Employer’s Liability in the Gig Economy

Do you hire independent workers for short-term positions in your business? These may be workers from what we know as the ‘gig economy’ and typically could be delivery drivers, car drivers, seasonal employees or contractors and other staff members.

According to the Office for National Statistics, approximately 5 million people in the UK are employed in this way, making up about 15 per cent of the nation’s workforce.

What’s the impact of your worker’s employment status on insurance?

If your organisation employs or is thinking about employing an individual worker, you must make sure that you correctly classify them.

Just as you do for your full-time employees, you also have a legal obligation to provide these individuals with a safe working environment and employment rights. Even though some may be independent, 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 to have a comprehensive employers’ liability (EL) insurance policy with at least £5 million of cover. An 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 can fine your organisation up to £2,500 every day if you do not have the appropriate level of insurance in place. If your organisation does not comply, you could receive fines, penalties and your cover may even be invalidated.

Our team at Andrew Bourne & Co spends time getting to know how your commercial haulage operation works. We’ll work with you to create a bespoke insurance solution that’s responsive to your business. For more guidance about employers liability insurance cover for all your employees, call David Crowther or one of the team at Andrew Bourne and Co. on 0116 272 0770 today.