As a result of the pandemic, the legal profession has realized that remote working is a viable option, and some individuals are eager to keep working remotely full-time. Under the Minimum Terms and Conditions (MTCs) for primary PII insurance, a fee earner working from home in England and Wales is covered in the same way as a fee earner working in the office. However, what about fee earners who have decided to move abroad and want to continue working from home and what are the implications for PII?
What the MTCs say
As a first step, the MTCs cover work performed in offices in England and Wales. This point is fairly well hidden within the SRA glossary, a commentary which defines a number of terms mentioned in the MTC.
The clause we can identify primarily here is clause 1.1 of the MTCs, which indemnifies each insured against civil liability to the extent that it arises from private legal practice in connection with the insured firm’s practice. The ‘Insured firm’s practice’ is defined in the glossary as the legal practice carried on by the insured firm as at the commencement of the period of insurance. And, ‘practice’ is defined as the whole or such part of an authorised body as is carried on from one or more offices in England and Wales.
So how is ‘carried on from one or more offices in England and Wales’ actually defined? When a fee earner needs to go abroad to deal with matters on a file for example briefing witnesses or to conduct mediation, or is perhaps responding to work emails during a holiday abroad, this would be covered by the MTCs. However does it still apply if the fee earner wants to stay working abroad on a permanent basis?
Working permanently from home abroad
It is not particularly clear in the MTCs what the position is for fee earners who have decided to work outside of England and Wales on a permanent basis.
However if a common sense approach is taken, the fee earner is likely to be considered within the scope of cover of ‘working from home abroad’ if their position is that of a principal or employee of a practice in England and Wales and working on cases where there is engagement between the practice offices in England or Wales, and the client.
There will however inevitably be grey areas and there is certainly potential for insurers to take issue with these arrangements that may result in policy disputes. Therefore if your firm does employ fee earners who are, or plan to be, working consistently from a home abroad then you should think about what actions may be required to ensure you are fully covered.
Steps to take
Initially it is advisable to approach your broker to liaise with the insurance provider in this regard, requesting a firm confirmation that you are covered for employees working permanently abroad. It is also recommended that your firm reviews its other policies such as office and cyber policies, to determine whether the same approach is required.
At the end of the day, insurers need to be sufficiently satisfied that correct and appropriate measures are in place within your firm to cover such aspects as confidentiality, supervision, document storage and cyber security. It is therefore advisable to make sure that your arrangements and procedures which you have in place to address these areas are clear, concise and well documented and that you include all relevant details when you raise these matters with your insurer in the case of employees wanting to work abroad permanently.
It is also worth noting that it may be beneficial for your firm to mandate that employees working from a home office abroad should not divulge their foreign address as being one of your firm’s offices, nor should they solicit clients locally by virtue of their foreign address. Firms should ensure that all postal communications relating to the matters with which they are dealing should continue to be sent to the firms offices in the UK, which is the same rule as that for those employees working from home in England or Wales.
If you would like to speak with one of our expert brokers about your firm’s requirements or to obtain a competitive PII quote, please do not hesitate to contact us on 0800 180 4203 for a personal and professional service.