Liability for others’ errors
Claims and Legal Services Director, Sarah Venus, explains
How can I be liable for other people’s errors?
As a healthcare professional you will be used to the idea that you can be held liable for a personal failure to use reasonable care and skill. You may be less aware of your exposure to liability for the failures of others. Such liability can arise in relation to the acts of your employees, partners and, in private medicine, those for whose acts you are contractually liable.
Of these, the most common source of liability in practice is vicarious liability – the employer’s liability for the negligent acts and omissions of an employee in the course of their employment. If you employ others, either directly or as a member of a partnership, you will be exposed to vicarious liability. You can, however, also be held liable for your partners’ errors: in law, partners are “jointly and severally liable” for each other’s acts.
In some circumstances you may also be liable for errors made by independent contractors through whom you provide services. Such liability could arise because the contractor is judged to be equivalent to an employee, or because you have inadequately checked their credentials or, in private medicine, as a result of your own contractual liability to the patient.
What does my individual MPS membership cover?
Your MPS membership is personal to you. It does not extend to indemnity for your liability for your staff in general, nor to liability for the acts of partners or independent contractors. Your subscription is set at a level that reflects your own “personal” risk. However, we will usually use our discretion to assist in the case of claims arising from the negligence of employees, such as admin staff and phlebotomists, who act only under your instruction (eg, as set out in a practice manual) and under your general supervision.
Where employed staff act independently, exercising their own professional skill and judgment, it is unlikely that your individual MPS membership will provide indemnity, either to you or them.
How can I protect myself?
Just as it is essential to ensure that everyone in your practice has the appropriate skills to carry out their duties, so it is equally essential to ensure that there is adequate and appropriate cover in place for potential liabilities. Checking this regularly is an important aspect of managing risk in your practice.
It is essential to make sure that all your partners have their own indemnity or insurance arrangements. You could make annual proof of the arrangements in place a requirement of your Partnership Agreement.
It is also in your interests to ensure that all clinically trained employees or independent contractors who have high levels of autonomy subscribe to their own indemnity or insurance scheme. This includes, by way of example (but the list is not exhaustive) locums, deputies, radiographers, nurses, audiologists, physiotherapists, counsellors, embryologists, pharmacists, midwives and laboratory scientists. It is not only that you may be held liable for their errors. They can be sued in their own right and so should arrange their own professional indemnity. Ensure that their employment or other contract requires them to have such indemnity and check regularly that it is in place and is adequate.
It is often possible to arrange additional protection through MPS. For example, MPS’s Practice Reward packages offer free indemnity for specified employees in GP practices. To find out more about MPS's Practice Reward Packages, click here. MPS can also offer individual membership to a wide range of health professionals.
What about legal structures such as limited companies/limited liability partnerships?
It is becoming increasingly common for doctors to work together not in a traditional unlimited partnership, but under a corporate legal structure. As a clinician working within a corporate entity you will be expected to have your own professional indemnity, but the corporate entity will be the employer or contracting agent. The corporate entity would be liable for the acts and omissions of staff and contractors.
With certain narrow exceptions, your individual MPS membership would not extend to cover liabilities of a company or LLP. The corporate entity should therefore have its own insurance in place to cover its own liabilities, including vicarious liabilities. Corporate insurance may in fact be a contractual requirement of contracts with PCTs or other NHS bodies.
MPS is not an insurance company and cannot provide corporate insurance. However, MPS has a wholly owned subsidiary company, MPS Risk Solutions Limited, which is an insurance company authorised and regulated by the Financial Services Authority and which specialises in addressing the corporate malpractice insurance needs of health professionals in business. MPS Risk Solutions Limited can provide insurance policies which cover the corporate’s own liabilities and the liabilities of its employed staff.
If you are not sure, ask
If you are unsure of what your MPS membership covers, MPS is here to help with support and advice. Please email member.help@mps.org.uk with any questions. For information about MPS policy on vicarious liability, click here. For more information about insurance offered by MPS Risk Solutions Limited telephone 0113 241 0395 or visit their website.
Checklist
- Do not assume that your staff are covered under your personal indemnity arrangements
- Ensure that those requiring it have their own indemnity arrangements in place
- Consider obtaining insurance for corporate liabilities
- Conduct regular reviews.