By Simcox Brokers, Nov 24 2015 11:16AM
We recently had the pleasure of speaking with CFC underwriting about vicarious liability for recruitment agencies. Here is what they had to say.
Why vicarious liability matters
Vicarious liability is a legal term stating an employer can be deemed liable for the actions of another. Crucially, the ‘employer’ does not necessarily have to be at fault for the accident, and can be deemed liable if found to have authority over the actions of the person who caused the accident, or if found to be responsible for their actions in another way.
Because the employment status of temporary workers is so unclear, recruitment agencies can be deemed their ‘employer’ and thus liable for their actions. Most importantly, this means a recruitment agency can be considered liable for the actions of a temporary worker even when they have not been negligent in the recruitment process. In such a scenario, the recruitment agency would be considered ‘vicariously liable’ for the actions of the temporary worker.
The impact of non-standard contracts
Hiring clients are increasingly requesting recruitment agencies to sign contracts which contain onerous insurance clauses. The employment status and responsibility for supervision direction and control of temporary workers is often unclear, or even passed back to the agency. These contracts increase the prospect of a recruitment agency being found vicariously liable for the actions of the temporary workers so be clear the insurer is comfortable covering such contracts.
What to look for in a policy
First things first, purchase a specialist recruitment product. Make sure vicarious liability is clearly defined and included in the policy wording and fully extends to include the actions of temporary workers.
Author: CFC Underwriting Ltd
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