I have been asked to find our legal liability to our franchise workers.

The company employ workers directly and these workers deliver and install white goods, including gas.

We have several franchise companies who employ workers that are classed as self employed on the franchise books, they do exactly the same work as company staff and the work is given out exactly the same as our staff we just pay the franchise company and they pay their staff, there are issues if they can be classed as self employed for HMRC but that's a different story.

My opinion is that they are our responsibility and should a problem arises we would be liable, another thought is that we should make sure the franchise have a a current H&S policy and their own RA and SSOW for each job but because they do exactly the same as us ours should suffice.

I have the NGC but it is little help where this is concerned.

links to legislation and official acops would be appreciated because I need to present this to the directors.

Let’s start with the Public Liability responsibilities i.e. liability to third parties: I presume that these people are installing a product supplied by you? And that the customer agrees a contract for supply and fit. It won’t matter if it is one of your own employees or a franchise worker – if they cause damage to the customer’s property/premises then you’ll be liable to pay any claim.

Turning to the liability for an accident/injury to one of the franchise workers: Presumably the method of work is defined by you. What lengths to you go to in establishing the knowledge/expertise of the franchise company? Do you require them to hold suitable and sufficient insurance and to indemnify you in the event of any cliam made agisnt you? Do you give them any “steer” as to what you expect of these self employed workers? How do you ensure that the franchise workers are suitably “gas trained”?
In the absence of any answers it is almost impossible to provide a clear answer. But what looks pretty clear is that you are likely to be regarded as the ultimate employer if a franchise worker is injured. OK, there may be a degree of contributory negligence but you/your insurer will still have to handle the claim and incur expense/cost.
And, of course, even if you thought that it was the franchise company that was at fault can you guarantee they won’t “fold” in the event of a claim? That would leave you holding the baby.
You comment that you employ your own workers carrying out the same work. I think that would be viewed by a court as meaning that you knew what work was being done, the risk, the precautions etc. If I were advising a claimant I’d recommend suing everyone in sight!
All of this leaves me to say: Why wouldn’t you treat them as employees and take the same care of them as of your own direct employees?
Legislation/Case Law: I can’t really comment on the former but suffice to say there are many compensation claims that involve lengthy chains of contractors and sub-contractors, cases where firms in the chain go bust etc etc. Regard yourself as their employer and act accordingly
Phil

The company I work for operates by company owned and operated sites and company owned but franchised operated sites.

In our instance my company takes responsibility for HSE for our Franchise site employees (i.e. employees of the franchisee not my company) - this is mainly due to the fact that franchise sites adopt and follow the same safety management system (including training / risk assessing etc.) as we have for our company operated sites.

We develop the system, we are responsible for it's adequacy. We also have suitable monitoring systems in place to alert us to the fact that a Franchisee is not following our systems, and therefore in the event an accident / injury occurred due to the Franchisee not following our system they would bear the responsibility (i.e. we have done all that is reasonably to ensure they have the available tools and we have reasonably assurances they are following them).

If we have no control of the Franchise sites then I guess the responsibility would be less so, but then it wouldn't be a Franchise if the sites were completely different!

Franchised operations generally adopt the same processes and procedures as the "head office", thus probably establishing a master/servant relationship as Ray states. You train the people and authorise them to work (spanner owners excepted) and any failure in your training system will be traced back to you.

Whilst the employer would have primary liability for any harm caused by or to their employees it is entirely foreseeable that the "head office" organisation could be hit by sizeable civil liability claims as well as criminal charges.

There will still be public liability exposure if the franchisee's insurances are inadequate or ineffective.