Welcome to our March newsletter

In this edition, we look at the imminent changes which should be top of the agenda for HR teams and employers.  Coming into force in April, this includes new National Minimum Wage rates and HMRC guidance on the extension off off-payroll working to the private sector.  We also take a look at new pension legislation which will be introduced later this year.

Employers continue to rise to the challenge of managing the impact of the pandemic on employees and the workplace.  We shine a light on the extension of workplace testing and updated guidance from Acas on vaccinations.  Read more about one of the first employment tribunal decisions to emerge around Covid measures – an HGV driver was considered fairly dismissed by his employer after he had refused to wear a mask.

We report on the cases you need to know about, including a TUPE case with significant implications for organisations involved in outsourcing, two connected cases on the issue of religious discrimination, and a case about covert recording, which shows the devil is in the detail.

We welcome your feedback and questions, so please do get in touch.

What’s New March 2021

This month we look at increases to the National Minimum Wage and tribunal awards, off payroll working, and a new Home Office register for Modern Slavery Statements.
Read more >

Budget Summary

The Budget has been announced and the focus is on the impact of COVID-19.

Read more >

Dismissal for refusing to wear a mask was fair

A heavy goods vehicle driver was fairly dismissed by his employer after he had refused to wear a mask, as a precaution against the spread of coronavirus, whilst at a customer’s site.

Read more >

Eligibility for workplace COVID-19 testing and guidance updated

The Government  extends rapid workplace Covid-19 testing to smaller businesses.

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Underhand surveillance or protecting the business?

In the case of Northbay Pelagic Limited v Anderson, the Employment Appeal Tribunal had to decide whether the dismissal of an Employee for installing a camera in his office while suspended was within the “band of reasonable responses”.

Read more >

 

Pensions Update

The Government will be introducing new legislation later this year – we take a look at the Pensions Schemes Act 2021.
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TUPE Transfer – to more than one employer

In the recent case of McTear Contracts Ltd v Bennett, the EAT has confirmed that where a service previously carried out by one provider is divided into two parts and awarded on re-tender to two new providers, employees may transfer to both of the new providers.

Read more >

 

Religious Discrimination

In the cases of Page v NHS Trust Development Authority and Page v Lord Chancellor the Court of Appeal has rejected two appeals brought by the same individual who was removed from his posts as a lay magistrate and a non-executive director after he had spoken out publicly against same-sex adoption and homosexuality.

Read more >

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Pannone Corporate’s HR Forum is a free regular update for employers, aimed at HR professionals and anyone else who is involved in managing a workforce or dealing with HR issues.

Our first HR Forum of 2021 will be held as a webinar and will include:

Employment Law Update
A summary of the most important or interesting decisions coming out of the tribunals and courts in the last few months together with a legislation update.

Managing a Post Lockdown Workforce
With the end of lockdown and the end of the furlough scheme looking like a reality in the next few months, we take a look at the legal and practical issues that may arise with a return to some form of normality. In the short term, many employers will be keen to get their staff back into work, but what can they do about staff who refuse to attend the workplace? What about staff who refuse to be vaccinated or who remain clinically vulnerable? In the longer term, increased flexibility is likely to be on the agenda, both for employees who want to continue working from home and/or more flexibly, and for employers who are keen to protect the business from the impact of unexpected disruption in the future. We look at the challenges of managing a new more disparate workforce, including handling flexible working requests and making the changes to terms and conditions needed to future proof the business.

Details: 
When: Thursday 4 March
Where: via Zoom
Time: 10am to 12pm
Cost: Free

To reserve your place please RSVP by email to val.beck@pannonecorporate.com 

Places will be limited so please book soon. If there are any particular questions you would like to see addressed during the session, please contact jack.harrington@pannonecorporate.com

We look forward to seeing as many of you as possible.

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New ICO guidance on dealing with subject access requests

New guidance has been released by the Information Commissioner’s Office (ICO), concerning an individual’s right to ask an organisation whether or not they are using or storing their personal information and to request copies of their personal information – commonly known as subject access requests (SARs).

The detailed guidance focuses on how data protection officers and those responsible for data protection within an organisation should respond to SARs under the GDPR. The guidance contains valuable, practical advice and working examples. It covers how to recognise a SAR from an individual; how to locate and retrieve their personal data; and how to supply the information to that individual.

The changes follow a public consultation and provide clarity on key points which were raised, including:

Time limit for a SAR

Ordinarily a SAR has to be responded to ‘without undue delay’ and, at the latest, within one month of receipt of the SAR or, where applicable, receipt of the individual’s ID documentation (where the organisation has requested verification of the individual’s identity) or the fee payable by the individual (where a fee has been charged to the individual for a manifestly unfounded or a manifestly excessive SAR).

The time limit is calculated from receipt of the SAR (or ID documentation or fee) until the corresponding calendar date in the next month. If there is no corresponding date in the next month, the deadline for the response is the last day of the next month. For example, if the date of receipt is 30 January, the deadline would be 28 February (or 29 February in a leap year). If the corresponding date in the next month falls on a weekend or a public holiday, the deadline for the response is the next working day.

Time limit for a complex SAR

The time limit can be extended by a further two months, if the SAR is complex or an organisation has received a number of requests from the individual (this includes SARs and other data subject right requests, such as the right to erasure).

The new guidance gives the following examples of factors that may add to the complexity of a request:

It’s important to be aware that although searching large volumes of information may add to the complexity of the SAR, this does not of itself make the request complex.

Stopping the clock

An organisation can ask for clarification on a SAR if clarification is genuinely required and if it processes a large amount of information about the individual. It is unlikely to be reasonable or necessary to ask for clarification if the organisation can obtain the information quickly and easily. Where it does ask for clarification, the time limit for responding to the request is stopped and resumes when clarification is received. This needs to be explained to the individual when the request for clarification is made. To calculate the time limit for the response, you need to work out when the response would normally be due (see above) and extend this by the number of days that the clock was stopped.

However, an organisation should still provide confirmation that it holds personal data about the individual, if that’s the case, and the supplementary information which it is obliged to give in response to the SAR within the one-month deadline. This is usually done by providing a link to or a copy of the organisation’s privacy notice.

Unfounded or excessive SARs

If a SAR is ‘manifestly unfounded’ or ‘manifestly excessive’, the organisation may refuse to comply, or charge a reasonable fee for the administrative costs of complying with it.

The guidance states that a SAR may be ‘manifestly unfounded’ if:

However, where an individual genuinely wants to exercise their rights, it’s unlikely that the request is manifestly unfounded.

A SAR will be ‘manifestly excessive’ if it is clearly or obviously unreasonable. This is based on whether the request is proportionate when balanced with the burden or costs involved in dealing with it. Relevant factors include the nature of the requested information; the context of the request and the organisation’s relationship with the individual; the organisation’s resources; whether a refusal to comply will cause substantive damage to the individual; and whether the SAR largely repeats previous SARs and a reasonable interval hasn’t elapsed. When thinking about whether a reasonable interval has elapsed between SARs, the nature of the data and how often it is altered should be taken into account.

In each case, the word ‘manifestly’ means the unfoundedness or excessiveness must be obvious or clear, and the organisation must be able to strongly justify a finding of ‘manifestly unfounded’ or ‘manifestly excessive’. This is a high threshold.

The guidance gives some welcome clarification on how to determine a reasonable fee when dealing with a manifestly unfounded or excessive SAR. The organisation may take into account the administrative costs of assessing whether or not it is processing the individual’s personal data; of locating, retrieving and extracting the information; and of providing a copy of the information to the individual. However, no double charging is permitted. Specifically, a reasonable fee may include photocopying, printing and postage costs; the cost of transferring the information to the individual; the costs of envelopes or USB devices; and staff time, based on the estimated time it will take staff to comply with the request charged at a reasonable hourly rate. It’s good practice to establish an unbiased set of criteria for charging fees which explains an organisation’s standard charges and how it calculates the fee.

If you require more information, or need help with complying with a SAR, please get in touch with our data protection team.

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Employees previously shielding are advised to do so again

With new nationwide restrictions due to come into force from tomorrow, the Government has confirmed that individuals who were previously advised to shield because of their increased vulnerability to the coronavirus should do so again.

Employees who fall into this category are strongly advised to work from home and, if they cannot do so, should not attend work whilst the increased restrictions are in place.

The position remains that employees who live with shielding individuals (as with all employees) can still attend work if it is not “reasonably possible” for them to work from home.

Shielding employees may be eligible for Statutory Sick Pay, Employment Support Allowance or Universal Credit. The guidance suggests that their previous formal shielding notification should act as sufficient evidence of their shielding status. The Government has not yet indicated whether new rules on SSP for shielding employees will be published. Under the previous rules, employers started paying SSP from the first qualifying day a shielding employee was off work.

The Government has also confirmed that provided they were on the payroll before 30 October 2020, shielding employees may also be eligible for the extended Coronavirus Job Retention Scheme.

If you have any questions about the impact of the new restrictions on your business or about the extended Coronavirus Job Retention Scheme, please contact Jack Harrington

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In order to process personal data concerning EU residents in connection with the sale of goods or services or the monitoring of EU residents (either as a controller or a processor), you may need to  appoint a representative within the EU. This requirement (under Article 27 of the GDPR) is sometimes referred to as the “hidden obligation” as many organisations are unaware of it. From the end of this year, when the UK will no longer be subject to the Brexit transitional arrangements and will formally cease to be part of the EU, UK businesses will need to appoint such a representative if they do not have a formal presence within the EU but offer goods or services to individuals in the EU or monitor their behaviour.

Appointing a representative will not be a straight-forward process. The selection process will take some consideration, since the representative will have authority to represent the relevant controller or processor (the non-EU entity) in respect of all of their obligations under the GDPR within the EU, including before supervisory authorities (regulators). It will be crucial to appoint someone with a good grasp of data protection laws and an understanding of the nature of the processing activities being undertaken by the non-EU entity. The representative should be appointed in writing and their details will need to be made available to EU data subjects and regulators (such as on the non-EU entity’s website and in its privacy policy).

In addition, the representative must be able to facilitate communications with EU data subjects and maintain a record of processing activities on behalf of the non-EU entity. The representative will need to be located in the member state where the relevant EU data subjects are located, or where most of them are, and should be able to converse in the local language (or ideally multiple languages of the EU). Some non-EU entities operating across the EU may need to consider appointing multiple representatives. The European Data Protection Board has advised that a representative should not be the same person as the non-EU entity’s data protection officer or their processor due to the potential for a conflict of interest.

Failing to appoint a representative could result in a fine of up to (the higher of) €10 million or 2% of annual worldwide turnover.

Although it is ultimately the responsibility of the non-EU entity to comply with the GDPR with respect to EU data subjects, regulators are able to initiate enforcement action through a representative, including addressing fines and penalties to the representative.

Public authorities are exempt from the requirement to appoint an EU representative, as are any non-EU entities that only process occasional personal data that does not include a large amount of special category or criminal data and which is unlikely to result in a risk to the rights and freedoms of individuals.

Of course, given the intended incorporation of the GDPR into UK data protection law at the end of the transition period, EU entities without a presence in the UK may correspondingly need to appoint a UK representative from 1 January 2021.

Please get in touch with our data protection team if you require more information or need help with appointing an EU representative.

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In place of our usual annual IHL conference in Manchester city centre, we will be offering the following webinars, presented by senior lawyers and partners, remotely via Zoom, each starting at 10am for 45 minutes:

 

17 September 2020

Corporate Insolvency and Governance Act 2020

What are the changes and how does this affect commercial contracts?

 

24 September 2020

Concluding contracts remotely

Avoiding the traps

 

1 October 2020

Changes in regulator behaviours post COVID-19

What to expect in 2021

 

8 October 2020

Contract law update

A review of recent developments and a reminder of the principles of force majeure and frustration

 

To register your place, please email alice.silk@pannonecorporate.com. Joining details will be confirmed prior to each webinar.

 

Do not hesitate to contact us if you have any questions.

 

We look forward to seeing you.

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On 16 July 2020, the CJEU gave its long awaited decision on international data transfers in C-311/18 – Data Protection Commissioner v Facebook Ireland Ltd and Maximillian Schrems (Schrems II).

The court ruled that the EU-US Privacy Shield (Privacy Shield) is invalid and can no longer be relied on to transfer personal data from the EU to the US. The court also held that standard contractual clauses (SCCs) cannot be relied on alone for a lawful international transfer. So what now for international data transfers?

International transfers under the GDPR

The GDPR restricts the transfer of personal data outside the EU to help ensure that the data protection rights of individuals are not undermined. Transfers of personal data can only be made in limited circumstances including:

• To a country which the European Commission has decided ensures an adequate level of data protection, but these are limited in number.
• Transfers governed by SCCs (also known as model clauses) between the data exporter and data importer. The SCCs have been approved by the European Commission with separate SCCs for        controller to controller transfers and for controller to processor transfers.
• Transfers between group companies governed by Binding Corporate Rules (BCRs). These are bespoke agreements which have to be approved by the ICO (or relevant supervisory authority) and are less common.
• Until recently, transfers to a US data importer that is a member of the Privacy Shield. This is a framework that was set up by the US Department of Commerce and the European Commission as a mechanism to comply with data protection requirements when transferring data from the EU to the US. It is commonly used by organisations to make data transfers to the US.

The end of the Privacy Shield

In Schrems II the CJEU found the Privacy Shield to be invalid with immediate effect. The court was concerned about access to personal data by US security bodies under US law and did not consider that individuals whose data had been transferred had effective remedies. All data transfers to the US which rely on the Privacy Shield are now illegal.

The US Department of Commerce is continuing to administer the Privacy Shield despite Schrems II and has made it clear that the decision does not relieve a participating US company of its Privacy Shield obligations.

