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James Kincaid

Industrial Disablement in Britain

(Summer 1967)

From International Socialism (1st series), No.29, Summer 1967, pp.18-21.
Thanks to Ted Crawford & the late Will Fancy.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

It is reckoned that in Britain there must be more than 750,000 adults under pension age who suffer from a physical or mental handicap sufficiently serious to make them unable to work, or to lower their earning power by a substantial amount. As might be expected such groups figure fairly heavily in current estimates of the numbers in Britain who live in poverty. Even the best estimate can only be a guess, but experts believe that for up to 250,000 men, women and children living at income levels below the government’s official ‘minimum,’ the primary cause of their poverty is that a member of the family is disabled. Paradoxically it is not necessarily the disablement of the bread-winner that does most damage to a family’s economic position. Worst off are families in which it is the wife who is disabled, for unless she happens to have been working and has paid full contributions into the national insurance scheme (most working wives do not) there is no financial provision by the State to help the family meet the extra costs of her sickness or disablement. Women in employment are always covered for industrial injuries, but only full insurance contributions cover them for sickness and unemployment; the husband cannot claim any allowance from the national insurance scheme on behalf of a sick or disabled wife, unless he too is unable to work. All local authorities have a home help service, but it is very poorly developed in most places.

There is another large category of handicapped people for whom there is no provision in the national insurance scheme, those who have never been able to work long enough to make the minimum number of contributions to the scheme and so qualify for benefit. The Supplementary Benefits Commission – still known to millions as the NAB – caters in a meagre way for 140,000 adults in this situation. The total of handicap is made up by three other groups,

1. about 300,000 workers on sick benefit for more than 12 months,
2. about 275,000 people with war pensions and
3. 90,000 with industrial injury pensions. (Many of the war and industrial pensioners will hold a job, though often a poorly paid one).

Many of the injustices of the British system stem from the fact that the amount of financial assistance available to support a handicapped person is often not determined by the degree of his disability or by his family responsibilities. What counts more heavily is a variety of other factors; how the person was injured, whether by disease or accident, whether injury was in war, in industry or in some other context, the social status and previous income of the person, whether he can establish that someone else was legally to blame for the accident, whether that other person happened to be rich enough or well enough insured to bear the costs of compensation.

Those injured in war or industry constitute something like an aristocracy of handicap. A single person off work because of an industrial injury gets a basic £6 15s a week from the State for up to six months; the same person off work through sickness gets only £4 a week. The widow of a man killed in an industrial accident is paid £4 10s a week; other widows only £4 a week. Non-industrial widows only qualify for the £4 if they have dependent children, or if they had been married for at least 3 years and were at least 49½ years old when husband died.

In the case of long term benefits the distinction is even sharper. Once you have qualified, sickness benefit can continue indefinitely, but no extra provision is made for the rising costs to the family of long-term sickness. But if you become permanently handicapped as a result of a war wound, or an industrial accident or industrial disease, you can claim a disablement benefit which is compensation for the damage done to you, and is paid irrespective of whether you can return to work or not. A pension for 100 per cent disablement in industry is £6 15s, and likewise for privates in the army – captains get about £10 a week and brigadiers over £12. For those disabled in war or in industry there are in addition special allowances, e.g. for total incapacity to work, for the extra costs where nursing is needed. However to reach a weekly income of £20 10s – the average wage for manual work in industry today – a person disabled in industry or in war would have to be so crippled as to be incapable of any work, and require constant nursing and have dependent children as well. There are no corresponding provisions in the State scheme for handicap arising from non-industrial or non-military causes; a lucky few may be able to claim damages from someone, but, as an example, it is estimated that only 1 in 10 of people injured in motor car accidents are able to get any compensation; it is only very recently that people disabled in criminal cases have been able to get compensation.

