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Labour plan to make directors personally liable if their companies fail to comply with tribunal orders.


The proposal

Labour’s Green Paper makes it clear that they want to introduce tougher penalties on directors if their organisation fails to comply with tribunal orders or if they break employment laws. Labour have provided very little detail beyond this headline but we can assume in the context of tribunal orders that directors will be personally liable for unpaid tribunal compensation.

Labour were also planning to scrap caps on compensation awards which would particularly affect awards for unfair dismissal (some awards such as discrimination and whistleblowing are already uncapped, for example). But, since publishing their ‘Plan to Make Work Pay’, this promise has disappeared.

Practical impact

Without further detail, it’s difficult to know the potential impact of this proposal, but as a starting point, it would be prudent to review your current Directors’ and Officers’ liability insurance to see whether it covers tribunal awards. If it doesn’t, you’ll want to find an insurance solution that does.


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This update is accurate on the date it was published but may be subject to change which may or may not be notified to you. This update is not to be taken as advice and you should seek advice if anything contained within affects you or your business.