What about SCCs and BCRs?

The CJEU has clarified that SCCs are still valid to make data transfers. However, they are not in themselves enough to make a transfer lawful and so cannot be relied on alone.

Individuals whose personal data are transferred outside the EU pursuant to SCCs are to be afforded a level of protection essentially equivalent to that guaranteed in the EU by the GDPR. The CJEU set out that supplementary measures may need to be adopted by a data controller, in addition to the SCCs, depending on the “prevailing position in a particular third country” in order to ensure compliance with the level of data protection required under the GDPR.

For data transfers to the US, supplementary measures are required, given the position under US law which led to the Privacy Shield being invalid. The European Data Protection Board (EDPB) has confirmed that data can only be transferred to the US if these supplementary measures, along with the SCCs, ensure appropriate safeguards and US law does not affect the adequate level of protection that they guarantee. The nature of these supplementary measures is currently unclear (see below).

For data transfers to other countries, the EDPB has set out that the data exporter and the data importer should assess whether the level of protection required under the GDPR is respected in that country in order to determine if the SCCs can be complied with in practice. If not, an assessment is to be made on whether supplementary measures can be put in place to ensure an essentially equivalent level of protection to the GDPR and whether the law of the recipient country will prevent their effectiveness. No data should be transferred pursuant to the SCCs if it is not afforded a level of protection essentially equivalent to that guaranteed within the EU.

The EDPB has clarified that the position for BCRs is the same as for SCCs and that supplementary measures may be required in the particular circumstances of the transfer.

What does this mean for your international data transfers?

The CJEU decision leaves international data transfers in a state of uncertainty. It has brought about an abrupt end to the Privacy Shield and at the same time brought uncertainty to the use of the alternatives, SCCs and BCRs.

The CJEU decision points to the possible need for “supplementary measures”, but gives little guidance as to what these may be. However, it seems likely that they will be technical or organisational measures, such as encryption, rather than contractual. One of the main issues of concern identified by the CJEU is access to the data by security or other authorities which would not be addressed by additional provisions in the SCCs, as the authorities are not a party to the contract between the data exporter and data importer. The EDPB has promised more guidance on supplementary measures. Organisations that make US transfers should keep a look out for this.

In the meantime, the ICO has recommended that “you should take stock of the international transfers you make and react promptly as guidance and advice becomes available”. Organisations should therefore undertake an audit of their international transfers outside of the EEA to ascertain which countries data is being transferred to and the basis for the transfer, whether an adequacy decision, Privacy Shield, SCCs or BCRs. This includes for any international transfers made by processors on their behalf. For data transfers to countries other than the US, where SCCs or BCRs are used, organisations should assess the level of protection conferred in that country taking into account local law. For data transfers to the US which currently use the Privacy Shield, organisations need to urgently consider alternatives, including potentially restricting data processing to the UK or EEA.

The implications of Schrems II are difficult for businesses, particularly in the currently climate. The ICO has said that it “understands the many challenges UK businesses are facing at the present time and we will continue to provide practical and pragmatic advice and support.” Nevertheless, organisations should not ignore the implications of Schrems II, in particular for US transfers which use the Privacy Shield.

Patricia Jones, Consultant, patricia.jones@pannonecorporate.com

For further information please contact our specialist data protection team.
Amy Chandler, Partner, Amy.Chandler@pannonecorporate.com
Patricia Jones, Consultant, patricia.jones@pannonecorporate.com
Danielle Amor, Senior solicitor, Danielle.Amor@pannonecorporate.com

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The phrase “cash is king” was used widely after the global stock market crash in 1987 and during the global financial crisis of 2008. No doubt the phrase will also be used frequently in these current challenging times. Whilst many recruitment companies are efficient, well run businesses, one area where potential is not always maximised is pursuing disputed fees. Having an organised and structured process to follow with disputed fees could lead to your business collecting in significant amounts in fees and boosting your profits.

This article looks at some practical steps for you to consider, both in relation to internal steps you can take to reduce the risk of fees becoming disputed, and also in relation to a suggested stage by stage process at the point a fee becomes disputed.

The issue

It’s understandable to see why it’s sometimes easier to let a client ‘off the hook’ when they query a fee, as the everyday life of a recruitment business is fast paced and brings multiple challenges. The situations where we commonly see fee disputes arising are: back-door hires and temp to perm hires. The most common grounds we see raised in fee disputes are: arguments that your terms have not been incorporated and so cannot be relied upon, assertions that your introduction was not the effective cause of the engagement, and, that fee clauses are unenforceable penalty clauses.

Internal measures – prevention is better than the cure

Reducing the scope for fee disputes arising is the starting point. Most importantly you need to be able to show your contract terms apply so you can rely on the fee clauses in the terms. Things to consider to assist with this are:

Training – invest time and resources in training your consultants (including refresher training) on: understanding fully why your terms are so important, what the various provisions are that you’ll need to rely on in disputed fee cases and why, and the best steps to take to optimise your chances of proving the terms apply. This will help prevent mistakes being made (such as old terms being sent out in error).

Email footers – ensure your email footers state your terms apply to any work undertaken. If you take this step and attach a copy of your terms to emails introducing candidates as standard practice, or place a link to the terms in the footer, this will stand you in good stead.

CV footers – you can also include reference to your terms and conditions in the footer of your standard CV templates. This makes it more difficult for an end client to dispute a fee by saying that they did not know the terms applied, or had not seen them.

Process for sending terms – ensure a consistent process for sending out your terms. Ensure terms are provided alongside any CVs sent out and reference the terms in the covering email. It’s much more difficult for a client to say the terms don’t apply if they have been provided with a copy of them and they’ve been specifically referred to in emails.

Keep contemporaneous internal notes – impress on your consultants that they should make notes on your internal computer systems of any calls (they can even do this whilst on the call to save time). Such notes can be invaluable in cases which are litigated to trial, as judges prefer contemporaneous evidence in documents over oral evidence. Instilling a note making habit in your consultants will reap dividends in the long term.

A suggested process when fees are disputed

Whilst the above will help in trying to reduce fees becoming disputed, you should also have a process in place when a client disputes a fee. Firstly, you should have a Business Protection team or strategy in place to monitor circumstances when fees might become payable. This will include: checking Linked-In profiles periodically; monitoring job boards or company job advertisements if they are suddenly removed, indicating a position’s been filled; calling candidates to check in every now and again to establish where they are working; and, if you are suspicious a candidate has been engaged directly, calling the end client to try to speak with the candidate to evidence they’ve been engaged (and keeping a contemporaneous note of any such call!).

A process we’d suggest following with fee disputes is as follows:

Step 1 – gather evidence and assess your position

Step 2 – enter into early dialogue

Step 3 – raise an invoice and send a letter of claim

Step 4 – escalation – draft claim and final warning

Step 5 – commence court proceedings

Step 1 – gather evidence and assess your position – collate evidence to show the candidate has been engaged, such as screenshots of Linked-In profiles and notes of calls made to the candidate and/or the end client. Also review the background facts to establish the strength of your claim and any possible weaknesses at an early stage.

Step 2 – enter into early dialogue ¬– upon a discovery a fee may be due, speak with the end client and ask for an explanation. They may accept it’s a misunderstanding, or you will, at least, be able to understand their position and why they dispute the fee.

Step 3 – raising an invoice and sending a letter of claim – if no resolution has been achieved, send an invoice and a more formal and detailed letter of claim. This can come from you or your solicitor, but the background should be set out with evidence of the engagement, with reference to the terms and say why the fee is due. Further exchanges of correspondence may follow.

Step 4 – further escalation – a draft claim and final warning – if there is still no resolution, you can take steps to prepare a draft court claim. To save on the cost of the court issue fee initially, you can send it in draft form to the defendant to allow one final chance to find a resolution.

Step 5 – commencing court proceedings – the final step is to issue County Court proceedings to recover the sum due. This shows the end client you’re prepared to take matters further and you are essentially calling their bluff. You should note, however, that the majority of matters will settle before trial.

Always consider settlement – Throughout the dispute you should always consider making ‘without prejudice’ offers to settle. This may be a reduced fee, an agreement for the end client to pay in instalments to help their cash flow, or some agreement to apply discounts against future fees. You can be as creative and as flexible as you like in settlement, which should be contrasted with a final trial in the courts, where a judge is only able to determine if a fee is payable or not and therefore any flexibility is lost.

Ensure your terms work for you, not against you – Another issue to bear in mind is the content of your terms themselves. Having terms periodically reviewed and updated to ensure they are as strong as possible is a worthwhile use of resources and can help guard against common defences to fee claims.

Summary

Ultimately, by taking the above steps and getting processes in place, you’re looking to avoid the situation where you simply let disputed fees go without a fight, or you’re putting yourself in as strong a position as possible to succeed if the matter proceeds to a trial in the courts and maximising your chances of achieving an early settlement. Review your existing processes and be prepared to be a bit braver in pursuing fees that are disputed. It could end up bringing in some much needed cash to your business.

Jonny Scholes is a director at Pannone Corporate LLP, an experienced commercial law firm in Manchester. Pannone Corporate’s lawyers have vast experience in the recruitment sector in: commercial drafting of recruitment contracts; dispute resolution (including unpaid fees and breaches of restrictive covenants), employment advice, and corporate advice (including shareholders’ agreements, sales and acquisitions and group restructuring).

Jonny has worked with recruiter clients for over 12 years and has assisted clients recover hundreds of thousands of pounds in disputed fees. His approach is to work collaboratively with his clients to seek a resolution as quickly and cost-effectively as possible. If you have any queries arising from this article, you can contact Jonny at jonny.scholes@pannonecorporate.com.

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The 2019 Court of Appeal criminal case of R (The Pensions Regulator) v Workchain Limited (Workchain) serves as a useful reminder of the possible criminal consequences of unauthorised access to a computer system.

Facts

Under the Pensions Act 2008 employers are required to automatically enrol eligible workers into a pension scheme. The employer has to pay pension contributions and to deduct from earnings and pay into the scheme employee pension contributions. An employee, but not the employer, can opt out of the scheme. If this is done within one month of enrolment, then the employer and employee do not have to pay any pension contributions.
Workchain was a recruitment agency which employed temporary workers and provided them to clients for a fee. It used National Employment Savings Trust (NEST) as its workplace pension scheme. Workers are given a unique NEST ID so that they are able to access their data on-line and to enable them to opt out of the scheme if they wish. Employers are not given access to employee on-line data nor are they allowed to opt-out their workers. This is because employers have an incentive to opt out workers to save paying pension contributions. The NEST system was designed to ensure that an opt-out is a free choice of the employee.
However, Workchain was determined to opt out its temporary employees from the NEST scheme after their enrolment. Workchain staff made calls to NEST pretending to be temporary employees in order to obtain their NEST IDs which were later used to access the NEST on-line system and to opt them out. Workchain managed to achieve an opt-out rate of 66% compared to an average of 8%. Some of these opt-outs could be traced back to Workchain senior staff pretending to be a worker to obtain a NEST ID and others originated from a Workchain IP address indicating that they had been made by Workchain staff rather than the temporary workers. NEST became suspicious and the Pensions Regulator was alerted.

The criminal proceedings

The Pension Regulator brought charges against Workchain, its directors/shareholders and various other personnel under s1 of the Computer Misuse Act 1990 (CMA). This sets out that a person is guilty of an offence if:
(a) he causes a computer to perform any function with intent to secure access to a programme or data held in any computer, or to enable any such access to be secured;
(b) the access he intends to secure or to enable to be secured is unauthorised; and
(c) he knows at the time when he causes the computer to perform the function that that is the case.
The focus of this offence is the unauthorised access to computer programmes and/or data. It is committed without the need to prove dishonesty or any intent to use the data for example for further offences or any other purpose. The offence carries a maximum sentence of 2 years’ imprisonment or an unlimited fine on indictment.
In this case all eight defendants pleaded guilty. The two directors were sentenced to four months imprisonment suspended for two years, were directed to perform 200 hours community service and to pay £11,250 costs. Workchain was fined £200,000 with a costs order of £60,930 and a victim surcharge.
Workchain appealed its fine claiming that it was manifestly excessive. For the first time ever the Court of Appeal had to consider how sentences under s1 of the CMA should be determined. The Court decided that the assessment of harm and culpability are the foundation of the sentence. When assessing harm, the Court stated that this is not limited to financial harm. A crucial head of harm under s1 of the CMA is the loss of integrity of the computer system involved in the breach, which was particularly important in this case given that employers are prohibited from having access to the employee pension data. When assessing culpability the reasons for and circumstances of the unauthorised access and the degree of persistence are relevant. The fact that an employer is in a position of trust is also to be taken into account. Previous convictions, particularly of a like sort, are an aggregating factor as may be poor regulatory compliance by the employer. Finally, the sentence imposed should be proportionate which means that the financial circumstances of the offender can affect the fine.
In this case, the financial loss to the employees and the savings for Workchain were small because of the temporary nature of the workforce. However, importantly in addition to the direct financial harm, Workchain’s “manipulation of the on-line system inevitably damaged or risked damaging trust in these systems, and consequently the scheme introduced by the Pensions Act as a whole. It inevitably risked undermining public confidence in the security of personal data in this context and generally, including confidence in the security of the pension funds involved”.
The Court considered Workchain’s culpability to be high. “Its senior employees unlawfully attempted to persuade its workers to opt out and, having failed to do so, pretended to be those workers in order to access unauthorised data for the purposes of defeating the automatic enrolment provisions”. The Court considered Workchain’s offending to be serious and to warrant a substantial sentence.
However, when considering the proportionality of the sentence the Court took into account that the company’s directors/shareholders had been convicted of the same offence and that a fine would in practice fall upon those same individuals as shareholders, the company’s otherwise unblemished record and its general regulatory compliance. With a discount for a guilty plea the Court of Appeal halved the fine imposed from £200,000 to £100,000.