Despite all these special provisions, however, the present system of protection for workers against the risks of industrial accidents and diseases, is very far from adequate, and reflects little credit on the Labour government who created it in 1946. Compensation for industrial accidents was one of the earliest elements of the modern social security system in Britain, initiated by the Workman’s Compensation Act of 1897. The pre-1946 scheme had many defects, eg a workman got half pre-accident earnings, but no allowance was made for any subsequent changes in the cost of living; if a workman was held responsible for the accident, he could only claim if his disablement was exceptionally severe. The scheme did, however, have one great merit, namely that the full cost was borne by the employers alone – £21 million a year by 1946. The post-1946 scheme offered better protection to workers, but made them bear a substantial part of the cost. The new scheme began on the basis that the total employers’ contribution was reduced from £21 million to £10 million a year – and another £10 million found by a flat-rate levy paid by workers as part of the national insurance stamp. Currently the adult male employee pays 9d a week into the Industrial Injuries Fund, and the employer 10d on behalf of each worker. Employees also contribute as taxpayer, since at present about 14 per cent of the income of the Fund comes from general taxation via the Exchequer.

In 1964, out of the 23.4 million workers covered by the scheme, 820,000 claimed industrial injury benefit. Most of these claims were for relatively minor injuries, and the average time off work was about 4 weeks. However, in 1964, there were 18,600 new claims accepted for disablement benefit, which is only awarded in cases where there is permanent damage to the worker as a result of an industrial accident or disease. Thus, each year, 1 in every 1,200 workers is suffering from some permanent impairment at work. At this rate of injury, about 1 in 30 workers can expect to experience such damage at some point in his or her working life. An example of the minimum kind of injury that would qualify a person for disablement benefit is the loss of part of a finger. The benefit takes the form of some kind of weekly payment in more serious injuries; for what are called minor injuries the worker gets a lump sum, calculated by reference to degree of injury and his age. The maximum lump sum paid is £450 at present (it’s called a ‘gratuity!’). To qualify for £450 a worker would have to be a young man, and have lost at least the whole of his index finger.

Just under 2,000 workers were killed in industrial accidents or by industrial diseases in 1964. At this rate of death, 1 in every 600 of workmen are being killed as a direct result of their work at some point in their working lives. Mining is still the biggest killer of all with an annual industrial death rate of 1 per 900 workers – nearly all from pneumoconiosis. As regards deaths from accidents, the fishing industry has the blackest record, 1 in every 1,300 workers killed in 1964.

This is enormously much higher than the death rate of 1 per 6-7,000 workers in metal manufacture and building in 1964. An injured workman is entitled for the first 6 months of work to a weekly benefit of £6 15s, plus 30s if he has a wife and 22s 6d per child (family allowances included). There is now, in addition, a wage related element, e.g. £2 a week if he had been earning £15 a week, £3 for a wage of £18. The man on injury benefit will be in any case a good deal better off than the man who is sick or unemployed (by at least £2 15s a week). But for the majority of workers an industrial injury will still involve a considerable drop in income, as Table 1 illustrates.

It is not clear why anyone who is injured at work should have to exist on a lower income while he is off work. The middle classes in Britain expect their employer to pay full wages for the first weeks or sometimes months off work, whether their injury or sickness is work generated or not. But the Victorian principle of less eligibility is still firmly installed in the British social security system, so that a worker’s standard of living has to fall when he is not at work, whatever the reason may be. In any case it would certainly cause political difficulties to make even sharper the disparity in treatment between the industrially injured, and those sick or injured in non-industrial accidents. For once, a lack of available resources cannot be made the excuse for not improving benefits. The government keep a quite separate fund for the industrial injury scheme, and if excess of income over expenditure is the test of successful administration, few of the government’s many balance sheets look more impressive than the Industrial Injuries Fund. By March 1965 the Fund had an accumulated reserve of £328 million. Over a period of only 17 years this huge sum has been taken from employees, employers and taxpayers and not transferred to the industrially injured and disabled. There might be a justification for building up a small reserve fund, given that the number of people with long-term disablement benefits tends to cumulate over the years. But £328 million is completely disproportionate. The 1964-5 expenditure of the Industrial Injuries Fund was about £86 million. The income from employees and their employers was £68 million, and from the Exchequer £13½ million. Thus the gap between contributions and expenditure was only £4½ million. Nor was it necessary to dip into the reserve capital of the fund in order to bridge this gap, since investment income from the reserve amounted to £14i million in 1964-5. So, from year to year, the reserve continues to grow – in 1964-5 by as much as £10 million. The reserve Fund is invested in various government securities at a low rate of return (4.4 per cent in 1965), and forms a convenient addition to the working capital required for the financing of the British Government, though why money collected to provide for the victims of industrial accidents and diseases, should be used for this purpose is not explained by the Government Actuary who guarantees the financial ‘soundness’ of the scheme.

