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Employer Duty of Care

The Legal and Moral Case

Business Class® injury and travel insurance

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Duty of Care is more than a moral obligation – it’s a legal requirement

All businesses, small and large, have a legal and moral obligation to look after their employees and mitigate the risks they face while at work.

While legislation varies from country to country across the EU, employer duty of care obligations are typically consistent, placing the onus on businesses to demonstrate they have sufficient policies, procedures and monitoring in place to minimise the risks that employees may face while at work, or travelling on business.

In today’s global economy, the risks employees face are greater than ever before, as businesses look internationally to grow sales and achieve cost efficiencies. As a result, employer duty of care responsibilities now extend beyond the immediate work place, so it is important to understand the implications when sending employees overseas on business and provide the right tools and support to minimise these risks.

The implications for employers are far reaching

Employer duty of care obligations cover a broad range of activities, such as, ensuring a safe working environment, with appropriate policies and procedures in place to mitigate any risks employees may face while at work, while in the office, or travelling on business at home or overseas.

It is therefore imperative that employees are provided with suitable information, training and support to promote compliance with company policies. These should also be reviewed through regular risk assessments and audits to ensure they are adhered to and are effective.

Failing to implement and demonstrate measures are in place to effectively and diligently manage duty of care responsibilities can have significant financial and reputational implications for a business, as the case studies shown later demonstrate. In addition to the legal implications, the impact can be far reaching - resulting in greater pressure on fellow colleagues, lower productivity, increased absenteeism, poor morale and ultimately, lost talent.

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Employer Duty of Care

Best Practice examples

What constitutes best practice in the area of employer duty of care will vary from one business and industry to another. Below we have provided typical examples of how employers can effectively manage their responsibilities.

In the workplace:

• Ensuring a safe working environment. For example, having a Health and Safety policy in place that is regularly reviewed to ensure it is followed and relevant to the risks employees face.

• Clearly signposting the importance of complying with company policies in employment contracts and regularly reinforcing these through regular training and reassessment.

• Providing a pleasant working environment with areas for rest and relaxation. Also, ensuring that employees are not working excessive hours as defined by local regulations.

• Protecting staff from bullying, harassment or discrimination from staff or third parties and providing them with appropriate channels of communication to raise concerns.

• Supporting the health and safety of employees by providing them with tools to help protect them against the dangers they face in the work place, such as easily accessible resources and training.

• Duty of care may even extend to employee health and wellbeing programmes promoting healthier lifestyles, such as improving their diet, exercising more, reducing alcohol intake and supporting quit smoking campaigns.

Business Travellers:

• Ensuring the risks of travelling on business to remote, or more risky destinations are appropriately assessed in advance, with measures put in place to minimise the potential risks.

• Providing travelling employees with appropriate tools and support to prepare them for risks they may face and help them stay safe with quick and easy access the right support while away. For example, pre-travel risk awareness training and ensuring quick and easy access to emergency medical and security assistance and live information and alerts to help them avoid danger or delays.

With effort, comes reward

Businesses that embrace their duty of care responsibilities and take a more holistic approach to employee health and wellbeing not only attract top talent - which is an increasing necessity for top businesses - they have also been proved to improve employee wellbeing, good will and loyalty. This in turn measurably boosts productivity that can be balanced against the costs of ensuring the health, safety and wellbeing of a business’ most important asset – its people.

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The NetherlandsEmployee involved in a road traffic accident

PakistanEmployees injured in a terrorist attack

PeruSenior employee killed in a helicopter crash in the Peruvian Andes

Republic of CongoSenior employee killed in a plane crash

FranceAccident while on a foreign assignment

The consequences of not properly managing duty of care

The Andes, Peru 2015 legal judgement, United Kingdom

SummaryA senior employee of a UK based financial securities firm was killed in a helicopter crash while travelling on business in the Peruvian Andes. His employer was found in breach of its duty of care responsibilities as they failed to make adequate preparation and enquiries into the method of transport and charter operator.

Due to the nature of the route and potential danger of flying over inherently dangerous terrain, the employer should have recognised the increased risks and

carried out a detailed risk assessment. Failure to discover these resulted in the crash.

Following a 2 week trial, it was determined that the employer owed a duty to take reasonable care to safeguard [their employees] from the danger involved. In the circumstances of this case, that should have entailed the firm carrying out a risk assessment, reviewing the safety of the proposed trip and method of transport. If they had done so, they would have determined that the helicopter was inappropriate for the journey and that the charter operator was in financial difficulties which was affecting the safety of operations.

