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Fee for Intervention – do not get caught out

Published: 3 August 2017 - Victoria White

Until 2012, if your business was subject to an on the spot inspection by the Health and Safety Executive, the only costs you would be likely to incur were from fines resulting from a successful prosecution. That changed when the Fee for Intervention (FFI) scheme was implemented in 2012. The aim of this article is to explain how the FFI system works, why HSE might be visiting you, and what powers their inspectors have.

There are several ways in which HSE target businesses for inspection:

  • Specific hazardous industries, such as those operating under licensing regimes; for example offshore, rail or explosive environments.
  • In sectors where there is a high rate of accidents or ill health.
  • In response to a specific complaint or incident.
  • New businesses or premises
  • Certain geographical areas
  • Random spot checks

Whilst it is possible to appeal against an FFI invoice, be warned that the hours spent by the HSE in defending the appeal will be added to the original invoice if the appeal is unsuccessful.

Why does it exist?

FFI was enacted by Government in 2012 to “recover its costs … from those found to be in material breach of health and safety law”. HSE describes a “material breach” as a contravention of health and safety law sufficient to require a notice in writing to the duty holder. A written notice could be in the form of a notice of contravention, an improvement or prohibition notice, or even a prosecution. FFI applies to employers, the self-employed who put others (including employees and members of the public) at risk. It covers public and limited companies, including limited liability partnerships.

The fee is calculated at the currently-set rate of £129 per hour, for all the time necessary for HSE to investigate and conclude their regulatory action including any office work. From its inception on 1st October 2012 to the end of January 2014, HSE issued invoices under FFI of around £10.6m.

What has been the impact?

Spiers Engineering Safety obtained figures from HSE for 2014/15 and 2015/16. These figures show that in the manufacturing sector alone, HSE raised around 6100 invoices totalling £3.7m in 2014/15 and around 7200 invoices totalling £5.2m in 2015/16.

HSE staff recorded over 169 000 hours of chargeable time under FFI in 2014/15, and over 202 000 hours in 2015/16. These figures do not count hours spent investigating if a breach has actually occurred, time which may or may not be converted to FFI time.

The manufacturing sectors most heavily impacted by FFI are shown in the following table:

Five manufacturing sectors most impacted by FFI – 2015/16

Source: Health and Safety Executive response to FOI request by Spiers Ltd
  Sector Cost of FFI Hours invoiced
1 Manufacture of fabricated metal products, except machinery and equipment £1,210,497
2 Manufacture of machinery and equipment n.e.c. 

£560,123

3 Manufacture of food products £553,299
4 Manufacture of chemicals and chemical products £448,084
5 Manufacture of wood and of products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials £419,717

It is interesting that the same five industry sectors appear in each table, albeit in a different order.

It cannot be overstated that the figures listed above are not the total cost to the businesses as a result of these breaches. These figures relate to FFI alone, and so do not include fines imposed by courts, costs of civil litigation and compensation, production losses caused by prohibitions placed on machines or processes, or any of the other well-known but little-recognised consequential costs related to accidents. These are well discussed elsewhere.

Companies who fall foul of health and safety law are also being hit by another factor; the vast increases in fines due to recent changes in the sentencing guidelines [insert link to one of several articles on this?]. Fines resulting from a single incident in excess of £1m are not uncommon.

Geographically, the West Midlands has been most affected by FFI as in 2014/15 and 2015/16 businesses in this area received more FFI invoices than any other region, although in both periods, East Midland, Yorkshire, the East, and the North West were very close behind.

Why is it vital for organisations to be on top of their PUWER processes?

It is true that a proportion of these figures will be for breaches of PUWER, and the remainder will be for breaches of other regulations or the Health and Safety at Work Act 1974. At present, we do not know what these proportions are. However, a business which has a proactive approach to PUWER will generally have a similar methodology for other areas of Health and Safety. It also follows that if a business is undertaking PUWER seriously it will probably also put in place other measures as the result of the PUWER activity. For example, a PUWER inspection might pick up that ladders are not tagged. Ladders are work equipment, but the requirement for tagging comes from the Working at Height Regulations. A PUWER inspection may highlight manual handling issues, but this comes under the Manual Handling Operations Regulations. An observation of a likely electrical hazard is covered under the Electricity at Work Regulations. Encompassing all of this are the employer’s duties under the Management of Health and Safety Regulations.

It's well documented that for every £1 of insured costs incurred by businesses, somewhere between £8 - £38 of uninsured costs are incurred. That statistic may well have to be updated now that FFI is added to the equation.

Some companies are afraid that they won’t comply with PUWER and adopt the ostrich approach to safety, hoping – wrongly - that they can claim ignorance. This is a big mistake. There is a tacit understanding with the HSE that the resources of companies are not limitless, either in terms of cash or with regard to people. The HSE will not expect all non-conformities to be fixed tomorrow, but will be likely to look favourably upon a company that acknowledges it needs to improve and has a plan in place to prioritise actions. Obviously, any activities which emerge from Risk Assessment as Unacceptable will need to be stopped immediately pending some sort of action to mitigate the current risk level. A good PUWER inspection will allow you to give precedence to the higher risk items.

The safety of your employees is your ultimate priority.

First of all, the PUWER regulations require that the person carrying out the inspection is competent to do so. This can be difficult to prove when using your own staff to conduct assessments. Engineers are commonly not trained in risk assessment techniques, and your Health and Safety officer may not know enough about engineering and machine safety to make the correct judgements of the risk level – or may even miss risks altogether. All of Spiers’ engineers are qualified in PUWER assessment, and carry out such risk assessments week in, week out.

Spiers Engineering Safety are also the only service company carrying out PUWER assessments using the remarkable RiskMach software. RiskMach means waving goodbye to paper-based risk assessments, or uncontrolled electronic copies which inevitably end up in multiple versions on the computers of multiple interested parties. Before long, version control becomes impossible. With RiskMach, there is only one version of the assessment, centrally located. IT can be revisited by supervising staff regularly to see if progress is being made on outstanding items.

Spiers are also a fully independent consultancy. We have no connections with suppliers of solutions, components, or any other external links. With a PUWER report from Spiers, you can be sure that the advice you are receiving is completely impartial, free from any potential conflicts of interest.

Source: Industrial Compliance


 
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