Freelance flying and insurance
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Freelance flying and insurance
I have recently been freelance flying (out of necessity). I only have a verbal agreement with my employer, but he does pay me the agreed daily rate (in cash) at timely intervals, and I have no concerns about cash reimbursement.
But I would I'd be grateful for advice and discussion over the requirements to be fully legal for freelance flying with and EU-OPS operator, and correctly insured personally. I have no contract with my employer, he pays me cash (which I will declare on my tax declaration) but he pays no social contributions to my EU country of residence.
If I have no written contract with my employer, what is my legal status in case of an accident? Could I be personally liable?
I know that I should ask this of my employer, but would like to be correctly armed with facts before getting into a discussion with him. At the moment I just need the cash - family to feed etc so I do not have much alternative but to carry on - grateful for advice!
But I would I'd be grateful for advice and discussion over the requirements to be fully legal for freelance flying with and EU-OPS operator, and correctly insured personally. I have no contract with my employer, he pays me cash (which I will declare on my tax declaration) but he pays no social contributions to my EU country of residence.
If I have no written contract with my employer, what is my legal status in case of an accident? Could I be personally liable?
I know that I should ask this of my employer, but would like to be correctly armed with facts before getting into a discussion with him. At the moment I just need the cash - family to feed etc so I do not have much alternative but to carry on - grateful for advice!
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very good point
You will be on the wrong side of the fence, in the event of an incident or accident.
You need a contract with whoever you are flying for.
In this contract you must ensure that there is a clause that you will not be held liable for any action taken whilst "employed".
NBAA and other organisations will have the chapter and verse on this.
American freelancers / contractors, will not get out of bed without this cover.
glf
You need a contract with whoever you are flying for.
In this contract you must ensure that there is a clause that you will not be held liable for any action taken whilst "employed".
NBAA and other organisations will have the chapter and verse on this.
American freelancers / contractors, will not get out of bed without this cover.
glf
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Hello!
I have no background as a lawyer, so better take my words with some skepicism, but I have been in this business for nearly 20 years now (more than 10 of which in various postholder positions in commercial operations).
In Germany, it is the aeroplane through the operator ("Halter"/"Luftfahrtunternehmer") that is insured and not his staff. So as long as his staff, whether employed or not and whether paid or not, is not acting in negligent, grossly negligent or deliberate manner, there will be no issues with the insurance. Therefore, a contract will not change your position in respect with the insurance. On the other hand, even a contract can not protect you from liability claims if you act in grossly negligent manner or deliberately breach rules!
Over the years, I have flown with and without contracts (e.g. I never had - and still don't have - a contract with the FTO for which I instruct on freelance basis since many years). But after several bad experiences I would not fly for a new employer without a written contract. Mostly for monetary reasons: Your employer may be your best friend today and always pay you quickly, but this can change within the next four weeks or four months (been there, done it). Without a clear contract, your chances of ever seeing your money are marginal. On the other hand, most employers (at least most employers I ever flew freelance or worked for) insist on a written contract on their own part to get some leverage on their freelance staff: Without a contract, a pilot is literally free to do what he likes, so to say.
I do not know, what kind of operation you fly for. But if they do not hold an AOC, a contract is even more important because it can save you from an accusation of illegal public transport. If the operation is illegal (or partiall illegal, for example if your corparate employer sells empty seats on his flights to people outside his company), you as pilot in command might be held responsible. Being able to show a contract with your employer will at least prove that you did not act on your own behalf! So get yourself a freelance contract ("Freelancer Vertrag") and sleep more quietly!
happy landings,
max
If I have no written contract with my employer, what is my legal status in case of an accident? Could I be personally liable?
In Germany, it is the aeroplane through the operator ("Halter"/"Luftfahrtunternehmer") that is insured and not his staff. So as long as his staff, whether employed or not and whether paid or not, is not acting in negligent, grossly negligent or deliberate manner, there will be no issues with the insurance. Therefore, a contract will not change your position in respect with the insurance. On the other hand, even a contract can not protect you from liability claims if you act in grossly negligent manner or deliberately breach rules!
Over the years, I have flown with and without contracts (e.g. I never had - and still don't have - a contract with the FTO for which I instruct on freelance basis since many years). But after several bad experiences I would not fly for a new employer without a written contract. Mostly for monetary reasons: Your employer may be your best friend today and always pay you quickly, but this can change within the next four weeks or four months (been there, done it). Without a clear contract, your chances of ever seeing your money are marginal. On the other hand, most employers (at least most employers I ever flew freelance or worked for) insist on a written contract on their own part to get some leverage on their freelance staff: Without a contract, a pilot is literally free to do what he likes, so to say.
