Employers' Liability Insurance

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Employers’ Liability Compulsory Insurance Act 1969 (ELCI) Requirements

1. Legal Obligation for Employer Insurance

Employers’ Liability Compulsory Insurance (ELCI) Act 1969

Under the Employers’ Liability Compulsory Insurance Act 1969, commonly referred to as ELCI, employers are legally mandated to provide insurance coverage for their employees against workplace injuries and diseases. This requirement extends to lone workers as well.

2. Equal Protection for Lone Workers

Ensuring Adequate Protection for All Employees

It's important to understand that lone workers, even if they work from home or independently at various sites, should receive the same level of protection as their colleagues. In fact, lone workers may require even more comprehensive protection due to the unique health and safety challenges they face as isolated individuals.

3. Coverage for Workplace Injuries and Illness

ELCI Act 1969 and Compensation

If employees sustain injuries while at work or suffer work-related illnesses during their employment, the Employers’ Liability (Compulsory Insurance) Act 1969 ensures there is a minimum level of insurance coverage to address such claims. Employers’ liability insurance enables employers to cover the costs of compensating employees for injuries or illnesses, regardless of whether they occur on or off-site.

4. Motor Accident Coverage

Distinct Coverage for Motor Accidents

It's important to note that injuries and illnesses resulting from motor accidents while employees are working for you may be covered separately by your motor insurance. Employers’ liability insurance primarily focuses on workplace-related incidents.

5. Understanding Public Liability Insurance

Distinction from Public Liability Insurance

Public liability insurance serves a different purpose. It handles claims made by members of the public or other businesses, but it does not cover claims by employees. While public liability insurance is generally optional, employers’ liability insurance is compulsory.

6. Consequences of Non-Compliance

Penalties for Non-Compliance

Failure to possess a current employers’ liability insurance policy that complies with the law can result in fines. Unless you qualify for specific exemptions, you are legally obliged to have employers’ liability insurance.

7. Exemptions Under the Act

Exemptions from ELCI Requirements

While most businesses are subject to ELCI regulations, certain entities are exempt from the Act's requirements. Exempt employers include:

  • Most public organisations, such as government departments, agencies, and local authorities
  • Health service bodies, including NHS trusts and health authorities
  • Organisations funded through public funds, like passenger transport executives and magistrates’ courts committees

There are additional exemptions for specific business groups, so it's essential to be aware of your exemption status.