Posted By AlanB
I have been asked a question by a colleague, and I think I know the answer, but I want to make sure of my facts first. The question is:

We have a fencing job that needs to be done in a remote location. There are no working activities there, only old abandoned mine shafts. We want to fence these shafts to make them secure. The fencing job will not result in any persons, other than those fencing, at risk of injury. My colleague has a contractor lined up to do the work. The contractor is a small company (only 2 employees - 2 brothers). The contractor has today informed my colleague that they do not have employers liability insurance or public liability insurance.

Is it a legal requirement for them to hold these insurance documents? Can we contract the work out to them from a legal perspective (even if the moral practice is not sound)? Can the contractor work under our insurances?

Thanks.

Posted By Dave Wilson
Alan,

Know this might not help mate but should you really be contemplating using a company who does not have any insurance at all which protects themselves and any other third party in the event off? Think this says a lot about the way they operate.

If they fall under your 'umbrella' if anything goes wrong who picks up the 'insurance cost' etc.

Personally I would contact your insurance company for guidance as they will be the ones who will take the 'insurance' risk.

Posted By Martyn Hendrie
There is an exemption from having employers liability insurance for family businesses that only employ close family members (this does not apply if a limited company has been formed). A free guidance document is available via the HSE web site > free leaflets.

I am also not sure that public liabilty insurance is a legal requirement, but only a fool would be in business without it.

Posted By Ken Taylor
So how do you convince the HSE and others that you have engaged competent contractors? If they have no insurance, I doubt if you will be able to obtain many references from previous clients. For working at and preventing access to mineshafts, I would expect a minimum of £5m public liability cover.

Posted By AlanB
Martyn,

Competence is nothing to do with having or not having insurance, and I don't think that this thread has suggested that. The importance of insurance is that if anything does go worng, the contractor has backup for any action that may come as a consequence.

My concern at companies not having insurances is that they are chancers. They chance not having insurance, which means that they may well chance on their safety paperwork, whcih means they may well be chancers whilst working. If they chance whilst working, they are putting themselves and others at risk.

Of course, it may be that they can't, or can not afford to get insurance, which means that they either have a poor track record, or their line of work is regarded as being hazardous, which means they are at greater risk of having problems, which means they then need insurance more than anyone!!

If I'm wrong, then please correct me!

Alan

Posted By Ken Taylor
I agree with Alan too. This is the sort of point I was trying to make in my hasty fashion. The HSE and others advise that clients should seek to engage safe and competent contractors by asking the right questions, getting appropriate information, etc. We always require evidence of public liability insurance when engaging contractors as well as satisfying ourselves as to their health and safety performance. From the information supplied, I rather doubt that this company would be able to provide such an assurance - including valid references.

Posted By Nigel Singleton BSc
On a completely different note, if you are woried about the chancers, have you asked them for a copy of their safe systems of work, method statements and safety policy, whislt I know they don't need the last one, if they cannot be supplied and they don't have insurance, I guess Mr. Insurance man would be knocking at your door for his pound of flesh should something go wrong, as you have employed them as contractors.