Category Archive: Regulatory
In addition to Government guidance and Covid-19 safety measures, business owners should consider whether its processing of Covid-19 pass information meets the requirements under the Data Protection Act 2018.
A visitor’s Covid-19 status constitutes health data, a type of special category of personal data under UK data protection laws. Compliance obligations around processing this type of personal data are more onerous, due to its inherent sensitivity, and a failure to comply with the 2018 Act could lead to sanctions issued by the ICO, the UK Regulator responsible for data protection matters.
For operators, where you do check or record people’s Covid-19 status, you must justify this in terms of what you collect, what you do with the information, how long you keep it for, and how you keep it secure, amongst other things. The Data Protection Act 2018 requires that you ensure the collection of visitors Covid-19 status is necessary, clear and transparent. What you do with this information should be set out in your Privacy Notice, statement or policy.
The same applies for those employees from whom you seek a vaccination status. An employee has the right to understand what information is held about them, and the easiest way to demonstrate this is with an Employee Privacy Notice. The processing of employee personal data must be fair and justifiable in all the circumstances and where you operate a business with a sizeable number of employees, you should carefully consider the purpose for retaining an employee’s vaccination status long-term.
Remember that the cornerstones of the 2018 Act are transparency and accountability, and that even where you are acting in line with government guidance, this must be demonstrated by your policy documents.
Article from our North East Leisure Supplement 2022, produced in conjunction with Sanderson Weatherall.
The hospitality industry is often regarded as a springboard into the workplace for many young people but recently the UK has experienced rising staff shortages, with job vacancies at their highest levels since records began.
Covid-19 and Brexit have been cited as contributing to the problem. Since the start of the pandemic, 1 in 5 workers have left the sector, according to industry bodies such as Hospitality UK.
Prior to the pandemic, the hospitality industry employed 3.2m people and was the UK’s third largest private sector employer, with vacancies consistently around 90,000.
Figures from the Office for National Statistics reveal that job vacancies in the industry were already at high levels before the UK went into in lockdown in March 2020.
Much of this shortfall could be attributed to the perceived culture of very long working-hours and low wages. Hospitality insiders suggest that some shortages, particularly of chefs, waiting staff and restaurant managers, are being seen because the Government reopened the whole economy at the same time and so everybody is looking for staff. Hospitality UK state that the industry can return to pre-pandemic levels of demand by the start of 2022, but warns it is “undoubtedly going to take the industry a long time to recover”.
The situation could be seen as a “reset moment” with employers looking at working conditions, training, and skills development.
Staff shortages are impacting on hospitality businesses in many ways – with reduced opening hours, it is highly likely that with overworked teams, customer service will suffer alongside reputational damage and an increase in complaints. Pressure on existing staff where they are covering multiple job roles that they may not be trained or qualified to do. Pressure on staff who are training new staff and the time and effort this takes alongside trying to do their own jobs.
With increasing challenges facing the hospitality industry, it is important to ensure that all staff are fully trained ahead of starting their first shift.
By ignoring the importance of workplace training, you could risk:
- An increase in workplace accidents, decreased staff morale and increased absence. There is a legal obligation to ensure staff are provided with adequate health and safety training.
- Inadequately trained staff are likely to experience poor job performance and increased levels of work-related stress.
- Lack of training leads to staff feeling undervalued, which will reduce workplace productivity, loyalty and engagement.
Article from our North East Leisure Supplement 2022, produced in conjunction with Sanderson Weatherall.
Cross-border data flows: new compliance requirements on transfers to Third Countries by UK businesses
There have been a number of changes over the last year or so relating to the free flow of personal data to and from the UK.
Last year, on the 28 June and following the UK’s exit from the European Union, the UK was awarded “adequacy” status by the European Commission. This was significant as it meant that, whilst the UK was no longer a member state of the EU, we could continue to send and receive personal data from EU member states without the requirement for additional safeguards (such as the inclusion of Standard Contractual Clauses or “SCCs” in our contracts). Companies were able to go about their business without the need to implement additional measures to demonstrate their compliance with the UK’s data protection legislation, and this was well-received by the business community, as one might expect.
