FEE FOR INTERVENTION: DOES PAYMENT = ADMISSION?

Law firm warns over danger of blindly accepting HSE FFI invoices

Law firm Wragge & Co has published an interesting article concerning the relationship between HSE Fee for Intervention charges and the admission of guilt regarding health and safety breaches.

“Background

From October 2012 health and safety duty holders who the Health and Safety Executive (HSE) believe have committed a material breach of health and safety legislation have been required to settle invoices for advice given by the HSE pursuant to the Fees for Intervention (FFI) scheme. The HSE estimates that the FFI scheme could potentially generate £37 million per annum by shifting the cost of Health and Safety Regulation from the public purse to the businesses and organisations that breach health and safety laws.

Whether that provisional estimate proves to be accurate remains to be seen. It is early days. Between October to November 2012, 1419 invoices were issued by the HSE totalling £727,644.81. Of these around 10% were for more than £1,000, 70% for less than £500 and 20% for between £500 and £1000.

Potential implications

n subsequent criminal proceedings for a breach of health and safety legislation, there is Inothing preventing the HSE from seeking to use the payment of the invoice as an admission of guilt. Such an approach might be unfair where a commercial decision is made to make payment rather than contesting the FFI invoice submitted. In addition, FFI will inevitably arise early on in any potential case and well before a potential defendant realises that they may actually have a defence or are likely to be prosecuted by the HSE.

Therefore, if a case could potentially be contested there is the possibility of unfairness where an early FFI invoice has been settled. Notification of an apparent material breach is in any event based solely on the opinion of the individual HSE inspector concerned. It is therefore subjective. The notice of breach must include the following information:

The law that the inspector’s opinion relates to;

The reason(s) for the opinion;

Notification that a fee is payable; and

Confirmation of which contraventions are material breaches.

No comfort from the HSE

Peter McNaught, the current HSE chief legal adviser, has gone on record to say that the HSE cannot give assurances regarding how evidence about FFI will be used in any subsequent case. At the same time the HSE says it is not “actively looking” at using paid FFI invoices in this way.

According to Mr McNaught the situation regarding FFI invoices is similar to where an Enforcement Notice is issued which is then complied with and not appealed. However, the dilemma for the duty holder is that by paying the invoice, they may be seen to be accepting the material breach. That perceived acceptance may be used as an admission in any subsequent criminal prosecution.

Whether the HSE will decide to use an FFI payment in evidence in a subsequent criminal prosecution will no doubt be dependant on the facts of each particular case. What is clear is that the risks of the HSE using an FFI payment in this way are very real and the potential consequence of making a payment needs to be considered at the time of the HSE attendance and again when and if an invoice is sent through.”

Wragge & Co also provide some practical action points to consider:

“Protective steps

Given the possibility that the Health and Safety Executive (HSE) may consider using the payment of its Fees for Intervention (FFI) invoices as evidence of a sign of guilt in subsequent proceedings, the duty holder might wish to consider trying to protect their position in the following ways:

1. Dispute the invoice using the FFI disputes procedure. All queries and disputes about an FFI invoice will initially be treated as a query. Anyone receiving an FFI invoice has 21 days from receipt to query whether there was a material breach or that the time for which the fee is charged is incorrect. If the subsequent HSE response is considered to be unsatisfactory then the appeals process must be commenced within ten working days of the initial response to the query.

The process operates in two distinct stages. A level 1 dispute results in the invoice being reviewed by a HSE senior manager who is independent of the management chain that generated the invoice. The HSE’s response must be sent within 15 working days of receipt of the dispute. If this does not resolve the issue then the matter is escalated to a level 2 dispute where the matter is considered by a panel of HSE staff and an independent representative.

If at the end of this process the challenge is not upheld then the HSE will seek to recover the costs of dealing with the dispute at levels 1 and 2 using the FFI rate of £124 per hour. Where the challenge is not upheld and a decision is made to pay the invoice, then consideration should be given to steps (2) or (3) below;

2. Pay the invoice to acknowledge that work has been undertaken by the HSE under the FFI scheme but include a clear covering statement that such payment should not be taken as an admission of there having been any material breach;

3. Settle the FFI invoice in full but only once the HSE has agreed in writing not to use the fact of the payment as evidence of any material breach in the event that any future criminal proceedings arise;

4. Don’t pay the invoice. The risk then is that the HSE may begin civil debt recovery proceedings. However, that risk may be seen as small because the HSE might be reluctant to issue civil proceedings before it has made a decision about whether to bring a criminal prosecution. To proceed straight to civil proceedings to recover an FFI invoice might result in the issues having to be tried. The HSE may lose making a criminal case more difficult.