Corporate Manslaughter and Corporate Homicide Act

RUSSELL HILL
Member - 27 posts

Hello Rosemary. I'm not in the insurance business but from what I have read it is not something you can really insure against. The important thing is that you have in place systems and practices to reduce any risks. As a large multi-national you will most likey have in place most of what you need. I can only speak about your workplace driving but you need to make sure you are in control not only the vehicles but also the men and women who drive them. The three main areas you need to control are the

The driver - the vehicle - the journey

Rosemary King
Member - 7 posts

Thanks Russell

As you rightly guessed we have in place all of the basic requirements, we could always do better of course, but at least we try to be as compliant as possible.
It is, if anything, the Company Car Drivers who are the biggest risk. Although Car driving, be it company car or drivers using own cars on company business is covered in the H&S policy and specifically on the Car & Driver Polcy we cannot regulate the lovely boys and girls 24/7.
I completed the Workplace Law online quiz hoping I would get from this some clarity on what we needed to do to improve or enhance our existing Insurance Policies, but came up lacking that information.
It would appear that we will have to trust to luck and what we already have in place to provide peace of mind.
It is too early in the legislative process to have precedent so lets hope none of the Workplace Law members are called upon to become precedents!
All I can do in the meantime, is pass onto HR and the Directorate all of the guidance and wisdom available as it develops.
R

Shirley Holley
Member - 3 posts

Whilst it is not possible to insure against fines, it is possible to insure against defence costs. I suggest that you ask your current insurers what steps they are taking, if any.

I asked my insurance company what action we needed to take and was advised that our Director & Officer policy effectively covers employees acting in the interests of our business.

Our EL/PLinsurer is adding an endorsement to our policy as follows;

"To provide Policyholders with protection against legal charges for defence
against a charge of Corporate Manslaughter or Homicide, all Employers’
Liability, Fleet and Smallfleet written by Zurich Commercial Broker,
Zurich Commercial Direct or Zurich Global Corporate UK will be extended to
provide defence costs up to a £5 million limit. In respect of Public
Liability policies written by Zurich Commercial Broker or Zurich
Commercial Direct we will provide for defence costs up to £5 million or
the policy limit of indemnity, whichever is the lesser.

Few of our competitors have made their final intentions on this cover
known at this time, but on the information that is available, we believe
this level of cover will be towards the upper limits available within the
market and will further enhance our product offering.

It is our intention to provide the enhanced cover to all existing
customers with effect from 01 April 2008, irrespective of policy renewal
date. We are in the process of preparing a "Notice to Policyholder",
which will confirm cover by intent, thereafter polices can be endorsed as
they fall due for renewal. In addition, articles will appear in our
customer publications, "News and Views" for ZCD and Business First ZCB.
The charge of Corporate Manslaughter or Homicide is very specific and will
require a change to the policy wordings, endorsement wordings are being
finalised for our core policies for each line of business and will be
available shortly."

RUSSELL HILL
Member - 27 posts

Rosemary you are right to think that it will be your drivers who will put you most at risk. whilst I agree you cannot sit with them 24/7 what you must do as a company is set out guidelines as to what is and isn't acceptable. This is the main thrust of CM it makes the company responsible for the actions of it's work force. Work place driving is too important a sugject just to be tagged on the end of a general policy. I would reccommend to organisations of all size to have in place an Occupational Road Safety policy which would include a specific H&S policy covering driving, a drivers handbook and a management instruction manual that will allow managers to create the necessary audit trail. If that all sounds too much hassle or too complicated believe me it's not .

Shirley i read with interest your comments. i am now being asked a lot how companies can insure against CM so any further information you can give would be appreciated. email info@chilterndrivertraining.co.uk

Kelly Mansfield - Workplace Law Network
Online advisor - 60 posts

Hi Rosemary,

In order to answer your query I have referred to the Corporate Manslaughter and Corporate Homicide Act: Special Report, published by Workplace Law Group. Within the report, insurance broker Simon Hickman provides the following guidance:

"As usual, insurers will not provide cover for fines or penalties of any kind and this is likely to extend to any publicity order (see Chapter Four) made by the courts.

"The cover is therefore for costs and expenses for which an organisation will be legally liable to pay in the defence of an action.

"Typically the types of policies that have provided cover in the past are directors and officers indemnity policies. These policies provide cover for wrongful acts committed by or alleged to have been committed by a director or officer of the organisation. In the future, these policies will not provide cover for corporate manslaughter as the policy covers the individuals and not the corporate entity. However, it is possible to extend the policy to cover the corporate entity for the defence and investigation costs and expenses. The problem area here is that the policy may well share the indemnity provided with that of the cover provided to the individual directors and officers. This will reduce the level of cover available if they are also facing individual charges under health and safety legislation.

"[Public and employers liability insurance] is likely to be the main policy under which corporate bodies will obtain cover. Typically these policies in the past have provided a level of cover for the costs and expenses legally incurred in the defence of criminal proceedings for offences under health and safety legislation.

"Current policies should be checked to see if the existing health and safety cover extends to similar safety legislation, which should include the new Act."

I hope this information is helpful. There is further detail available on this and all other issues relating to the new Act within the report. See: http://www.workplacelaw.net/news/display/id/14115

Jennifer Chapman
Member - 15 posts

At the moment you do need to check specifically with your insurer(s)/insurance brokers (and you certainly must already have 'local' ie UK- EL and Motor insurance arranged) and should there be any 'Global' covers arrnged by your US Parent Co, request confirmation that the new UK legal position is understood and included by the insurer - for instance there is often a Global D & O policy arranged esp by US domiciled parent co's since this was a cover that originated emanated from that very country and was originally introduced into usage in the UK by US-based insurers eg AIG and Chubb 30-ish years ago.

Rosemary King
Member - 7 posts

Thank you all very much, I think I have enough to go on now.
I appreciate your help.