A new cost recovery scheme will now affect businesses being investigated by the Health & Safety Executive (HSE).
The Health & Safety (Fees) Regulations 2012 allows the HSE to impose a fee of £124 per hour if a person or business is, in their opinion, contravening or has contravened one or more of the relevant statutory provisions that the HSE is empowered to investigate. These fees, called fees for intervention, can be imposed where an inspector believes that the person or business is in the process of contravening the law and, therefore, is in “material breach”.
Some examples given by the HSE of what might be considered a material breach include failure to prevent access to moving parts of machinery by not providing guards or effective safety devices, failing to prevent the release of asbestos fibres into the atmosphere, or where an injury has occurred.
Any accident at work is likely to trigger the possibility that health and safety rules have been breached. It is also thought that breaches of this legislation are most likely to affect the manufacturing and construction industries.
Notification of the fees for intervention must be made in writing and can be done so at the first visit by the HSE. Thereafter, all investigation costs are recoverable, including follow-up visits, preparation of statements, gathering evidence, assessment of findings, correspondence and telephone calls. Bearing in mind that HSE investigations are usually complicated and time consuming, the cost to businesses could be considerable.
The fees for intervention must not exceed the sums reasonably incurred by the HSE, but the fees are payable within 30 days from the date on which the invoice has been raised. These fees do not include the fees connected with any criminal prosecution that may follow and would appear to be payable even if a prosecution is not proceeded with. These fees may result in the HSE being able to recover a greater percentage of their investigation costs when businesses are prosecuted. Typically, the courts disallow claims for costs made by the HSE where those costs form part of the officer’s general duties. This scheme therefore neatly gets around that issue.
The fees do not apply to appeals against improvement or prohibition notices; nor do they affect employees; nor self employed people whose actions do not expose any other person to a health or safety risk, and it does not apply to those who hold a licence to undertake work with asbestos. There are also exemptions from this legislation, for example for the off shore oil and gas industry, but by and large these regulations will potentially affect all businesses in the future.
Fees for intervention is another method the HSE now has to ensure that health and safety laws are complied with. Obviously if businesses are compliant, then they will not incur these fees. It is therefore advisable for businesses to review their health and safety practices and procedures, as well as risk assessments, in order to ensure that they are compliant, if they are to avoid further fees in addition to prosecution costs.
It is not yet known if it is possible to challenge these fees. If a company is found not guilty following trial, or the HSE offer no evidence, then it may be possible to claim the fees back – but the law is unclear on this point and much will depend upon the stance taken by the courts in due course.
Furthermore, it is essential that businesses challenge any decision that there has been a material breach if there is any doubt at all. Businesses are always best advised to seek legal advice as soon as they become aware of a problem, since cases are generally won or lost in the initial stages of investigations.
The HSE is sensitive to criticism that this is a money making exercise. However, fees for intervention will cause concern among businesses who may well be sceptical of such assurances.
Indeed, the appeals process against fees for intervention is unlikely to fill businesses with confidence in the system either. A panel of HSE staff and an independent advisor will be set up to assess any dispute. If the dispute succeeds, then the costs of the appeal, at £124 per hour, will be refunded. However if the appeal fails, then businesses would be liable for the cost. This is not an independent and free enquiry system as operated by utility companies and the ombudsman system.