Conclusion

This case demonstrates the wide application of the CMA and the potential criminal liability under it. It requires only for data to be accessed without authority and for it to be known at the time that access is unauthorised. Importantly, there is no need to prove dishonesty or any intent to use the data. Many cases of unauthorised access are for financial gain, but as this case shows even if the sums involved are insignificant the Court can impose significant sentences upon a company, its directors and employees where the offence risks undermining public trust in the security of the data. Companies and their employees should be mindful of this case and ensure, particularly during this time of remote working, that they respect data security controls and limitations on access.
For further information please contact our specialist data protection and regulatory team:

Amy Chandler, Partner, Amy.Chandler@pannonecorporate.com
Patricia Jones, Consultant, patricia.jones@pannonecorporate.com
Rhian Greaves, Associate Partner Rhian.Greaves@pannonecorporate.com
Danielle Amor, Senior solicitor, Danielle.Amor@pannonecorporate.com

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The NHS Test and Trace system for COVID-19 was launched on 28 May 2020, some critics say with undue haste. The accompanying contact tracing app has had a first phase launch in the Isle of Wight. The purpose of these systems is to help control the spread of the virus. As part of this, large amounts of personal data will be collected. So how has data protection been addressed in these systems?

NHS Test and Trace system for COVID-19

The Privacy Notice for the system gives some insight into the type of data that is collected and why. It sets out that people who test positive will be contacted and asked to confirm or provide their full name, date of birth, sex, NHS number, home postcode and house number, telephone number and email address as well as details of their COVID-19 symptoms including when they started and their nature. They will also be asked to give the contact details of anyone they have been in close contact with who will then be contacted by text, email or by a contact tracer to provide their full name, date of birth and contact details as well as details of any COVID-19 symptoms. Some contact tracers will be employed by private companies which act as data processors in which case those people can only see the information of the contacts they are to call.
Public Health England (PHE) will keep the personal data for people with COVID-19 symptoms for 20 years and 5 years for contacts of those people who do not have symptoms. PHE justify this retention period on the basis that COVID-19 is a new disease and it may be necessary to know this information to help control any future outbreaks or provide any new treatments. However, privacy campaigners have expressed concern about the length of the retention period and the potential for personal data to be used by other government departments for other purposes.
It has been reported that PHE did not complete a Data Protection Impact Assessment (DPIA) before launch of the NHS Test and Trace system and that The Open Rights Group have made a complaint to the Information Commissioner’s Office (ICO) about this. Under the GDPR a DPIA must be carried out for processing which is likely to result in high risk to an individuals’ rights and freedoms, prior to the processing. In particular a DPIA must be carried out in the case of processing on a large scale of special category data, which includes health data, so one should have been carried out for the system. In certain cases the ICO needs to be consulted about a DPIA if the processing would result in a high risk and the controller cannot take measures to reduce that risk. In that case, the ICO will provide advice to the controller including in appropriate cases advice not to carry out the processing because the ICO consider it would breach the GDPR.
The DPIA serves the important purpose of considering the likely processing and helps to identify and mitigate the data protection risks. The reported lack of a DPIA before launch gives the impression that the data protection implications of the system have not been fully thought through and could be a factor which undermines public trust in it.

NHS Covid-19 App

On 7 May 2020 the ICO confirmed that it is reviewing the DPIA for NHSX’s pilot of its contact tracing app on the Isle of Wight. The ICO state that even though there is no legal requirement for NHSX to do so, NHSX has asked the ICO for an informal review of its DPIAs for the Isle of Wight trial and for a national roll out of the app. The ICO has agreed to do this as part of its support to NHSX.
Alongside this the ICO has prepared a document for the Human Rights Joint Committee which was sent in advance of an appearance before the Committee of the Information Commissioner and the ICO’s Executive Director of Technology and Innovation. This document sets out the ICO’s expectations on how contact tracing solutions may be developed in line with the principles of data protection by design and default and includes best practice recommendations. This makes clear that a DPIA must be completed prior to the commencement of the processing and updated at all relevant stages of the app’s development.

Conclusion

The ICO’s involvement with the NHSX contact tracing app is encouraging. However, it does seem that the NHS Test and Trace system has some further work to do to re-assure the public that the data protection risks have been considered and addressed.
If you require any further information or assistance please contact our specialist data protection team:

Amy Chandler, Partner, amy.chandler@pannonecorporate.com
Patricia Jones, Consultant, patricia.jones@pannonecorporate.com
Danielle Amor, Senior Associate, danielle.amor@pannonecorporate.com

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To date the potential fines for non-compliance with the GDPR have attracted headlines. However, it is important for organisations to appreciate that there is also potential liability to pay compensation to individuals for a data protection breach. There is a developing claimant industry for compensation claims following a data protection breach. We round up below some recent cases and developments on data compensation claims.

Class action claim against EasyJet

On 19 May 2020 EasyJet reported that they had suffered a personal data breach relating to names, email addresses and travel details of 9 million customers and the credit card details of 2,208 people. Only 3 days later, on 22 May, a law firm publicised that they had issued a claim form on behalf of affected customers, that it would be now seeking a group litigation order and asking for affected people to join the claim. The litigation against EasyJet has been widely publicised by the national press, stoking up interest by individuals in making a claim.
EasyJet first became aware of unusual system activity in January 2020 but carried out investigations before informing affected individuals of the breach. They have reassured affected customers that there is no evidence that their personal data has been misused. However, those acting for claimants have described this as a monumental data breach which has had a serious impact on customers. It seems that the battle lines are being drawn for a claim for significant compensation, all at a very difficult time for the airline industry. In the meantime, EasyJet has reported the breach to the Information Commissioner’s Office (ICO) which is investigating.

Other recent breaches

The EasyJet personal data breach follows on from others in the airline industry. In March 2020, the ICO fined Cathay Pacific £500,000 for having failed to secure its systems from October 2014 to May 2018, leading to the exposure of the personal data of 111,578 customers’ from the UK and about 9.4 million more worldwide. The security breach took place before the GDPR, so this was the maximum fine that the ICO could impose.
The ICO has also indicated an intention to fine British Airways £183 million for a personal data breach in 2018 including payment card and travel booking details which involved about 500,000 customers. In addition, British Airways is currently facing court action from affected individuals for compensation. One law firm informs potential claimants that they will be able to claim significant compensation from British Airways ranging from thousands to tens of thousands of pounds.

Atkinson v Equifax Ltd

One issue is whether an Individual who has suffered no financial loss or distress from a data breach can still recover compensation.
These were the circumstances in the Atkinson case. The claim arose from a significant cyber-attack on Equifax US in 2017. Mr Atkinson brought a representative civil action seeking, according to his solicitors, compensation of £100 million on behalf of 15 million affected customers. He claimed damages for “loss of control” of his data. This followed the Court of Appeal judgement in Lloyd v Google which found that damages can be awarded for loss of control of data, even if there is no pecuniary loss or distress. Equifax Limited had already been fined £500k by the ICO, the maximum amount as this was a pre-GDPR breach, so the civil action represented further significant liability.
It has recently been reported by the barrister team acting on behalf of Equifax that, following service of the defence, Mr Atkinson is withdrawing his representative action and his solicitors have accepted that Equifax is entitled to recover its costs. Although this is not a reported case, it is indicative that there are limits on “loss of control” damages. The defence is said to have challenged the correctness of Lloyd v Google and its application to a cyber-attack case and must have been persuasive to lead to the withdrawal of the claim. Lloyd v Google has also been appealed to the Supreme Court so further developments on “loss of control” damages are expected.
However, the decision is unlikely to have an immediate impact on the mushrooming data protection claim industry, where the net for compensation following a data breach is usually cast wide to include damages for distress as well as for any financial loss and personal injury.

WM Morrison Supermarkets Plc v various Claimants

This is a recent Supreme Court decision which considered the circumstances in which an employer will be vicariously liable for a data protection breach committed by an employee. Importantly, the Supreme Court found that the employer, Morrisons, in the circumstances of this case was not vicariously liable.
The employee (S) was a senior auditor who as part of his job was given access to the payroll data of the whole workforce. Unbeknown to Morrisons S harboured a grudge which led to him copying and uploading the data of nearly 100,000 employees to a publicly accessible file sharing site as well as sending data to various newspapers. S took extensive steps to cover his tracks but was eventually caught and imprisoned. Morrisons spent more than £2.26 million in dealing with the aftermath of the disclosure.
A group action for damages was commenced by 9,263 employees/former employees who alleged they had suffered distress because of the disclosure. If successful Morrisons faced potential claims from all the affected individuals, so its potential liability was significant. In both the High Court and the Court of Appeal, Morrisons was found not to be directly liable for the disclosure. However, it was found to be liable on a vicarious basis as the employee was considered to be acting in the course of his employment when he made the disclosure. Fortunately for Morrisons, the Supreme Court overturned this decision.
The Supreme Court considered that the key question to establish vicarious liability is whether the disclosure of the data was so closely connected with acts that the employee was authorised to do that, for the purposes of the liability of the employer to third parties, the employee’s wrongful disclosure may fairly and properly be regarded as done by him while acting in the ordinary course of his employment. In this case the Court considered that the employee was not engaged in furthering the business of his employer when he committed the wrongdoing but rather was pursuing a personal vendetta. His wrongful conduct was not so closely connected with acts which he was authorised to do that it could fairly and properly be regarded as done by him while acting in the ordinary course of his employment so as to establish vicarious liability.
This is a case under the Data Protection Act 1998 but it is expected that the same constraining principles will apply under the GDPR to establish vicarious liability in respect of processing by rogue employees. However, it is important to remember that where an employee is processing data on behalf of their employer, the employer is directly liable for any non-compliance with the data protection legislation. Employees should be trained on data protection and compliance monitored. An employer who fails to put in place appropriate security measures to guard against unlawful disclosure and/or data loss which causes or contributes to a disclosure will also be liable under the GDPR.

Conclusion

For breaches that affect a large number of individuals, compensation can be a significant potential liability. Whilst the Morrisons and Equifax cases demonstrate that there are some limitations on data protection compensation claims, there is still a mushrooming industry pursuing these claims on a “no win no fee” basis. We await with interest the future outcome of these compensation claims to give further guidance in this developing area.
If you require any further information or assistance please contact our specialist data protection team:

Amy Chandler, Partner, amy.chandler@pannonecorporate.com
Patricia Jones, Consultant, patricia.jones@pannonecorporate.com
Danielle Amor, Senior Associate, danielle.amor@pannonecorporate.com

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The Corporate Insolvency and Governance Bill has now been published.

The key features of the Bill are as follows:

It is currently expected that the Bill will become law in early June.

The full text of the Bill can be found here:

https://publications.parliament.uk/pa/bills/cbill/58-01/0128/cbill_2019-20210128_en_1.htm.

In conjunction with the above, HMRC has also published guidance indicating that it will support temporary payment holidays in the case of individual and company voluntary arrangements and that it will not pursue bankruptcy or winding up petitions for enforcement purposes in the current climate unless it is deemed essential (i.e. where there are allegations of fraud or criminal activity).

We will set out further thoughts on each of the features highlighted above over the coming weeks and as the Bill progresses through parliament.

If you wish to discuss any of the issues referred to above or require further guidance, please do not hesitate to contact Daniel Clarke or Heather Morris.

 

E          daniel.clarke@pannonecorporate.com

M         (0)7920 237687

 

E          heather.morris@pannonecorporate.com

M         (0)7487549047

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The Covid-19 lockdown restrictions have significantly impacted upon the employer/employee relationship with it being reported that 7.5 million workers have been furloughed.

Longer term effects may be unavoidable as some employers will be forced to make cut-backs to their workforce. As employees move on to join new businesses, or to set-up on their own, one issue which ought to be considered is the risk of misuse of confidential information.

The case of Trailfinders Limited v Traveller Counsellors Limited & Others, which was decided earlier this year, serves as a useful reminder of the way in which the court balances the need to protect confidential information with the risk of inhibiting legitimate competition.

The facts of the Trailfinders case

The Claimant, Trailfinders, is a travel agent with 37 branches in the UK and Ireland, employing over 700 sales consultants. The Second to Fifth Defendants in the case were former sales consultants at Trailfinders who left to join the First Defendant, Travel Counsellors Limited (TCL).

Trailfinders alleged that when the Second to Fifth Defendants left they took with them the names, contact details and other customer information, and that they continued to access Trailfinders’ customer database after the termination of their employment.

Trailfinders claimed that each of the Defendants had misused its confidential information.

What will amount to confidential information?

The Trailfinders’ case helpfully summarises the three classes of information which an employee may obtain through their employment:

  1. The first class of information is that which is obviously not confidential and so not capable of being protected.
  2. The second class of information is confidential information which is acquired during the normal course of employment and which becomes part of an employee’s experience and skills. This is capable of being protected during the term of the employment relationship.
  3. The third class is information which is of the nature of a trade secret (such as a chemical formulae or special method of construction) or which has a high degree of confidence. This is capable of being protected both during the term of the employment relationship, and following its termination.

Implied into every contract of employment is a general duty of good faith and fidelity which restrains an employee from misusing both the second class and third class of confidential information during the term of employment. This duty comes to an end upon termination of an employment contract.

There is a further, narrower implied term in every employment contract not to misuse the third class of information even after the termination of the employment contract.

Second class – is it really part of an employee’s skill and knowledge?

Former employees will often seek to defend their use of confidential information on the basis that it forms part of their skill and knowledge and they are therefore free to use that information following the termination of their employment.