I do not know, what kind of operation you fly for. But if they do not hold an AOC, a contract is even more important because it can save you from an accusation of illegal public transport. If the operation is illegal (or partiall illegal, for example if your corparate employer sells empty seats on his flights to people outside his company), you as pilot in command might be held responsible. Being able to show a contract with your employer will at least prove that you did not act on your own behalf! So get yourself a freelance contract ("Freelancer Vertrag") and sleep more quietly!
happy landings,
max
Last edited by what next; 24th Jul 2010 at 08:48.
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You are absloutely right to be concerned about the issue of personal liability if sh$t happens.
If there is an incident where loss is caused to your employer or any third party as a result of any negligence on your part then you personally are in the frame to the extent of all your personal assets...house, car, savings, pension...the lot.
As a freelancer I have looked carefully into the possibility of getting insurance and I simply could not find any broker who would provide it on a reasonable basis. Balpa were characteristically useless as were their affiliated brokers.
That left the only alternative which was to incorporate a limited liability company and provide my services through that. The company has a nominal share capital of £100 and employs me. There are a few implications in terms of the need for getting an accountant involved etc...but for the little this costs I can sleep sound at night knowing that if I screw up no one can touch me and all that anyone can get is £100 from my company.....
Seemples!
If there is an incident where loss is caused to your employer or any third party as a result of any negligence on your part then you personally are in the frame to the extent of all your personal assets...house, car, savings, pension...the lot.
As a freelancer I have looked carefully into the possibility of getting insurance and I simply could not find any broker who would provide it on a reasonable basis. Balpa were characteristically useless as were their affiliated brokers.
That left the only alternative which was to incorporate a limited liability company and provide my services through that. The company has a nominal share capital of £100 and employs me. There are a few implications in terms of the need for getting an accountant involved etc...but for the little this costs I can sleep sound at night knowing that if I screw up no one can touch me and all that anyone can get is £100 from my company.....
Seemples!
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Having been freelance for many years, I have also looked into this extensively.
Sadly, TinyTim, I think your shelter is illusory.
If there is an incident, the aircraft insurance pays out to Owner/pax/ third parties etc. If there is negligence involved they are perfectly entitled to sue the negligent party to recover their costs.
If this party is you, the pilot, then they can sue you, regardless of who was employing you and contracting you. Your shell company is not liable as they presumably did not employ you to be negligent, and therefore you have stepped outside your "contract".
This is also true for employees of the owner/operator - not a lot of people realise that.
The only defence is not to be negligent!!
You can also take some comfort from the fact that unless it is such a minor incident as to be virtually not worth mentioning, your total net worth after the legal fees will probably be so small compared to the amount the insurance company is out of pocket that they won't bother.
Sadly, TinyTim, I think your shelter is illusory.
If there is an incident, the aircraft insurance pays out to Owner/pax/ third parties etc. If there is negligence involved they are perfectly entitled to sue the negligent party to recover their costs.
If this party is you, the pilot, then they can sue you, regardless of who was employing you and contracting you. Your shell company is not liable as they presumably did not employ you to be negligent, and therefore you have stepped outside your "contract".
This is also true for employees of the owner/operator - not a lot of people realise that.
The only defence is not to be negligent!!
You can also take some comfort from the fact that unless it is such a minor incident as to be virtually not worth mentioning, your total net worth after the legal fees will probably be so small compared to the amount the insurance company is out of pocket that they won't bother.
I don't know if I am missing something here but the way I see it each and every one of us can be held liable for negligence if it can be proved.
Being a freelance pilot changes what exactly? If an employed airline pilot writes off a hull through negligence then he can still be held liable. If a doctor working for the NHS kills someone he can still be held liable.
Having said that I have just come across this which may be of help: Professional Indemnity PI Insurance - Company Insurance, Freelance Insurance, Recruitment Agencies Insurance - Caunce O'Hara
Being a freelance pilot changes what exactly? If an employed airline pilot writes off a hull through negligence then he can still be held liable. If a doctor working for the NHS kills someone he can still be held liable.
Having said that I have just come across this which may be of help: Professional Indemnity PI Insurance - Company Insurance, Freelance Insurance, Recruitment Agencies Insurance - Caunce O'Hara
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I don't know that particular company, but a quick look at that link shows that their "off the shelf" freelance insurance policy can be taken out to cover amounts as large as 2 million pounds - that might just about cover a small dent!
My experience is that the companies prepared to consider a policy that was in any way meaningful (around the USD100 million mark) wanted to charge a premium that was more than I earn in a year....
My experience is that the companies prepared to consider a policy that was in any way meaningful (around the USD100 million mark) wanted to charge a premium that was more than I earn in a year....
