Of the £7.4million spent on fines so far in 2018, every one of the companies had Employer Liability Insurance, which did not cover 1p of the fines.
Employers liability insurance does not cover your costs if you have an accident or breach of health and safety regulations, nor does it provide protection when your company or individual manager is found to be in breach of health and safety regulations.
The cost of bringing or defending legal action can put serious financial pressure on your business, whether you eventually win the case or not.
You might face legal action from an employee, a customer, a supplier or a member of the public.
Based on the nature of your business and the type of incident, there are many other uninsured costs that may need to be met by you.
- Lost time
- Production delays
- Legal Costs
- Damage to products, plant, buildings, tools, equipment
- Investigation time
- Excess on any claim
- Loss of business reputation
- Loss of contracts
- Production delays
In order to explain how business costs can escalate out of control, the below scenario details how a simple machine guard costing pennies, would have saved the MD over £53k
A worker’s left arm became trapped between the metal sheeting he was holding and a roller as it was fed into the machine. The young worker suffered extensive damage to his left forearm, leaving him in chronic pain and with significant impairment to the use of his arm.
The Health and Safety Executive (HSE) investigation found that it was possible for employees to reach dangerous parts of the roll-forming machine when it was in operation as the company failed to suitably guard the machine.
His left forearm suffered extensive tissue and muscle injury. He spent 12 days in the hospital undergoing major surgery and was off work for three months. On his return, he was placed on administrative duties for five months and he was unable to operate machinery for eight months.
The Managing Director was prosecuted following the incident
Costs to his company
|Wages for the injured over the period||£10,000|
|Loss of production/remedial work required||£8,000+|
|Overtime wages to cover lost production||£3,000+|
|Wages for the replacement worker||£7,000+|
|Loss of time of manager/MD||£5,000+|
|Fines and court costs||£12,000+|
|Increase in Employer’ Liability insurance premiums||£6,000|
|Total cost to business||£53,900+|
The compensation claim value is unknown.
Meeting your health and safety duties is easier than you think
The HSE (Health and Safety Executive) states:
Compensation: As long as you have taken reasonable steps to prevent accidents or harm to your employees (and the injury or illness was caused after 1 October 2013), you shouldn’t have to pay compensation.
Breach of Regulations: if you can show that you have done everything practicable possible to prevent or cause harm, then you have complied with the regulations and will probably not be prosecuted.
How can Safety PAL help?
Safety PAL has 3 unique benefits:
- It provides the evidence needed to prove the worker was a careless worker:
- N.B: If it can be proven the worker has sufficient competence, received the required training and is in date, and they have an understanding of the activity risks, then you as a company have done ‘everything reasonably practicable’ to prevent or cause harm and cannot be prosecuted.
- Everything in one place: simple, effective and interconnected reducing business inefficiencies, saving your business time and money running H.S.E.Q management.
- It eliminates the language barrier, with a single click, all your H&S information available in 19 different languages.
To experience how Safety PAL can help in your business, we need just 20 minutes to give an
online no-obligation demonstration.