Employers’ Liability and Public Liability – small claims with a disproportionate impact?
Whilst focus in the industry quite rightly continues to be on the upcoming whiplash reforms, the Keoghs market affairs team looks ahead to another aspect of impending compensation reform…
We’ve written frequently in these pages about the upcoming reforms to whiplash compensation. The reforms (at the time of writing due for implementation on 6 April) remain vital and are a primary focus for the industry. However, this is not the only area that the Government has committed to reform this year.
Let’s look at what the latest is in respect of the small claims track limit for employers’ liability and public liability cases.
Originally referenced within the package of reforms under the broader umbrella of the Civil Liability Act, an increase to the EL/PL small claims track (SCT) limit was proposed at £2,000 (general damages) alongside the implementation of the whiplash reforms. Currently, this will mean an SCT increase from £1,000 to £2,000 for all EL/PL claims on 6 April 2020. The trigger is currently unconfirmed but we can assume it will mirror the RTA proposal of “accidents on or after”.
This will be a CPR amendment and we still await sight of the final detail from the Civil Procedure Rules Committee and the MoJ. This is assuming that this will form part of the reforms soon to be launched: the ABI asked back in September last year if this policy remains right.
Either way, we have not yet had any clarity from the Government as to how they intend for claimants to deal with their claims as litigants in person. We know that “Official Injury Claims” (i.e. the new LiP Portal) as currently built caters for RTA claims only. We must also assume that EL & PL claims caught within the new SCT increase (so those between £1,000 and £2,000 general damages) will also become out of scope of the existing MoJ portal and so would have to be presented “manually” in the old fashioned manner to the relevant compensator. On this last point, claims handlers will be only too aware that often in EL/PL the identity of that compensator is sometimes far from obvious -particularly to an unrepresented claimant.
In terms of determining liability, it is arguable that EL and PL cases can be more complex than RTA. For cases up to £2,000 after 6th April, the question must be asked as to how attractive such cases will be to claimant solicitors if they are operating in the SCT. Likely scenarios can be envisaged of an increased number of LiPs struggling to identify the right compensator and understand sometimes complex liability arguments or the deliberate inflation of damages to try and lift the claim out of the new SCT and back into a world of recoverable costs.
There is also the wider social issue of an employee bringing a claim directly against an employer. Without the benefit of an intermediary (in the form of a solicitor), this may - for some claimants - be quite a daunting prospect.
We appreciate that for many compensators, volumes of such cases will be relatively low and that in the broader spectrum of the 2020 reforms, there are greater operational and technical challenges. That said, compensators will be sensitive to the industry’s brand and reputation should there be a cohort of claimants who struggle to access justice and achieve redress in genuine claims.
With whiplash taking up everyone’s current headspace, there is a danger that we sleepwalk into trouble in other areas. With courts stretched and access to justice concerns already a talking point in some political circles, the impending increase to the EL/PL SCT limit may be an issue that requires renewed attention.