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France French Cassation Court, Social Chamber (Labour Division), December 2011

An expat employee was victim of an accident that she considered attributable to a breach of contractual safety obligation, even though it occurred out of place and time of work.

The employer was held liable under contractual breach of duty under French labour law, despite provisions for work accidents not applying to employees outside work. This was because the expat employee was deemed to be exposed to the risk only as a result of her work overseas, even though the accident occurred outside work hours.

The employer was liable for the entire cost of the damage caused, which totalled €125,000.

Republic of Congo, Africa 2015 legal judgement, United Kingdom

SummaryA senior employee was killed on a flight from Cameroon to the Republic of Congo after it crashed into a hill side. He was invited, on behalf of his employer, to fly as a guest of a mining company’s board of directors on a private charter arranged by them to inspect a mining site.

A claim was made by the employee’s family against his employer for failure to meet the duty of care they owed to him.

His employer argued that it was the mining company’s responsibility to ensure duty of care was extended to their employee for the trip, which was in contradiction of their health and safety policy that expressly and stated that staff exposed to hazards or risks that cannot be fully eliminated should be subject to a risk assessment done by a competent person.

His employer was made aware of the itinerary, method of transport and potential risks in advance of the trip.They were also asked to agree to a waiver excluding the mining company of liability in the event of bodily injury or death of their employee. The firm was later criticised for agreeing to sign the waiver in the first place, which should have raised alarm bells and was in breach of their duty of care obligations.

While neither the employer or mining company were held accountable for the accident, senior employees from both organisations were criticised for their inaction and acceptance of the increased potential risks without conducting a more formal risk assessment. If they had 11 lives may not have been lost.

The Netherlands Dutch Supreme Court judgment, February 2008

Under the Dutch Civil Code, the two main duties are a (1) duty of care on the employer for liability for industrial accidents and diseases and (2) a duty to act as a reasonable and fair employer or employee.

SummaryThe Dutch Civil Code extends employer duty of care responsibility to employees travelling during the normal performance of their job, requiring “appropriate insurance” against accidents that may occur, for instance, in the event of a traffic accident.

In this particular case an employee was travelling by car to different businesses for his work and was involved in a road traffic accident suffering a severe whiplash injury. At the time however, the employee was not wearing a seat belt.

Despite the apparent complacency of the employee, and it was accepted that insurance may not cover intentional

conduct or wilful recklessness, the court ruled that the fact the employee did not wear a seat belt did not constitute wilful recklessness and therefore the employer could not avoid all liability.

Karachi, Pakistan French Court of Appeal, Rennes, 24 October 2007

A group of French employees were on a business mission to Karachi, Pakistan in 2002 and were victims of a terrorist attack while they were travelling by bus to their workplace.

The Court of Appeal held the employer was grossly negligent and in breach of their safety obligations. The employer knew there was imminent danger of a terrorist attach due to the threats made and should have ensured that safety measures issued to staff were strictly enforced and enhanced in light of the high risks.

In order for the employer to prove the employer was not liable, they had to show the victims were negligent in failing to reduce the risks faced, which was not possible under the circumstances.

Under French law, the employer was made to compensate the victims for the bodily injuries and psychological damage caused, and moreover, repay the costs to the National Social Insurance that were incurred as a result of the incident.

Employer Duty of Care

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Legal Landscape

Austria & Germany

Both countries’ Civil Codes impose an obligation on the employer to protect against injury to employees while travelling on business.

An employer’s liability may be limited by the employee’s acts, but the burden is on the employer to show that the employee did not take the necessary steps to protect themselves against injury.

Before departure the employer must ensure the travellers have undertaken the required formalities and have the correct documentation. They should inform them of potential security and medical risks, and ensure they have correct and up to date vaccinations and appropriate training.

Whether special security training is necessary depends on the circumstances of the individual and the destination in terms of whether there is an imminent risk. Arrangement of appropriate travel insurance is also a prerequisite.

While the employee is travelling on business it is the employer’s responsibility to keep them updated. The employer must have clear communication channels in place so the employee can notified in case of an emergency.

Benelux

Under the Dutch Civil Code, the employer has a duty of care to prevent industrial accidents and diseases, and has a duty to act as a reasonable and fair employer.

The employer may be liable if an incident occurred to the employee while travelling for business purposes. This includes a duty to ensure “appropriate insurance” for employees who could be involved in a traffic accident in

the course of the performance of their work. The question as to what constitutes appropriate insurance must be determined on a case-by-case basis, taking into account all the relevant circumstances, but the courts will consider the prevailing public opinion as to what events should be insured.

