The Government’s attempts to end the compensation culture by cutting the fees lawyers can charge for processing minor injury claims has had an immediate effect. Claims are down, allowing the insurance industry to reduce premiums. But this shift in attitude should not encourage retailers to relax attitudes towards health & safety compliance and claims management. Whilst the less robust claims may diminish, poor processes and culture can still result in a significant number of valid claims.
And with just the bare minimum information recorded when an incident occurs – and that often in an unstructured and non-centralised manner– the vast majority of retailers have no insight into trends in activity; no way of ensuring appropriate steps are taken to prevent recurrence; and limited opportunities to counter a claim that may not even be registered for several years.
Effective claims management enables retailers to effectively manage incidents, identify and respond to potential claims in a bid to drive down legal costs and, critically, prevent recurrence to create a safer and healthier environment for both staff and customers.
There is no doubt that over the past decade the UK has followed the US and adopted a blame culture: if an accident occurs these days, most people seem to be looking not just for someone to blame but also some form of recompense.
As John Norfolk, Head of Risk at Ocado was recently quoted as saying, in society generally there appears to be an increasing feeling of dissatisfaction and disaffection. He said: “When people feel downbeat they are more inclined to hold others responsible for accidents. The recession has certainly resulted in an increased likelihood of people making claims – both valid and not so valid.”
In an effort to end the compensation culture, ministers have curbed the attractions of “no-win, no-fee” or conditional fee agreements. The costs regime that kicked in from last April means that claimants striking “no win no fee deals” can no longer recover the extra fees that they must pay their lawyers or their legal insurance premiums from the losing side.
The result is that claims are plummeting – a fact that has enabled the insurance market to drop car premiums by an average 10% this year. However, for any retailer, the management of claims is still an issue – due, in the main, to the poor recording of accidents and incidents across the business.
The vast majority rely on either paper-based recording in store, unstructured methods such as spread sheets or use of a third party service that restricts the scope of information the retailer needs to identify specific to their organisation.
None of these offer the depth of information recording required to contest an unjustified claim. Nor do they provide staff with a clear pathway through the processes required to manage these incidents effectively.
And this is key. Retailers deliver excellent health and safety training to staff and provide in depth documentation. But this complex, detailed information cannot be retained by all individuals. It is therefore important to provide a way of guiding staff through the steps to ensure all the critical information is recorded and appropriate steps taken.
What was the nature of the incident? Where did it occur? What was the injury? Was medical attention required or provided? Did the accident require hospital treatment? If a piece of equipment was involved, was that equipment shut down? Was it inspected by a qualified engineer?
It is also essential to ensure the information is recorded and stored for the required duration. The Limitations Act 1980 states that personal injury claims must be brought within three years of the date of injury. However, the limitation period does not effectively start until the claimant reaches the age of 18 – therefore if an injury occurs to a child of 13, the retailer needs to retain information regarding that accident for at least eight years. A claims management system will automatically ensure the records are retained until the limitation period has ended.
Combining a simple way of prompting individuals to record in depth information with a workflow process that ensures all the key steps are taken, fundamentally changes the way retailers manage and respond to workplace incidents. Retailers have in-depth insight into trends in accidents, both within individual stores, the entire store estate, as well as warehouses and offices.
This enables the business to rapidly identify and address problem areas that are affecting both staff and customers. Highlighting issues with specific pieces of equipment, for example, or incidents that may indicate a need for additional staff training can enable proactive change to prevent these accidents occurring in the future.
In addition, with a clear view of every incident that has occurred, the retailer can begin to assess whether or not claims are likely to be made and take a proactive approach to resolving those claims without incurring additional legal fees. By ensuring that staff are prompted to record in depth information and take the appropriate steps in the event of an incident, the retailer is extremely well placed to respond to any solicitor’s claim for recompense, minimising the legal costs and negating claimants who might be overstating their case.
Over the past decade, the corporate attitudes to health and safety have changed. Organisations now have proactive Corporate Social Responsibility policies designed to create a safer environment for employees and customers alike.
By capturing the right, in depth information up front a retailer can react quickly to minimise the chance of further incidents; predict which injuries incidents are likely to result in a claim; and ensure early and appropriate investigation to either accept liability early or refute the claim early. The result is fewer incidents, reduced legal fees and continuing safeguard of brand and reputation.