Employers Liability Insurance

[Wanderer]

This turned up quite recently. It doesn't only cover employees. If you have a valid RoS, you need ELI to cover any subbies you may bring in: without it you can argue that your RoS is a sham.

I can't speak for other contractors but when I engage subbies its on a B2B basis, not as an employee on PAYE or self employed so I don't legally need ELI. They only reason I get it (and this is the deciding factor) is when the client demands that I have it. If the client refuses to do business without it then you pretty much have to get it so the whole argument is a bit moot.

There are lots of references to back this up, reading SueEllen's link, someone is generally defined as your employee if:

• they are under a contract of service
• you deduct National Insurance contributions and income tax from the salary you pay them
• you control when, where and how they work
• they cannot employ a substitute when they are unable to work

None of this applies to my subcontractors, though of course other people may operate differently.

You can also read it direct from the HSE where they say:

You may not need employers’ liability insurance for people who work for you where:

• they do not work exclusively for you (for example, if they operate as an
• independent contractor);
• they supply most of the equipment and materials they need to do the job;
• they are clearly in business for their own personal beneit;
• they can employ a substitute when they are unable to do the work themselves;
• you do not deduct income tax or national insurance. However, even if someone
• is self-employed for tax purposes they may be classed as an employee for other
• reasons and you may still need employers’ liability insurance to cover them.

I'm making it all up. I know nothing about contractor legalities and only read the Beano.

I had you down as more of a Tellytubbie in la la land but there you go.

[malvolio]

I had you down as more of a Tellytubbie in la la land but there you go.

All very fine and Dandy (geddit) but...

I was talking about RoS. For that to work as an IR35 defence the subbie has to be paid through YourCo (net or gross) and they are doing your job for YourCo, not delivering some subsidiary service. On that basis, ELI is required.

[psychocandy]

Go check out QDOS. IF you don't have PI/PL already they do a very competitive bundle, or you can just go for the ELI, £10m as standard. £42+change. Just taken insurances out myself and they were the cheapest quote by a significant margin.

Vote for QDOS. I'm sure its under £20 a month for the full monty anyway.

[Waldorf]

I vote qdos as well, just get a combined package and then forget about it.

[psychocandy]

I was wondering this the other day when my insurance came up for renewal.

Previously, I paid for PI, PL, and EL through QDOS. Then I noticed, that, strictly speaking, I didnt need EL. However, it only saves £42 or something.

So I checked my contract and it said I needed adequate EL insurance which could be taken to mean, because I'm exempt then I dont need it so cover is adequate anyway.

But then again, malvolio has a point about subbies. And its only £42 so I'm just going to leave it alone.