How does Employee Status Affect Employer’s Liability Cover?

Employee Status Title Image

As an owner or manager, you have a clear obligation and responsibility to provide your employees with a safe working environment. If you fail to do so, it could result in a current or even former employee filing a claim against you. A successful claim against you can be costly not just financially but also to your organisation’s reputation.

To protect yourself and comply with government regulations, you need employer’s liability (EL) insurance, which covers the cost of compensating employees that have been injured or fallen ill at work.

Even if you only have one employee, you still need EL cover

However, in addition to employees, you may have volunteers, seasonal employees, contractors or other types of non-standard staff that work for your organisation. Correctly classifying your employees especially non-standard ones is crucial when estimating the level of EL cover you need. To help you avoid a costly employee misclassification mistake, review the guidance in our Risk Insight.

What is EL insurance?

Under the Employer’s Liability (Compulsory Insurance) Act (the Act), all organisations, with few exceptions, are legally required to have EL insurance if they employ full or part-time employees.


If you would like to know more about EL insurance contact your broker or download our Risk Insight.

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