Employment claim insurance - the pitfalls!

I have recently been approached by a number of clients who had signed up to an insurance backed employment scheme and now wish they hadn't. The idea is that for a reasonably large monthly premium payment (and often linked to a lengthy term) the client gets employment advice on the basis that assuming it is followed the insurer will pick up any successful unfair dismissal or other employee claim. The problem is that as these claims can be expensive the insurer will want to be as cautious as possible when dealing with a misbehaving employee. However most employers know that there will be occaisions when an employee is being so disruptive that whilst the grounds for dismissal may be less than 100% the benefits to the business merit taking the risk.Unfortunately if the insurer does not agree the employer can either be stuck with the employee or take the decision to dismiss and lose the benefit of the expensive insurance cover. It seems to me a better option to put some straightforward employment policies in place and take advice from a specialist lawyer if a difficult situation arises. If you then want to take a punt you can do so and I suspect that with many employers if they simply put a sum equivalent to the premium payments in a pot to pay any claim that may arise they would still make a profit! The trick is to have simple policies in place, follow them and take advice before rather than after you act. If you prefer this approach my colleague Marsha mrobinson@tolhurstfisher.com would be delighted to check you have the right polices and to support you in dealing with difficult employees.