Onsite Accidents, Employee Theft, and Poor Advice Leaves Businesses In Critical Condition
23% of small business owners that have experienced ‘serious problems’ within the workplace have paid compensation out of their own pocket
Extreme incidents like onsite accidents, employee theft and acting upon poor advice are leaving small businesses in a ‘critical condition’, according to a study by Direct Line for Business.
The survey of 501 enterprise owners has revealed that 31% have experienced such damaging situations, which has also had a knock-on effect for their clients.
When breaking down incidents, the most common ones experienced by respondents are:
- Had an employee get injured while on duty (29%)
- Had an employee steal money or information (21%)
- Lost a client due to poor advice (19%)
- Had a client suffer an injury (18%)
- Had to hire a lawyer over poor advice (16%)
- Lost confidential data (15%)
When it comes to repairing the damage, 23% of those surveyed have had to fork out compensation out of their own pocket, 18% have had staff resign, 18% have lost a client or clients, while 13% had to actually dissolve the business.
Worryingly for larger businesses, it appears no one is ‘too big’ to avoid such problems with larger businesses (between 50-249 workers) being the most likely to suffer such a massive setback.
Jane Guaschi, business manager at Direct Line for Business, said:
“Advising clients and running premises comes with its risks, so it’s important to makes sure you have the right safety procedures in place to minimise any potential issues. Even if you’re professional and always give advice and sell products in good faith, everyone has the potential to make mistakes.
“The costs of litigation and damages can be steep, so small business owners should ensure they have the relevant insurance cover to give them peace of mind and allow them to get on with growing their business”.