Similar to the Netherlands, Belgian employers are obliged to have insurance cover for occupational accidents, and like the Netherlands, this responsibility extends to business travellers with employers potentially liable for accidents or injuries that occur while the employee is away on business fulfilling their normal occupational duties.

France

Pursuant to articles L. 4121-1 and seq. of French Labour Code, employers have to take all measures to ensure the safety of employees and to protect their physical and mental health in the work place and at any time while on a work related assignment. These measures include the prevention and mitigation of potential risks, addressing difficult working conditions, moral and sexual harassment and providing information, training actions and setting up of a suitable organisation and means to manage these risks.

Regarding health and safety, employers are required to demonstrate they have effective measures in place. In the case of an accident the employer must assume responsibility except where they can demonstrate they had taken all necessary and sufficient prevention measures to avoid the risk - the circumstances of the accident evidence whether this was the case. This is referred to as “Obligation de Securité de Résultat” – Result Based Safety Obligation.

If an employer fails to demonstrate and ensure the safety of employees, they may be liable for compensation and

damages, including where employees have suffered an injury or accident while travelling on business at home or overseas.

Italy

Italian law imposes duties of care through occupational health and safety laws administered by a government agency and private rights of action for workplace injuries. It is recommended that employers to put in place an insurance policy in order to mitigate the potential risks that employees may face when travelling abroad on business.

Occupational health and safety regulations are strictly enforced - a serious violation in Italy can send a manager to prison. This makes it even more important that the employer’s duty to its employees is taken seriously.

Employers can demonstrate they are fulfilling their duty of care to employees in a number of ways including increasing awareness of duty of care responsibilities at all levels of the organisation. This should involve key stakeholders in the planning and delivery of duty of care, developing policies and procedures for managing risk in their organisation, verifying the duty of care provisions within their supply vendor chain, performing a risk assessment and making travellers aware of the findings so they can prepare adequately for their trip.

Employers should also have communication channels in place, be able to locate travelling employees and have established procedures in the event of medical or security emergency, with appropriate management controls and the ability to demonstrate the integration and coordination of emergency assistance service providers.

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Nordic countries – Denmark, Finland, Norway and Sweden

An employer is obliged to have policies in place when at work and when travelling in the line of work. The employer is responsible for safety in the workplace (cf. Work Environment Act 1977:1160 in Sweden, Work Environment Act 2005/06/17 in Norway, or Act on Supervision of Occupational Safety etc. 44/2006 in Finland).

The definition of “workplace” extends to travel, when an employee travels in the line of duty. The employer must thus ensure that the trips can be made safely, and that the employee is provided with necessary means (e.g. safety instructions, vaccination recommendations etc.)

The responsibility of the employer in case of an accident is limited to events that “are directly linked to the purpose of the trip”, meaning if an employee is injured by personal activities, the employer is not liable, but if there is a direct link to the purpose of the trip, the employer may be liable.

Spain

Spanish employers have a duty of care obligation that extends to the relocation of employees for the purpose of performing activities their company entrusts to them. This duty extends for the entire time the employee is relocated or travelling on business. The implications are more onerous where an employee is subject to their company’s decisions regarding accommodation and transport.

The Spanish Supreme Court has held that the “place of work” means any place where the employee may be instructed to perform the entrusted activity, even when that is not the usual place of work. However, the employer may not be liable if an accident or injury takes place outside working hours, e.g. at the weekend as a result of a sporting accident.

Switzerland

Swiss Civil Code imposes several duties to protect the personal rights of employees, all of which are subject to the principle of proportionality. These include a duty to inform the employee of unusual risks they may not be aware of, including the steps they should take to avoid them.

Employers must conduct a risk assessment where appropriate to anticipate any possible accidents that may occur. They must also intervene to correct inappropriate behaviour, particularly in relation to the health and safety of the employee travelling.

Reversing the traditional burden of proving guilt, past Swiss court judgements show that it is the employer who must show they have fulfilled all of their obligations and were not at fault if an accident or incident occurs. The employer must show it has acted responsibly and taken the necessary steps to protect the lives and safety of those who have been harmed.

United Kingdom

In the UK, employers have a common law duty to provide a safe working environment for employees. This includes providing a safe place of work, taking the care to select competent fellow workers and supervisors and provide proper machinery and materials and to maintain a safe system of work.

