Defamation liability

Defamation (also called vilification, slander, and libel) is the communication of a statement that makes a false claim, expressively stated or implied to be factual, that may harm the reputation of an individual, business or product. Most jurisdictions allow legal actions, civil and/or criminal, to deter various kinds of defamation and retaliate against groundless criticism.

Defamation liability protects against infringement of trademarks, copyright, registered designs and plagiarism – along with unintentional defamation including negligent advice, mistake or misprint contained in a business publication

Professional Indemnity

Professionals and professional service firms perform in an environment of increased responsibility and accountability in New Zealand.  With litigation becoming an increasingly common means of settling disputes, professionals are being held more culpable for their advice and actions and any losses suffered as a consequence.

Builders and tradesmen, seen by clients as experts, particularly fall into the grey area of being “professional” – often draughting plans and specifications for small projects, inspecting homes pre-purchase, advising on application etc.

Very few, other than those companies which specialise in “design & build”, take Professional Indemnity cover, and they are inadequately covered under their Public Liability insurance policies.

Employers Liability

(This New Zealand terminology must not to be confused with similarly named global products and is sometimes referred to as ACC Shortfall):
 The Policy

The Employers Liability policy provides protection to employers for:

• Settlements or damages payable (including exemplary damages) in respect of claims for personal injury to employees suffered in the course of their employment and not covered by Accident Compensation.
• The costs incurred in defending or settling these claims, including any prosecution, inquiry or investigation.
• The costs incurred in defending allegations of a breach of the Health and Safety in Employment Act 1992.
• Reparation awards made by a Court following a prosecution under the Health and Safety in Employment Act 1992 and amendments.

Common Law Exposures for Employers

• Mental anguish, in the absence of physical injury
• Food poisoning
• Injury caused by a gradual process; (disease or infection caused by passive smoking, and air conditioning systems for example).
• Heart attack or stroke caused by stress.
• Nervous shock or fright.
• Stress and/or fatigue.

Health and Safety in the Workplace

The Health and Safety in Employment Act (1992) is now more than a decade old and during this period a significant number of employers and businesses have had experience in dealing with the Occupational Safety and Health Service in relation to workplace accidents.

Legal costs and ultimately fines have been the result for many and with the introduction of the Health and Safety in Employment Amendment Act in May 2003 the cost to business for a breach of the legislation is likely to increase significantly.

Among the changes introduced in May 2003 were:

Employment Disputes

(This is New Zealand terminology and is also called Employment Matters and might be better called Employment Issues):

The Policy

Employment Dispute insurance provides protection to employers for personal grievance actions taken by employees and prospective employees as a result of unjustified dismissal, discrimination or other disadvantage.

Coverage is provided for:

• Compensation for intangible loss, such as humiliation or loss of future prospects of employment (but not remuneration).
• Compensation for most breaches of an employment contract, and also certain breaches of the Privacy Act 1993 and Human Rights Act 1993
• The costs incurred in defending injunctions or orders restraining employers from initiating dismissal or other disciplinary procedures.
• Defence costs, fines and penalties arising out of breach of certain compliance provisions of the Employment Relations Act 2000.

A Challenging Environment for Employers

Recent History has seen a number of changes in employment law which have and will continue to challenge even the most careful employers.

The Employment Relations Act 2000 has provided the opportunity for unions to monopolise the collective agreement negotiating process and regain their right of access to employers.

Faulty Workmanship Extension

Public Liability policies, (including the Builtin Public Liability policy) exclude claims for Faulty Workmanship but do include resultant damage.

This extension deletes the usual Exclusion under the Public Liability insurance cover to properly protect you.

Statutory Liability

• Defence costs associated with alleged breaches of the Building Act, Consumer Guarantees Act, Fair Trading Act, Privacy Act and most other statutes affecting commercial activities. The notable exceptions are police prosecutions and taxation legislation.
• The costs of representation at an investigation or inquiry.
• Any fine or cash penalty payable by the insured following conviction for an offence under the insured statutes, except under the Health & Safety in Employment Act.

Under much of the legislation particularly the Building Act, Health and Safety in Employment Act, Commerce and Fair Trading Acts the result of an adverse judgement can be disastrous both financially and in terms of reputation, Maximum penalties are substantial and the cost of defence can easily exceed the fine itself.

Most recently the introduction of the Health and Safety in Employment Amendment Act has created a number of new areas of exposure for businesses, an even more stringent compliance regime for workplace safety and with it harsher penalties.