The Trailfinders’ case is helpful to employers in that it makes it clear that:

Third class – what information may be protected after the end of the employment relationship?

Misuse of this third class of information is likely to cause an employer the greatest damage and is therefore capable of being protected even after the termination of the employment relationship.

The Trailfinders’ case helpfully reminds employers of the questions to ask when assessing whether confidential information bears the hallmark of this third class:

The court’s decision in the Trailfinders’ case

The court held that the Defendants had extracted details relating to at least 32 customers from Trailfinders’ databases. The court rejected the Defendant’s assertions that they could have obtained Trailfinders’ customer information from public sources, because they were found not to have done so.

The court held that the former employees and TLC had misused Trailfinders’ confidential information.

Conclusion

The present climate may result in conflicts arising in relation to the misuse of confidential information. The following key points may assist employers in mitigating, investigating and responding to that risk:

For further information on the issues raised in this article please contact Paul Jonson or Sarah Bazaraa.

Contact details:
Paul Jonson
Senior Partner
T (0)7737 571147
E paul.jonson@pannonecorporate.com

Sarah Bazaraa
Director
T (0)7920 237599
E sarah.bazaraa@pannonecorporate.com

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Introduction

On 1 April 2020 the Supreme Court handed down two significant decisions: Barclays Bank plc v Various Claimants [2020] UKSC 13 (“Barclays”) and WM Morrison Supermarkets plc v Various Claimants [2020] UKSC 12 (“Morrisons”).

Although the Supreme Court held that the law has not changed, both cases mark a departure from the increasing scope of vicarious liability (VL) and help provide some certainty.

VL is a doctrine that holds employers liable for wrongdoings committed by employees through the course of their employment.
It is particularly important in civil claims for damages, where it is a common practice for claimants to target the parties with the deepest pockets – usually the employer and its insurance policy.

In order to impose VL, two elements are typically needed:
a) an appropriate relationship between the employer and the wrongdoer; and
b) that the wrongdoing was committed within this relationship

Barclays

In Barclays, Dr Bates was a doctor who worked for a variety of hospitals and insurance companies. He also carried out medical assessments for prospective employees for Barclays Bank plc. Applicants would be told by Barclays that they had to pass a medical examination, and Barclays would arrange the appointments with Dr Bates. Dr Bates was not paid a retainer, but was paid for each report.

Many of the examinees now allege that Dr Bates (now deceased) sexually assaulted them during these examinations and sought to hold Barclays liable under VL. The Supreme Court disagreed.

It was held that there was a distinction between work done for an employer as part of their business and work done by an independent contractor as part of their own business – the crux was whether the wrongdoer was carrying on business on their own account.
The court held that Dr Bates was not sufficiently akin to an employee of Barclays. He carried out work for them, but was not on retainer and was free to refuse work.

Morrisons

In the Morrisons case, an employee published personal information about other Morrisons employees online. He did this because he held a grudge against Morrisons following a disciplinary hearing. Initially, the Court of Appeal held that this action fell within VL but the Supreme Court held that the lower courts had misunderstood VL.

The Supreme Court found that the disclosure of the information was not part of the wrongdoer’s field of activities, that the unbroken chain of causation was insufficient and that motive was highly relevant.

It was also found that the fact that the wrongdoer’s employment gave him the opportunity to commit the wrongdoing was not enough to impose VL.

The wrongdoer was clearly not trying to further his employees business, and the wrongdoing was not closely connected with the job he was authorised to do.

What does this mean?

Barclays examines the kind of relationships which allow VL to be imposed, making it clear that an employer cannot be held accountable for the actions of self-employed contractors.

Morrisons illustrates that VL will not be imposed simply because the wrongdoing is similar to the authorised job. It is also reassuring to know that a ‘personal vendetta’ by an employee will not result in a liability and potential civil claims.

Both of these cases are ultimately good news for employers and help clarify the law surrounding vicarious liability.

Contact details:
Paul Jonson
Senior Partner
T (0)7737 571147
E paul.jonson@pannonecorporate.com

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There has been an emerging trend for individuals to sue for compensation for breaches of the GDPR including after cyber-attacks. Two recent cases give important guidance to controllers on the extent to which they may be liable for a data protection breach.
WM Morrison Supermarkets Plc v various Claimants
This is a recent Supreme Court decision which importantly found that the employer, Morrisons, was not vicariously liable for breach of data protection law committed by an employee.


The employee (S) was a senior auditor who as part of his job was given access to the payroll data of the whole workforce. Unbeknown to Morrisons S harboured a grudge which led to him copying and uploading the data of nearly 100,000 employees to a publicly accessible file sharing site as well as sending data to various newspapers. S took extensive steps to cover his tracks but was eventually caught and imprisoned. Morrisons spent more than £2.26 million in dealing with the aftermath of the disclosure.
A group action for damages was commenced by 9,263 employees/former employees who alleged they had suffered distress because of the disclosure. If successful Morrisons faced potential claims from all the affected individuals, so its potential liability was significant. In both the High Court and the Court of Appeal, Morrisons was found not to be directly liable for the disclosure. However, it was found to be liable on a vicarious basis as the employee was considered to be acting in the course of his employment when he made the disclosure. Fortunately for Morrisons, the Supreme Court overturned this decision.


The Supreme Court considered that the key question to establish vicarious liability is whether the disclosure of the data was so closely connected with acts that the employee was authorised to do that, for the purposes of the employer’s liability to third parties, the employee’s wrongful disclosure may fairly and properly be regarded as done by him while acting in the ordinary course of his employment. In this case the Court considered that the employee was not engaged in furthering the business of his employer when he committed the wrongdoing but rather was pursuing a personal vendetta. His wrongful conduct was not so closely connected with acts which he was authorised to do that it could fairly and properly be regarded as done by him while acting in the ordinary course of his employment so as to establish vicarious liability.


This marks a welcome decision for employers, particularly as the Court of Appeal and court of first instance had previously found Morrisons to be vicariously liable for S’s actions. However, it is important to remember that where an employee is processing data on behalf of their employer, the employer is directly liable for any non-compliance with the data protection legislation. Employees should be trained on data protection and compliance monitored. An employer who fails to put in place appropriate security measures to guard against unlawful disclosure and/or data loss which causes or contributes to a disclosure will also be liable under the GDPR.


Atkinson v Equifax Ltd
This case relates to a significant cyber-attack on Equifax US in 2017. Mr Atkinson brought a representative civil action seeking, according to his solicitors, compensation of £100 million on behalf of 15 million affected customers. He claimed damages for “loss of control” of his data. This followed the Court of Appeal judgement in Lloyd v Google which found that damages can be awarded for loss of control of data, even if there is no pecuniary loss or distress. Equifax Limited had already been fined £500,000 by the ICO, the maximum amount for a pre-GDPR breach, so the civil action represented further significant liability.


It has recently been reported by the barrister team acting on behalf of Equifax that, following service of the defence, Mr Atkinson is withdrawing his representative action and his solicitors have accepted that Equifax is entitled to recover its costs The defence is said to have challenged the correctness of Lloyd v Google and its application to a cyber-attack case and must have been persuasive to lead to the withdrawal of the claim.
It will be interesting to see whether this leads to a downturn in the number of class-action type claims brought by groups of individuals for damages following a cyber-attack. Lloyd v Google has also been appealed to the Supreme Court so further developments on “loss of control” damages are expected.


Conclusion
The potential fines for non-compliance with the GDPR have attracted headlines. However, there can also be potential liability to pay compensation to individuals for a data protection breach. For breaches that affect a large number of individuals this can be a significant additional liability. Whilst the Morrisons and Equifax cases demonstrate that there may be some limitations on such compensation claims, we await to see what effect they will have on the market for compensation claims.
If you require any further information or assistance please contact our specialist data protection team:


Amy Chandler, Partner, amy.chandler@pannonecorporate.com
Patricia Jones, Consultant, patricia.jones@pannonecorporate.com
Danielle Amor, Senior Associate, danielle.amor@pannonecorporate.com

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The Information Commissioner’s Office (ICO) has recently set up an information hub on its web site (https://ico.org.uk/global/data-protection-and-coronavirus-information-hub/) giving helpful guidance on data protection compliance in these difficult times.

Regulatory action

Organisations may be concerned that they are no longer meeting their usual standards of data protection compliance because resources are being necessarily diverted elsewhere. The ICO has confirmed that it “won’t penalise organisations that we know need to prioritise other areas or adapt their usual approach during this extraordinary period.” Whilst the ICO is unable to extend the statutory time limits which apply to subject access requests (SARs) and other data protection rights of individuals, it will tell people that they may experience delays.

COVID-19 does not mean that organisations can ignore data protection legislation. You should still try to comply as much as possible. Keep a record of decisions made and the reasons for them, in case of scrutiny afterwards. You should continue to try to respond to SARs keeping individuals informed and updated on the response and likely time-scales.

Security measures for homeworking

The ICO confirms that data protection law does not prevent home working or staff from using their own device or communications equipment. However, the same kinds of security measures are needed as are used in normal circumstances.

Can you tell staff that a colleague may have contracted COVID-19?

Organisations should keep staff informed about cases, but individuals should not be named. The ICO states you should only disclose necessary information as required to satisfy your health and safety obligations and duty of care to staff.  

Can you collect COVID-19 information from employees or visitors?

You have an obligation to protect employees’ health but that this does not mean you can collect lots of information about them. The ICO suggests asking people to tell you if they are experiencing COVID-19 symptoms, advising staff to call 111 if that is the case and asking visitors to consider government advice before they decide to come. If specific health data is still needed then only collect what is necessary and ensure it is appropriately safeguarded. This includes keeping it secure and restricting access to it on a “need to know” basis.

Can you share employees’ health information with the authorities for public health purposes?

Yes, although the ICO considers it unlikely that you will need to share information about specific individuals.

Community groups

This crisis has demonstrated community altruism and groups are springing up to help the vulnerable and those self-isolating. The ICO has a dedicated blog on its web site for these groups.

We understand that there are data protection challenges in this time of crisis. If you require any further information or assistance in complying with data protection obligations please contact our specialist data protection team:

Amy Chandler, Partner, amy.chandler@pannonecorporate.com

Patricia Jones, Consultant, patricia.jones@pannonecorporate.com

Danielle Amor, Senior Associate, danielle.amor@pannonecorporate.com

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Introduction
The Government has recognised the COVID-19 pandemic as a “significant challenge for the entire world” and has now taken decisive statutory action, enacting the Coronavirus Act 2020 (“the Act”).
Of particular interest to those in the landlord and tenant sector are sections 81 – 82 of the Act which cover both residential and commercial tenancies and apply to both England and Wales. This note summarises the key takeaways from the Act and the likely effects on both landlords and tenants.

Residential Tenancies
Section 81 of the Act makes various amendments to the Rent Act 1977, Protection from Eviction Act 1977, Housing Act 1985, Housing Act 1988 and Housing Act 1996.
The effect of the amendment is that the time period that a landlord must give to its tenant in any of the relevant statutory notices served in line with these Acts as a precursor to possession proceedings has now been increased to three months. There is scope for this period to be extended up to a maximum of six months by the Secretary of State. The amendment is time limited, only having effect until 30 September 2020, although official Government guidance has already indicated that this is subject to review and may be extended by secondary legislation.
In alignment with section 81 of the Act, the Master of the Rolls has issued Practice Direction 51Z, which suspends all possession proceedings under Part 55 of the Civil Procedure Rules from 27 March 2020 for a period of 90 days. This means that any ongoing litigation with the Court where a landlord was seeking possession of a property (as well as any proceedings seeking to enforce an order for possession already obtained) are now stayed. As with section 81 of the Act, PD 51Z is time limited, only having effect until 30 October 2020.
In further official guidance published over the weekend, the Government “strongly advise” against landlords continuing with present claims or commencing new action seeking possession during the pandemic “without a very good reason”. Unfortunately, the Government stop short at outlining what constitutes “a very good reason”.
In these unprecedented times, landlords should take steps to communicate with tenants who may find it difficult to meet their ongoing obligations. As possession proceedings are effectively suspended during this period, it would be prudent to have sensible conversations with tenants as regards the payment of rent. As an example it may be possible to agree to longer term payment plans to assist were possible.
The same applies to tenants; if you are suffering financial hardship due to the current COVID-19 pandemic, actively engage with your landlord to see if there is a way to come to a mutually beneficial agreement during these tough times. Burying your head in the sand and allowing rent arrears to accrue will only leave you exposed to enforcement action further down the line.

Commercial Tenancies
Section 82 of the Act deals with commercial tenancies; the Act confirmed that this section applies to any tenancy which has security of tenure for the purposes of the Landlord and Tenant Act 1954, or would have such protection if it had not been contracted-out.
The key headline is that a landlord cannot exercise a right of re-entry or forfeiture for non-payment of rent from 27 March 2020 until 30 June 2020, referred to in the Act as the “Relevant Period”. As for any ongoing litigation based on forfeiture for rent arrears, the tenant cannot be evicted until the end of the Relevant Period. Again, as with the provisions affecting the residential sector, the Secretary of State has the power to extend the Relevant Period.
This will provide relief for commercial tenants whose businesses have been forced to close following the strict restrictions imposed by Government on “non-essential businesses”, resulting in cash flow halting almost overnight in some cases.
It is important to note that the suspension of the right to forfeit does not create a rental holiday for commercial tenants; any rent which falls due in the Relevant Period will still payable by the commercial tenants. However, the likely effect of the provisions will result in a rent deferment in many instances as landlords have lost their key weapon for enforcing non-payment of rent.
Another piece of good news for landlords is that the Act makes it clear that no conduct by or on behalf of a landlord during the Relevant Period is to be regarded as waiving the right to forfeit for non-payment of rent (unless specifically waived in writing). This will preserve the landlord’s right to instigate forfeiture proceedings once the Relevant Period has come to an end.
The commentary above regarding parties communicating is equally as applicable to commercial tenancies. There is considerable merit in considering conversations in which the parties can discuss options, including:-
 accepting monthly payments instead of quarterly payments;
 offer a rent deferment (e.g. the March quarter’s rent becomes payable at the same time as the June quarter);
 offer a rent discount (e.g. reduce to a concessionary level for one or more payment periods); and
 offer a rent free period.
The above proposals will certainly ease the short-term financial pressure on commercial tenants. Even if no formal agreement is in place, it would certainly be wise for tenants to pay what they can towards the rent to ensure that any arrears that build over the next few months do not become unmanageable (leaving the tenant exposed to forfeiture action once the Relevant Period expires).
From a landlords’ perspective, they will have to carefully consider how they are to implement any agreements between the parties; any side letters must be carefully drafted so they accurately reflect the terms agreed and executed correctly so they can be relied upon.

