Businesses that engage others to work on their behalf, whether in a permanent, temporary, or flexible capacity, face a range of responsibilities. Among them is ensuring that individuals such as subcontractors, apprentices, and home-based workers are protected against injury or illness that could arise in the course of their work.

We explore how employers’ liability insurance may apply to different types of workers, what factors could affect cover, and how brokers can help businesses assess their insurance needs.

What Is Employers’ Liability Insurance?

Employers’ liability insurance is designed to help protect a business if an employee makes a claim for illness or injury resulting from their work. Cover can extend to legal costs and compensation, subject to the terms of the policy.

For many UK businesses, holding employers’ liability insurance may be a legal requirement, particularly when there is a contract of service in place. However, the definition of “employee” can vary, and businesses that engage non-traditional or flexible workers may need to examine their arrangements closely.

Does Employers’ Liability Cover Subcontractors?

Subcontractors are commonly brought in by businesses for specialist tasks or to support short-term projects. Whether they are covered by an employers’ liability policy can depend on several factors.

Labour-Only vs. Bona Fide Subcontractors

• Labour-only subcontractors typically work under the direction of the business, use company tools, and follow site rules. These individuals may be viewed similarly to employees for insurance purposes and could fall within the scope of employers’ liability cover.
• Bona fide subcontractors, on the other hand, often use their own tools, control their working hours, and may carry their own insurance. In such cases, they might not be considered employees, and employers’ liability cover may not apply.

It may be advisable for businesses to confirm the status of subcontractors in their policies and check whether additional protection is necessary.

Are Apprentices Covered Under Employers’ Liability Insurance?

Many apprentices are classified as employees or trainees under a formal agreement. As such, they could be covered under a business’s employers’ liability insurance if they suffer a work-related injury or illness.

It can be important to declare apprentices to the insurer when arranging or updating the policy. This helps ensure that the level of cover reflects the full scope of the workforce, including any young or less-experienced workers who may require closer supervision.

Do Homeworkers and Remote Employees Need to Be Covered?

With more businesses adopting hybrid and remote models, questions around cover for home-based workers are increasingly relevant.

If a business requires or authorises an individual to work from home, that person may still be considered an employee under the law. Employers could remain responsible for their welfare during working hours, even when the work is carried out away from the main premises.

Employers’ liability insurance can extend to cover homeworkers, but insurers may request information about home working arrangements, risk assessments, and any measures in place to protect staff.

Key Considerations When Reviewing Employers’ Liability Cover

When assessing whether employers’ liability insurance is suitable and sufficiently comprehensive, businesses may wish to consider:

• The status and nature of each worker’s engagement

• Whether any subcontractors are using business-owned tools or working under supervision

• The number of apprentices, trainees, or volunteers involved

• Any remote or flexible working arrangements

• Contractual obligations or regulatory requirements regarding cover

Brokers can support businesses in reviewing their workforce profile and sourcing policies that are aligned with their staffing model and industry risk level.

Managing Responsibility Across a Diverse Workforce

From self-employed subcontractors to apprentices and remote employees, a modern workforce can take many forms. Understanding how employers’ liability insurance could respond in each scenario is an important step toward meeting potential obligations and protecting the business from the financial impact of claims.