The relatively favourable treatment accorded to the industrially injured and disabled as compared with other groups unable to work, means that a great deal of attention has had to be given to the definition of what exactly constitutes an accident or disease arising ‘out of and in course of employment.’ To this end much effort has been expended by lawyers, trade-union claims officers, and by the administrative tribunal of the National Insurance Commissioner who adjudicates disputes arising over national insurance benefits. To a layman the distinctions drawn seem pretty arbitrary. Accidents happening during the journey to and from work are not industrial unless the worker is in a vehicle provided by his employer, or is called out in an emergency. Accidents in pit-head baths, lavatories or canteens are industrial, but not in the case of canteens not for meals before or after work and not unless the canteen is run by employer. An accident at a trade union meeting would be industrial, but only if employer approved the holding of the meeting, and it was on his premises. Making tea is part of employment, but only at times specifically approved by the employer.

The basic benefit paid to someone with a long-term industrial disability is determined solely on the basis of the amount of damage caused. (There are a variety of additional allowances, if e.g. a person has become incapable of work, needs constant nursing and, if completely immobilised, the State provides a motorised three wheeler with one seat – only the war disabled get cars). The procedure by which entitlement to the basic benefit is assessed is a classic example of bureaucratic rationality in action. A person is counted as 100 per cent disabled (i.e. entitled to £6 15s per week disablement pension) if he or she loses both hands or feet; is made completely deaf or blind; loses a hand and foot. People counted as less than 100 per cent disabled are awarded the disability pension at an appropriately reduced rate, e.g. loss of one arm is 90 per cent, but only if the amputation is through the shoulder blade, loss of one eye is 40 per cent, loss of a thumb 30 per cent, if index finger lost 14 per cent, middle finger 12 per cent, either of two other fingers 7 per cent. Leg amputees are meticulously graded; hip amputees are paid a 90 per cent rate; if there is less than 5 inches of stump the rate is 80 per cent. Over 5 inches but not below middle of thigh 70 per cent, and so on down the leg. The use of a scale set out in 10 per cent units means that a small difference in degree of injury can mean a large difference in pension awarded – the difference could be 15s a week for life – so bureaucratic rationality, as often happens, has managed to combine precision and injustice. Such quantification problems become serious when the whole system is being run in the niggling spirit of the minimum.

There is, in addition to the State scheme, a quite separate procedure whereby a person injured at work can obtain compensation and financial provision – namely by suing the employer for damages. Not many workmen have a case that will stand up in law. It is believed that no more than 10-20 per cent of workmen seriously injured at work will claim damages, and not all claims are successful. Litigation arising out of industrial accidents forms a substantial and expensive part of the work of the British legal system, and of trade unions and insurance companies. From the point of view of people claiming damages it is a chancy and capricious business – ‘a degraded bingo session,’ one leading Scottish lawyer calls it. The burden of proof is always on the worker. To succeed, he must show that the accident happened because of the employer’s negligence; if the employer can show that the employee’s negligence contributed to the accident, then the damages will be reduced proportionately. To be legally negligent, it must be held that a person could have been reasonably expected to foresee that an accident might arise. Thus the outcome of innumerable cases turns on the interpretation of what constitutes ‘reasonable foreseeability.’ Given an issue so metaphysical, it is inevitable that judges will vary widely in their decisions. The chief authority on the matter notes that, ‘Some learned judges are able to foresee very little; others by taking a complex series of events, step by step, are able to foresee almost anything.’ [1] The appeal courts are kept busy correcting the grosser discrepancies in the judgements made in lower courts.

