Employers may face new compensation bill for victims of work-related violence
Employers may end the year having to pay compensation to workers that is currently paid by the government under the Criminal Injuries Compensation Scheme.
The proposal is contained in a Home Office consultation document that aims both to cut the cost of the scheme (CICS) and improve services to victims of crime1. The Home Office proposes switching responsibility for CICS payouts from the state to employers where their employees:
Other proposed reforms that will have a financial impact on employers are set out in box 1. Home Secretary David Blunkett stresses that he wants compensation "to come from the most appropriate sources". The proposals, he says, "look to the perpetrators as well as the state. We believe that a payment towards victims from offenders should form an important part of their reparation."
The Home Office's cost-benefit appraisal of its proposals notes that the availability of the CICS may mean that employers currently have a "limited incentive" to mitigate the risk of criminal injury sustained during the course of duty. The CICS, it says, could be "effectively . . .reducing the cost to employers of hiring workers into jobs with an elevated crime risk, thereby lessening the incentives to reduce the risk".
The Home Office does not present any evidence to support this; nor does it know how much its proposals will cost employers, although it insists that they will not affect employer competitiveness.
Consultation on the proposals, which build on a 2003 paper2, ends on 29 March. The government hopes to enact the changes by summer 2004 through the Domestic Violence, Crime and Victims Bill. It expects the measures to raise £25 million that will go into a new Victims' Fund (see box 2).
Public sector conundrum
In 2002/03, 3,200 awards totalling £11.6 million were made under the CICS to victims who sustained injuries at work or on duty. Just two years earlier, the figure was £6.6 million, and the government expects the increase to continue. Most payments were made to public sector workers in the:
There is no separate data for private sector workers; the Home Office believes that they account for a small proportion of the payments, although sectors such as private security and hospitality may be disproportionately affected. The proposals are in any case restricted to companies with 250 or more workers because of the disproportionate costs it would otherwise place on small enterprises.
Although the proposal to transfer responsibility for CICS payments to employers is likely to hit the public sector hardest, the Home Office also says it "will wish to ensure that the local authority sector is appropriately compensated in keeping with the new burdens principle". It does not, however, suggest how it might square this circle.
Removing "anomalies"
The Home Office wants to remove two "anomalies" from the scheme. The first is that the scheme does not compensate people who are injured accidentally in dealing with a crime, unless they were taking an exceptional risk. This accounts for around 500 payments totalling £1.8 million a year, mainly to police officers.
Secondly, since 1990 the CICS has compensated railway workers who have suffered trauma from seeing people commit suicide by jumping in front of a train or in dealing with the immediate aftermath. This accounts, on average, for 150 payments totalling £0.5 million a year. But, says the Home Office, this is an anomaly; other groups of workers, such as bus workers, who witness a suicide, are not covered by the scheme. Nor are these railway workers victims of "violence" in the traditional sense of the word.
In both cases, the Home Office wants to look at alternative ways of compensating the workers and removing them from the scheme. The document does not consider "equalising up" an option, ie by bringing previously excluded groups into the CICS.
Equivalent, effective and efficient?
The Home Office is less certain about the mechanism for transferring the responsibility for payment to the employer. One option is that the CICS continues to compensate the victim and then claims the payment back from their employer.
Alternatively, employers might be required to make their own arrangements: the Home Office notes that while some schemes already have a degree of cover, it is rare that this extends to mental anxiety and trauma. Nevertheless, it "would like to examine the opportunities to build on existing workplace schemes and arrangements to compensate those who are injured in other circumstances".
The Home Office is adamant that workers will "receive equivalent compensation to that which they would receive through the scheme", albeit "more effectively and efficiently". But the TUC has requested an urgent meeting with the government. General secretary Brendan Barber insists that: "Any improvement to support for victims of crime is welcome. But the TUC is concerned about any moves to treat differently people who suffer injury due to crimes at work."
1 "Compensation and support for victims of crime", 12 January 2004, www.homeoffice.gov.uk/inside/consults/current/index.html. Responses to Mike Carso, tel: 020 7273 2276, email: Michael.carson4@homeoffice.gsi.gov.uk.
2 "National strategy for victims and witnesses", www.cjsonline.org.
