Employers are increasingly turning to flexible employment arrangements to respond to changing market conditions and economic uncertainty.
The Recruitment and Employment Federation and KPMG's most recent UK Report on Jobs, published in October, revealed permanent placements had fallen again as companies were reluctant to commit to permanent hires, while demand for short-term staff had continued to increase1.
Temporary employment placement is the fourth biggest industry by employment in the UK after supermarkets, charities and hospitals2. There were estimated to be just under 1.62 million temporary workers in total in the UK in July 20233.
Short-term strategy
If a business wants to increase its workforce for a short period of time, there are some important things to consider:
- It is crucial to provide effective training and orientation to new hires in order to familiarise them with the company's policies, procedures, and systems. This will help them integrate into the workforce and start contributing to the increased workload as soon as possible.
- Goals and expectations should be carefully communicated to the new hires. Provide them with a clear understanding of the terms of their employment, help manage their expectations and ensure they are aware of the temporary nature of their position.
- Regular check-ins with temporary hires are important and an opportunity to give feedback on performance and address any issues promptly.
- Plan for the transition back to the regular workforce by communicating the timeline and expectations to temporary employees for a smooth transition.
What are the risks?
An employer has a duty to take reasonable care of the health and safety of its employees and not expose them to unnecessary risk. This responsibility also extends to an employee’s physical and mental health. One key risk relating to the employment of temporary workers is potential claims relating to injuries they sustain in the workplace.
If temporary workers are hired through an agency, it is important to review the contracts to determine who is responsible for injury and damage. Typically, the agency is only responsible for providing an employee with the relevant skills for the interview process. Once the employment begins, so does the business’ duty of care to the employee, just as it would for its full-time staff.
If a temporary employee makes a claim, what's the outcome?
A client’s temporary employee worked for the company for under six months. During this time, the employee took holiday and sick leave, resulting in them working roughly half of this time. Months after leaving the company, the business received a repetitive strain claim from the employee. As a result, Gallagher, the insurer, and the loss adjuster conducted an investigation, which involved examining the information the client still held on the employee. The investigation concluded that it would be highly unlikely for someone to develop this condition in such a short period.
This case study exemplifies the importance of maintaining comprehensive records related to temporary staff (and all employees in general) when they leave a company. Employers must have confidence in their ability to defend any claims, and having all the necessary evidence is essential. The records should include details of the tasks performed by the temporary employees, their training and induction, any absences, and complaints or issues that arose during their employment.
If a business is going through a change programme that involves closing premises, they should ensure they keep photographs and any relevant certifications for the building. These can act as evidence against potential claims against unsafe working conditions, which can be filed up to three years after the event.
Employers’ liability insurance
The employers’ liability (EL) insurance market is growing and was valued at £1.64 billion in 2022. According to Global Data, a primary reason for its growth is the growing deployment of online platforms to hire gig economy workers, alongside the rising popularity of flexible premiums. Other factors that could be contributing to the EL insurance market growth are EL claims settlements because these drive premiums and increases in payroll (premiums are based on payroll) as wages rise to match inflation. Combined these causes are likely to drive the UK EL insurance market to reach £1.87bn by 20264.
Employers' liability insurance is legally required for businesses that have one or more employees on their books. If an accident occurs and an employee is injured or becomes ill as a consequence of work-related activities, they may make a claim for compensation against you, regardless of how long they worked for the business. Employers’ liability usually sits alongside a client’s general liability cover, which can include public liability and product liability insurance.
Unsure about the different types of liability insurance? Need advice on what level of commercial general liability coverage is suitable for you? Give us a call. We’re providing insurance and risk management solutions for businesses of all shapes and sizes. Simply contact your local representative, call us on 0800 612 3635 or get in touch online.
