Do you own commercial property that your tenant uses as a workplace? If so, you should be aware that it is possible for you to be held liable for workplace accidents. Here’s what you need to know about liability, and what you can do to minimise your exposure as a commercial property owner. While there is no guarantee that following these guidelines will prevent a claim being brought in the future, these tips can help you lower your risk and potentially help absolve you of blame.
If a tenant who leases your commercial property plans on using it as a workspace, consider adding a clause to the contract stating that they must obtain (and keep up) their own public liability and workers compensation insurance. It’s best to have a lawyer well-versed in commercial property leasing at your disposal in this situation, to review your contract and make sure the language is clear.
This helps put any responsibility for one of their employees (or a member of the public) being injured on property you own squarely on their shoulders. It alone is not a guarantee that you will not be subject to a claim for a workplace accident. However, the contract being in order and the tenant carrying their own full insurance cover can help if a claim were to be filed.
Since you are not the employer, you don’t need workers compensation insurance on a commercial property you lease out to a tenant, but public liability insurance is a must. If an accident occurs and it could be proven you had supplied an unsafe property to the tenant, it could be posited that you had failed in your duty of care. You do have a responsibility to provide a safe environment for your tenant and anyone they may bring onto the property.
If someone is injured on the property and doesn’t think they are being sufficiently recompensed by their employer, they could view you as a target with deeper pockets. Alternately, an employer being sued over a workplace injury might try to point blame at you. It’s best to be prepared to defend yourself, and insurance coverage can help protect you in case of a judgment. It’s not fun to think about ending up being blamed for an accident on your property, but being insured can take some of the sting out if it does happen.
The best way to protect yourself is to carefully check all aspects of the property for safety before leasing it out, and to have full photographic and video records of the entire property for your records. That way, if a tenant makes changes in the property that could be dangerous, you’ll have proof you handed over the keys in good faith (and with the property in good order). Documenting everything and supplying copies to your tenant can help make it clear that you are looking out for your interests.
If the tenant installs an entry floor that could become slippery in case of rain, or changes fittings for gas or electric that could pose a hazard, it will be obvious that the alterations were made by the tenant post-lease. This can also help protect you against a claim of liability. Any claim brought due to changes they made could be quickly dealt with if you have proof you are not to blame for the lack of safety on the premises.
Looking for the perfect commercial property to help you achieve your investment goals? Get in touch with Ray White Surfers Paradise today to learn more about buying, selling, and leasing commercial properties.