Management Liability Management Liability

Management Liability

In the current economic climate, business failures, regulatory investigations and actions, employment practices claims, and employee theft are becoming more prevalent. As a result, directors and officers of Australian companies are increasingly vulnerable.

Management liability insurance policies are designed to protect the directors and senior executives of small-to-medium enterprises (SMEs) against the risks and liabilities associated with running a business. Professional service firms and local government are also seeking peace of mind by purchasing management liability insurance.

WHAT IS A MANAGEMENT LIABILITY CLAIM?

The following claims fall under the ‘management liability’ umbrella:

  • Directors’ and officers’ (D&O) liability, including:
    • Unfair competition
    • Fraud/breach of fiduciary duty
    • Misappropriation of trade secrets
    • Insolvent trading
    • Manslaughter.
  • Employment practices liability (EPL), including:
    • Bullying
    • Harassment
    • Unfair dismissal
    • Discrimination.
  • Statutory liabilities (such as fines and penalties resulting from operating the business), including:
    • Work Health and Safety penalties
    • Environment and Protection Authority penalties
    • Other pecuniary penalties.
  • Employee dishonesty, including cases resulting from theft and fraud by employees.
  • Corporate entity liabilities, which may later be brought against directors and officers, including
    • Wrongful act/fraud
    • Shareholder dispute
    • Shareholder employment.
WHO CAN BRING A CLAIM?

The following entities, organisations and individuals can bring an action against a company, its directors, officers and employees:

  • Regulators
  • Employees
  • Competitors
  • Creditors
  • Shareholders
  • Clients
  • Liquidators/administrators.
OUR EXPERTISE

If you are facing a management liability claim, you need a lawyer who understands the challenges of running a business and is experienced in handling these kinds of claims.

At Barry.Nilsson., we have extensive experience of assisting insurers and their clients with both litigated and non-litigated management liability claims.

We deal regularly with the following kinds of claims against directors, officers and employees:

  • Breaches of directors’ duties and/or fiduciary duties
  • False, misleading and deceptive conduct
  • Improper or illegal conduct
  • Breach of statutory duties, such as those falling under the Corporations Act 2001 (Cth)
  • Work Health and Safety (WHS) prosecutions
  • Unfair dismissal, discrimination, harassment or bullying claims
  • Defamation claims
  • Breach of intellectual property rights
  • Statutory fines and penalties
  • Taxation investigations.

In addition, we often advise clients on strategies relating to risk management, which has proved invaluable in helping them to avoid claims.

Need assistance?

Submit an enquiry online and we will be in touch as soon as possible, or call one of our national offices directly.