Employers’ expertise essential on asbestos claims scheme

The Mesothelioma Bill currently being debated in the House of Commons is set to establish a mesothelioma payments scheme to resolve certain insurance disputes between victims, insurers and employers. It is the National Federation of Builders’ (NFB) view that this Bill should be comprehensive and ensure that mesothelioma victims’ claims are resolved quickly and fairly. However, for this to take place, the Bill must ensure that responsible employers are not locked out of insurance disputes and can assist in the swift resolution of these claims.

The construction industry as a whole has taken great steps over the past fifty years to ensure that workers are shielded from the harm caused by the inhalation of asbestos dust. Responsible employers are fully aware that mesothelioma is a devastating disease that is distressing for victims and families. A good employer will ensure that they have the appropriate health and safety safeguards and employer’s liability insurance in place.

Owing to the long-tailed nature of the disease, many employers, often small and medium-sized family companies, face historic claims against them for mesothelioma exposure from former employees dating back to the 1960s and 1970s. If successful, a claim of this type can average around £150,000, a potentially crippling amount for a small business.

While it is sometimes possible to trace employer’s liability insurance, it can often be extremely difficult to trace comprehensive levels of evidence because of the length of time elapsed. The nature of both the construction industry and the insurance industry means the result of mergers or changes to company structures is often increased difficulty in tracing detailed records. This can leave many cases open to dispute.

The Mesothelioma Bill, currently at committee stage in parliament, has provisions to establish a ‘technical committee' to decide on insurance disputes between potential claimants and insurers about whether an employer maintained employer's liability insurance. A notable absence from this committee is representation for the employer facing the potential claim. An employer's voice could offer expertise on the committee into how companies keep insurance records and how asbestos was used in the industry. It is worth remembering that these companies are ultimately the party that will have to pay out if sufficient evidence of insurance cannot be traced.

The NFB strongly feels that without the expertise of an employer’s voice in such committees, decisions reached in this forum will not accurately reflect the reality of cases where insurance exists but the evidence is not clear. This is why the NFB would also like the Bill to ensure that what constitutes acceptable levels of evidence is established to ensure greater clarity for all parties and avoid lengthy legal disputes.

Over the next five years mesothelioma cases are set to peak at around 2,500 per year in 2015/16, with the majority of claims from former construction workers. In a sector where 99% of businesses are SMEs, this will disproportionately affect small family firms that cannot afford excessive fees to defend complex and lengthy legal cases and will be forced to wind their business down. Owing to insolvencies and other untraceable companies, many firms facing claims are the 'last man standing', having to face the same claim alone for a worker that worked at their company for a few months over a potential exposure period of ten or twenty years rather than as one of several defendants.

The NFBis calling for MPs to back an amendment in parliament that will ensure that in disputed cases, employers are granted a fair hearing from the technical committee. We would also like the Department for Work and Pensions to ensure that acceptable levels of insurance evidence are established when the bill is passed into law.

The technical committee forms part of the wider government scheme that is expected to award £30 million a year in compensation to mesothelioma victims.

Julia Evans, Chief Executive, National Federation of Builders