Accident at Work Insurance Does Not Make the Working Environment Safer
The Ministry of Social Affairs asked for an opinion for the intent to develop the accident at work insurance. The intent aims at establishing a system for indemnifying accidents at work, which would be based on private insurance and where the employer would be obliged to insure a person employed under an employment contract against accidents at work. In the Chamber’s opinion, the state wants to place a part of their responsibilities on employers and does not support the planned changes.
The change does not increase the employers’ motivation to contribute more to the working environment
A potential problem lies in the situation where the insurer does not take into account the contribution of the specific company into the working environment, and instead relies on the sector average and such situation has a negative impact on contributing to the working environment. Furthermore, the companies who at the moment fail to follow the occupational safety requirements, might not do that even with the mandatory insurance. For example, such companies may conclude a contract under the law of obligations with their employees and thus avoid paying accident at work insurance payments.
Increasing expenses force to think creatively
Today, the state and employers spend ca 10 million euros on compensating costs related to accidents at work. The Ministry of Finance estimates that the total cost of accident at work insurance, which would be based on private insurance would be 31 million euros in 2019.
The amendment would increase expenses per employee working based on employment contract. This may motivate employers to use more of the contracts under the law of obligations (e.g. authorisation agreement, contract for services). As a result, the protection of the people who work may be reduced. Furthermore, the risk that employers start giving preference to the employees who are more careful and are less likely to end up in an accident at work. In this manner, the mandatory insurance may reduce the motivation of employers to employ or keep at work employees who are in a more advanced age.
One of the aims of establishing the mandatory accident at work insurance is to ensure a simpler and quicker compensation of costs that have occurred because of an accident at work, but there may be disputes also in case of private insurance. For example, disputes may arise in relation to whether the damage to an employee’s health was related to work or not. Secondly, the disputes may arise in a situation where an employee works remotely, and the work time is flexible. For example, it is not clear then if the damage to health occurred during work or not and if the accident at work occurred outside the workplace.
Employees should be motivated to follow occupational safety
The Chamber finds that employees play an important role in improving the working environment and preventing accidents at work. Following the requirements for occupational safety and notifying of deficiencies should be a part of the priorities of all employees. Establishing a mandatory insurance does not increase the motivation of employees to be more careful when performing one’s duties. On the contrary, it may increase the risk of intentionally causing an accident at work in order to obtain indemnity from the insurance.
Chamber’s proposals
The Chamber finds that indemnifying expenses related to accidents at work should still be done via the solidary social insurance system where employers contribute by paying the social tax. Instead of the mandatory insurance, the state could increase supervision over the performance of the occupational safety requirements and do it on the basis of risk. Furthermore, the state should advise employers as well as employees on the topic of working environment in order to increase general awareness. Furthermore, the state could exempt from the fringe benefit tax the insurance payments of employers made for insuring their employees against accidents at work.