| The employment landscape is constantly changing. Even if an organisation can keep up with the changes, mistakes may happen or grievances may arise. Employment practices liability insurance provides protection to all kinds of organisations against the financial risks associated with a wide range of disputes. |
| Why do you need Employment Practices Insurance? Employment disputes can cost organisations an enormous amount in management time and resources. However good an organisation’s human resources practices and procedures, the risks cannot be eliminated. Good procedures do help, but do not offer enough protection against employment claims and it is difficult to maintain control over all staff at all times. If things do go wrong, whether there are any grounds to the allegations or not, a well constructed insurance policy can help to mitigate the impact and disruption associated with these situations. The Supreme Court decision in July 2017 on the abolition of the Employment Appeal Tribunal Fees Order 2013, will inevitably lead to an increase in activity at employment tribunals. What does the policy cover? The purpose of this policy is to insure organisations and their directors, officers, employees and volunteers for defence costs and legal liability incurred on account of claims and prosecutions against them for wrongful employment practices and also for discrimination against customers or suppliers. So What Can Go Wrong? An employee claimed disability discrimination on the grounds of an illness that the employer was not even aware that the employee suffered from. The employee had been dismissed for gross misconduct following allegations of verbal, physical and sexual assault from 2 members of staff. The evidence was corroborated by 5 colleagues, who also confirmed the employee was running another business on company time from his employer’s premises. Despite a catalogue of confirmed misconduct, a failure to precisely follow procedures reduced the effectiveness of the case for the defence. It is not simply a case of who is right and who is wrong, it is frequently down to whether fair procedure has been followed. It is also easy for a tribunal to look at the facts after the event and take a view as to what should have been done. In this case, even though the claimant’s demands (in excess of £1,000,000) were reduced, and the belief was that a strong defence existed, the costs to the employer were still well over £250,000. Employment claims payments typically break down at an average of 35% to 40% expenditure on defence costs, so both aspects of the policy (defence costs and other loss) work to protect the policyholder. For help, advice and a quote – Contact Justin on 0800 542 0672 or email sales@neilwillies.co.uk |