The workman or his widow who succeeds in obtaining damages for industrial injury is in a much better financial position than someone who does not. But the sums awarded are still trifling by comparison with those of, for example, American courts, where awards of well over £150,000 for fatal accidents are not uncommon. It is rare for awards to go over £25,000 in British courts, and then only for death or the total crippling of a young man. There are many criteria employed by British courts to minimise the amount of damages. Account is taken of how much a dead person or a person crippled would have earned if he could have continued in the same job, but no allowance is made for any future increases in the general level of wages in his occupation. Hypothetical future earnings are calculated net of the tax that would have been paid by the dead man, though interest earned by investment of the damages awarded will also be taxed. Thus the dead and the crippled are doubly taxed. One half of all prospective benefits from the State industrial injuries scheme is subtracted from common law damages! (Law Reform Act of 1948 – the law officers of Labour governments are always in the vanguard of reaction). The widow has to be produced in court; if the judge thinks her young and attractive, damages are reduced – she is more likely to remarry. It is normal to give £500 (very recently increased to £1,000) to compensate for loss of expectation of life; but the estimate of hypothetical earnings is reduced accordingly. As the judge said in a recent case:

’If the claimant is injured so severely that he can only live a year or two at most, the damages will be much less than if he is less injured so that he may survive for many years.’ [2]

Another important component in assessment of damages arises from loss of ‘enjoyment of life.’ A person who can prove that he had a lot of hobbies and athletic interests will get more. In a recent case (not industrial accident) in which a boy of 3 was badly scarred for life, damages were reduced because:

’Judge said the effect of scarring on a person of his age would be much less than on an older person because appearance would be the only appearance he had ever known.’ [3]

There is general agreement even among lawyers, that damages are too low. One pressure that operates to increase the size of awards is having progressively less effect, for in recent years there has been a deliberate and successful policy of keeping accident eases away from juries. Having to adjudicate between personal tragedy on the one hand and their insurance companies on the other, juries are apt to give high damages, and the appeal courts were spending a great deal of time cutting down awards that reflected the humanity of jurymen and not the inflexible conventions of the law.

The Labour Government has appointed a Law Commission which is busy devising reforms in many branches of the law, including the law of negligence, but in this area there is a strong case for much more than piecemeal reform. What is needed is a national insurance scheme that will provide for disability, however caused, whether by accidents in the workplace, at home, or on the road, and for handicaps resulting from disease, as well as from accident. And why should such a scheme aim to provide only half of the anticipated standard of living? Full compensation in monetary terms will scarcely produce a rush of people throwing themselves in front of cars or down stairs. It is sometimes argued that such a scheme would result in an increase in accidents, in that the employer or motorist would be less careful than at present because he would not himself have to bear the consequences of his carelessness. But already, unless in exceptional circumstances, the cost of negligence is borne by insurance companies, and thus individual carelessness is paid for by motorists as a whole (loss of a no-claim bonus is scarcely a savage penalty), or employers as a whole – as well as by the victim. Sanctions against individual negligence can easily be found in the Criminal Law or the Factories Acts. To make compensation depend on the identification of someone who has been negligent, and on whether that person is insured or well-to-do is an element of our legal system that belongs in a type of society in which face-to-face relationships predominate, rather than with the abstract relationships of modern society. Such a comprehensive scheme might not prove overwhelmingly expensive to run, since enormous savings could be made by a reduction in the vast litigation at present involved in actions for personal damages.

We can hardly expect however that the present Labour Government will consider the possibility of such a scheme as even worth investigating. However strong the case for such a reform might be, on grounds of social justice as well as rationality, to set it up would need more than the patching, fiddling spirit in which the present government deals with welfare problems. In any case there would be political problems of the kind which this government has shown no disposition to face; for the creation of an adequate and comprehensive scheme of provision for people who become mentally or physically handicapped would inevitably expose the inadequacy of present provision for groups arising from the disabilities of old age or sickness or from inability to find a job.

Footnotes

1. E. Munkman, Employer’s Liability, 3rd Ed., p.24.

2. The Times, report, 3 Nov. 1966.

3. Current Law, Aug. 1966.

 
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