Compensation Claim - DOC by BeunaventuraLongjas

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									                                Compensation Claims


Employers' duties
What kind of claims may be made?
       The tort of negligence
       Tort of breach of statutory duty
                Civil liability exclusions
                Conditions to be met for breach of statutory duty
Defences against a claim
       Contributory negligence
       "Violenti" rule
       Vicarious liability - when the employee is negligent
       Strict liability - when the employer is not negligent
       Limitations on timescales for claims
Procedures when a claim is made
       Letter of claim
       Information that defendants must disclose
       The three "tracks"
Winning the cases
       Role of insurance
Lists of relevant legislation
                          Further informationCompensation claims

In the event of an incident, the injured person is increasingly likely to make a claim
for compensation, whether they are an employee or not. It is important that safety
practitioners and managers understand the legal principles behind personal injury
claims and know how best to defend and win them.

Employers' duties

Employers must comply with:

                The requirements of the Civil Procedures Rules (as amended by the
                 Woolf reforms)
                The Employers' Liability (Compulsory Insurance) Act 1969 under
                 which it is compulsory to have employers' liability insurance.

These are in addition to the requirement to comply with the Health and Safety at
Work, etc Act 1974 and all health and safety regulations, under which claims may
also be made.

In practice

Legal principles governing claims

                                             (Page 19   of website guidance – compensation claims)
Duty of care

The fundamental starting point for most personal injury claims was established in the
groundbreaking case of Donoghue v Stevenson (1932). This is the famous ‘snail in
the bottle’ case which established that a duty of care is owed to our ‘neighbours’. The
case described neighbours as being those who we could ‘reasonably foresee’ could
be affected by our ‘acts and omissions’. Typical neighbour relationships include:

               Employer to its employees
               Employer to others' employees
               Employer to contractor
               Occupier to authorised visitors
               Occupier to unauthorised visitors, eg. trespassers
               Employer to members of the public.

The common law duty of care owed by an employer to its employees was further
defined in the case of Wilson's and Clyde Coal Co v English (1938). In particular the
case considered the personal nature of the duty.

In this case, the employer was compelled by law to employ a colliery agent who was
in charge of safety in the mine. Nonetheless, when an accident occurred, the
employer was held liable. The case decided that the employer's duty of care to his
employees was personal to the employer and could not be delegated to a manager
or safety advisor - In other words, the common law duty of care established in
Donoghue v Stevenson is primary and cannot be transferred to someone else,
diluted, or delegated to employees.

The case went on to say that employers must provide:
              A safe place of work and equipment
              Safe systems of work
              Reasonably competent employees.

In addition if the employer knows an employee has a condition that makes that
makes them more susceptible to injury, or makes the consequences or injury more
severe than usual, extra precautions must be taken.

Consequently, employers must take into account any significant ‘special needs’ in an
employee and take extra precautions. Employees with ‘special needs’ include
(depending on the circumstances):
               Young and inexperienced workers
               Pregnant employees
               Employees with learning difficulties
               Employees with a medical condition or disabled workers

Actions under common law for work-related stress are now successful, so employers
today must take into account mental wellbeing as well as physical wellbeing.

What kind of claims may be made?

                                            (Page 29   of website guidance – compensation claims)
In practice, the law of tort will be used to bring claims. "Tort" means a wrongdoing in
civil law. Two particular torts are usually used when someone brings a claim for
personal injury. These are the tort of negligence and the tort of breach of statutory
duty. These two torts are often used together and this is commonly referred to as a
"double-barrelled" claim.

The tort of negligence
A claim for compensation based upon the tort of negligence requires three conditions
to be proved by the claimant as follows:

1. A duty of care must be owed by the defendant to the claimant.
2. The duty of care must have been breached.
3. The injury or loss suffered by the claimant must have been due to the breach of
duty of care.

There are some points to note about these three conditions in practice.

Tort of breach of statutory duty
An alternative route when making a claim for personal injury is for the claimant to
show the defendant was in breach of a relevant statute and therefore liable to pay

Civil liability exclusions
Not all statutes can be used in a civil claim. Notably, the main sections of the Health
and Safety at Work, etc Act 1974 cannot be used because of the civil exclusions
clause at s.47 of the Act. This essentially means that breaches of these statutory
provisions cannot be used to make a compensation claim.

There used to be exclusions in the Management of Health and Safety at Work
Regulations 1999, but these were removed in October 2003. The Management of
Health and Safety at Work Regulations 1999 retain an exclusion for "persons not in
employment" eg. members of the public who therefore still cannot cite the regulations
in making a civil claim. Otherwise regulations on health and safety can be used
without restriction.

