‘Staff’ charges – one for the many ways in which Kier exaggerate a claim to Third Parties, enabled and assisted by Highways England.
Kier Highways Ltd (Kier) differentiate between their ‘operatives’ and ‘staff’ employees when charging Third Parties (drivers, fleets and insurers).
OPERATIVES are those people working within the Area an incident occurs and attend the location either as first-response or associated with the repair. They may be charged using a multiplier (uplift) to Third Parties as it is claimed they work 8am to 5pm and are paid this higher rate for working outside these hours – we doubt this.
STAFF are office based, admin’ employees who likely work ‘core hours’ of 8am to 5pm. They are common to most claims as they are said to deal with the planning and pricing (as examples). Unlike operatives who are specific to an Area and whose rates may vary, ‘staff’ will be seen on all claims, no matter in which Area an incident occurs, or what repair is required, at a set rate.
A charge for staff is therefore consistent no matter which Area a claim occurs in, no matter what the contract states about charges i.e. whether or not Appendix A to Annex 23 (a formula within the contract by which to determine the maximum charge to a Third Party) applies, there is a charge. The base rate or ‘defined cost’ of ‘staff’ is unaffected by Area or time as they work from a constant location during set hours.
But how to calculate a ‘staff’ charge; they work in an office and attend to many matters. Kier’s (reasonable) answer is that you average their cost per incident.
However, they do not practice what they preach!
For example, Kier do not average a TM programmer out. They charge Third Parties for a longer period and at a higher rate! The process, the exaggeration, is described here – TM Programmer.
There are therefore 2 means by which Kier can and do overstate a claim to a Third party, by:
- charging an excessive rate
- exaggerating the time the staff member is associated with an incident
We possess many of the ‘defined costs’ or ‘base rates’ for ‘staff’, for example:
- TM Programmer
- Assistant to Area Manager
- Network Occupancy Manager
- Traffic Safety officer
- Asset Engineer
- Depot clerk 1
- deport clerk 2
- store man
According to Kier and Highways England, ‘defined costs’ are a constant; base rates used to bill Highways England and Third Parties. What causes the charge to a Third Party to be higher should be the uplift:
Highways England are charged by Kier using the following formula:-
Defined Cost (£) + Fee (%) = charge
Third Parties should be charged similarly where Appendix A to Annex 23 applies:-
Defined Cost (£) + Third Party Claims Overhead (%) = MAXIMUM charge
But whether or not the Appendix A to Annex 23 formula (above) applies, ‘averaging’ should not be affected, the time assigned to the incident should remain the same. But it is not.
The charges to Third Parties using an ‘averaging process’ are as follows (T06B428):
For clarity, the above figures, the times assigned per role and claim are as follows:
|Assistant to Area Manager||0.25|
|Network Occupancy Manager||0.5|
|Traffic Safety officer||0.5|
|Depot clerk 1||0.5|
|deport clerk 2||0.5|
These are averages, therefore, the time assigned and charged to both Highways England and Third Parties should be the same. However, they are not, the charges vary substantially with regard to, as an example, the TM Programmer:
- £6.65 to Highways England
- £94.94 to Third Parties – drivers, fleets and insurers?
The answer is:
- Kier are not complying with the contract
- Highways England are not enforcing the contract
- Averages are not being used
It may simply be coincidence that the above process, ‘Appendix A to Annex 23’ has been kept from the very people who need to know of and understand it – Third Parties. Similarly, it may be coincidence that, from the outset (07/2014) and to this day, Kier have not complied with the process.
It appears to be no coincidence that both Kier and Highways England are keen to keep us from ‘defined costs’ – the base rates Highways England and Kier agreed to charge both the Public Authority and Third Parties but to which only Highways England have access and can check they are being applied correctly.
For a detailed explanation of the exaggeration associated with hourly rates and the time ‘average’ associated with a TM programmer, click here.