Conclusion
In the current economic climate, the reality is that both parties are likely to suffer financially in the short-term. Having early conversations could help mitigate losses and build solid relationships between landlord and tenant, which will survive the COVID-19 pandemic and result in long-term connections that ultimately prove prosperous for both landlord and tenant.


Pannone Corporate
31 March 2020

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1. Are we still entitled to require employees to attend the workplace?

The Government announced on 23 March 2020 that all members of the public must stay at home, except in very limited circumstances. This means that all employees must be permitted to work from home where possible. The Prime Minister said “Travelling to and from work [is permitted], but only where it is absolutely necessary and cannot be done from home“. 

Therefore, you can require employees to attend work provided their work cannot be done from home.  However if employees are capable of doing their work from home but you would prefer to have them in the office, it may be a breach of the implied term of mutual trust and confidence to require attendance in light of the current Government guidance.  An employee in this situation may choose to resign and claim they have been constructively dismissed. Further, it may be automatically unfair to dismiss an employee who refuses to come into the office because they are concerned about the risk of catching the virus.

2. Where an employee falls into the category the government has identified as ‘extremely vulnerable’, can we require them to come into work if their role cannot be carried out remotely?

The Government has identified a limited category of people who are considered to be “extremely vulnerable” and should be “shielded”.  In summary these are:

These individuals are strongly advised to stay at home at all times and avoid any face-to-face contact for a period of at least 12 weeks.

If you have employees who fall into one of the categories above and their work cannot be done from home, you should not require them to attend work.  

The recently published Government guidance on the Coronavirus job retention scheme says that these employees can be furloughed however it is likely that this will only be the case where there is no work for that employee to do so they would otherwise have been laid off.

3. Where an employee can’t work from home and doesn’t wish to attend work, what should they be paid?

Only employees who are ill, self- isolating because they live in the same household as someone who has symptoms of the virus will be entitled to SSP.

Any other employees who don’t wish to attend work (however understandably) and can’t work from home are not entitled to SSP and not entitled to be paid their normal salary either as it is their choice not to come to work. It is up to you whether you continue to pay full salary, ask/allow them to take holiday or require them to take unpaid leave.

In the case of pregnant employees, where the nature of their role means that they cannot work from home and there is no suitable alternative work available that they could do from home, you should consider suspending on full pay in accordance with regulation 16(3) of the MHSW Regulations.

4. What about working parents whose children are off school due to the school closures?

Employees have the right to take unpaid time off to deal with an emergency involving a child or other dependent.  However the right is limited to allowing parents to put alternative arrangements in place and will not cover the extended period needed in this situation.

Employees also have a right to take unpaid “parental leave” to look after a child up to their 18th birthday.   Each parent can take up to 18 weeks for each child in blocks of a week at a time with a maximum of 4 weeks a year for each child. Only employees (not workers) are entitled to unpaid parental leave and only if they have worked for you for a year or more and have parental responsibility for the child. This includes step-parents who have parental responsibility. Normally employees must ask for such leave 21 days in advance however it would be reasonable to waive this notice requirement in the circumstances.

It is also open to you as an employer to simply agree that an employee may take unpaid leave for this purpose.  Alternatively, parents may choose to take annual leave in this situation, subject to your approval.

If you require employees to take holiday or unpaid leave in this situation, there is a risk of indirect sex discrimination. Women are more likely than men to be disadvantaged by the operation of this policy in the current situation because (it is judicially recognised) they tend to take the lion’s share when it comes to caring responsibilities. You may therefore have to justify this approach as a proportionate means of achieving a legitimate aim.

You should make sure therefore that you explore any alternative working arrangements which may avoid the need to take unpaid leave or holiday, such as flexible working hours or a change to duties, before any decisions are made.

5. What about working parents who can work from home but who you suspect are not being productive due to their childcare responsibilities?

You are entitled to require that an employee who is being paid to work from home carries out his full duties and responsibilities, although in the current situation, you may want to take a more flexible approach to the way in which employees carry out their duties.

If you have evidence that an employee is not working from home as they should, you should discuss this with them by telephone. If the problem is their childcare responsibilities, you should discuss the options above.

6. Can we lawfully conduct temperature checks on employees, workers or visitors?

You cannot require an employee, worker or visitor to your premises to undergo a medical examination without their consent. This would include taking temperatures.  Where an employee refuses to have their temperature checked you may refuse entry to the premises, but only where there is a compelling reason for doing so, such as the risk of contact with shielded individuals.

Making a record of the temperature check results entails processing special category personal data which is only lawful in very limited circumstances. The Information Commissioner’ Office has published guidance on data protection and Coronavirus which confirms that “if you need to collect specific health data, don’t collect more than you need and ensure that any information collected is treated with the appropriate safeguards.”

7. Do employees have the right to be notified if colleague/customer develops the virus?

Employees must be notified of any infection risk as soon as possible however you shouldn’t provide more information than necessary and the identity of employees who have contracted the virus should not be disclosed. You should simply advise that an employee who has been in the workplace has been infected and set out any additional precautionary measures that you will be taking to protect employees or that employees should be taking to protect themselves.

8. In what circumstances is Statutory Sick Pay (SSP) payable?

SSP is now payable to:

and who is unable to work as a result.

Employees who are healthy but have been instructed to self-isolate may be able to work from home. If this is an option, they should receive normal pay rather than SSP.

9. What about requiring a ‘fit note’?

For absences up to 7 days, employees should self-certify as usual.  Where the absence exceeds 7 days, employees can now obtain online self-isolation notes to evidence that they have been advised to self-isolate due to the coronavirus. The notes can be accessed from NHS 111 online (https://111.nhs.uk/isolation-note).

Keep in mind that employees who are sick for reasons not related to the coronavirus may struggle to obtain a ‘fit note’ given the closure of GP surgeries. You should therefore be flexible with an employee in this situation and use your discretion when requiring medical evidence.

10. What are the changes to SSP?

The following changes have been made to the SSP scheme:

The legislation for the above changes is not yet in effect however it is advisable that you make a record of any absences relating to the coronavirus (if you are not doing so already), so that you can easily identify those periods of absence which will qualify.

11.  Can we change our enhanced sick pay scheme to provide that only SSP is payable in the event of absence due to coronavirus?

This will depend on whether enhanced sick pay is a contractual right or a discretionary benefit.

Where there is a contractual right to enhanced sick pay, whether express or implied by custom and practice, to amend entitlement will amount to a variation of contract which you can only do with the agreement of employees.

Where enhanced sick pay is genuinely discretionary you can exercise discretion not to pay in the event of coronavirus related absence.

12. Should coronavirus sickness/self-isolation be disregarded when taking account of periods of absence for sickness triggers?

If you have a sickness trigger policy, you may want to consider informing all employees that a period of absence caused by coronavirus, whether because of infection or due to self-isolation in accordance with Government guidance, will be disregarded for the purposes of the absence threshold at which formal action is taken under the policy. A dismissal based on coronavirus related sickness absence may be unfair.

You should also bear in mind that employees with disabilities such as auto-immune conditions, respiratory conditions or diabetes, are likely to suffer more severe symptoms (and therefore take greater time off work) if they catch the virus, or may be more likely to self-isolate due to the potential risks of catching the virus. To avoid any potential disability discrimination issues arising, you should consider disregarding coronavirus absence for such employees.

13. Can holidays be used during periods of coronavirus sickness absence?

Workers are entitled to take statutory annual leave during sickness absence so workers who wish to take annual leave during a period when they would otherwise receive only SSP may be allowed to do so. 

Workers cannot however be compelled to take annual leave during sickness absence and must be allowed to reschedule a period of holiday which falls within a period of sickness absence should they wish to do so.

It is likely that the same principle would apply to someone who is absent because they have been forced to self-isolate (i.e. someone who qualifies for SSP).

14. Can we cancel a worker’s annual leave?

You are entitled in your employment contract to require workers not to take statutory annual leave on certain dates.

In the absence of any such contractual right, an employer may refuse a worker’s holiday request by serving a counter-notice. This must be given at least as many calendar days before the date on which the leave is due to start as the number of days which the employer is refusing.

Unless your employment contract provides otherwise, you must give notice of this requirement which is twice the length of the period of leave to be taken.

15. Is a healthy worker entitled to reschedule holiday?

In light of the current restrictions on movement, many workers are seeking to reschedule periods of holiday to a date later in the year.  It is up to you whether you allow employees to reschedule and it may be beneficial to require employees to take their holiday as planned, or even to give them notice of your requirement to take some of their holiday, during this period.

If you allow employees to reschedule holiday you may face operational difficulties later in the year when everyone wants to book their holiday at the same time.

16. Can we withdraw offers of employment or delay start dates for new recruits in light of the coronavirus outbreak?

If a new recruit has accepted an unconditional offer of employment, there is a binding contract of employment so you would have to serve contractual notice to terminate the contract.The amount of notice pay due will depend on how much of the notice period falls after the agreed start date.

Whilst it would be a breach of contract to impose a varied start date, you can agree this with a new recruit as an alternative to giving notice.

17. What do we know about the furlough scheme in light of the latest Government guidance?

The Government’s guidance is detailed but leaves a number of questions outstanding, such as whether the scheme applies retrospectively to those who have already been laid off without pay, and whether furlough leave could be rotated amongst employees provided each employee is off for a period of at least three weeks.  Here is what we do know:

Overview

Who does it apply to?

How will it be paid?

Employers may choose to top up employees’ wages to 100%, but there is no obligation to do this.

What are the conditions?

https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

18. What is the new Emergency Volunteering Leave (EVL)?

EVL is a new form of statutory unpaid leave. Employees will be able to take a maximum of four weeks leave in any 16-week volunteering period. This is unpaid leave, but otherwise terms and conditions continue as normal. Employees have the right to return to work on the same terms etc. at the end of the leave and are protected against detriment and dismissal for taking the leave. To take EVL, an employee must be certified as an emergency volunteer by an appropriate authority. A compensation scheme will be set up to cover any losses employees incur taking the leave. Certain employees will not be eligible for EVL, for example, if they work in the emergency services or where their employer employs 10 or fewer employees.  

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Covid-19 is raising a number of legal issues in addition to a host of other problems. We set out below a practical analysis of the relevant law.

Force Majeure

As ‘force majeure’ is not defined in statute or case law, contractual clauses are interpreted by looking at their precise wording under the regular principles of contractual interpretation. Some contracts attempt to include “force majeure conditions” without going further but English courts have concluded these are too uncertain and found them void.  It is important to understand that the English courts will not imply a force majeure clause.

The courts have also held that where a clause states that a force majeure event must “prevent” a party from performing its duties (or render it unable to do so), then it must be impossible for the parties to perform the duties – not just more costly or most difficult.

On the other hand, the courts have found that where a clause states that a force majeure event must “hinder”, “impede”, “impair” or “delay” a party in the performance of their duties, the performance only needs to be significantly more onerous.

Parties to a contract can claim force majeure even if the event was not unforeseeable, but a party cannot claim if the event was caused by their own negligence. It was also decided in a recent case that a force majeure clause will only apply if the force majeure event was the only cause of a party’s non-performance.

A party to a contract seeking to excuse non-performance under the contract by relying on a force majeure provision must demonstrate that:

Where the force majeure event definition includes a list of specific events, followed by a catch-all phrase (such as “any other cause beyond the parties reasonable control”) the catch-all phrase will not be qualified by the list and will keep its wide meaning.

Force Majeure and Epidemics

Deciding if Covid-19 would trigger a force majeure clause in a contract will be determined on a case by case basis by looking at the wording of the contract. It is likely to be triggered if the definition of a force majeure event includes words such as “epidemics” or “diseases”.

If such wording is not included, parties may have to rely on more generic language in order to classify the Covid-19 outbreak as a force majeure event.

Examples might include “outbreak”, “crisis” or “government action”.

It may be worth noting that the China Council of the Promotion of International Trade (an international trade promotion agency in China) is currently issuing force majeure certificates to Chinese businesses struggling under the effects of the outbreak.

Frustration

As stated the courts will not imply a force majeure clause where one is not included in the contract, but the concept of frustration may apply.

Put simply, if after the formation of a contract an event occurs that makes it impossible to perform a fundamental obligation of the contract OR makes a fundamental obligation radically different to how it was imagined when the contract was entered into, then the contract will be frustrated and therefore automatically terminated.

Usually the threshold for proving frustration is higher than the standard required by force majeure clauses.

