BPA Requirements

Discussion in 'Professional Fireworks' started by Sonic Fireworks, Nov 16, 2017.

  1. Arthur

    Arthur Pro Firer/Crew

    "Freelance" means only "takes work from several work providers". Employment and tax and insurance status is something quite separate.
  2. https://www.policybee.co.uk/blog/10602/do-i-need-employers-liability-insurance-for-freelancers/

    Big questions

    It’s time to tackle a question we get asked a lot: if I work with freelancers, do I need employers’ liability insurance?

    And it’s a good question. But let’s start with a little context.

    What is employers’ liability insurance?

    If a member of staff is ill or injured and it’s happened because they work for you, employers’ liability insurance compensates them for any pain and suffering. It covers the legal costs of dealing with a claim against you, too.

    If you have employees, employers’ liability insurance is a legal requirement. The Health and Safety Executive can dish out a £2,500 fine for each day you’re without cover. That’s on top of the £1,000 fine for not displaying a valid certificate. Ouch.

    But what about freelancers?

    According to the HSE’s definition, an ’employee’ is someone whose National Insurance and income tax is arranged by their employer.

    Using this definition, a freelancer isn’t technically your ’employee’. If your business works with freelancers, but you have no other employees, employers’ liability insurance isn’t a legal requirement, and the HSE can’t fine you for not having it.

    So I don’t need it then?

    There’s a little more to it than that.

    If you never see the freelancers you work with (because you only work with them ‘virtually’), you don’t need employers’ liability insurance. That’s because you’re not in control of their working environment. You can’t be responsible if they get a work-related illness or injury.

    It’s different, however, if freelancers work at your place and use your equipment, and if you’re in control of what they do. In these situations, you’re responsible for their health and wellbeing while they’re at work.

    That means you’re potentially liable if one of them comes a cropper. Without employers’ liability insurance, you’ll have to pay for any damages/compensation yourself.

    A little extra help

    If you’re still not sure you need it, try this straight-from-the-horse’s-mouth guidance.

    Our own employers’ liability insurer uses the following definition of ’employee’:

    Any person working for you in connection with your business who is:

    • Employed by you by a contract of service or apprenticeship
    • Hired to or borrowed by you
    • Self-employed and working on a labour only basis under your control or supervision
    • Engaged by labour only subcontractors
    • A labour master or person supplied by him
    • Engaged under a work experience or training scheme
    • A voluntary helper
    If any of these sound familiar, you should consider getting employers’ liability insurance.
  3. Arthur

    Arthur Pro Firer/Crew

    "Would this person sue me if they were hurt?" should be one guide to the need for employer's liability insurance. If a "helper" or approved visitor to the site became injured (to a permanent life changing extent?) who will pay them for lifetime care. There is apparently already a motor insurance case where "lifetime full time care for a youth in near vegetative state" has been valued at about £22 million.
    Sonic Fireworks likes this.
  4. gareth71

    gareth71 Pro Firer/Crew

    Screen grab from BPA website ...
    Screen Shot 2017-11-18 at 20.36.13.png

    I am an experienced, trained, qualified (BPA) firer. Several display companies use my services. I provide my own transport, tools and PPE, but use the display company's firing equipment and materials. If I am not the senior firer on a display, I work under the direction of that day's senior ; however, if I am the senior firer, I have the autonomy to make decisions on site and act on them as I see fit. I am paid against an invoice, without any deductions at source. My accountant prepares a self-assessment tax return each year, and I pay income tax on my operating profits (income less expenses) along with my own National Insurance. Am I an employee or a freelance contractor?
    Last edited: Nov 18, 2017
    Sonic Fireworks likes this.
  5. Skydazzle Pyrotechnics

    Skydazzle Pyrotechnics Pro Firer/Crew

    Do you carry your own Public Liability Insurance if you consider yourself a contractor??
  6. gareth71

    gareth71 Pro Firer/Crew

    Not for pyro, no - my main work is in theatre and events. Would be interested to know which brokers or insurers are used by others in my position (rather than those operating as stand-alone display companies) who do have their own PLI policy which covers fireworks.
  7. Skydazzle Pyrotechnics

    Skydazzle Pyrotechnics Pro Firer/Crew

    If a Display Company is using you as a sub contractor, which if you are invoicing for your work, sounds like they are, then you are liable for any incidents that you are involved with on site. As a senior firer on a site you are on some serious dodgy ground in my opinion should an incident occur.

    This has been discussed before at length and nobody takes any notice...........so I don't expect they will now!

    Maybe we should all remember the hell that Geoff from Firestorm went through, without his Insurance Company defending him and proving his innocence who knows what might have been the result...........do Firers and Display Company owners really want to take that risk????
    Sonic Fireworks likes this.
  8. gareth71

    gareth71 Pro Firer/Crew

    So which PLI product would you (or others) recommend for a freelance firer?
  9. Pyro Productions

    Pyro Productions Pro Firer/Crew

    I took some advice on this back when we started. We setup as a Ltd and were told at the time that as directors with less than 50% share of the business we ourselves were classed as employees, how and what we got paid or not has nothing to do with it. So we needed ELI from the start.
    Sonic Fireworks likes this.
  10. Andy Pittam

    Andy Pittam Pro Firer/Crew

    Chris, im not 100% sure that is entirely correct in your case as your co-director is/was your brother (think thats right?) and my understanding of the law is that for a Ltd company, family members can be excluded from employee status for the benefit of requiring ELI or not???
  11. Skydazzle Pyrotechnics

    Skydazzle Pyrotechnics Pro Firer/Crew

    I have no idea..........I would suggest talking to one of the Insurance Companies that provide to the industry. I don't see any advantages being a sub contractor to a Display Company?
  12. Skydazzle Pyrotechnics

    Skydazzle Pyrotechnics Pro Firer/Crew

    I just spent an hour of my Sunday morning trawling through my PLI documents and found this:

    If you read it and extract from the legal babble, it is saying you need PLI of the same value as the company, which is usually £5 or £10million and ELI for anyone you bring on site.