It is important to note that the European Commission’s assessment of our adequacy to transfer and receive data from the EU remains under review and will be reassessed periodically. At this point, our UK GDPR is aligned with its EU GDPR counterpart. However, as new laws and guidance develop in the UK, this alignment may diverge which is why the European Commission wants to keep our adequacy status under review. This will not happen overnight, but it will be something that UK businesses whose processing activities rely upon data transfers with the EU will want to bear in mind.
Building upon this adequacy decision, the UK regulator, the Information Commissioner’s Office, or “ICO”, has examined the data flow mechanism to and from the UK more generally and has updated its guidance on the use of SCCs as a transfer mechanism. This has been entrenched in law, having been put before Parliament earlier this year.
Since the 21 March 2022, businesses are required to use either an Addendum to the SCCs or a separate International Data Transfer Agreement, or “IDTA”. This will be a requirement under Article 46 of the UK GDPR (the documents are issued under Section 119A of the Data Protection Act 2018) when making restricted transfers and which require more detailed information to be provided. Some of the more notable details required by the IDTA are listed below:
- The status of importer/exporter as data controller/data processor;
- Any linked agreements (including sub-processors, master service agreements, etc.)
- Where relevant, the onward transfers of personal data by importers to third parties;
- IDTA review dates;
- Security arrangements specific to processing activities;
- Transfer risk assessment to be prepared identifying any specific risks and measures intended to mitigate such risks;
- Additional protective and commercial clauses (such as indemnities);
- Additional obligations on importer of personal data to make exporter aware of any local laws that may affect the transfer;
- Obligation on exporter to carry out reasonable (ongoing) checks on importer’s ability to comply with the IDTA (or provide appropriate safeguards);
- Rights of data subjects including new ones to provide individual with a copy of the IDTA on request;
Businesses already operating under the existing EU SCCs can continue to rely upon these documents for the time being – a long-stop date of 21.3.24 has been provided by the ICO, after which an IDTA or Addendum should be used. Those businesses who have acted in good faith to this point to negotiate contracts incorporating the existing SCCs can continue to use them if they are concluded by 21.9.22, but after this time a switch to the new IDTA/Addendum will be necessary. The good news is that the IDTA as a transfer tool looks to be a more straight forward and practical document than its SCC predecessor. It avoids legal vernacular and should prove an attractive substitute for most businesses operating cross-borders.
If you have any questions regarding this article, please feel free to contact Louise Weatherhead, a data protection lawyer, by email at firstname.lastname@example.org, on Twitter @LNWdataprotect, or by telephone on 0191 2263699.
The EPC (Environmental Performance Certificate) rating can have important implications for commercial property owners wishing to let
Under the Minimum Energy Efficiency Standard Regulations, since April 2018, unless exempt, it has been a legal requirement that a commercial building must have a rating of at least E before a new or renewal lease can be granted. Failing to comply holds a fine ranging between £5,000 to £150,000 for the Landlord and a risk of being published on the PRS Exemptions Register.
From April 2023, the requirement will change and apply to new and existing leases. Any Landlord continuing to let a non-exempt commercial property with a rating of less than E will be in breach of the regulations.
To remain compliant, commercial property owners should consider:
- Checking their EPC ratings and the date they expire. This can be found on the certificate or by searching the public register of EPC certificates using this link.
- Checking whether they are exempt, e.g. properties let for less than 6 months, or more than 99 years. Listed buildings – if it can be established that energy improvements would unacceptably alter the appearance or character of the building.
Where the property has a low rating, consideration could be given to whether the exemption from carrying out improvements may be relied upon. This exemption includes where improvements would devalue the market value of the property, where the Landlord is unable to obtain consent from the tenant or another relevant party to carry out the improvements, or where all possible energy efficiency improvements have already been undertaken, or there are none that can be made.
Any exemption being relied on would need to meet the requirements exactly and the exemption being registered on the PRS Exemptions Register.
In 2020, the Government produced a white paper indicating that by 2030, all commercial properties would be required to achieve an EPC rating of at least B. Last year a consultation set out a proposed framework to meet that target, suggesting by 2027, an interim target rating of C may be required.
Currently, funeral plan activities are exempt from regulation under the FSMA 2000 (Regulated Activities) Order 2001 (RAO). This has meant that previously, the industry-established Funeral Planning Authority, produced rules and a Code of Practice for firms to follow on a self-regulating basis.
In recent times, demand for funeral plans has grown significantly leading to increasing concerns over the conduct of some providers and potential for consumer harm.
Firms using high-pressure sales tactics and misleading information resulting in consumers buying plans not suitable for their needs, consumers paying higher prices for their plans than they should and plans not being redeemed by the consumers family due to being unaware they exist have led to the government consultation in 2019 on the future regulation of the funeral plans market. From 29 July 2022 pre-paid funeral plans will be within the scope of FCA regulation. This will mean that any firm wishing to continue to provide pre-paid funeral plans after 29 July 2022 will need to apply to the FCA for direct authorisation in respect of one or more of two new permissions. These will appear as new regulated activities in the RAO as:
- Entering as provider into a funeral plan contract, and/or
- Carrying out a funeral plan contract as a provider.
Alternatively, firms can apply to become an appointed representative (AR) of a principal firm.
Providers not authorised by 29 July 2022 must cease selling and/or administering funeral plans before the FCA regulation takes effect. This will include firms wanting to carry out pre-existing plans. Anyone carrying out regulated activities relating to funeral plan contracts with FCA authorisation could face criminal proceedings, unless exempt. Providers not authorised by 29 July 2022 should stop selling funeral plans from that date and transfer their existing books of business to an authorised provider, or wind down their operations.
Once authorised, firms must comply with the FCA’s rules on the regulation of funeral plans in PS21/15 ensuring firms are fair. Conduct of Business Sourcebook (FPCOB) is a new chapter in the FCA Handbook specific to the Making of the Funeral Plan. These rules are not only for providers of funeral plan contracts but also intermediaries such as funeral directors, will writers and lead generators.
There will be an impact on firms who ‘cold call’ as this will be banned, as will commission to intermediaries and funeral plan instalment products which do not guarantee delivery of a funeral after a moratorium period.
Funeral plan providers must have arrangements in place to financially reimburse customers should they become insolvent and where a transfer of funeral plan contracts to an alternative provider are not arranged.
In order to comply with these regulations, firms should review their governance and sales processes, to include their products, intermediaries, conflicts of interest, risk management and outsourcing.
A six-monthly prudential return and an annual complaints report will have to be sent to the FCA by all providers and intermediaries, in addition, providers are also required to provide quarterly conduct returns.
The window for authorisation by the FCA is now open. Firms should plan now. Any applications not authorised by 29 July 2022 will result in firms being unable to trade until the FCA has processed the application.
Firms must decide which of the new permissions they will need to apply for. In support of all firm applications, the FCA will expect firms to provide evidence of client onboarding procedures, policies and notifications, proof that they meet the FCA’s Threshold Conditions and details of how they will comply with the requirements in FPCOB. All firms should have a regulatory business plan.
The Senior Managers and Certification Regime (SMCR) will apply to authorised funeral plan providers and firms should ensure that Senior Managers are aware of their responsibilities under the regime with all staff being trained on the Conduct Rules.
Firms must ensure all complaints are recorded as once authorised, they will fall under the jurisdiction of the Financial Ombudsman Service (FOS). Policies, procedures and controls should be implemented to minimise FOS costs and remediation processes.
Firms already regulated by the FCA may need to submit a variation of permission application, adding one or more of the new regulated activities to their existing permissions.
The firm, consistently praised for its strength and capability throughout the business, again wins recognition for its legal expertise, deep experience and first-rate levels of client service.
Practice areas across the business win recognition as leaders in their field, with healthcare again being confirmed as one of the key advisors nationally for its work with growing numbers of NHS Trusts, organisations, professionals and healthcare businesses across the UK.
Chambers and Partners 2022, published today, also highlights 17 of Sintons’ lawyers as being stand-out names in their specialism, many of whom are recognised in the legal marketplace as being leading figures regionally and nationally.
The rankings come only weeks after Sintons won similar praise across the board from Legal 500, which also recognised the wide-ranging expertise, legal capability and service excellence the firm delivers to its clients.
Both Chambers and Legal 500 are independent publications which assess and rank law firms and lawyers throughout the UK, based on interviews, examples of work, and client and peer testimonials.
“For over 125 years, Sintons has built a well-deserved reputation as a first-rate legal advisor delivering outstanding levels of service to its clients, and those values have remained at the heart of the firm since our foundation in 1896,” says managing partner Christopher Welch.
“That these key features are consistently highlighted by independent legal publications like Chambers and Partners, and recently Legal 500 too, is a huge endorsement of what we do here at Sintons. Businesses, families and individuals put their trust in us to deliver an outstanding legal and personal service and that is what we deliver.
“Chambers again confirms our strength across the whole Sintons business, with capability and talent running throughout the firm, and a shared commitment by everyone here to continue to build Sintons so it can be the best it can be. We are all delighted to again have our efforts recognised in this way.”
Law firm Sintons has again maintained its reputation as one of the leading law firms in the North of England in newly-released rankings from Legal 500, winning plaudits for its strength and expertise across the firm.
Legal 500 2022, released today, renews its praise of Sintons and confirms them as being a go-to legal provider in the region in many key practice areas.
The independent publication – which ranks law firms and lawyers across the North, compiled as a result of examples of work, interviews and client and peer testimonials – names eight of Sintons’ lawyers as leading individuals, three as next generation partners and a further six as rising stars. One of its lawyers also secures the highly coveted accolade of being named in the Legal 500 Hall of Fame, in recognition of consistent achievement throughout their career.
The latest Legal 500 rankings add further to the long-standing reputation of Sintons – winner of five awards at the most recent Northern Law Awards, including overall Law Firm of the Year – as a leading player in the North of England, with national reach and capability in many of its departments.
The leading individuals at Sintons, as identified by Legal 500, are:
- Angus Ashman, Dispute Resolution partner
- Adrian Dye, head of Corporate
- Phil Davison, head of general Personal Injury
- Keith Land, head of Employment
- Amanda Maskery, Healthcare partner
- Paul Nickalls, head of Personal & Family
- Karen Simms, head of Commercial
- Christopher Welch, managing partner and Corporate lawyer
The next generation partners, as identified by Legal 500, are:
- Jane Meikle, head of Banking & Corporate Finance
- Alex Rayner, head of Construction & Engineering
- Hilary Waters, head of Dispute Resolution
The lawyer named as member of the Legal 500 Hall of Fame is:
The rising stars at the firm are:
- Paul Collingwood, senior associate, Wills, Trusts & Estates
- Ailsa Hobson, senior associate, Employment
- Aimee Hubbard, associate, Dispute Resolution
- Andrew McGowan, head of Neurotrauma
- Emma Pern, senior associate, Corporate
- Emma Saunders, partner, Contentious Trusts & Probate
Christopher Welch, managing partner of Sintons, said: “We are very proud of the reputation we have built during our 125 year history as being a law firm which consistently offers legal excellence and an outstanding service to our clients, and for these two factors to again be recognised by Legal 500 as being a staple of Sintons’ offering is very pleasing.
We are delighted to maintain our position as one of the leading law firms in the North of England, with strength, capability and experience running throughout our practice areas.”
The Government has published guidance which applies to regulated activity in a care home (the provision of accommodation together with nursing or personal care). It has been produced to help support the implementation of the Health and Social Care Act 2008 (Regulated Activities) (Amendment) (Coronavirus) Regulations 2021 (‘the Regulations’). The Regulations require registered persons of all Care Quality Commission (CQC) registered care homes (which provide accommodation together with nursing or personal care) to ensure that a person does not enter the indoor premises unless they have been vaccinated. This is subject to certain exemptions. These, together with an overview of the Regulations, are dealt with below but many commentators are concerned that the entire substance of the Regulations could be called into question.
From 11 November 2021, it will become law that anyone entering a care home must have had a complete course of an authorised COVID-19 vaccine. For care home staff, this means you will only be able to continue to work inside a care home if you are vaccinated, unless you are…read more>>
The ICO’s Age Appropriate Design Code (commonly known as the Children’s Code), requires businesses to make necessary changes to their online products and services to meet the standards set out in their statutory code of practice. The expectation is that by 2 September 2021 businesses will have met the 15 standards.
The aim of the code is to ensure children’s personal data is protected online.
If a business fails to meet the standards, there is a potential for enforcement action, such as compulsory audits, processing bans and fines, not to mention reputational damage. Although the ICO have stated that they will take a measured and proportionate approach, the 12 month transitional period is almost over and the ICO will expect progress to have been made.
What should you be doing now?
The ICO does not expect all businesses to be fully compliant by September 2021, however, you will be expected to have at least:
- Decided whether you are in scope
You must determine whether your online products and services are in scope. Are they relevant information society services likely to be accessed by children? If they are, you need to be taking steps to ensure compliance. Even where you believe they are not, you must document and evidence your decision. The ICO suggest user testing and surveys, market research and academic literature will all be helpful to support your decision.
- Undertaken a Data Protection Impact Assessment (DPIA)
Where you are in scope, you should complete a DPIA. Annex D of the code has a template DPIA . You will need to map children’s data and age ranges, as well as the associated user journey. To assist with assessing risks and mitigations, the ICO have provided additional resources on their website which should be used to finalise your compliance plan.
- Put a road map in place
Set out steps you have taken so far and a proposed timeline to gain full compliance. Take a risk-based approach to your compliance, prioritising areas of higher risk.
The ICO state that 1 in 5 internet users are children and the aim of the code is “to protect children within the digital world, not protect them from it”. Businesses must put the best interests of the child first and work from there. For many, this will be a new way of designing, innovating and creating online products and services that children are likely to use.
Please click on the play button in the bottom left corner of the below video image to start viewing.
We have also included a podcast version, the link is also below.
The Health and Safety Executive (HSE) has set out a list of the hazards to lungs in the farming and agriculture sector.
Chest problems, and ultimately work-related (occupational) lung disease, may occur as a result of breathing in dust vapours or chemicals from:
- harvesting or handling grain, or mixing animal feedstuffs
- feeding animals
- handling mouldy hay or bedding and waste products from animals or poultry
- slurry, silage
- welding fume
- some veterinary medicines and disinfectants
Risks include being exposed to dusts, vapours or chemicals at work for just a short time that may cause unpleasant irritation or inflammation in the nose, throat or lungs.
Longer exposure may lead to more serious chest problems and lung diseases, including asthma, chronic bronchitis and farmer’s lung.
These symptoms can be short-lived at the time of a job, or they may get worse and last longer until they are almost always present. They can be set off by even small exposures to any substance to which you have become allergic, or sensitised.
Controlling the hazards, avoid breathing in harmful substances by:
- using alternative, safer substances where possible
- changing to low dust materials, e.g. granules or pellets
- enclosing sources of dust or spray
- vacuuming spillages instead of sweeping them up
Reduce the amount you breathe in by:
- using local exhaust ventilation (LEV) e.g. when welding
- using effective filters in tractor or vehicle cabs
- maintaining filters to the manufacturer’s instructions
- improving ventilation in buildings
- wearing appropriate, effective respiratory protective equipment (RPE)
All masks and respirators must be CE marked.
For more information on personal protective equipment (PPE), go to the HSE website.
What is your role at Sintons and how long have you been with the firm?
I have been with the firm for 17 months and am an associate in the regulatory and compliance team.
Tell us about your career to date…
I began my career in law with a training contract with a criminal defence solicitor in York. I completed my police station representation qualification and duty solicitor exams and represented clients at Magistrates’ Courts on a daily basis. I worked in the prison law department and assisted prisoners with parole hearings and adjudications. After a five year daily drive to York from Newcastle, I moved to Hartlepool, still working in crime, then moved to Newcastle in the role of regulatory with a firm in the city. Pre-GDPR so much of my work was privacy policies, staff training for companies and assisting companies with their applications to become FCA registered.
Can you tell us about your department and the work it does
The regulatory and compliance team at Sintons has a longstanding reputation as being a leader in its field, advising businesses around the North East and beyond for many years. We advise clients across public, private and third party sectors on regulatory compliance and provide training to firms on new legislation within their sector. We draft and assist with policies, risk assessments and procedures for health and safety, anti-money laundering, data protection, fraud and tax evasion. We assist with FCA matters and change of permissions as well as CQC matters. We have a good reputation in defending cases against Local Authorities. The team can conduct full on-site audits of all compliance processes for firms regulated by FCA, ICO, CQC or HSE, including internal processes. Additionally, we can represent clients at interview under caution, criminal courts and first tier tribunals
What have been your personal career highlights to date?
Winning cases. Quite often the regulatory body can be unfair in their proceedings and clients need a helping hand so they do not feel intimidated when facing them in court.
Sintons enjoys a first-rate reputation regionally and nationally for its work. What is it like to work here?
I can say with no doubt whatsoever, Sintons is the best law firm I have worked for. It is a pleasure to work for a firm that not only takes great pride in the service it provides to all clients, but is genuinely interested in the wellbeing of all its colleagues.
And finally, tell us about your interests outside work…
When not in lockdown, I enjoy cycling, regular gym workouts, spinning classes, sunny holidays abroad and eating out. While on lockdown, cooking and keeping in regular contact with my family via a WhatsApp group chat.
The Health and Safety Executive (HSE) have given new guidance to help manage risks and keep lone workers healthy and safe.
The law will apply if:
- You are an employer;
- Your work activity is specifically mentioned in the regulations, this includes work in construction, agriculture, railways or work with gas, asbestos or genetically modified organisms, or;
- Your work activity poses a risk to the health and safety of anyone else.
Think about the types of activities you undertake as part of your work and ask yourself if they pose a risk to the health or safety of others. You have a duty to protect yourself and others from the risks your work creates, even if this is only for a small part of your overall work activity. In practical terms, if you are self-employed you will not have to do anything where there is no risk to others.
Can other people be affected by your work activities? Think about the services that you provide to them, in particular:
- Your working environment, do you work in a workplace where other people have access? Could you harm their health or safety?
- The equipment, materials or substances that you use. Could someone be burnt, scalded, crushed, trip over or fall? Does your work activity create noise, dust, fumes? Do you use any materials or substances that could injure someone if they came into contact with them?
If you have answered yes to any of above, then it is likely your work activities may pose a risk to the health and safety of another person and the law will apply to you.
The new guidance contains a section on how to protect lone workers from the risk of work-related violence, information on how managers should keep in touch with lone workers and new advice on the impact lone working can have on stress, mental health and wellbeing.
Lone workers face the same hazards at work as anyone else, but there is a greater risk of these hazards causing harm as they may not have anyone to help or support them if things go wrong. As an employer, you should provide training, supervision, monitoring and support for lone workers.
You can access the new guidance by clicking here.
As Sintons marks its 125th anniversary, here, we highlight some of the major events since 1896, both in the development of Sintons, as well as the world in general.
Please click on the play button below.
As Sintons celebrates its 125th anniversary, some of its team share their thoughts and experiences of being part of the firm and playing their role in its growth. From those who have been at Sintons for over 30 years to those who have joined more recently, here they discuss what makes the firm stand out in the competitive legal marketplace, while also being a great place to work.
“I have been at Sintons now for nearly 20 years and during that time I have progressed from trainee to partner level and more recently to head of our fast-growing NHS Healthcare team. Many of my clients have been with Sintons for years and grown with me and I think a large part of that is because we have built such strong and trusting relationships with them.
The firm has grown significantly since I first started working here – it has doubled in size. However, the same culture, values and traditions are still imbedded which means whilst the firm changed in size, it still embraces the supportive nurturing culture you only find at Sintons which cascades from the top down.
As I began life as a trainee at Sintons, it’s fantastic to be able to support others in progressing and achieving their goals. We have a strong team and great dynamic and that is evident to our young lawyers who bring with them a refreshing approach to the Sintons culture.”
“Starting my career, it was important to find a firm with local roots and a reputation for providing high quality training. The first-class levels of service Sintons provide is testament to the standard of training they deliver, and there was no question which firm I wanted my career to start in.
Sintons have always focused on ensuring that my development is put first and have laid the foundations for a successful career as a solicitor. Being a full service firm has given me the opportunity to experience all areas of law and has exposed me to a variety of high value and complex work. I look forward to what the future holds for me at Sintons.
Although the marketplace is competitive, Sintons longstanding history and their presence, both locally and nationally, will always place them at the forefront.”
Anne Smith, secretary
“I started at Sintons in 1986 and this year in November will have been here for 35 years.
I still remember my first day like it was yesterday. Everyone was so friendly and welcoming, and it is still like that today – almost like a second family to me.
