As an employer, if you fail to take reasonable steps to ensure a safe working environment, and an employee is injured or suffers illness as a result, you may find yourself defending a claim for compensation.
The following guide looks briefly at the law relating to employers liability claims and, in turn, what steps can be taken to avoid being sued.
The legal basis for employers’ liability
As an employer, you have a common law duty to take reasonable care for the safety of your employees, in particular through the provision of:
- a safe place of work
- proper plant and equipment
- a safe system of work
- competent staff (for whose actions you may be responsible).
Under section 2 of the Health and Safety at Work etc Act 1974 (HSWA), you are also under a statutory duty “to ensure, so far as is reasonably practicable, the health, safety and welfare at work” of all your employees.
Various regulations made under the HSWA place employers under additional, more specific, statutory duties in relation to all aspects of health and safety in the workplace, for example, the duty to carry out risk assessments or provide personal protective equipment.
Commonly referred to as the six-pack, the main health and safety regulations are as follows:
- The Management of Health and Safety at Work Regulations 1999
- The Workplace (Health, Safety and Welfare) Regulations 1992
- The Personal Protective Equipment at Work Regulations 1992
- The Provision and Use of Work Equipment Regulations 1998
- The Manual Handling Operations Regulations 1992
- The Health and Safety (Display Screen Equipment) Regulations 1992.
Following changes to the HSWA, for accidents that occur after 1 October 2013 there is no longer any civil liability for breach of health and safety regulations made under the Act. That said, the statutory framework of duties placed on employers to protect their employees from harm will remain relevant as evidence of the standards expected of employers in any claims for negligence.
Accordingly, the court will still have regard to these regulatory duties when considering what steps an employer ought reasonably to take in meeting its common law obligations.
Employers’ liability for health and safety offences
Whilst any breach of the health and safety regulations no longer gives rise to any civil liability, at least not directly, a breach of duty to ensure the health and safety of employees will still put you at risk of criminal prosecution by your local authority and/or the Health and Safety Executive (HSE).
You will be guilty of an offence if you are unable to show, on a balance of probabilities, that it was not reasonably practicable to avoid a risk of injury.
The maximum penalty for failure by an employer to comply with a general duty imposed by HSWA 1974, is 6 months imprisonment and/or an unlimited fine (on summary conviction), or 2 years imprisonment and/or an unlimited fine (on indictment).
Taking steps to avoid employers’ liability complaints
As a responsible employer you should seek to take all necessary steps to avoid putting employees at risk of harm. By creating a safer working environment you can also minimise any risk of either civil or criminal liability.
There are a number of steps that can be taken to reduce the likelihood of accidents in the workplace and, in turn, the possibility of employers liability claims. Although not exhaustive, these steps should include the following:
Implementing a written health and safety policy appropriate for the type of activities involved in the workplace and the size of your undertaking.
- Appointing competent personnel to oversee workplace health and safety.
- Carrying out suitable and sufficient assessments of the risks to the health and safety of employees to which they are exposed whilst at work.
- Taking preventive and protective measures to reduce any risks identified.
- Providing employees with comprehensible and relevant information on any risks to their health and safety identified by the risk assessment, as well as the preventive and protective measures that need to be taken.
- Providing employees with a safe place of work, including adequate ventilation, heating and lighting, with clear traffic routes to prevent slipping and tripping hazards.
- Providing suitable personal protective equipment and clothing wherever there are risks to health and safety that cannot be adequately controlled by other means.
- Providing an employee with adequate information, instruction and training in the use of work equipment, including personal protective equipment, for the purposes of health and safety.
- Ensuring the safety and suitability of work and personal protective equipment for the purpose for which it is provided.
As an employer, you are under a common law duty to act reasonably. Whilst this provides some scope to argue that the costs of a particular safety measure may not be justified by the reduction in risk that the measure would produce, liability cannot be avoided simply by claiming that improvements are too expensive.
Insurance cover for employers’ liability
Most employers are required by law to insure against liability for injury or disease to their employees. Under the Employers Liability (Compulsory Insurance) Act 1969, unless you are exempt, it is mandatory to have at least a minimum level of insurance cover against any such claims, set at £5 million. Your policy must also come from an authorised insurer.
Employers liability insurance should not be confused with public liability insurance. This covers you for claims made against you by members of the public or other businesses, but not for claims by employees. While public liability insurance is generally voluntary, employers liability insurance is compulsory.
You can be fined by the HSE up to £2,500 a day if you do not hold a current employers liability insurance policy that complies with the law.
When you take out or renew a policy, your insurer will provide you with a certificate of employers liability insurance. You must display a copy of this certificate where your employees can easily read it, although this can be done electronically.
If you do not display the certificate of insurance, or refuse to make it available to HSE inspectors on request, you can be fined up to £1000.
Common problems with employers’ liability
Whilst compensation for an employers liability claim will usually be paid out under your insurance policy, you cannot then simply ignore your legal duty of care in respect of the health, safety and welfare of your employees.
If your insurer believes that you have failed to comply with your common law or statutory duties, and this has led to the employers liability claim, the policy may enable the insurer to reclaim the cost of the compensation against you.
You must also ensure that any policy cover is adequate, based on the level of risks and liabilities presented in the context of your undertaking. Unfortunately, however, you cannot insure against the indirect cost to your business of a valuable employee no longer able to continue in their job as a result of work-related injury or illness.
Seeking legal advice for employers’ liability claims
The practical and costs consequences when facing an employers’ liability claim can potentially be significant. In the event that an employee has suffered a work-related injury or illness, it is always best to seek early legal advice to minimise the effects of any civil, or even criminal, liability.
Your legal adviser can also help you to devise strategies to help avoid any further risk of injury or illness in your workplace.