Freelancers, Subbies and Insurance Issues

[Dan Curtis]

On a couple of occasions recently I've come across a few freelancers and contractors who are unaware of their obligations when it comes to insurance. A lot of this seems to arise from a confusion and mis-definition of the term "subbie".

 

What I do for a living is climb and cut trees. I am self employed, own my own vehicle to get to and from site, provide my own climbing equipment, saws, rigging equipment etc. I am hired on a day basis, for as many or as few days as the company who engage my services need me to get the job done. By definition, I am a freelancer or labour only sub contractor.

 

As a freelancer, I'm neither required to have Public Liability nor Employer's liability. I am in essence, an employee of another contractor for the day. A "subbie" is a term often used to describe people who do what I do.

 

Another definition of a sub contractor, or subbie, is a "bona fide" sub contractor. This situation is very different. It would mean a self employed person who takes on the whole job, on their terms and timelines, with their equipment and the staff they choose to use. They would submit an invoice to the main contractor, who in turn would submit an invoice to the client/tree owners, usually with a mark up for their own profits.

 

In my circumstances, the individual or company that engage me and my services for work are LEGALLY obliged to hold Employer's Liability insurance. Currently, Public Liability insurance is not a legal requirement.

 

In the instance of a Bona fide sub contractor, the sub contractor is the one who is required to hold the insurance. It would cover the people they hire to help them carry out the job. (such as freelancers)

 

So, a warning to all freelancers out there. There are a few contractors who I have come across who are trading without Employer's Liability, sometimes by confusion of the term "subbie", sometimes by sheer arrogance and ignorance. You can't always tell by their name, reputation, nor are they going to be the "******" or any of the other derogatory things I expect people will have in mind. Some of these people advertise in reputable places, so don't go by that either.

 

It is prudent imo to check the insurance of people who engage you for work. If you have any doubts, DON'T work!

[Tom Mabbutt]

Great advice. You've helped:thumbup1: to clear up some confusion I had over the matter too. Nice one.

[norfolk_tom]

Well said Dan, I've had the same problem trying to explain this to some employers.

 

It seems such a simple situation but in many cases they've actually been confused by what their insurance company has told them, some (obviously not all) companies seem to throw around the term subbie without providing enough distinction between labour only and "bona fied" appointments. I don't understand why the term "freelancer" isn't better defined and adopted to avoid this confusion

 

I've been asked too before to present proof of my Public Liability cover for a labour only appointment, only to have to go to great pains to explain it's irrelevance in that type of arrangement

[Adrian cook]

As a regular employer or sub contractors I always ensure that they hold their own insurance. Including Public liability. Whilst I am employing their services, they are in turn supplying a service to me for which they require to be insured. As an AA aproved company it is a requirement to ensure all sub contractors have proof of insurance.

 

Yes, all my sub contract employees are covered under my employees liability, but if their equipment fails such as a rope or karabiner. And they end up in a wheel chair for the rest of their life I can assure you that i will not cover that! If the subie, or freelance person uses my equipment and I supply all ppe efectively the only diference being that they pay their own tax then thats a different matter.

 

Trust me, you are in a dodgy situation if you think you are right. I hope you never have to find out the hard way

[Hodge]

As a user of freelancers I learnt long ago that so long as I have E/L and P/L then all is fine. The people who work for me on a freelance basis are covered and do not require insurance while working for me, however I too have heard of company's that use freelance workers and insist that they have insurance which they don't. Some company's seem to bully people into getting it when they don't need it.

[Hodge]

Ok, so if a freelance climber is working for me and his carabiner or rope fails and he breaks a leg then whats the score?? He doesn't have insurance but I do. But it was his equipment that failed.

[Dan Curtis]

Trust me, you are in a dodgy situation if you think you are right. I hope you never have to find out the hard way

 

I have insurances to cover me, I do other things than freelance. They are completely irrelevant in the situation described.

 

This thread was meant to outline freelancing situations. I can assure you that it's a waste of money for any of your freelancers to have their own policies to "cover" them whilst working for you, their insurance company would not pay out on a job where you are the contractor, and you are the one taking the risks of business.

[Dan Curtis]

I too have heard of company's that use freelance workers and insist that they have insurance which they don't. Some company's seem to bully people into getting it when they don't need it.

 

It's fairly common and mostly seems to arise from a misunderstanding when speaking to insurers by referring to freelancers as sub contractors. Insurance companies will usually take this to mean bona fide, therefore declaring that you need said "subby" to hold insurances.

[Dan Curtis]

Ok, so if a freelance climber is working for me and his carabiner or rope fails and he breaks a leg then whats the score?? He doesn't have insurance but I do. But it was his equipment that failed.

 

If it's his, so long as you've taken every effort to ensure he's using safe, inspected gear, that would be a situation for his own personal accident insurers and/or equipment manufacturers to decide.

[treequip]

Ok, so if a freelance climber is working for me and his carabiner or rope fails and he breaks a leg then whats the score?? He doesn't have insurance but I do. But it was his equipment that failed.

 

LOLER requires you to ensure anything used on your job is pukka so you should ask for a copy of the current LOLER inspection for any kit in use.

 

That doesn't mean he wont have a broken leg if it goes wrong but you will have fulfilled your legal obligations