JCT is clear when it comes to passing liability on to the contractor for public, products and employer’s liability.
However, there are circumstances where your client may choose to take on management of the contract themselves or appoint their own project manager to manage sub-contractors or direct employees to deliver the project.
In these situations, different liability policies will be required to make sure there are no gaps in cover.
If you are in doubt, please call us to discuss what liabilities you feel your client is running, and solutions for your specific situation.
It’s important to understand the project type and the requirement for Full Project Public Liability and whether or not Employer’s Liability is also required.
Generally, if there is a labour force to be paid direct on a short-term basis, who are not providing anything other than their own simple tools to complete a task, Employer’s Liability may well apply.
If there is a master/servant relationship between a labour-only sub-contractor and the client or the client’s project manager, it is likely that Employer’s Liability will apply. These workers rarely have their own Employer’s Liability or Public Liability cover and will almost certainly look to your client if they are injured on-site.
The default position should be at least Property Owner’s Liability (POL) for a client who is handing over the entire project to a main contractor. The limits for this cover start at £2m but could be as much as £10m depending on the size of the project.
We have seen cases where a sub-contractor has named the property owner as co-respondent in a personal injury case. While these almost always come to nothing, there are often costs associated with presenting an initial defence and passing on the action to the contractor. It is also the case that if the contractor’s liability insurance fails, your client may be the next nearest target and expect to be named in an action.