Conditions to be met for breach of statutory duty
It is important to note that a breach of a statute is not sufficient on its own to prove
the tort of breach of statutory duty in a civil claim. The following conditions must be

                The statute cited must apply to be claimant, for example an
                 employee must use a statute which applies to employees, and a
                 member of the public must use a statute which applies to the public.
                The statute cited must have been designed to prevent the type of
                 injury incurred by the claimant. For example the Control of
                 Substances Hazardous to Health Regulations 2002 (COSHH) are
                 unlikely to be suitable in a case where the injury relates to manual

                                              (Page 39   of website guidance – compensation claims)
                The statute must have been breached. If there has been a
                 prosecution by the appropriate enforcing authority, this may aid the
                 claimant's case.
                The injury must have been caused by the breach of statute. This is
                 often referred to as the causation rule. For example, was the
                 claimant's hearing loss due to a breach of the Control of Noise at
                 Work Regulations 2005 by their employer, or was it due to the
                 claimant attending pop concerts in their own time?

Defences against a claim

A number of possible defences may be applicable to a particular case. The claimant
might not be able to show negligence or breach of statutory duty. For example, the
employer did take reasonable care of his employee, or the injury sustained was not
due to a breach by the employer.

Contributory negligence
One of the more important defences is that of ‘contributory negligence’. This is based
on the Law Reform (Contributory Negligence) Act 1945 which states that if claimants
are partly to blame for an accident through their own negligence, then the amount of
compensation should be reduced. For example, if claimants failed to wear protective
clothing issued to them, or if they did not follow procedures or protocols, then they
may be open to a charge of contributory negligence and the damages award may be
reduced or even withheld. Where it can be shown that the injury sustained was due
to the sole fault of the claimant, the defendant will not be liable at all.
"Violenti" rule
The use of violenti non fit injuria is often misunderstood as a potential defence in
compensation claims. The term means that the employee has consented to the risks
at his or her workplace. The "violenti" rule once predominated but it is no longer a
realistic defence in most cases today.

Vicarious liability - when the employee is negligent
In some situations an employer is liable for the negligence of its employees with
respect to some other person being injured. This is referred to as vicarious liability.
The key conditions for this liability to third parties are that:
                The employee must have been negligent
                The employee must have been acting in the course of employment,
                 in other words acting on behalf of the employer.

Strict liability - when the employer is not negligent
In other situations the employer is liable even though it has not been negligent. This
is often referred to as ’strict liability’. The Employers' Liability (Defence Equipment)
Act 1969 says that where an employee is injured using equipment that has a latent
defect, the employer will be liable even though they may have taken all the
necessary steps to ensure the equipment was obtained from a reputable supplier. It
will be up to the employer, not the injured employee, to pursue the manufacturer
through the courts in a counter claim.

Limitations on timescales for claims

                                              (Page 49   of website guidance – compensation claims)
Any action for personal injury or death must be commenced within three years from
the date of the accident. This comes from the Limitation Act 1980 and from the
Prescription and Limitations (Scotland) Act 1973.

In some cases it may be difficult to ascertain a precise date when an injury was
sustained, for example noise-induced deafness. In these cases the date when the
claimant became aware of the injury may be used. This often relates to the date of
diagnosis by a medical practitioner.

In the case of a death, the Fatal Accident Act 1976 allows close relatives to make a
claim on behalf of the deceased.


Damages can be considerable and there are two broad types.

                Pecuniary: these involve monetary losses such as loss of earnings,
                 medical and travel expenses.
                Non-pecuniary: these involve compensation for pain and suffering
                 and loss of amenity such as changes to lifestyle.

Procedures when a claim is made

New rules were put in place in 1999 following Lord Woolf's enquiry into the reasons
why the legal system for dealing with claims was slow and unfair. The new rules
made it clear that litigation should be a last resort and introduced a number of ’pre-
action protocols’ to provide for the early exchange of information. Parties who fail to
comply with the protocols can be penalised by the courts.

A summary of the intended sequence of events is as follows.
              Letter of claim received.
              Defendant must reply (at least acknowledge) within 21 days.
              Claim investigated.
              Admit liability and settle out of court.
              Deny liability either completely or partially.
              Relevant documentation disclosed.
              A ‘statement of truth’ must be signed by someone from the
               defendant's organisation.

Letter of claim
Following the decision to make a claim, the claimant must send two copies of a
standard ‘letter of claim’ to the defendant. The letter contains information relating to
the general circumstances of the claim including the nature of any accident, a
description of injuries sustained and the documents which the claimant would like to
be disclosed. The defendant must acknowledge the letter of claim within 21 days. If
the defendant does not reply within this timescale, the claimant will be entitled to
begin legal proceedings.