Some (non-exhaustive) examples of situations where a party cannot claim that a contract has been frustrated include:

The 2019 case Canary Wharf (BP4) T1 Ltd v European Medicines Agency shows how difficult it can be to prove frustration. In this case, the European Medicines Agency (the EMA) tried to convince the High Court that its 25 year commercial lease was frustrated as, after Brexit, they were required to move their headquarters from London to Amsterdam. The court held that it was foreseeable to both parties when the lease was agreed that EMA may need to leave the premises during the term and had included provisions allowing the tenant to assign or sub-let the lease during its term. Therefore, it was found that Brexit did not radically alter the EMA’s performance of the contract as it still had the ability to assign or sub-let the lease. The parties, despite not foreseeing Brexit, had foreseen the possibility of the tenant wishing to leave the premises during the term AND had included provisions for this by including an assignment/sub-letting clause.

Covid-19

It is of course difficult to predict the possible impact of Covid-19, but the fact of an outbreak can longer be characterised as “unforeseen”. Under English and Welsh law, if a contract is silent on whether the force majeure event needs to be unforeseen, the court will be reluctant to impose the qualification.

The current outbreak may impact the performances of countless contracts, not rendering them impossible but more difficult or more expensive to perform. Under English and Welsh law, there is no implied right to renegotiate a contract – the right to renegotiate would need to be specifically drafted into the contract. Even if it was included, courts are very reluctant to hold parties to an “agreement to agree” as this is too uncertain as to be enforceable.

Practical tips

19 March 2020

Paul Jonson
Senior Partner
Email: paul.jonson@pannonecorporate.com
DDI: 0161 393 9035
Mob: 07737 571147

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The World Health Organisation has now classified the coronavirus COVID-19 as a public health emergency of international concern.  European countries have advised protective measures to encourage social distancing, with Italy going so far as a total lockdown. The international reaction is already putting a strain on supply chains into the UK and, with the likelihood of similar protective measures being introduced by the British Government over the coming weeks, where does that leave Employers and Contractors engaged on active construction projects?

The key question will be: Who carries the risk for such an event delaying the project or preventing its completion? The place to find the answer, so far as can be ascertained, given that this is such a new phenomenon, will be in the written form of contract between the parties.

NEC

The terms of unamended NEC3 and NEC 4 are likely to provide compensatory protection for Contractors for delays and for additional costs incurred as a result of the impact and effects of COVID-19. Clause 60.1(19) includes, as a Compensation Event, an event which:

In order to benefit from this provision the Contractor will only have the right to seek an extension to the completion date and/or to seek additional costs if it complies with the strict condition precedent for notifying a Compensation Event.  Under the NEC Main Contract, the Contractor must give notice of an event within 8 weeks of becoming aware that the event has happened.  For Sub-Contractors also working under NEC 3 or NEC4, they should note that their notice period is only 7 weeks.

If notice is not given within this time period, the right to any change to the price or the completion date is lost.

It will also be necessary to check the completed Contract Data to ascertain if the risk allocation for such an event precludes either an entitlement to an extension to the completion date or to associated costs. In any event, an early warning notice should be given, by one or other of the parties, as early as possible in order that the parties can engage in discussions to manage and reduce the impact of COVID-19 before either party is required to take more draconian steps to best protect themselves.

In terms of the Employer’s options, the Project Manager can instruct the Contractor to stop work for up to 13 weeks under unamended NEC, before either party can seek to terminate the contract under clause 91.6. Such instruction would be a Compensation Event giving rise to a Contractor’s right to an extension and to additional cost.

The Employer only also has a separate right to terminate under clause 91.7 for an event which stops the Contractor completing the works or is forecast to delay completion by more than 13 weeks and which neither party could have prevented and which an experienced contractor would not have judged as occurring when entering into the contract.

JCT

Under unamended JCT the position might not be so clear.  The specified Relevant Events, which give rise to a right to an extension of time for completion, include, at clause 2.26.14, ‘force majeure’ but which term is not defined and currently has no recognised meaning under English Law.

Force majeure is generally understood to cover an event or circumstance beyond the control of either party, and so, on a reasonable interpretation, a proven adverse impact of COVID-19 may be a force majeure event but this is by no means certain.

The time period for giving notice of delay under unamended JCT is whenever it become reasonably apparent that the progress of the works is being or is likely to be delayed.  However, amendments to the JCT terms often include a strict time period for so notifying.

Also, under JCT, force majeure is not a Relevant Matter so there is no means for the Contractor to seek recovery of the cost of the delay, even if an extension of time is secured.

Under clause 3.10, the Employer could postpone operations on site, which in itself is both a Relevant Event and a Relevant Matter entitling the Contractor to claim an extension and associated loss and expense.  Any Employer seeking to postpone must also be aware that JCT does include a force majeure event as a ground for termination by either party if the works are suspended for the continuous period of time specified in the Contract Particulars.  The default period of suspension in JCT is 2 months but this may have been expressly amended. 

Contract Amendments

It is important to review the express amendments or additional terms incorporated into a contract.  The terms may provide the Employer with the right to terminate at will, or to suspend the works for a certain period.

Conversely, the express terms could limit the Contractor’s rights in such circumstances, limiting the grounds for securing an extension, and precluding it taking steps to terminate.

At common law

In the absence of adequate grounds for securing an extension under the contract or for suspending or terminating, the common law offers little assistance. 

It is only possible to avoid the express terms of the contract addressing delaying events which give rise to an extension if the Employer has prevented performance.  COVID-19 is not an Employer act of prevention.

The common law doctrine of frustration, which would discharge the parties from all future obligations, only applies in certain restricted circumstances where performance has become physically or commercially impossible, which the Courts have interpreted narrowly.  If the Contract can be performed, but subject to delays, it is not impossible to perform, so will not provide sufficient ground to seek to terminate the contract.

Future contracts

If you are due to enter into contract, be warned – The potential delaying impact of COVID-19 is now reasonably contemplated.  That means that it will not be deemed a force majeure event. It will therefore be necessary to either expressly provide for the impact of COVID-19 in the terms of contract or factor in sufficient float to the programme in order to avoid the delaying impact of this pandemic over the coming months.

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It was confirmed in yesterday’s budget that, as a temporary measure to help contain the spread of the Coronavirus, the Government will refund employers with fewer than 250 employees (to be determined by the number of people a business employed as of 28 February 2020) the first 14 days of Statutory Sick Pay they pay to employees as a result of Coronavirus related absence.

It is anticipated that this measure will come into effect at the same time as the temporary regulations to extend Statutory Sick Pay to be available from day one (rather than day four) for employees who self-isolate.

It was also announced that the Government will introduce a temporary alternative to the fit note in the coming weeks which can be used for the duration of the Coronavirus outbreak. This will enable people who are advised to self-isolate to obtain a notification via NHS111 which they can use as evidence for absence from work where necessary. This notification would meet an employers’ need for evidence when paying Statutory Sick Pay. If you would like more advice on any of the issues raised above or in our Coronavirus FAQs (read here), please do not hesitate to get in touch with us.

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What’s New? This month we look at new ICO guidance on the time limit for responding to a subject access request and data protection after Brexit; new rates for statutory family and sick pay; and parental bereavement leave.

https://i.emlfiles4.com/cmpdoc/7/3/2/5/9/files/656487_whats-new-february-2020new.pdf?dm_i=21HH,6RB6T,NK38PB,R0LO2,1

Look out next month Proposals for the new points based immigration system will take effect from 1 January 2021.

Stop Press! ACAS issues new advice for employers on the impact of Corona Virus

https://www.acas.org.uk/coronavirus?dm_i=21HH,6RB6T,NK38PB,R0NUD,1

When is a detriment caused by an act of whistleblowing? In the case of Jesudason v Alder Hey Children’s NHS Foundation Trust the Court of Appeal found that the Trust was not liable to the claimant for detriments caused to him by steps the Trust had taken to protect its reputation following the claimant blowing the whistle.   

https://i.emlfiles4.com/cmpdoc/7/3/2/5/9/files/656350_jesudason-v-alder-hey-nhs.pdf?dm_i=21HH,6RB6T,NK38PB,R0LO2,1

Can a compulsory retirement policy be justified? In Ewart v Chancellor, Master and Scholars of the University of Oxford, the Employment Tribunal upheld a university professor’s claims for direct age discrimination and unfair dismissal following his compulsory retirement.

https://i.emlfiles4.com/cmpdoc/7/3/2/5/9/files/656478_retirement—-ewart-v-uni-of-oxford-new.pdf?dm_i=21HH,6RB6T,NK38PB,R0LO2,1

Grievances and reasonable adjustments In the case of Ishola v Transport for London the Court of Appeal looked at the meaning of “provision, criterion or practice” in the context of a claim about an alleged failure to make reasonable adjustments. 

https://i.emlfiles4.com/cmpdoc/7/3/2/5/9/files/656482_ishola-v-tfl-new.pdf?dm_i=21HH,6RB6T,NK38PB,R0LO2,1

Disability – assessing the long term effect of an impairment In Tesco Stores Ltd v Tennant, the EAT has held that for the purposes of a disability discrimination claim, a claimant must show that their condition had a “long-term effect” at the time the alleged acts of discrimination were committed. 

https://i.emlfiles4.com/cmpdoc/7/3/2/5/9/files/656481_tennant-v-tesco-formatted-new.pdf?dm_i=21HH,6RB6T,NK38PB,R0LO2,1

Pannone Academy offers a range of employment law and HR courses designed to help companies ensure they operate within the law, with a clear focus on prevention rather than cure. More details can be found online at Pannone Academy

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2019 saw climate change making the headlines with ‘climate emergency’ being declared the word of the year, demonstrating that it is at the forefront of the public’s interest. As we move into 2020, there are changes in environmental legislation which are due to come into force and further proposed changes.

Energy Performance

The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 (“MEES Regulations”) mean that it is unlawful to grant a new tenancy of a property with an EPC rating of E (a sub-standard property), unless an exemption has been validly registered.

From 1 April 2020, it will be unlawful for landlords to continue to let a sub-standard domestic property, unless they have validly registered an exemption, or they have made all the relevant energy efficiency improvements for the property and the property remains sub-substandard. If a landlord breaches the MEES Regulations, they can be subject to fines and a publication penalty.

The government has published a consultation on amending the MEES Regulations to improve the energy performance of non-domestic private rented properties. The consultation sought opinions on two targets: either all non-domestic private rent properties are to achieve a minimum EPC rating of B by 1 April 2030 (where cost effective); or a minimum EPC rating of C (where cost effective). The government’s preference is for the ambitious target of a minimum EPC rating of B. The outcome of the consultation is awaited.

There are also intentions for the government to consult on increasing the minimum energy efficiency for domestic private rented properties.  

MEES provisions are becoming more common in leases and can impact on other aspects of the lease, such as rent review reinstatement and dilapidations.

Conservation Covenants

The government has proposed the introduction of conservation covenants in England to improve the natural environment for future generations. A conservation covenant is an agreement between a property owner and a body such as a conservation organisation (for example, the National Trust), local authority or government body. The covenant could contain positive or restrictive obligations for a conservation purpose. The covenant would be binding on future owners of the land and will last indefinitely, unless it provides for a shorter period or is with a tenant. There will be no restriction on the number of conservation covenants on one property.

Conservation covenants were included in the Environment Bill 2019, but it was not passed before the dissolution of Parliament. It is expected that the new Parliament will pick up the Environment Bill 2019.

The potential implications of conservation consents are not yet known. However, as with restrictive covenants, an onerous conservation covenant could affect the value of the land and the ability of the property owner to deal with or sell the property.

Electric Vehicle Charging Structure

In 2019, consultations were published by the Department for Transport looking at improving the charging infrastructure for electric vehicles.

The consultation included proposed amendments to the Building Regulations 2010 to include electric vehicle infrastructure requirements. The proposals would impact on developers by requiring the installation of charge points and/or cables (depending on whether the building is residential or non-residential) for new buildings and where existing buildings are undergoing major renovation (subject to exemptions). The outcome of the consultation is awaited.

Looking Ahead

As the public continue to demand action on climate change, it is likely that we will see further environmentally aware initiatives which could impact on real estate. 

For real estate advice, get in touch with the Pannone Corporate team on 0800 131 3355 or  complete our contact form.

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Manchester manufacturing specialist M&I Materials is targeting new international markets after turnover soared by more than 20 per cent.

The company – which is being advised on its overseas expansion strategy by Pannone Corporate – reported a rise in sales from £38m to £46m during its most recent financial year.

Chief executive Giles Salt attributed the growth to M&I’s international efforts, which now account for 91 per cent of income. Customers include Boeing, CERN and F1.

“It’s not often you see an industry transform before your eyes, let alone in a way that you can actively contribute to,” said Salt. “The UK wants to be a leader in the EV transition and it can be, but only if we can crack the issues of range anxiety and edge towards charge times more similar to the petrol pump experience.

“We can help do that. We have been working in advanced materials and electrical insulation for more than 100 years, with a core specialism in dielectric fluids for more than 40. We work with some of the world’s best universities and research institutions to keep innovating and growing.”

Pannone Corporate senior partner Paul Jonson added: “M&I Materials has been a client for several years and, through its innovative and highly specialised products and commitment to building long-term relationships with its global supply chain, has become a leader in its markets.”

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How do you prepare for and ensure that a mediation has the most chance of success? When it comes to mediation, the measure of success depends on a wide range of factors. But, the methods of reaching a mutual and agreeable solution are often the same.

 

We have won national awards for our use of mediation. We have been using mediation as a method of dispute resolution for over 16 years. The dispute resolution team at Pannone Corporate know that mediation is a valuable and preferable form of dispute resolution for clients. Mediation is confidential, flexible, easy to arrange and a controlled environment. It is also much less expensive than a trial. While the following tips are by no means comprehensive, they are a good starting point and essential to consider prior to any mediation proceedings.

