Has FFI charges helped improve health and safety in businesses?
Paul Williams considers whether the Fee For Intervention charge has helped the regulator to stamp out poor health and safety practices in business.
(Article in Tomorrow’s Health and Safety, click here to Read Full Article)
The HSE introduced fee for intervention (FFI) as their new cost recovery scheme in April 2012 in an attempt to bridge the gap created by a 35% reduction in the previous full government funding. Some saw it as a timely clamp down in enforcement by the HSE effectively acting as a deterrent, where others thought it would weaken their position by reducing routine inspections and availability.
Love it or loathe it, the system has been with us for a little over 18 months now and has undergone its first major independent review. In essence, the system is quite simple: if a member of the HSE attends your premises and identifies a material breach of health and safety law, you begin to incur an hourly rate of £124 (calculated in 6 minute intervals).
A material breach is when, in the opinion of the HSE inspector, there is or has been a contravention of health and safety law which requires them to issue notice in writing of that opinion to the duty holder.
Written notification from an HSE inspector may be made by a notification of contravention, an improvement or prohibition notice, or a prosecution, and must include the following information:
- the law that the inspector’s opinion relates to
- the reasons for their opinion
- notification that a fee is payable to HSE.
It applies to duty holders where the HSE is the enforcing authority. This includes employers, self-employed people who put others (including their employees or members of the public) at risk, and some individuals acting in a capacity other than as an employee, e.g. partners. It includes:
- public and limited companies
- general, limited and limited liability partnerships
- Crown and public bodies
From the moment the HSE arrive onsite and determines there is a material breach, the meter is running and continues to count up only whilst they are onsite. Don’t panic if the inspector has to go home for a few hours rest, the counter stops when they leave site, and will restart when they clock in at the next visit. The bill only increases when the HSE are physically onsite.
Despite the independent report findings that the system is effective in recovering costs, there are issues surrounding FFI and its fairness and effectiveness as a deterrent. In the grand scheme of things, the amount charged to the most serious offenders in larger companies is only a very small proportion of the cost involved in a serious breach, so its effect in larger cases could be argued to be minimal. In one case heard recently, the direct costs of an injured persons wage, legal representation, lost time, fines and fees etc. was in excess of £290,000, where the FFI value was below £5,000. Clearly, the FFI fee in this case is a drop in the ocean and wouldn’t serve as a deterrent, but rather as it was originally intended to offset the HSE costs.
Where it does take effect is in the SME market place where the £124 per hour charged soon surpasses the daily earnings of the organisation. It seems the lower the turnover, the more effect the charge has on the business owner. These are the same types of companies who cannot afford a full time H&S resource, and often don’t have contact with competent external help and advice.
For a small business owner, in the event of an HSE visit resulting in them issuing a written notice, the worst thing you can do is make a knee jerk reaction and hire an expensive lawyer or barrister to defend you. Your first action should be to talk (not shout) with the inspector, and ask them what to do. After all, these professionals have been in the business for a while and more often than not do know what they are talking about, AND you are already paying them for their time so why not get some benefit from it? Their advice should be taken as it is given and acted upon as soon as practicable; then, get yourself a decent consultant, one who is well established, OSHCR registered, and who offers current clients as references. Most importantly, they should have a knowledge of your specific industry.
Many generalist consultants can help you get off the starting blocks with a library of generic templates which may not reflect your business and will not help your cause in the long run. Or, when you get to court, you may end up throwing out everything they did for you, and have to find a more competent person resulting in paying another fee for the privilege. So chose wisely.
Those consultants with an insight to your business will be able to accelerate your income at the same time as providing compliance by helping you to avoid further pitfalls and better manage potential costs.
The first port of call to find a suitable consultant or H&S provider should be the OSHCR register which is free to search, or contact Hosking Associates. We don’t claim to be experts in every field, however, we have access to a vast number of specialists and if you have an issue in an industry we have little direct experience in, an associate who has the necessary industry knowledge will be found for you.
*Paul Williams TechIOSH is a Safety & Health Practitioner at Hosking Associates Ltd.