In the case of Wilsons and Clyde Coal Co v English (1938), it was established that employers have a duty to carry on operations in such a way “as not to subject those employed by him to unnecessary risk”.

Harris v Bright Ash Felt Contractors Ltd (1953) defined an unnecessary risk as “any risk that the employer could reasonably foresee and which he can guard against by any measures, the convenience and expense of which are

not entirely disproportionate to the risk involved”. As a consequence, the acronym ALARP has been established: reducing risks to ‘as low as reasonably practicable’.

Duty of care is a non-delegable responsibility. Cook v Square D Ltd (1992), established that it was the employer’s duty “to take all reasonable steps to ensure the safety of his employees in the course of their employment, and that such a duty could not be delegated”.

Responsibility extends to third party premises, and travelling to and from between them during the course of work. As determined in Smith v Austin Lifts Ltd (1959), “employers who send their workmen to work on the premises of others cannot renounce all responsibility for their safety. The employers still have an overriding duty to take reasonable care not to expose their men to unnecessary risk. They must, for instance, take reasonable care to devise a safe system of work, see General Cleaning Contractors Ltd v Christmas (1953); and if they know or ought to know of a danger on the premises to which they send their men, they ought to take reasonable care to safeguard them from it.”

In Durnford v Western Atlas International Inc (2003), an employee of an oil exploration company successfully claimed damages against his employer when he suffered an acute prolapse of an inter-vertebral disc due to the inadequate minibus that had been supplied for a long journey to the third party premises where he was to work. The judge found that there was a foreseeable risk of injury to a person of ordinary physical robustness as a result of travelling the journey by minibus and there was no evidence of any enquiries made regarding alternative transport. That decision was upheld by the Court of Appeal. It is an illustration of the liability of an employer for breach of its duty of care in relation to transport abroad.

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Employer Duty of Care

Extra ways to demonstrate that duty of care measures are effective

In addition to monitoring and auditing employees to ensure compliance with company policies and procedures, and having the appropriate insurance programme in place to protect the business financially, Chubb provides additional tools to help employers manage their duty of obligations and demonstrate their credentials as socially responsible and caring organisation.

Chubb Travel Smart provides a range of tools to help businesses stay in touch with employees and mitigate any risks they face while travelling on business. These include online pre-travel risk training and accreditation, a handy smartphone app providing employees with direct access to medical and security assistance, live alerts and useful information regarding their destination, and connected to this, an online dashboard that enables HR and Risk managers to locate and send alerts or messages to them.

South Africa

South African employers have a duty of care obligation towards its employees under the common Law and the Occupational Health and Safety Act 85 of 1993 ("OHSA").

The OHSA specifically places an obligation on employers to identify and reduce risks to the health and safety of employees and other persons in the workplace.

The employer has a duty to provide and maintain a working environment that is safe and without risks to the health of employees. This duty includes the duty of an employer to inform employees of the hazards to health & safety associated with any work performed, and to inform the employees of the necessary precautions, which must be taken to mitigate the identified risks.

The scope of the OHSA would extend to business travellers and expatriates who perform work outside of South Africa for its South African employer. It is therefore critical for South African companies to ensure that their employees are subjected to a working environment that is safe and that they are not exposed to unnecessary hazards.

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Regional Contacts

Diana Pombinho Fernandes Business Analyst - Multinational & Projects, Accident & Health, Europe 100 Leadenhall Street, London, EC3A 3BP United Kingdom O +44 (0)207 173 7233 M +33 06 21 89 61 56 E diana.fernandes@chubb.com

Stéphane Baj Regional Director - Corporate & Affinity, Accident & Health – Europe Middle East Africa Chubb - Le Colisée - 8, avenue de l’Arche, 92419 Courbevoie Cedex, France O +33 (0)1 55 91 47 53 M +33 (0)6 14 19 54 79 E stephane.baj@chubb.com

Benelux

Clemens Roomer Underwriter Multinational, Corporate & Travel, Benelux, Accident & Health Marten Meesweg 8-10, 3068 AV Rotterdam, The Netherlands O +31 10 289 3553 M +31 (0) 6 5318 7585 E clemens.roomer@chubb.com

Carla Fonck Business Development Manager, Accident & Health Benelux Emiel Banningstraat 41-47, 2000 Antwerp, Belgium Nerviërslaan 9-31 Avenue des Nerviens, 1040 Brussels, Belgium O +32 (0)2 516 97 56 M + 32 (0)472 88 73 97 E carla.fonck@chubb.com

