Summary and implications

The Government's much vaunted attack on the compensation culture has found its voice through the Jackson costs reforms: cutting solicitors' "bunce" and choking off unmeritorious claims because they will not get paid and outlawing referral fees that saw claims managements and solicitors alike making obscene profits.

On 1 October 2013 a little heralded change came in the form of section 69 of the Enterprise and Regulatory Reform Act 2013, which might not have an immediate impact but potentially could have a real impact in years to come. This provision deadens the effect of health and safety breaches in civil claims. No longer can a claimant point to a breach of some obscure health and safety provision, as giving rise to civil liability, unless it specifically provides for it in the act or regulation.

Claimants will now have to show that their injuries are caused by negligence. This will make it easier for employers to defend claims, but not that easy. Some of the more outlandish claims, like a postman's bike being work equipment, might be things of the past. Bang go some of the "Red Top" headliners.

But is it really that fundamental a shift? Not really:

The Act is not retrospective. It applies only to accidents/injuries occurring after 1 October 2013. When a breach occurs, giving rise to a cause of action, it's going to be a nice argument for lawyers to have at their client's expense. Claimants in personal injuries actions still have three years to bring their claims, and in disease cases claims are often based on breaches occurring decades before.

Employers will still have to show that they have not been negligent. To do this they will have to have taken steps to look after their employees' safety, which will still be judged by reference to the health and safety framework prevalent at the time of the accident or injury.

Cases will have to reach the Court of Appeal (often several years after a claim starts) before clear guidance is given on how the changes should be applied. Judges are unlikely to change their approach overnight. As defendants employers will still have to go through the hoops of showing documented procedures and producing detailed witness statements.

Unsurprisingly the claimant and insurance lobbies have alighted on the changes: it is another erosion of access to justice or a much needed correction, depending on which side of the fence you are. In reality it is unlikely to be either. Claimants will have to jump higher but employers will still have to make a positive case on meeting the test.

For business it is unlikely that these changes will impact on the bottom line of insurance premiums for the years to come. Insurance premiums will continue to rise while the insurance industry wrestles with the underlying cost of legacy claims adversely impacting their reserves. When was the last time your insurance premium was reduced? Added to that is the unedifying practice of insurers seeking to lay off their liabilities to other insurers and the unfortunate uninsured business who thought they had made proper provision.

So what can you do about it? Don't take your eye off health and safety, it is more than a conduit for civil claims, it saves lives and saves you money in the long run. Do pay attention to keeping proper records and be robust with your insurers over legacy claims taking an active interest in their disposal. The more the insurer pays the more you do.

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