HSE publishes plans for 'fully independent' fee for intervention disputes process

Out-Law News | 26 Apr 2017 | 2:22 pm | 2 min. read

Further details of how the Health and Safety Executive (HSE) intends to make the settling of disputes in relation to its fee for intervention (FFI) scheme more independent have been published for consultation.

In particular, the regulator is seeking views on how the process should operate; how to ensure that it is accessible to all types and sizes of business; and how to ensure the process is proportionate to the issues involved and the fees charged.

The consultation closes on 2 June 2017. HSE had previously agreed to put a new system in place by 1 September 2017, as part of its agreement to settle an application for judicial review of the scheme brought by facilities management company OCS Group UK Ltd.

The FFI scheme came into effect on 1 October 2012 and was designed to shift some of the costs of regulating workplace health and safety from the taxpayer to those responsible for breaches. Those found to be in 'material breach' of health and safety laws are now liable for payment of HSE's related costs, including those incurred as a result of inspection, investigation and taking enforcement action. The duty holder can dispute any fees raised under the scheme.

The current disputes mechanism is overseen by two HSE members with one independent member, and has faced increasing criticism for lacking independence. Under the revised procedure, the review panel will instead be independent of HSE and consist of two members experienced in health and safety matters, plus a lawyer as chair.

Disputes that reach the independent panel will usually be decided in writing, although the panel may convene a meeting with the inspector and the duty holder as part of the process where "it is considered necessary and desirable to do so". However, no witnesses will be called as part of that process. Both HSE and the duty holder will make their representations to the panel in writing. The panel will then make its recommendations, which HSE will "ordinarily … accept unless it considers the recommendation to be clearly wrong".

The first stage review process, before the dispute is referred to the independent panel, will remain largely unchanged and will be dealt with by the relevant HSE inspector's line manager. That line manager will, however, have the option to discuss the matter with the duty holder before making a decision.

In the event that a dispute is not upheld, the duty holder will have to pay the costs reasonably incurred by HSE in handling the dispute. This will include a fee for the lawyer and travelling expenses for the other panel members, and is likely to be charged at around the current rate of £129 an hour, according to the consultation. If the duty holder refuses to pay, HSE will be required to take civil action to recover the debt.

As part of the consultation, HSE is seeking views on whether there should be a separate process where the FFI in dispute is small and so likely to be overtaken by the costs of the dispute process; or where there is no dispute about whether there is a material breach. If so, respondents have been asked for suggestions about what that process should be.

The dispute process will be suspended where an investigation or appeal against an enforcement notice is ongoing under the proposals.

Health and safety law expert Kevin Bridges of Pinsent Masons, the law firm behind Out-Law.com, said previously that FFI invoices under the current regime were rarely challenged. Businesses tended to view paying any FFI invoice as the most time and cost effective solution given the limited scope for challenge under the existing regime, while a review carried out shortly after FFIs came into force found that only 3% of invoices were challenged while the figures for those ultimately disputed were even lower.

This approach could have serious consequences for businesses, given that evidence of previous breaches counts as an aggravating factor in sentencing under the Definitive Guideline for Sentencing in Health and Safety, Corporate Manslaughter and Food Safety and Food Hygiene Offences, Bridges said.

"Making the payment, rather than challenging it, could potentially be cited as evidence of poor health and safety performance," he said.