A Slice of History Comes to the Surface

As we pass the centenary of the sinking of the Titanic, the original insurance slip for RMS Carpathia has been presented to Lloyds of London by national brokers, Marsh. This slip dates back to the 1900's and shows just how important insurance cover was then as it is now (although I am sure premiums have changed). 

RMS Carpathia was built in the North East by Swan Hunter and Wigham Richardson and rescued more than 700 survivors of the Titanic disaster 100 years ago. RMS Carpathia was sunk by a German U-Boat (submarine) on 17th July 1918 at the tail end of the First World War. 

My Fault Your Problem

The above phrase is a common one in military circles, used in situations where someone senior has made a mistake and needs someone junior to blame and sort it out. There are probably parallels in the construction world as often the hierarchy is blurred and as subcontractors are engaged by various parties and in the event of a claim he blame game is often a tough one to sort out. This is why Employers Liability is a legal requirement. This obligation is not just concerned with people who are PAYE but anyone who works under your direction. 

Here are some handy notes for you to work out whether you are meeting the Compulsory Insurance (Employers Liability) Act. There are hefty fines if you are not.

 Common Misconceptions:

My subcontractors all pay their own N.I. and Tax so are not my responsibility: WRONG!

All my staff are volunteers and therefore work on the understanding that they are responsible for their own actions: WRONG!

I only engage one sub-contractor for a couple of hours a week. They don’t build up enough hours to warrant this insurance: WRONG!

My Subcontractor already has insurance in place so I don’t need to take it out: WRONG!

In all of the above Employers Liability is required. Unless you are a sole trader working exclusively on your own or only with Bona-Fide Subcontractors (more on them in a bit) the liklihood is that you do require cover.

Bona-Fide Subcontractors:

It is not a legal requirement to insure Employers Liability for people you are working with who you may class as Bona-Fide Subcontractors. These are people who you might bring in to do a specific task for a fixed contract price and who would work under their own direction with their own tools and under their own health and safety policies and method statements. In order to assist in identifying whether someone can be classed as a bona-fide subcontractor I have attached a tick-sheet.

Is My Sub-Contractor Bona-Fide?                                                                                                 

The Subcontractor…

arranges their own Liability Insurances:                                            Yes                  No

works solely under their own direction:                                            Yes                  No

is responsible for their own H&S and method statements:                 Yes                  No

works for a fixed contract price:                                                       Yes                  No

works with their own tools and / or equipment:                                 Yes                  No

If the answer to all of these is ‘yes’ then they can be rated as Bona-Fide Subcontractors. If even only one of the above is a ‘no’ then they must be rated for Employers Liability.

Case Study: Joe Bloggs Lighting Design Ltd has designed the lighting scheme for a new museum in London. They employ a firm (Handyman ltd) to provide the staff to undertake the installation. Handyman Ltd have agreed a fixed price for the three day job. Joe Bloggs Lighting will be overseeing the installation as they are keen to make sure the lights are put in place in accordance with their design. Joe Bloggs Lighting Design Limited provided ladders with which to reach the heights to fix the lights in place. One of the employees of Handyman Limited is following the lighting plans produced by Joe Bloggs Lighting Design and goes up the ladder to fix the light in place. Whilst up there he over-stretches and falls to the floor, he breaks his leg.

Are Joe Bloggs Lighting Design Limited legally obliged to insure Employers Liability? Yes – Despite the fact Joe Bloggs are employing Handyman on a temporary basis they are in charge of the overall site and are providing equipment with which to carry out the contract

Assuming Joe Bloggs had the EL cover in place will they actually pay out for this claim? Probably – Whilst it would appear to be the individual’s fault for over-stretching and falling it was ultimately the responsibility of Joe Bloggs to ensure that they were competent working at height and depending on the circumstances should have been supervising such work and maybe suggested moving the ladder closer to avoid such things. There are several points which suggest that Joe Bloggs were negligent and so it is entirely plausible that the injured individual would make a successful claim. 

So for some good advice and a review of your requirements why not give us a call. A phone call might cost you a few pence, to ignore these requirements might cost you a whole lot more. 

We look forward to hearing from you.

Alistair

Chimps, Humans, Gremlins, Computers and Bananas (of varying types).

By way of a warning this post is not about insurance (strictly speaking) so don't be to disappointed. On a Thursday morning I attend a great meeting of local businesses. It gives us a chance to promote business within the local community and to provide access for our clients to a wide variety of trades and professions who we know and trust and are happy to recommend. Within this group there is a wonderful chap named Mike Duckett who runs a company called 'Coaching for Success'. How best to describe Mike's work?.... I would say that he facilitates your success (in whichever field it is required - business, sport, media, cuisine etc) by helping you realise and address weaknesses, strengths, hurdles and hangups. He opens doors that probably existed but you didnt have the key, or perhaps couldn't find it. Anyway.... his services are useful to many of us and in particular what he spoke about this morning struck a chord with me.

What does all this have to do with Chimps etcetera? Well you may have heard Olympic certainty (I mean hopeful) Chris Hoy talk about his inner chimp. Mike gave us an illustration which has been used by the team GB cycling psychiatrist and it would appear to good effect.

We all have in us or with us.... stick with me on this one.... A chimp, a human and a computer.

 The chimp and the human deal with the here and now and the computer is where we store all the past and the lessons learnt. The chimp is (being fairly primitive) in charge of base emotions, often reacting instantly and instinctively with gut reaction and emotional strength. The human is the more logical and rational part of us who is in charge of making reasonable decisions and properly thinking through things and making rational decisions.

So whats the problem? The problem is that the chimp always wakes up first. When faced with a new situation we often react emotionally and then store that reaction as a default in the computer... this is called a 'gremlin' (which we don't want). What we want to try and do is get our human to form a rational reaction and decision and store that in our computer as an 'autopilot' so that when faced with the same or similar situation we know what we are doing and don't get all, well 'chimpy' about it.

So how do we make sure we are storing autopilots in our computer and not gremlins? Through the cunning use of bananas! That's right people. I am not imploring you to run out and panic buy bananas, these are all metaphorical bananas. There are two types. There is the distraction banana which in real terms is using a different task where the chimp might be useful (competitive sport like cycling for example - remember the chimp is stronger than you) and the other is the reward banana which is where you might consciously reward yourself for not following the chimp's previous advice or gremlin. Either way the aim is to get the chimp into a  box where he is happy with his banana and so you can get on with focused and rational thinking.

But don't take my word for it all...... I'm not the professional. So if you think you might need to sort out your chimps from your humans and throw around some bananas then you need to speak to Mike at Coaching for Success. If it works for Olympic athletes then I'm sure it could help you (other non-chimp related techniques are available).

Have a great Easter.

Alistair


Visit Mike's website for more information  -  www.coachingforsuccess.co.uk