The Employers’ Liability Tracing Office (ELTO) welcomes a long-awaited change in the Financial Conduct Authority’s (FCA) Employers’ Liability rules, following a member-backed project to streamline the collection of UK Employee Reference Number (ERN) data, preventing members from regulatory burden. Read on to find out more about this project and to watch a full-length video from ELTO board members.

With backing from members, ELTO embarked on a project to streamline how ERNs are captured and then stored on the Employer’s Liability Database (ELD). Since the inception of ELTO in 2011, members have been tasked with collecting the ERN from their policyholders to populate their policy records on the ELD via various collection methods, all of which, time consuming and resource intensive.

Following a successful pilot in 2019 the project carried on for two years, resulting in ELTO working collaboratively with both HMRC and the FCA to meet the objective of achieving a better ERN capture process for the industry. This objective has since been met following a successful data enrichment programme, which saw ELTO supplementing member data with that obtained working directly with HMRC.

In 2023, ELTO were able to provide evidence of consistent, positive results it had been achieving with the data enrichment, showing a much higher ERN population rate than existing processes. The FCA then entered into a consultation with ELTO and its members, resulting in the updating of the rules in the ICOBS 8.4 handbook, outlining that ELTO would now undertake the ERN Collection work on behalf of its member insurers.

With the updated ICOBS now in place, ELTO will now take on the responsibility of using ‘best endeavours to obtain the ERN’ for members, with member firms now only required to pass on ERNs to ELTO if they happen to be received, but do not need to resource follow-up processes to chase and obtain missing ERNs. This change is understandably a real success for ELTO members and wider industry stakeholders who are involved in supplying the required EL information.

Steve Browne, Chair of the ELTO Board said,

“This is a milestone moment for ELTO and the insurance industry, a great result for us all, and demonstrates that regulatory change is possible where a sound business case exists. This achievement not only demonstrates a tangible return on investment for our ELTO members but also has an impact on the wider industry operationally.”

Learn more about how this project has benefited our members and the wider industry in our video here: