The role of private actors in preventing work-related risks: A law and economics perspective

This contribution considers the regulation of work-related risks such as industrial accidents and occupational diseases, and more specifically the role of employers and employees in the regulation and prevention of such risks. First, a law and economics perspective will be provided on the delegation of regulatory design and enforcement tasks to private actors. Thereby it will be assessed (for the specific case of work-related risks) what are the theoretical advantages and disadvantages of private regulation and enforcement compared to public regulation and enforcement, taking efficiency as a main goal. Efficiency in that respect relates to finding an optimal way of dealing with market failures, such as externalities in the form of work-related accidents and diseases. Secondly, confronting theory with practice, examples of private regulation of work-related risks will be provided for the Netherlands, which largely relies on collective labour agreements and private enforcement mechanisms. The role of liability insurers as an important potential driver of actions taken by employers and employees will be highlighted, as well as the importance of having (e.g. in administrative law) a smart mix between public law and self-regulatory mechanisms.