 

1) Timing is Critical

When it comes to mediation, timing can be key. Introducing mediation early into a situation can prevent further legal escalation, as well as helping to maintain relationships between parties. It can also help to avoid the legal fees, management time, reputational risk and other associated costs of going to trial. However mediating too early can be a mistake if the parties don’t understand enough about their own position or the opponent’s case. Again mediating very late on in a dispute, such as a few weeks before trial, can be a mistake as the parties are usually entrenched in their positions and significant costs have been incurred.

 

Additionally, if neither side has any expectation or intention of settling the case then mediation is not a good use of time or money.

 

2) Preparation

A large part of successful negotiation derives from preparing your case. This sounds obvious but there is nothing that beats knowing your case, including any weaknesses, as part of mediation preparation. You want to work with your lawyers in the approach to a mediation to understand the likely approach of the mediator, the issues that will form the basis of the discussions, the difficult legal and commercial issues, parameters for settlement and, importantly, what is your plan if mediation fails. Do you have a plan B? You do not want to be trying to devise a plan B while sitting in the mediation at 6pm.

 

3) Devil’s Advocate

As part of the preparation for mediation, you must understand the strengths and weaknesses of the opposition’s argument and have answers to their strongest points if possible. Knowing the opponent’s position as well as you do your own case is vital. The opponent’s perception of its case will influence their approach to settlement. Put yourself in their shoes as part of your preparation. What will be their focus?

 

4) Don’t Be Afraid to Walk Away

Mediation has a good track record in settling disputes but it is not always successful. If it is apparent that the two positions being argued for are worlds apart, then you should feel confident to walk away from mediation at any point. Before doing so you must appreciate what your next step will be. Leaving a mediation when the other party is behaving unreasonably can be a cathartic step but you need to know what your plan B is. Sometimes it is useful to postpone or adjourn the mediation as this can give both sides a chance to consider further their positions following a period of reflection or taking further advice. A bad deal is not better than no deal in most cases.

 

The disputes team at Pannone Corporate have represented clients in hundreds of mediations across a wide range of disputes and sectors. We have long-standing relationships with some of the foremost mediators in the UK and we use our experience to suggest the most appropriate mediator for any particular dispute. For an obligation-free discussion of your circumstances, please call our expert team of dispute resolution solicitors on 0800 131 3355 or contact us via our enquiry form.

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When making wills avoiding potential disputes should always be a consideration. Disputes post-death are all too common and can incur huge legal costs, stress and inconvenience.

Estate Planning 

The primary point of estate planning is to ensure that your assets pass efficiently to the people you want them to. Preparing your Will is the only way to ensure that there are no unintended beneficiaries of your assets. It also provides you with reassurance that your personal and financial affairs will be handled according to your wishes. Any rights or claims any person may have against an estate must be considered.

Explain All Aspects of Your Will 

If you choose to benefit one person over another and your Will is unequal, explaining the reasoning behind this may be important. Similarly, if you do not wish to leave any part of your estate to someone who may expect to receive a share, you should detail why your Will is drafted this way. 

By addressing your decision to exclude that person, they cannot claim that they were simply overlooked as you have explained the reasons for your action. This will reduce the likelihood of someone being able to challenge your Will after your death. 

In England and Wales a person has testamentary freedom to dispose of their estate however they wish. There are no forced heirship rules compelling a person to leave their property to particular family members. However, there is the possibility that a person could make a claim under the Inheritance (Provision for Family and Dependants) Act 1975. In order to bring a successful claim the person must show that the deceased’s Will did not make reasonable financial provision for the claimant. It is therefore important to consider anyone who may be able to claim against your estate when drafting your Will.

Distribute Personal Items 

While it is natural to be concerned about ensuring your wealth is distributed appropriately, you may also wish to give some thought to who will receive your personal items. By dealing with this at the estate planning stage, you can choose who should receive items of family importance and help prevent arguments over sentimental pieces. 

Update Your Will When Necessary 

Significant life events such as divorce or remarriage should prompt you to review your Will. This is because the act of marriage revokes any Will you may already have in place and divorce, too, has an impact on any existing Will. Therefore, should your personal circumstances change in this manner, you should seek advice and consider putting a new will in place. In any event, we recommend reviewing your Will every five years so that your Will remains fit for your circumstances.

If you would like to know more, then get in touch with the team here at Pannone Corporate on 0800 131 3355

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‘Originally published on LexisLibrary and LexisPSL’

https://pannonecorporate.com/wp-content/uploads/2019/08/London-Mayor-says-using-facial-recognition-technology-raises-real-concerns-about-legal-framework-5.pdf

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What’s new
This month we look at the latest statistics from the Employment Tribunal and Acas, a consultation on paid bereavement leave, and the new rates for national minimum wage and tribunal awards. Read more
We also cover some other key changes which came into force in April including changes to the Tax treatment of termination payments. Read more
Case law review
Shared parental leave
In the case of Mirab v Mentor Graphics (UK) Ltd the EAT considered the topic of ‘bumping’ in a redundancy situation and specifically whether an employee must specifically raise the option of ‘bumping’ before an employer is under a duty to consider it. Read more
Redundancy ‘bumping’
In the case of Mirab v Mentor Graphics (UK) Ltd the EAT considered the topic of ‘bumping’ in a redundancy situation and specifically whether an employee must specifically raise the option of ‘bumping’ before an employer is under a duty to consider it. Read more
Holiday pay for casual workers
It is a truth universally acknowledged that workers are entitled to 5.6 weeks paid holiday under the Working Time Regulations. In most cases, the maths is straightforward. A worker on a 5 day week is entitled to 28 days paid holiday and this is pro rated for part timers. However when it comes to workers on zero hours or other more irregular contracts, the position is less clear. In the recent case of Brazel v Harpur Trust, the EAT looked at the calculation of holiday pay for a music teacher on a term time zero hours contract. Read more
References
In the case of Hincks v Sense Network Ltd, the High Court dismissed a claim that an employer had been negligent when providing a reference for a former employee. Read more
GDPR update
The ICO has now published detailed guidance on the “legitimate interests” basis for processing personal data, which provides an explanation of this legal basis for processing, when it can be used, and a suggested approach for implementation. Read more
The ICO has also published draft guidance on data protection impact assessments and provided a draft template for a data protection impact assessment. These documents were produced in draft form for a consultation which has now closed, so may be amended in their final form. Nonetheless, they provide useful guidance for organisations who will be obliged to carry out assessments under the GDPR. Read more
Who to Contact
Jack Harrington
Head of Employment
0161 393 9050
jack.harrington@pannonecorporate.com

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Pannone Corporate’s HR Forum is a free regular update for employers and HR professionals, featuring sessions on employment case law, legislation and topics of interest to those involved in managing a workforce or dealing with HR issues.
In our next HR Forum, we will cover:
The GDPR and HR
This seminar will take you through the key changes to your data protection obligations regarding employees, workers and consultants as a consequence of the new EU General Data Protection Regulation and the steps you should be taking now to ensure you are GDPR compliant in readiness for the 25th of May 2018. We will share practical guidance and tips on how you can implement the necessary changes to your HR systems, policies and procedures and there will also be a question and answer session which will provide an opportunity to address any particular concerns you may have.
Case Law Update
A summary of some of the more important or interesting decisions coming out of the tribunals and courts in the last few months, including the most recent decisions on holiday pay, dismissing an employee who may not have the right to work in the UK, the European Court of Human Rights decision on covert surveillance, and employment status in the gig economy.
Details
When: Tuesday 24 April 2018
Where: Innside Manchester, First Street, Manchester
Time: 8.30am registration, 9.00am start, 12pm ends
Cost: Free
To reserve your place
To express your interest in attending, please RSVP by email to:
paula.kershaw@pannonecorporate.com
Places will be confirmed approximately 14 days before the event.
We look forward to seeing you.

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What’s new
This month we look at the new online DBS system, the Government’s response to the Taylor Review of modern working practices, the increases in statutory pay due to take effect in April 2018 and the requirement to provide itemised payslips from April 2019. Read more
Case law review
Covert Surveillance
In the case of Lopez Ribalda v Spain, the European Court of Human Rights has concluded that installing and relying on evidence from CCTV cameras without notifying employees amounted to a breach of their right to privacy. Read complete article online
Can an employee claim unfair dismissal after the last in a series of fixed term contracts was not renewed?
In the case of Royal Surrey County NHS Foundation Trust v Drzymala, the Employment Appeal Tribunal considered whether an employee had been unfairly dismissed in relation to the expiry of a fixed term contract. Read complete article online
Knowledge of a disability
In Donelien v Liberata UK Ltd, the Court of Appeal has given useful guidance as to when an employer will be considered to be aware of an employee’s status as a disabled person, particularly in circumstances where an employee is refusing to co-operate with an employer’s occupational health provider. Read complete article online
Effective date of termination
In Cosmeceuticals Ltd v Parkin the EAT has again made it clear that if a summary dismissal has occurred, then it is not open to the parties to agree a different date of termination. Read complete article online
Compensation for injury to feelings can be awarded for working time detriment…
In the case of South Yorkshire Fire & Rescue Service v Mr D Mansell & Others, the EAT confirmed that all claims of detriment under Part V of the Employment Rights Act 1996 (including claims of being subjected to a detriment in connection with working time) were akin to claims of discrimination and as such could attract injury to feelings awards. Read complete article online
Who to contact
JACK HARRINGTON
HEAD OF EMPLOYMENT
0161 393 9050
jack.harrington@pannonecorporate.com

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What’s new
This month we look at the new rules for taxation of termination payments, changes to national minimum wage and other statutory rates, and a cautionary tale about data protection Read More
GDPR update
The ICO’s website now provides a number of useful resources to help businesses, both large and small, get ready for the GDPR. These can be accessed via the following links:


Case law review
Holiday pay – when self-employed consultants are found to be workers
The European Court of Justice in the case of King v Sash Window Workshop Ltd has ruled that where a company does not provide its workers with paid holiday, any accrued leave can be carried over indefinitely.
Read complete article online
Employer’s liability for rogue data protection breach
The risk of a disgruntled employee misusing confidential information in order to cause damage to the company’s business is often a concern where an employee is suspended or disciplined. A recent High Court decision has now given employers even more cause for alarm where that information contains personal data.
Read complete article online
Weekly rest periods
In the case of Maio Marques da Rosa v Varzim Sol – Turismo, Jogo e Animação SA the European Court of Justice has ruled that the 24 hour weekly rest period required under the Working Time Directive may be granted on any day within a seven day reference period.
Read complete article online
Employer breached implied term of trust and confidence when it provided a false reason for an employee’s dismissal
In the recent case of Rawlinson v Brightside Group Ltd, the Employment Appeal Tribunal considered whether an employee who had resigned when falsely told that the reason for his dismissal was a reorganisation when the real reason was his poor performance, could bring a claim for breach of contract for his notice pay.
Read complete article online
Can an employer lawfully dismiss an employee who fails to provide documents showing their right to work in the UK?
In the case of Baker v Abellio London Ltd, the Employment Appeal Tribunal considered if an employer could rely on illegality as the fair reason to dismiss an employee for failure to produce documentary evidence of his right to work in the UK.
Read complete article online
Who To Contact
JACK HARRINGTON
HEAD OF EMPLOYMENT
0161 393 9050

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Lawyers from around the globe visited Manchester recently to soak up what the city has on offer and improve international links, at an event hosted by Pannone Corporate.
As a member of the international legal network, PLG International Lawyers, Pannone Corporate hosted this year’s summer conference which saw lawyers enjoy a busy three days in the city.
The conference included presentations by some of the city’s business leaders.
Adrian Mills, the General Manager of BBC North, presented to delegates about the story and success of the corporation’s move to Manchester. Dan Storer, director of Business Development at inward investment agency Midas, took attendees through a history of the city, there were also legal seminars on corporate law, IP, IT & e-commerce and dispute resolution as well as meetings for Pannone Corporate clients with lawyers from the network.
Pannone Corporate managing partner Paul Jonson said: “The conference was hugely well-received by the attendees and everyone was impressed by what Manchester had to offer as well as the seminar programme. “As a member of PLG, we can offer clients direct to access to high quality legal experts on the ground wherever in the world they are doing or want to do business. We were delighted that so many our PLG colleagues and clients were able to joins us here in Manchester for the conference.”

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As Design Manchester came to an end last week, the festival was brought to a close in fitting style with their annual Great Debate.
The theme of this year’s festival, Design City, was reflected in the debate’s topic, “City Identity”. With the referendum result earlier this year the reality of Brexit and its impact on Manchester (and the development of cities everywhere) was a big part of the discussions.
To tackle these topics, the very best of Manchester’s creatives assembled at The Old Granada Studios, a venue steeped in Manchester history. On the panel was Sheffield-based star designer, Ian Anderson; Chancellor of Manchester Metropolitan University, Lord Mandelson; Technology Engagement at The Co-op and Director of TransportAPI, Emer Coleman; the front runner for Manchester’s mayoral election, Andy Burnham; Bristol-based creator of legible cities, Mike Rawlinson and urbanist and designer, Claire Mookerjee.  Chairing the event was magneticNorth’s Lou Cordwell.
Topics of the evening included city devolution and metropolitan mayors in the regions, how data changes our cities, how cities grow and of course the impact of Brexit.  But most importantly, it served as a great opportunity for the design community to discuss the role of design and the creative industries in our future cities.
The greatest outcomes of the discussions surrounded how the people make the cities. Mike Rawlinson suggested city identity relied on people and we should be creating cities around the citizen. He said, “We need to make the sum of our parts greater than the whole…to design cities around people is key as it is more benefiting for everyone.”
It was clear the panel believed digital and tech were the way forward. Lord Mandelson said, “What makes a city doesn’t come from branding or marketing, it comes from the people and the ability to enable its people to be what they want to be…which is chiefly driven by digitalisation. Digitalization will do for our generation what electricity did for others.” But the audience brought forward some good accompanying thoughts, that although tech and digital is what is pushing our cities forward, creativity needs to go hand in hand with that. Emer Coleman agreed, enthusing there should be “an integration of arts and creativity” with tech.
There was great anticipation for this sell out event and the striking venue of St John’s in OGS was a fitting backdrop to the discussions of the night, a building representing both Manchester’s past and future.  The audience helped push the flow of the debate into deeper discussions and really connected to the panel, with many nods of agreement from the audience and even a round of applause for Andy Burnham’s sign off, “If we don’t make this a time of change, when will we?”
Design Manchester has had an incredibly successful 2016 festival and the Great Debate reflected that. We are extremely proud to have sponsored the event and look forward to continuing our support for Design Manchester and the wider creative community.
 

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On Wednesday 19th October, the cream of creative Manchester is gathering in The Bonded Warehouse, St John’s, on the site of the Old Granada Studios next week to shape a positive future in Theresa May’s post-Brexit Britain. Key to that, they say, is city identity: not only for Manchester, the poster city for devolution, but for cities across the north and elsewhere in the country.
Design Manchester, a non-profit that speaks for the design community and organises the city’s annual design festival, is using its third Great Debate to discuss the role of design and the creative industries in our future cities, and sees the event as an opportunity for the sector to discuss its evidence to the House of Commons Select Committee on Culture Media & Sport’s enquiry into the impact of Brexit on the creative industries, tourism and the digital market.
At Pannone Corporate, we recognise the importance of choices made in the coming months with regards to Brexit. With all the public confusion leading up to the referendum, it’s more important than ever that we discuss and debate the potential consequences of legislative changes in an open and honest forum. As a major contributor to the UK’s economic future, the creative industries, particularly in Manchester, need to be in this discussion. This is one of the reasons we are supporting Design Manchester as a key contributor and as a sponsor of The Great Debate event.
The team are also looking forward to discussions on a variety of other city related topics including the public realm, architecture and transport, city devolution and how data is changing our cities.
Covering these topics, will be an expert panel including former EU Trade Commissioner Lord Mandelson, front-runner of Manchester’s mayoral elections Andy Burnham and Sheffield based star designer Ian Anderson. The debate will be chaired by CEO of digital design studio magneticNorth, Lou Cordwell.
We’re looking forward to the debate and will be sharing our highlights from the day on our Twitter page, so keep an eye out for that.
 

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It is easy to fall into the trap of believing that estate planning “is only for the wealthy”. However, most people want to ensure that their home, savings or other belongings of value pass to the right people in the right way and at the right time. A properly drafted Will ensures that your assets are available to benefit the people you choose and that if necessary, are protected for the future.

Below are some common traps clients fall into:

Not Planning

This sounds obvious, but one of the most common estate planning mistakes is to not have a Will at all. This usually has undesirable tax implications and often means that your assets will not pass onto the people you want them to. Death does not always come when expected, so it’s important to prepare as early as possible. This will ensure that your personal and financial affairs will be handled according to your wishes when you pass away.

An Outdated Will

Marriage, divorce and changes in relationships mean that many people’s Wills become invalid or unenforceable without them realising or making a new Will. We advise clients to review their Will every five years to ensure that it remains appropriate.

Inheritance tax (IHT)

Many clients fail to appreciate the impact of inheritance tax and miss out simple steps such as making lifetime gifts (outright or to trust) or structuring their Will appropriately to minimise IHT. Specific opportunities exist in relation to clients with business assets. Specialist advice is always required to mitigate any tax payable. A worse mistake is deciding yourself without the benefit of advice to make gifts. For example, many clients give away their home and continue to live there, not realising that it is not only useless from an inheritance tax perspective but also creates other significant tax problems and increases the amount of tax payable overall.

Second Marriages

Children from first marriages often get disinherited because assets have passed to a stepparent first.  A properly drafted will can enable you to provide for a spouse during his or her lifetime whilst still making sure that on their death your estate passes to your children and not anyone the spouse may choose to leave it to.

Not Updating Asset Ownership

It may be that you own some assets in your name, and some in joint ownership with your spouse, your children, or someone else. Every now and again, it’s crucial to review your plans. Perhaps there have even been changes in the law that make different ownership a better option. Many people should review their plans to see if they still relevant to their current situation. It’s one of the biggest estate planning mistakes that is easily avoided.

Powers of Attorney

Failure to make a Power of Attorney in time means that clients will not be able to choose who handles their estate if they are unable to do so themselves. Choosing the right person for this role can have a significant impact on how assets are protected for the next generation.

Picking the Wrong Executor!

It is vital that you trust your executor(s) to deal fairly, practically and cost-effectively with your estate and avoid any possible disputes which can give rise to significant delay and legal costs. Picking the wrong executor is one of the biggest estate planning mistakes as it could have an irreversible impact on your assets, which can bring additional stress to an already painful time to your family. It’s important to thoroughly research your options before making a decision.

Our specialist Estate Planning Team ensure that our clients deal with all of the above issues in good time and minimise the overall cost of inheritance tax and legal fees relating to death and the transfer of assets to next generations. For more information to help you avoid estate planning mistakes, don’t hesitate to contact us today.

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Earlier this month, we held our annual In House Lawyers Conference in partnership with BCL.
We had a fantastic day filled with speakers and workshops that challenged us to think differently about familiar topics and asked us to consider the practical impact of major legislative changes on the sector and society at large.
Our first speaker, Aidan Robertson QC of Brick Court Chambers, conducted a fascinating and informative discussion on Brexit. Aidan covered key questions such as the timetable for withdrawal, what laws and trade deals will replace EU law and the practical consequences for businesses in enforcement of rights. His talk helped to breakdown the ins and outs of the complex piece of legislation that is likely to have a dramatic effect on the way we trade goods, capital and services.
After the talk, we were keen to find out more and share his insights with a wider audience, so we grabbed him for a quick coffee and a chat. Here’s what he had to say:
Hi Aidan. An interesting talk! Could you tell us a little more about what you consider to be the realistic timescales of Brexit and what could be the legal implications of this?
I would expect the government to trigger the Brexit negotiations under Article 50 of the Treaty on European Union early in 2017, meaning that the UK would leave the EU in the first quarter of 2019. It seems to me that the EU Parliament Elections in May 2019 provide an obvious deadline by which the UK should no longer be an EU member.

This is subject to judicial review challenges in the High Court in Belfast and London and a likely Supreme Court hearing before Christmas as to whether Parliamentary approval to trigger Article 50 is needed – in my view, it is not.
What do you anticipate will be the biggest issues the UK will face in the wake of Brexit?
I expect the EU and UK to reach a workable agreement on trade in goods, capital and services, although the latter issue poses some challenges, in particular in the field of financial services.

In my opinion, the biggest issue is not so much the substantive rules on trade post-Brexit, but the enforcement of those rules. Unlike EU law, which has direct effect and so the full range of legal remedies are available in every national court throughout the EU, the new trade deal will operate at the level of international law. This means that it will not have direct effect (see Polydor v Harlequin Records 1982) and so any remedies will have to depend on what the trade deal provides.

It may involve claims for compensation under Investor to State Dispute Settlement provisions, but these involve arbitration rather than court proceedings and are unlikely to provide anything as effective as the current remedies under EU law.
How did your audience react to the subject of your talk? What kinds of questions did it raise?
Issues around Brexit are of relevance to any business trading with the rest of the EU, so there was a good response from a wide range of audience members.

One question I was asked was what the position would be with claims for breach of EU law where the events took place before Brexit but the claim was not brought until afterwards. I explained that UK limitation periods for civil claims (six years in England, Wales and Northern Ireland, five years in Scotland) would enable claims to be brought after Brexit. The position would be different for challenges to government action as being inconsistent with EU law, because the judicial review time limit is much shorter – claims must be brought promptly and in any event within 3 months.

Importantly, post-Brexit, English courts will have to decide on issues of EU law for themselves, as the option of making a preliminary reference to the Court of Justice of the European Union for an advisory ruling currently provided for by Article 267 of the Treaty of the Functioning of the European Union will no longer be open.
What did you think of this year’s IHL? How important are conferences like this?
This was an excellent opportunity for in-house lawyers to gather and discuss issues of mutual interest, both on ‘big picture’ matters such as Brexit and also on the more ‘hands on’ issues covered in other sessions. I was impressed by the high turnout for the conference, which was a practical demonstration of its importance.
Thanks Aidan – hope to see you again next year.

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Inheritance Tax is often viewed as the most invidious tax as it is paid on value accumulated over a lifetime which has already been taxed as it has been earned.. People object to their life savings or family home being passed to the taxman.  

A properly drafted Will can often minimise the impact of Inheritance Tax and ensure that the minimum amount of tax is paid overall taking into account all the relevant family circumstances.  The use of trusts can also ensure that wealth is preserved for the next generation and that assets are retained within the family rather than being diverted or diluted amongst non-family members.

There are also ways of minimising Inheritance Tax during your lifetime including the use of annual allowances, lifetime gifts and a useful exemption known as “regular gifts out of income”.  This allows a person to give away any amount of income which is surplus to his or her requirements. There are a few traps in this exemption so specialist advice needs to be taken and a paper trail needs to be put in place to ensure that the exemption can be claimed on death.

Life assurance can also help to mitigate the impact of any Inheritance Tax.  For example, where a client is not married, life assurance can be essential in ensuring that any surviving partner can continue to live in the home without having to sell it to pay a tax bill.

The establishment of trusts for children and grandchildren can allow you to retain control over assets as a trustee whilst taking value out of the Inheritance Tax net.  Specialist trusts and tax advice is needed to ensure that structures are workable and tax efficient.

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Yesterday the new edition of the industry guide, Legal 500 was released and we were delighted to be recommended in 17 practice areas. We are a young and ambitious firm and to be independently recognised in this way is testament to the quality and dedication of our team as well as our client focussed culture.
We have been recognised across a diverse range of legal disciplines which include corporate and commercial, EU and competition, commercial litigation, debt recovery, insolvency and corporate recovery, employment, health and safety, professional negligence, charities and not-for-profit, contentious trusts and probate, commercial property, construction, property litigation, IT and telecoms, intellectual property, media and entertainment and transport.
We’re looking forward to more reasons to celebrate as we move into our third year of business!
To view our rankings and leading individuals please click here for more details: http://www.legal500.com/firms/4091/offices/6633

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With all the garden furniture packed away and the days beginning to shorten we wanted to reflect on the positive stories from Plot.
It was lovely to see so many people using the garden for meetings, informal gatherings and the occasional bit of relaxation in the sun.
We’ve had great fun taking some of our meetings and team events outside. The feedback from staff and clients has been very positive and it’s been nice to do something different over the summer.
My colleagues Val Beck and Katie Kennedy who were part of the Plot team said “It’s been really rewarding working on Plot and we enjoyed being part of the Plot team. It was a good opportunity to meet some of our clients and contacts and get out in the sun (well sometimes!). We hope to be involved next year when Plot returns to Pannone Corporate”.
Finch Insurance Brokers were one of the many organisations who used Plot for a team event. Mike Latham of Finch commented “Our team found the whole experience refreshing and it really added to the energy of the meeting. We greatly appreciated the opportunity to use it and would like to do so again.”
We’ve already had lots of request for Plot to return, so if anyone has any ideas for what they would like to see in the future, please let us know. We’re always open to new ideas.

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This August, Pannone Corporate is proud to be bringing Plot, the ‘world’s first on-demand garden’, back to Manchester.
Plot was initially launched as part of Manchester’s urban gardening festival Dig the City, from a small rooftop garden on Barton Arcade, the project quickly gained international attention, bringing the idea of the sharing economy to the problem of lack of green space in cities.
We loved the concept behind Plot and were keen to find a way to share the project with our team, clients and contacts.
Over the past few months we’ve been working with magneticNorth, the design and branding studio behind Plot, to create a new version – Plot at Pannone Corporate – in our very own outdoor space at The Chapel, Deansgate.
We’ve had a great time preparing the garden and now that it’s all ready to go, we can’t wait for people to come and enjoy the space as they wish. Whether it’s for a meeting, an informal chat or to enjoy the sun, Plot has been designed to accommodate all kinds of activities.
If you’d like to book your slot at Plot this summer then please get in touch –
Plot@PannoneCorporate.com or (0)161 393 9080.
You can also keep up to date with all the latest activity at Plot on the
Pannone Corporate Twitter page.

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It is easy to believe that estate planning “is only for the wealthy ”. However,  most people want to ensure that home, savings or other belongings of value pass to the right people in the right way and at the right time. A properly drafted Will ensures that your assets are available to benefit the people you choose and that if necessary, are protected for the future

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Not Planning

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An Outdated Will

Marriage, divorce and changes in relationships mean that many people’s Wills become invalid or unenforceable without them realising or making a new Will. We advise clients to review their Will every five years to ensure that it remains appropriate.

Inheritance tax (IHT)

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Second Marriages

Children from first marriages often get disinherited because assets have passed to a stepparent first.  A properly drafted will can enable you to provide for a spouse during his or her lifetime whilst still making sure that on their death your estate passes to your children and not anyone the spouse may choose to leave it to.

Powers of Attorney

Failure to make a Power of Attorney in time means that clients will not be able to choose who handles their estate if they are unable to do so themselves. Choosing the right person for this role can have a significant impact on how assets are protected for the next generation.

Picking the Wrong Executor!

It is vital that you trust your executor(s) to deal fairly, practically and cost-effectively with your estate and avoid any possible disputes which can give rise to significant delay and legal costs.

Our specialist Estate Planning Team ensure that our clients deal with all of the above issues in good time and minimise the overall cost of inheritance tax and legal fees relating to death and the transfer of assets to next generations.

 

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