Key Recruitment Exposures and Risks
Risk management and quality assurance processes used to assist in prevention of potential breaches of professional duty and control of actual breaches of professional duty are critical. Significant issues include:
- breach of privacy;
- failure to conduct appropriate reference, police or other checks;
- inappropriate advertising;
- failure to check qualifications and experience levels of candidate are suitable for the job;
- claims of inappropriate contact/poaching of company staff.
There is no registration or licensing requirements applicable to this industry. However companies in this industry need to keep in touch with federal and state employment and labour laws, and any relevant changes to these regulations. Also firms’ need to be aware of those relating to workplace discrimination, working conditions and benefits, and immigration laws and visa issues for non-residents.
Another key element of control is in the area of client engagement and scoping of the work to be undertaken. A clear understanding of the task and services provided may prevent future disputes.
Underwriters/advisers may wish to investigate:
- The contract acceptance process with corporate customers including engagement letters;
- Details of how the firm handles conflicts of interest;
- Quality control and internal checks;
- Procedures to follow at a time of any problematic situation;
- Communication between staff and customers;
- Record keeping and storage of client documents;
- Data backup;
- How frequently the insured reviews working procedures to ensure they are current and in line with the latest best practice.
- Businesses are becoming more and more dependent on digital technology/integrated IT systems;
- Security/privacy breach - presence of large volumes of sensitive personal and cooperate data;
- Data breach - documents/e-mails send to wrong recipients intentionally or inadvertently;
- External hacking attacks, internal negligence, deliberate acts, system glitches etc.;
- Targeted denial of service attacks and call fraud attacks;
- Electronic data/software loss and replacement cost following a cyber-attack;
- Business interruption/increased in cost of working following a cyber-attack;
- Cyber-threat from interconnected supply chain business partners/outsourced services providers;
- Internal control and other issues – e.g. non-segregation of sensitive data, inadequate user access control/password protection, outdated POS software applications, absence of up to date antivirus software/firewalls, unencrypted data/information/lack of end-to-end encryption;
- Possible presence of older devices/computer systems with outdated operating systems and unsupported software;
- Inadequate training for employees on data security/privacy/cyber risk. No or inadequate background checks conducted on employees/various service providers/suppliers etc.;
- Compliance and control issues - no or inadequate policies, procedures and protocols on cyber security and related matters (if applicable);
- Controlling issues - Bring your own devices (BYOD), download and install personal, or unauthorised software, regular use of USB or other media devices etc;
- Extra expenses following a cyber incident including forensic investigation costs, crisis management expenses, notification and monitoring expenses, remediation expenses and other extra expenses association with a loss/data breach;
- Brand and reputational damage following a cyber-attack/data breach;
- Security lapses in company web-sites - cyber threat to own hardware and software, cyber threat to visitors of the website;
- Lack of security measures including a combination of technology (e.g. IT security) and physical security at the premises.
Why use Hunter Broking Group?
Recruitment Insurance Broker Brisbane:
As a recruitment business owner, you're faced with a unique set of circumstances when purchasing insurance. Whether you are an industry specific or general recruiter, specialise in permanent or temporary placements, you are at risk from the actions of the people you place in an organisation.
Increasingly, labour placement, recruitment and employment-related risks previously borne by employers are shifting squarely into the hands of external service providers.
Our Brisbane based brokerage makes sure all your needs are covered. Your designated broker has considerable experience in labour hire and recruitment insurance with access to a flexible suite of insurance products that can be tailored specifically for your employment practice areas.
We offer unrivaled support across all classes of recruitment insurance, including;
- Professional indemnity: provides protection from potential claims and disputes, which may lead to expensive of time-consuming litigation.
- Management liability: covers directors and officers for legal liability they may incur personally in managing an association, and also extends to the association itself for specific types of claims.
- Cyber Liability Insurance: First and third party losses resulting from a cyber breach / attack.