                                              (Page 59   of website guidance – compensation claims)
The court will take into account the fact that the defendant did not follow the
protocol's rules. This puts an important onus on companies who may be named as
defendants to react quickly to letters of claim. They must therefore have the
necessary procedures in place in order to facilitate this prompt action.

Information that defendants must disclose
Following the initial acknowledgement by the defendant of the letter of claim, the
defendant has three months to investigate the claim before replying. The protocols
set out in some detail specific information that defendants must disclose.

For workplace injury claims this includes:
                Accident book entries
                First aid reports
                Supervisor's report
Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 1995
(RIDDOR) report to the enforcing authority.
Where specific regulations apply, the protocols require additional documents to be
produced. For example, in respect of the Management of Health and Safety at Work
Regulations 1999 the following should be disclosed:
                Pre-accident risk assessment required by regulation 3
                Post-accident risk assessment required by regulation 3
                Accident investigation report
                Health surveillance records required by regulation 6.

In cases where the Control of Substances Hazardous to Health Regulations 2002
(COSHH) are relevant, a similar disclosure of documentation is required by the
protocols. This includes:
                 The risk assessment carried out to comply with the requirements of
                  regulations 6
                 Documentation relating to the maintenance of personal protective

For claims involving the Workplace (Health, Safety and Welfare) Regulations 1992,
the documents required to be disclosed include:
                Repair and maintenance records required by regulation 5
                Housekeeping records to comply with regulation 9.

The message for companies is clear. If they are unable to produce the relevant
documentation it may harm their case. If they have complied with the law, they must
keep the appropriate records to be able to prove it.

The three "tracks"
In situations where the pre-action protocols do not result in agreement or settlement,
the case will be allocated to one of three "tracks" as follows.

1. Small claims track jurisdiction with a financial limit of £5, 000
2. A fast track for relatively straightforward cases up to £15, 000 with strictly limited
timetables set up by the court.

                                               (Page 69   of website guidance – compensation claims)
3. A multi-track for cases over £15, 000 providing hands-on management by judicial

It is hoped that this system will ensure speedy settlements of cases and that positive
direction and management of cases by the courts will help bring cases to a

Winning the cases

Employers and other defendants need to consider carefully their approach to civil
claims if they are to win more claims, and reduce the accompanying costs of
accidents, including insurance premiums. The collection of evidence on the whole
range of positive actions that may have taken place on health and safety is
necessary, making an increase in record keeping and consequent bureaucracy
inevitable. The following points may comprise a sensible strategy in order to win
more claims and to deter others.

                Be proactive about health and safety.
                Generate a positive health and safety culture. Ensure health and
                 safety is a high priority alongside other key business objectives.
                Keep records and make sure they are up to date and retrievable.
                Remember people with ‘special needs’ such as young people or
                 those with relevant medical conditions.
                Be scrupulous on recruitment and ensure that having a positive
                 attitude to health and safety is a criterion for the job.
                Include health and safety as a personal performance appraisal
                Use discipline where necessary for breaches of health and safety
                 procedures and protocols.
                Train staff, especially managers and senior managers.

Role of insurance
               Most employers are required to have insurance by virtue of the
                Employers' Liability (Compulsory Insurance) Act 1969.
               Exemptions include a number of public sector bodies such as
                government departments.
               A current certificate of insurance must be displayed.
               An insurance excess may be agreed with your insurance company
                and this may help to keep the premium manageable.
               This insurance is designed to provide at least a minimum level of
                cover in the event of accidents/incidents and consequent claims by
               Cover must be at least £5 million.
               Copies of certificates of insurance must be kept for at least 40
                years. These can be kept as paper copies or electronically.
               The Health and Safety Executive enforces the law on employers'
                liability insurance.
               Employers without insurance can be fined up to £2500 for each day
                they do not have suitable insurance.

                                            (Page 79   of website guidance – compensation claims)
                Public liability insurance is designed to give cover in the event of
                 claims by non-employees

               Managers and other relevant staff must be given training in the
                Woolf protocols for dealing with claims.
               This training should include the need for claims to be dealt with
                quickly, (within no more than 21 days).

Lists of relevant legislation

               Management of Health and Safety at Work Regulations 1999
               Limitation Act 1980
               Fatal Accident Act 1976
               Health and Safety at Work, etc Act 1974
               Law reform (Contributory Negligence) Act 1945
               Employers' Liability (Compulsory Insurance) Act 1969
               Employers' Liability (Defective Equipment) Act 1969
               Civil Procedures Rules (as amended by the Woolf reforms)

Further information

The following are available from

               HSE39 Employers' Liability (Compulsory Insurance) Act 1969: a
                Guide for Employees and Their Representatives
               HSE40 (rev 1) Employers' Liability (Compulsory Insurance) Act
                1969: a Guide for Employers

                                             (Page 89   of website guidance – compensation claims)

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