The Russell Hume Collapse: How to prevent it happening to you in 3 steps

This is the first in a series of articles aimed at the food industry following Russell Hume's administration. As the media and regulators turn their attention to the food industry these articles will highlight 3 key steps to take in order to protect your business.

The known facts regarding Russell Hume are as follows. An unannounced FSA inspection on  12 January launched a 12-day investigation into Russell Hume, after becoming "aware of instances of serious non-compliance with food hygiene regulations". This resulted in the FSA instructing Russell Hume to withdraw all affected products in the supply chain and stopping any product from leaving Russell Hume sites until compliance could be assured.

This led to a number of customers (including JD Wetherspoon and Jamie’s Italian) to terminate their contracts with the supplier. KPMG partner Chris Pole, one of the appointed administrators, has said: “The recent product recall and halt in operations has caused significant customer attrition and trading difficulties, which in turn has led the directors to take the decision to place the company into administration."

While the reputational damage and subsequent loss of trade has been the cause of Russell Hume's collapse, it is also worth noting that there are severe criminal sanctions available in such instances of non-compliance including unlimited fines and custodial sentences for directors and senior management.

Below, we outline the first step all food companies should take to avoid these outcomes: Ensuring your Food Safety Management Systems are working.

In the near future we will publish further articles on Step 2: The Importance of the Senior Management Role and finally Step 3: Proper Crisis Management: what to do when things go wrong.

Step 1: Ensure your Food Safety Management Systems are working

The first and best way to avoid enforcement from any regulator is to ensure you have an efficient safety management system in place and that all employees are adhering to it.

A food safety management system helps to identify where and how the safety of food produced could be put at risk. It should state how you intend to manage these hazards and the controls you have in place to protect consumers.

You should put in place a system based on food safety practices that you are familiar with, in line with "Hazard Analysis and Critical Control Point" principles (HACCP). The level of documentation required will depend on the nature and size of your business. 

HACCP is a systematic preventive approach to food safety, and considers the biological, chemical, and physical hazards that can cause a finished product to be unsafe. Measures can then be put in place to reduce these risks to a safe level.

The seven principles of HACCP are:

  • identify the hazards;
  • decide on how to control these hazards;
  • decide and set critical limits, target levels and tolerances that are suitable for your business;
  • monitor how your controls work - usually daily checks;
  • decide what you will do if controls fail - what corrective actions will you take;
  • check and make sure your system works - management monitoring of staff and paperwork; and 
  • keep written records.  

 A HACCP system will deliver a number of benefits:

  • it works on the basis of prevention rather than cure;
  • it relies on simple and practical monitoring techniques;
  • it leads to creation of consistent and effective procedures;
  • it focuses resources where control is critical to food safety (e.g. cooking times and storage temperatures); and
  • all staff are engaged in the food safety process.

Implementing a HACCP system will ensure that you protect consumers, protect your business, and protect your staff.

For smaller businesses the FSA has published a downloadable food safety management system called "Safer Food Better Business" which focuses on the most obvious sources of food poisoning including cleaning, chilling, cross-contamination and cooking of food. There is also specialist guidance for catering, meat plants, wild game supply and butchers available here. However, larger organisations need to ensure that they have more in-depth and complex food safety management systems in place, and may need to seek specialist advice to ensure compliance.

Once a system is in place, you must undertake regular audits to ensure it is still fit-for-purpose, reducing your risks, protecting consumers, and ensuring that you are compliant. Many regulatory failings occur due to inertia or indifference about an existing system, which causes standards to slip. A common question from all regulators is "how were you checking the system was working?". Having no answer (or no written evidence) can often be an invitation for further regulatory enforcement.

If you have any queries or concerns with regards to corporate criminal liability, or your Food Safety obligations, please contact a member of our Business Risk and Regulation Team.

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