Hand Sanitiser poses new risk to retailers

Bonginkosi Ntuli, Claims Specialist: Professional Indemnity & Liability Claims at Stalker Hutchison Admiral

Jonathan Kaiser, Claims Specialist: Professional Indemnity & Liability Claims at Stalker Hutchison Admiral

Retailers could potentially face a new surge of class actions and personal injury claims for negligence regarding the use of harmful products. This follows the news that some South Africans have reported developing a rash after exposure to hand sanitiser dispensed at store entrances.

This is according to Bonginkosi Ntuli, Claims Specialist: Professional Indemnity & Liability Claims at SHA Specialist Underwriters, who says that even though it is debatable whether retailers will be held legally accountable for allergic reactions to hand sanitisers, retailers should act cautiously and ensure they have adequate cover in place.

“Government issued a directive requiring all stores to comply by ensuring that they have hand sanitisers available, with the only requirement being that they should be 70% alcohol based. Retailers had to be compliant by order of law, and may not have had enough time to conduct thorough testing. Scientific study will likely show that in any control group, a percentage of people could expect adverse reactions to any product. The question is whether stores can be held legally accountable if, for example, one out of every 10 000 people has a non-lethal reaction. Should the risk of averting Covid-19 enjoy priority over general consumer safety?

“It will be interesting to see whether the court ultimately believes that the Consumer Protection Act applies in these cases, as no money was exchanged for goods purchased as the sanitiser was applied as a pre-requisite to entering the store.”

Nevertheless, even if retailers are not held legally accountable for injury or damages in this regard, they are at risk of losing substantial amounts of money if they are not adequately insured against personal injury claims. “For a claimant to successfully sue a retailer, they would be required to prove that the harm caused was a direct or indirect result of the harmful product supplied by the store. While the court’s judgement may ultimately be in favour of the retailer, the legal fees that one incurs while defending such claims, can have a significant impact on a business.”

Jonathan Kaiser, Claims Specialist: Professional Indemnity & Liability Claims at SHA points out that the likelihood of being sued by a consumer is high, even if most cases are frivolous. “SHA’s own statistics show that the intimated values for personal injury claims against businesses have grown by at least 56% in a space of two years. The frequency of claims have also increased exponentially. Adding to that, the cost of adequate legal defence has gone up by between 8% and 10% annually in recent years. Considering that liability cases routinely take three to five years to reach settlement, the inflationary effect of legal fees will definitely be felt.”

In light of this, Kaiser says that retailers must take the necessary precautions to manage potential liability risks related to their use of hand sanitisers. “Retailers can start by putting up large visible disclaimers warning customers about any potential adverse effects of hand sanitisers – specifically indemnifying themselves from liability. They should further stipulate that while customers are required to be sanitised, they may decline to do so if they have their own sanitiser, and apply it before entry under supervision of the store. Retailers must also ensure that the products they use on consumers are approved as medically safe. In short, retailers should act in a way that a “reasonable retailer” would, and apply the necessary precautions.”

Ntuli says this pandemic has demonstrated to the world that you always need to have someone, whether in business or government, that is concerned with compliance. “The current Regulations under the Disaster Management Act is in some respects a moving target. As long as there is a responsible officer or company director in charge of these issues – there should be some structure in place to deal with a fluid compliance environment.”

Ntuli adds that retailers must ensure that their liability cover is in order on a regular basis. “Specifically for cases related to the ongoing Covid-19 pandemic, the risk environment is changing constantly and the consequences are far-reaching and unpredictable. Retailers should therefore be cautious with the products they use to sanitise their stores, their staff and their customers,” he concludes.