Do you ask staff to waive latent personal injury claims in your settlement agreements?

Earlier this month, the UK parliament discussed proposals to manage asbestos in workplaces and to introduce measures to protect the public from being exposed to it. It can be present in any building built or refurbished before 2000, and the scale of the problem is huge. Our report found that around 87,000 public buildings contain asbestos.  

During that debate, one MP indicated that, in the education sector, teachers and lecturers had been asked to sign non-disclosure agreements (NDA) preventing them from discussing asbestos in their workplaces. Another MP told parliament that she was asked to sign an NDA after she took early retirement from teaching in an FE college which, expressly stated, that she agreed to waive all of her rights to compensation in the event that she developed asbestosis. 

The Parliamentary Under-Secretary for Work and Pensions said this in relation to the use of NDAs: "I have been appalled this afternoon to hear about the issues affecting teachers. This is a matter for the Department for Education, but I will ask my officials to raise it with the DFE so that a response can be provided".

It's therefore likely that the education sector will be put under the spotlight and challenged if they attempt to waive personal injury claims that are dormant at the time an employee signs a settlement agreement. 

Asbestos related diseases

Asbestos exposure is the single greatest cause of work-related deaths in the UK, with the HSE estimating that more than 5,000 people die from asbestos-related cancers every year. More than half of those deaths are from mesothelioma, a type of cancer that can occur on the lining of the lung or the lining surrounding the lower digestive tract. According to the HSE, the UK has the highest rate of mesothelioma deaths per capita in the world.

Settling personal injury claims via a settlement agreement

It's perfectly okay to include personal injury claims in the list of claims an employee agrees to waive in a settlement agreement. It's usual, for example, to include physical (or more likely) psychiatric injury where an employee alleges discrimination. Employers will also want to include stress-related claims that arise from the employee's employment.

But, it's not reasonable for an employer to try and settle any free-standing personal injury claim which the employee doesn't know they have. In the context of asbestos, mesothelioma is not typically detected in the early stages of the disease, as it has a long latency period of 15 to 45 years, with some prolonged cases of 60 years before symptoms show.  

It is, however, reasonable for employers to ask employees to agree that they are not aware that they have any conditions which would give rise to a personal injury claim at the time they enter into the settlement agreement. This is included to ensure that the employee does, in fact, disclose any conditions they know or suspect they may have.

Challenging NDAs that waive latent personal injury claims

Generally, provided an employee has had the terms of a settlement agreement explained to them by a solicitor (or other suitable person), and it meets all of the other legal conditions necessary, they will be bound by its terms.  

However, there are some circumstances where an employee, who had agreed to waive future personal injury claims, will still be able to sue their employer. For example, they could argue that their waiver is void under the Unfair Contract Terms Act 1977 and/or section 1(3) of Law Reform (Personal Injuries) Act 1948. For that reason, those advising the employee will usually require ‘any latent free standing personal injury claim’ to be excluded from the list of settled claims. Most employers usually include this type of wording in their settlement agreements. 

We can help

We regularly prepare settlement agreements for schools and colleges and advise individuals on their terms and effect. Please contact Jenny Arrowsmith if you'd like us to review your standard precedents or need specific advice about settling a claim/s.

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