Brexit: What next for the personal injury industry?

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8 July 2016

Posted by Michael Jefferies, managing director of Legal Futures Associate Jefferies Solicitors

Jeffries: small claims reform may move down the agenda

Jefferies: small claims reform may move down the agenda

The UK’s unexpected vote to leave the European Union is still fresh in our minds, as speculation grows about the next steps for the country. While we don’t yet know specifics about the effects on the legal industry following the referendum, we can assume that certain changes will follow in the personal injury sector.

A historic chapter

Many of our laws stem from Europe. With some claiming that as much as 70% of UK laws are linked in some way to European regulations or directives, the removal of EU legislation could remove an extra layer in processes but there is a worry that the UK’s legal system could be set back to where we were some years ago.

Much European law has a direct effect in the UK, so there is no need for an Act of Parliament in order for the legislation to be effective here. If directly effective EU-wide legislation built up over many years is removed in its entirety, it will leave large gaps in the legal system, which may take a long time to fill.

There are a number of EU regulations in place that have a direct effect on personal injury claims. These include laws related to accidents abroad, safety in the workplace and consumer protection. Since deciding to leave the EU, this legislation could be amended or scrapped completely, making it much harder for people to pursue a personal injury claim.

Accidents in the workplace

For the many EU regulations in force that protect individuals in the workplace, perhaps the most significant of these is the 1974 Health and Safety at Work Act, which ensures that workplaces in the UK and across the European Union meet minimum health and safety requirements.

In 1992, six other important regulations stemmed from this Act, which go a step further in keeping people safe at work. These include the Provision and Use of Work Equipment Regulations, which make sure that appropriate protective equipment is supplied by employers where appropriate, and the Workplace (Health, Safety and Welfare) Regulations 1992, which place a duty on employers to ensure that the workplace does not present risks to employees that could result in an accident.

Since they were first introduced, these laws have significantly improved health and safety standards in the workplace, which could now be at risk with Brexit. British workers may no longer be able to benefit from future similar EU directives and regulations.

Flight claims

Claiming compensation for flight cancellations and delays has been gaining ground in the UK following recent rulings under EU law. Airlines are now obliged to pay compensation for disrupted flights due to technical faults.

Under European Regulation 261/2004, passengers can currently claim up to €600, but since the vote to Brexit, there will be more urgency placed on making claims before any changes come in – we could see a rise in claims here before an official exit.

The Civil Aviation Authority has already confirmed that there won’t be an immediate change, and is planning on working closely with the Department of Transport to ensure a smooth transition. Potentially the UK would need to put in place its own flight delay legislation.

Accidents abroad

Presently, European Union directives exist to protect road traffic accident victims who have been injured by the actions of uninsured or untraced drivers while on holiday in Europe.

Following our departure from the EU, those wishing to claim for their injuries following an accident may no longer be able to benefit from these laws or from other EU motor insurance directives which allow individuals to pursue their claim in the UK.

Small claims limit

Following the proposals in the Chancellor’s last Autumn Statement that the small claims limit could rise from £1,000 to £5,000, and that injured victims of road traffic accidents would no longer be able to claim for whiplash, the legal industry has been waiting to see what might happen. However, with such significant changes taking place after Brexit, it’s likely that this will be pushed further down the agenda.

While politicians and commentators can speculate on what will happen following Brexit, it is impossible to be certain of the implications, as they would depend largely on what replaced Britain’s membership of the EU.

Potential changes to current EU laws will reflect both political and economic forces, out of the control of innocent accident victims. It is these individuals who will find it more difficult to recover damages for their pain and suffering if key legislation is amended or abolished.

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