, they may not be replaceable at all, and this can leave you unable to meet deadlines or fulfill major contracts. This, in turn, will damage your reputation with your customers and could even cost you their business if you let them down.

The smaller your company, the higher your risk

It’s easy for smaller companies to assume that they don’t need the same level of fire safety training as bigger organisations, but if anything, small companies need it even more.

The smaller your company, the less reserves you have to cover unexpected costs such as fines and prosecution costs. Small companies have less staff and so less flexibility to cover when someone is injured, and they also tend to be more dependent on a small number of customers, so if they let them down, or lose their reputation, the whole business is at risk.

This means that if you fail to comply with fire safety and health and safety legislation, you could lose your company altogether.

The cost of complying is less than you think

As you can see above, the cost of non-compliance with fire safety legislation can be huge, yet the cost of fulfilling your obligations with expert training is far less than you think. CE Safety can come to your premises to deliver approved fire safety and fire marshal training at your convenience, in a highly cost effective way.

The courses will cover all the mandatory information, not only helping your company to comply with the law, but also helping your staff to create a safer workplace, helping to avoid incidents and accidents in the first place and acting promptly and professionally if an incident does occur.

At the end of the day, fire safety training should not be thought of as a cost; it should be considered an investment in the safety of your staff and the longevity of your business.