    However, my Policy also states this in the definitions:

    I think the definition of what a Bona Fide Subcontractor is and when it becomes necessary to have PLI needs clearing up. :(
    Last edited: Nov 19, 2017
    gareth71 and Jon like this.
  13. Arthur

    Arthur Pro Firer/Crew

    There is (was?) an example on HSE's www of liability and responsibility sitting with each and every self employed person on a work place for what they do, including for every person for whom they issue instruction.

    Formally employing everyone makes a company's position perfectly clear and means that the directors (should) know what is insured and what is not.
    Sending out a show with a lead firer who is casual and paid cash definitely means that the company insurers will have wriggle room, maybe leaves the lead firer with big financial responsibilities.

    Yes, in conversation with one firework insurer they mentioned "insurance for casual firers". Insurance that a casual firer could buy to cover themselves against claims when doing shows for a company. BUT the problem was cost, insuring someone who might do (then) five shows a year at £50, didn't leave any money for insurance.
  14. Skydazzle Pyrotechnics

    Skydazzle Pyrotechnics Pro Firer/Crew

    Total twaddle...........!! This is a serious debate and it is not helped by this type of nonsense.:mad:
  15. Pyro Productions

    Pyro Productions Pro Firer/Crew

    Like I said, we took advice and that was the advice that was given to us at that time. ELI is included along with our other insurance so in our instance it was a no brainer. But of course, you could be totally right. I'm not going to detail the exact nature of our business, but neither brother has a 50% stake. And it was this that seemed to tip the advice.

    We were also advised that if you are paying someone (what ever the tax setup) and you have control of their work (ie you are onsite with them or have given them a task to do like fire or crew on a show) then they are classed as an employee. Tax status has nothing to do with it. That is the advice we were given and we have set up our insurance on the basis we need to cover anyone that is working with or for us.

    I persoanlly have a totally separate policy that covers me while working professional for photography/videography work on a PLI policy.
    Sonic Fireworks, Andy Pittam and Jon like this.
  16. Jon

    Jon Pro Firer/Crew

    I think this is a live events issue really not just fireworks, loads of self employed people working with loads of companies with no clear guidance on insurance. Some trade bodies will offer insurance and advise, like BECTU but as an individual you need to be sure that you have the right insurance and the right amount.
    gareth71 likes this.
  17. Arthur

    Arthur Pro Firer/Crew

    Snipped from Skydazzle's attachments posted above;

    It is a condition of this Policy that all bona fide subcontractors engaged by the Insured have ...

    1 Employers Liability insurance ...

    2 Public/Products Liability insurance...

    Therefore, if a worker is a subcontractor they need full fireworks insurance, for a worker not to be a subcontractor they need to be properly paperworked employees.
    Sonic Fireworks likes this.
  18. Sonic Fireworks

    Sonic Fireworks Pro Firer/Crew

    This is great to see such a debate happening, this is where our trade body should be able to step in with clear guidance.

    Just more info to present to the BPA.

    I think it will be an interesting meeting.

    Firework Crazy and Pyro Ed like this.
  19. gareth71

    gareth71 Pro Firer/Crew

    I think that clears it up quite nicely, to be honest - at least, on the basis of my interpretation of the wording (which, I have to say, is remarkably clear considering it's extracted from paperwork relating to an insurance policy!).

    "Bona Fide Subcontractors Condition" - essentially, if you have a display booking come in which you can't accommodate, and you subcontract the whole shooting match out to another contractor, this is what's encompassed by this section. That is to say, if I had my own hardware, firing system and licensed storage, and you were to pass a display booking on to me to look after 'under my own steam', I would be a subcontractor. Which is fine, because if I had licensed storage I'd also have year-round insurance.

    "Person(s) Employed means any ... (iii) labour only sub-contractors, or (iv) self employed person working for and under your control" - both of these definitions would place me very definitely under the heading of a Person Employed for the purposes of cover by your PLI. So if you ask me to come and crew on one of your shows, as regular crew or a show leader, using your equipment and materials and under the blanket of your risk assessment and method statements, I'm a labour-only subcontractor and therefore covered by your PLI as a 'person employed' (even though it's on a self-employed basis).

    No grey area there at all, as I read it.
    Last edited: Nov 19, 2017
    argentc, Firework Crazy and Pyro Ed like this.
  20. gareth71

    gareth71 Pro Firer/Crew

    No, that's not correct in the context of what Skydazzle posted. Read the whole thing - labour-only subcontractors are classed as 'persons employed'. My interpretation of what you selectively quoted is that a subcontractor in that sense is someone who is subcontracted to provide a display in its entirety, in the same sense that an electrical installation company would be subcontracted to a construction company during the fit-out of a new building.