HSE’s costs recovery to be dealt with independently

Monday, March 13, 2017


• Disputes raised in relation to the 'fee for intervention' (FFI) costs recovery will be resolved by independent process

 Background

• In 2012 the HSE introduced the controversial FFI costs recovery system whereby if they attended on a dutyholder and concluded that there had been a “material breach” of health and safety, then the HSE could charge dutyholders for the time they spent dealing with the matter as part of the overall investigatory process.

• However, the basis upon which dutyholders could appeal against an invoice was flawed, as it was not an independent appeals process, instead all disputes were dealt with internally by the HSE.

Key Recent Development

• The HSE has recently avoided a High Court hearing when the appeals process was going to be challenged, by revealing a plan to change and restructure the FFI appeals process.

• The terms of the reform have apparently been agreed between the HSE and facilities firm OCS Group, the company that had brought the judicial review that was scheduled for 8 March. The terms of the agreement are set out in a legally binding “consent order” that were issued by the High Court on 23 February. 

• The document stipulates that the new procedure must be in place by 1 September 2017, and outlines six terms that the regulator must comply with when devising the new process.

Disputed Breach

• In the original notice of contravention, the HSE alleged that OCS had breached Regulations 6(2) and 7(2) of the Control of Vibration at Work Regulations.

• The firm was subsequently issued with two bills for £2,306 in total.

• However, OCS denied that it was in material breach of the Regulations. It raised a query with the HSE that was then rejected by its internal team. It then escalated the matter to a dispute, which was also refused by the HSE’s disputes panel.


HSE’s Press Release – Consultation Process

On 9 February the HSE announced that it would consult on proposals to make its cost recovery scheme dispute process fully independent.

The consent order states that the first stage of challenging a notice of contravention from an HSE inspector, the “query” stage, will remain largely unchanged.

Proposed Changes:

1. However, it will have the added clarification that the line manager of the inspector who issued the notice of contravention will handle the query.

2. The line manager will contact the dutyholder, which was not previously required.

3. Dutyholders who are dissatisfied with the outcome of the query will be able to challenge the outcome via the new disputes processes.

Changes in Consent Order

The consent order sets out that, during the dispute stage, the HSE must put its allegations about the breach to the dutyholder; release the evidence that the allegation relies on to the dutyholder; and allow the business to respond and make submissions, such as why the FFI bill is incorrect or supplying evidence that contradicts that of the HSE.

Independent Appeal

The decision on whether to uphold the dispute will be made by a new independent three person panel:

It will be chaired by a lawyer from the Attorney General's civil panel, a list of lawyers who are approved to undertake work for the government, with two additional members who must have experience of health and safety management.

Comment by OCS Group

Ian Goodlife, director of health, safety, quality and environmental at OCS Group, said:

“Our decision to ask for a judicial review of the Fee for Intervention dispute resolution process was not about opposing the idea of FFI but about addressing concerns we have about the independence, fairness and transparency of the dispute process in which the HSE effectively acted as prosecution, judge and jury.”


Safety Smart Comment:

• Regulatory lawyers have since the introduction of the controversial FFI system, which was introduced to enable the HSE to self finance, been waiting for the opportunity to challenge the procedural fairness of FFI on the basis that the appeal system lacked proper impartiality and independence.

• This case represented an excellent chance to challenge the process in the High Court. OCS and health and safety lawyers were quietly confident that if the matter had proceeded to court then they would have successfully challenged the process.

• It is therefore unfortunate that the HSE waited for several years, until they were practically at the doors of court, to accept that their appeal system of self regulation was not in keeping with independent procedural fairness.

• However, this development is excellent news for all our clients and dutyholders who, when faced with a disputed invoice for a material breach under the FFI system, can confidently consider appealing its legitimacy if it is disputed.

• In reality, we would suggest that the effect of this decision may well be to make the HSE less confident in their assertions of time spent as set out in FFI invoices and therefore more likely to act in a reasonable and conciliatory manner if items from invoices are disputed. So ultimately, this should save dutyholders time and money.

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