How Your Workers’ Employment Status Impacts Your Insurance
The UK gig economy* makes up an estimated 15 per cent of the nation’s workforce, according to the Office for National Statistics. Your organisation may even employ some members of this group if you have volunteers, seasonal employees, contractors and other kinds of non-traditional staff members. Just as you do for your full-time employees, you have a legal obligation to provide these individuals with a safe working environment and employment rights.
However, even though some gig economy* members may be independent workers, your organisation should not label them as self-employed. If you do, that could void their employment rights. To ensure all UK employees are protected, the government requires most businesses, with few exceptions, to have a thorough employers’ liability (EL) insurance policy.
A comprehensive and effective EL policy should provide cover for the following types of employees:
- All permanent employees
- Contract, casual and seasonal employees
- Abroad employees that spend at least 14 days continuously in Great Britain or more than seven continuous days on an offshore installation
- Labour-only subcontractors
- Temporary staff—including students and people on work placements
- Volunteers, advisors, referees and marshals
- The HSE enforces this rule and can fine your organisation up to ￡2,500 every day if you do not have the appropriate level of insurance. In general, organisations are required to have at least ￡5 million of EL cover, yet depending on your organisation’s particular risks and liabilities, you may choose to increase the amount of cover. If your organisation does not comply, you could receive fines, penalties and your cover may even be invalidated.
For more guidance about EL insurance, contact Pound Gates | Chartered Insurance Brokers today.
*A gig economy is an environment in which temporary positions are common and organizations contract with independent workers for short-term engagements. The trend toward a gig economy has begun.