Employers Liability – are you sure we don’t employ anyone?
It’s a question probably posed at many Residents’ Management Company (RMC) meetings – one of the directors points out to his colleague that their insurance cover does not provide protection for injury claims by employees and, looking to save valuable funds, everyone agrees not to take out this optional cover because they don’t employ anyone as everything is carried out by contractors.
Five weeks later the amiable retired resident, given cash in hand to keep the grounds prim and proper, manages to fall off a faulty ladder and break his ankle meaning that he can no longer drive or pursue his active social life. Unfortunately for you, his son in law just happens to be a solicitor and that is when his claim for compensation takes on a different perspective!
Anyone given cash in hand for their labour is likely to be deemed an employee in the eyes of the law: cleaner, gardener or handyman. If the provider of labour does not supply their own materials and equipment, work for other businesses or individuals, or submit invoices for work undertaken, that person is likely to be an employee for the period he or she works for you and may look to the RMC for compensation in the event of an injury. In these circumstances it is highly unlikely that your public liability insurance will indemnify you.
To put it simply, if someone runs a business, even as a sole trader, then that person is not an employee. However, if your tradesman is perhaps a resident with another job, is retired or is just helping out an employer, you will be required to comply with Employment Rights Act and related Health & Safety legislation implications. It can be a very costly mistake to make, so perhaps employers liability insurance isn’t such a bad idea after all.
In addition, if you use contractors your RMC will be responsible for the health and safety of contractors on your premises.
The moral of this story is that as soon as you get anyone to work on your premises in whatever capacity, brush up on the Health & Safety at Work Act and The Employers Liability Act and then you can enjoy your property with a clear conscience.
p.s. Did you know that if your RMC is a Limited Company it must hold Employers Liability insurance by law, even if there is no payroll?
Residentsline policy offers:
Automatic cover for voluntary workers
Employers Liability cover – Limit of Indemnity £10m
Public Liability cover – Limit of Indemnity £10m
For a block of flats insurance quotation for your property call the Residentsline team on 0800 281235 or visit Get a Quote – Residentsline Limited
Reviewed: September 2019
