The Corporate Manslaughter Act 2007 has brought the threat of huge fines for companies where the death of a person caused by their failures results in a conviction.
The warning came from barrister Bernard Thorogood, one of the UK's leading experts on such matters, during a presentation to an audience of businessmen and women from the private and public sector.
Speaking at a seminar organised by solicitors WH Law in Dudley and sponsored by Yorkshire Bank, Mr Thorogood, from No5 Chambers, said: "A recent consultation document from the Sentencing Advisory Panel suggested a starting point of five per cent of the average annual turnover in the three years prior to sentence, however this starting point may not be accepted.
"For some businesses, this could be a huge and very damaging penalty. In extreme circumstances the company could go out of business.
"In addition, damage from a 'publicity order' could be great, forcing businesses to publicise particulars as directed by the court."
Mr Thorogood explained the real desire to bring companies to book where death in the workplace happens.
"This will not only result in corporate manslaughter charges, but the greater depth of enquiry could lead to more individuals being charged with gross negligence manslaughter – a charge which was available under the old law.
"The offence will only be proved where the way the organisation's activities are managed or organised by its senior management, is a substantial element in the breach of duty of care. Senior management will be in the firing line where conduct falls far below that which could reasonably be expected. The duty includes that owed to employees and as occupiers of premises, and in connection with the supply of goods and services.
"Organisations, whether in the private or public sector, which stand accused, may seek to show that there is no direct connection between the way they are managed and the breach.
"The real answer is to raise your game in term of risk management and make sure the culture of your organisation is focused on being risk aware and risk averse."
Sarah Pugh, a partner in WH Law, urged directors to take action but not to panic. She said: "This is serious legislation and new measures to reduce risk are needed.
"Proper planning and advice is essential, as is the elevation of risk management to the top table of organisations."
Ms Pugh cites the case of migrant workers as illustrating the need to go the extra mile.
"Such workers may not always have enough grasp of English to understand all the finer points of complex instructions, so tailored communication and training should be essential.
"This is an extension of the position of employees generally, where consultation, training and involvement are key factors in acceptable risk management."
Other speakers at the seminar included Phil Osbourne and Tom Duffin of Chase Management.
Mr Osbourne recounted his experience of facing prosecution due to a death in the workplace whilst Mr Duffin addressed the issue of motivation and how to implement change.