France

John Pillet Global Account Manager, Accident & Health Le Colisée - 8, avenue de l’Arche, Courbevoie Cedex, 92419 O +33 1 55 91 48 48 M +33 6 16 15 76 85 E john.pillet@chubb.com

Pierre Amet Sales Director - Corporate, Accident & Health Le Colisée - 8, avenue de l’Arche, Courbevoie Cedex, 92419 O +33 1 55 91 47 04 M +33 6 08 36 58 40 E pierre.amet@chubb.com

Germany

ppa. Holger Micheew Accident & Health Corporate Manager Germany Lurgiallee 12, 60439 Frankfurt/Main, Germany O +49 69 756 13 6664 M +49 172 6172567 E holger.micheew@acegroup.com

ppa. Frank W. Halbschmidt Senior Key Account Manager, Accident & Health Lurgiallee 12, 60439 Frankfurt/Main, Germany O +49 69 75613 6670 M +49 172 8900738 E frank.w.halbschmidt@chubb.com

Iberia

Pablo Sampascual Agra-Cadarso Head of Corporate & Affinity, Spain & Portugal, Accident & Health C/ Francisco Gervás, 13, 28020 Madrid, España O +34 910 848 663 M +647 581 971 E pablo.sampascualagra@chubb.com

Italy

Massimo Prosdocimi CAH Underwriter Via della Moscova, 3 - 20121 Milano - Italia O +39 02 806 710 254 M +39 345 2484409 E mprosdocimi@chubb.com

Nordics

Christian Ellow Accident & Health Manager, Sweden, Denmark & Nordic Countries Birger Jarslgatan 43, Box 868, SE 101 37, Stockholm, Sweden O +46 8 692 53 82 M +46 709 32 66 71 Sankt Anne Plads 13, 2. Sal, DK 1250 Köpehamn K, Denmark O +45 33 34 75 19 M +46 709 32 66 71 E christian.ellow@chubb.com

Poland, Czech Republic, Hungary & Central Europe

Tomasz Rynkiewicz Accident & Health Manager, Poland ul. Królewska 16, Warszawa 00-103, Polska O +48 22 452 39 61 M +48 508 262 668 E tomasz.rynkiewicz@chubb.com

South Africa

Neil Beaumont Head of Business Development Ground Floor The Bridle, Hunts End Office Park, 38 Wierda Road West, Wierda Valley, Sandton Johannesburg, 2196, South Africa O +27 (11) 722 5716 M +27 (76) 507 1993 E neil.beaumont@chubb.com

Switzerland

Daniel Rehschuh Senior Producing Underwriter, Accident & Health Bärengasse 32, Zürich 8001, Switzerland O +41 43 456 7520 M +41 79 386 5899 E daniel.rehschuh@chubb.com

Ana de Montvert Underwriting & Business Development Manager, Accident & Health Bärengasse 32, Zürich 8001, Switzerland O +41 43 456 75 19 M +41 79.524 81 09 E ana.demontvert@chubb.com

Turkey

Ömer Abit Underwriting Manager, Accident & Health Büyükdere Cad. No:100-102 Maya Akar Center Kat 5 Esentepe 34394 İstanbul, Turkey O +90 212 3063931 M +90 533 1361254 E Omer.Abit@Chubb.com

United Kingdom & Ireland

Chris Conyard Head of Corporate Risks, Accident & Health 100 Leadenhall Street, London, EC3A 3BP United Kingdom O +44 (0)207 173 7129 M +44 (0)7833 255 041 E chris.conyard@chubb.com

Janene Blizzard Head of Global Accounts Division, Accident & Health 100 Leadenhall Street, London, EC3A 3BP United Kingdom O +44 0 207 173 7062 M +44 0 776 699 4297 E janene.blizzard@chubb.com

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Chubb. Insured.SM

About the new Chubb

On January 14, 2016, ACE Limited acquired The Chubb Corporation, creating a global insurance leader operating in 54 countries under the renowned Chubb name. The new company combines Chubb’s 130 years of underwriting insights and devotion to customer service with ACE’s three decades of technical underwriting excellence, broad risk appetite and global presence.

Chubb is now the world’s largest publicly traded property and casualty insurer, providing commercial property and casualty insurance, personal accident and supplemental health insurance, reinsurance and life insurance to a diverse group of clients.

Our goal is to provide the very best insurance coverage and service to individuals and families and businesses of all sizes — from small and medium-sized companies to the largest multinational corporations — all across the globe.

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