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Personal injury solicitors are warning that a deluge of false compensations claims could befall the offices of no win, no fee lawyers as the economic crisis finally begins to hit UK's residents fully in the pocket.
As the toll of job losses increases day-by-day, stark forecasts of desperation in the labour market are foreshadowing a rise in attempts to get money by any means and as the media reports that quarterly burglary and theft crime figures are up, the rise in fraud and forgery is also likely to increase apace.
One personal injury solicitor, from Liverpool, said, "In many respects we are entering uncharted waters. At the time of the last major economic downturn in 1990 there was no no win-no fee' funding for personal injury claims this did not come into effect until 1994."
So, there is no precedent for the effect of recession on personal injury compensation claims. However, lawyers have already admitted seeing an increased number of claims in 2009 for this time of the year, and an increase in the number of claims rejected at the first stage of consideration. This is perhaps a reassuring reminder that false claims will be identified and rejected from the system.
Claims are often categorized into three types: the genuine claim upon someone else's negligence; the determinedly fraudulent claim; and the regrettable accident where no liability can be apportioned. It is up the personal injury professionals to establish quickly which category each enquiry to their offices falls into.
The solicitor added, "Nobody should be fearful of pursuing a legitimate claim. The law is there to ensure that if you are injured as a result of someone else's negligence you can recover proper compensation for your injuries and financial losses.
"If you are not sure whether you have a claim, you should seek advice.
"But anybody who is considering a fraudulent claim as a way of making money should remember that reputable firms have systems in place designed to detect and weed out these claims."
Another lawyer, this time form Birmingham, says, "Given the fact that many household names within the manufacturing, food production, distribution and various other UK industry sectors have announced wide scale redundancies, it is worth noting such events and a rise in personal injury claims.
"The Nottingham and Derbyshire textile industry witnessed the closure of several garment manufacturing factories in the late 1990s and this lead to thousands of workers being made redundant.
"There followed an orchestrated campaign of advertisements, leaflets in local and national papers offering a free hearing test and listing occupations and companies for whom it was said compensation could be obtained including some where the worker had no primary noise exposure.
"This led to thousands of claims being brought against three main employers and their insurers despite evidence that their exposure was in most cases below recognised thresholds which required action on the part of the employer."
The West Midland's lawyer added that insurers and employers of companies and businesses that are forced to cease trading should take steps to protect themselves by retaining all employment documentation and records pertaining to working conditions for employees. This could prove invaluable in the event of future claims where a business building or factory is no longer in existence and working conditions cannot be tested or examined.
Records of training, risk assessments, company health checks, machine maintenance records, etc., are all items of documentation that could prove useful for litigation purposes in the event of a compensation claim against a company.
Personal injury solicitors have been aided in their quest to make access to justice a less protracted affair by last year's governmental overhaul of rules regarding such claims. Far stricter guidelines were put in place to speed up settlements and cut costs, meaning that those workers with legitimate claims against negligent employers will receive compensation for their suffering in a much smaller timeframe.
