Court decision to reduce disease claims for employers and insurers-QBE

By a majority of three to two the Supreme Court overturned a Court of Appeal decision and backed an initial ruling that an employer is not liable for noise-induced hearing loss if it did not know the risk faced by its employees. “The decision is good news for employers and their insurers and not just because it reduces the number of potential noise-induced hearing loss claims,” said QBE in its Claims Press Briefing in May 2011. “The Court of Appeal’s interpretation of the Factories Act meant that an employer’s breach of statutory duty could be judged in the light of knowledge not available at the time and without consideration of reasonable foresight of injury and acceptable standards. The ruling had it not been overturned could have been used to support thousands of claims.”hideThe decision in the Baker v Quantum Clothing Group and Pretty Polly Ltd and Meridian Ltd case specifically referred to hearing loss caused by noise levels of 90 decibels or below for unprotected exposure occurring prior to January 1990. It exonerated the employer under both common law and statutory duty imposed by the Factories Act 1961. It did find that any employer with specific knowledge of any risk, such as previous complaints of hearing loss from staff or from published research of which it should have known, will be liable two years from when it discovered that information. The date of knowledge would be determined in each individual case and two years allowed to devise and implement a system of hearing protection, QBE explained. The decision effectively restores the original trial judge’s decision and overturns many of the Court of Appeal’s findings. The Court of Appeal had held that ‘safe’, as defined by the Factories Act, was absolute and should be judged objectively with no reference to whether the risk of injury was reasonably foreseeable. “On that basis the claimant’s employers were liable for any risk that gave rise to injuries whether it was foreseeable or not,” said QBE. The insurer has also welcomed the UK’s Ministry of Justice final guidance on the Bribery Act, which comes into force on 1 July of this year. The guidance was published in response to fears amongst industry and other organisations that the new act would extend liabilities and render certain normal business practices, such as corporate hospitality and facilitation payments, illegal. “The published guidance will no doubt come as a relief to many businesses…and interestingly the guidance refers to many organisations having little or no bribery risk especially if they operate primarily in the UK,” said QBE. Reaction to the guidance has generally been positive, but the legislation itself has not been changed and some experts are warning that the act will still extend the likelihood of prosecutions for bribery. QBE points to several of the main areas covered in the guidance as reason for a more positive attitude towards the new legislation. It welcomes, for example, confirmation that corporate hospitality is permitted by the act provided it is not simply a cover for bribery. “The giving of gifts, supplying of tickets for sporting events and taking clients to dinner are specifically referred to in the guidance as not being in breach of the act provided that the expenditure is proportionate and reasonable,” said QBE. The guidance also points out there is a full defence to any charges of bribery by a service provider if an organisation can show that it had adequate anti-bribery procedures in place, and that there is no requirement to put anti-bribery procedures in place if there is no foreseeable risk of bribery taking place.

Court decision to reduce disease claims for employers and insurers-QBE

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