Liability for Security Contractors

Ive taken this one from my Misedio website - courtesy WorkCover NSW.

Its a good reminder why principal contractors engaging security (or any sub-contrator actually) MUST ensure their subbies have adequate insurance coverage. If your sub-contractor has ineffecitive cover (ie no coverage at all) the principal contactor will be up for the bill (or their insurer will, if its covered in their policy).

$407000 fine for subcontrator employee fatality
In the NSW Industrial Relations Commission in 2005 a head security contractor, a company it had engaged as a sub contractor, and a director were issued fines totalling $407,000. The Workcover CEO said, “This judgement is a landmark decision, which has clarified that the place of work definition in the Occupational Health and Safety Act 2000 applies equally to principal contractors and sub-contractors.”

Of note, principal contractors often rely on invoicing as a way of controlling their contactors ongoing insured status. They demand that sub-contractors must submit a copy of their current insurance policy prior to issuing payment of an invoice (as principals know,under the security of payments legislation, this is in fact law). However, this system does not adequately cover the situation of insurance expiring immediately AFTER an invoice has been paid. You could potentially have an uninsurred contractor working for you, and not have this identified until the next invoice is recieved for payment.

Don't say I didn't warn you......

Steve
www.misedio.com

Links
Misedio website where article can be found:
http://www.misedio.com/Resources/CaseWatch/tabid/305/Default.aspx

Workcover website where article can be found:
http://www.workcover.nsw.gov.au/MediaResources/MediaReleases/2005/security_firms_fined_after_fatal_robbery.htm