“I have mainly worked in private client and worked for lots of fee earners and partners. In 2000 I started working for Steve Freeman who then went on to become a Partner and Head of the Private Client Department. I have now worked for him for 21 years this year and I can honestly say it has been a pleasure and an honour to work for such a lovely man – we have a great working relationship. I also work with the rest of the Family Department and work for such lovely fee earners.
I am also very proud to say that my daughter Emma also works for Sintons in the Conveyancing Department and she also loves her job and the team she works with.
I have seen many changes over the years but one thing remains constant – Sintons is a great place to work. I have made lifelong friends here and they will remain so.”
Emelie Vardon, solicitor
“Sintons’ heritage was very important to me when choosing to join Sintons. I came here as a trainee solicitor in 2017 and making the right choice for my future career was crucial. Knowing Sintons’ reputation and history, I couldn’t have made a better decision.
This is such a great place to work with a warm and welcoming environment. Following the completion of my training contract in 2019, I joined our developing Wills, Trusts and Estate Disputes team. Under Emma Saunders’ excellent leadership and support, my first year as a qualified solicitor has been excellent groundwork for my future career in this specialist area of law.
As a full-service law firm, I consider that Sintons is well-placed in the competitive market.”
“I joined Sintons as a trainee in September 1997. At the time the firm consisted of about 80-90 people. We were operating from an office in Portland Terrace in Jesmond, it was like a rabbit warren for a new starter as it was multiple old terraced houses converted and joined on different floors.
The main changes have been the massive growth in size and expertise, plus multiple office moves until finally landing at the Cube. When I qualified in 1999 myself and the partner at the time (Andrew Walker) were the Sintons commercial property department. Since then we have grown significantly.
Sintons has always been and remains a great place to work, we have an excellent team in Real Estate and will continue to succeed because of the efforts of our staff.”
Pippa Aitken, senior associate
“Sintons was much smaller when I joined in 1998. It was a friendly, family firm renowned for its reputation in private client and personal injury work. There was no dedicated corporate and commercial department.
“I was the only trainee and was sent on all sorts of weird and wonderful jobs – witnessing wills, attending infant settlements and the odd trip to the bank for the accounts department!
Sintons has become a lot more sophisticated in its working procedures and there is a much faster pace of life with emails being the most popular form of communication. I have seen some great lawyers leave and some great lawyers arrive but everyone soon seems to inherit the ‘old’ Sintons sense of fun, respect and teamwork.
Sintons is in a great place going forward. Virtual working has opened up some great opportunities to spread our wings and engage with clients even better than before.”
“The firm has almost doubled in size since I started in 2005. The range of services offered by the firm has expanded quite significantly since then too, making the firm much more attractive to commercial clients.
When I first came to Sintons, I headed up the department with Lucy Winskell (now chair of NELEP and Pro Vice-Chancellor of Northumbria University). Since her departure I have headed it up myself. In spite of that, the department has grown in its client base and the amount of work we deal with on an annual basis.
With the growth in size and services we continue to see, I think Sintons are very well placed in the market to take advantage of opportunities going forward.”
Astrid Stevenson, secretary
“I joined Sintons on 21 October, 1997, and will have been here for 25 years this year.
I think when I started there were only about 80 people working at Sintons. We were based in Portland Terrace then moved to Osborne Terrace. We didn’t have open plan working like we have now, we had little rooms with approximately 3 secretaries in each room. I shared a room with Anne Smith from the first day I arrived and we have been firm friends ever since. Fee earners all had their own office. Basically, it was like a rabbit warren.
The staffing levels were very much smaller then, as I say about 80 staff then and now we have more than double that number. The computer system (Word Perfect 5.1) and equipment were top of the range for the time, and I think that has carried on until this day, our IT department have the latest of everything and are basically top notch.
Since I started 25 years ago, the firm has changed and has always moved forward with the times. When I started there were no female partners. Hilary Parker and Karen Simms became the first, which was a very welcome breakthrough for Sintons.
We were like one big happy family with lots of social events, which thankfully still happen to this day, keeping the ethos of Sintons going.
I think if I didn’t enjoy working here I wouldn’t be celebrating my 25th years this year at Sintons. I’ve worked for the head of dispute resolution Angus Ashman for 24 of those years, and I think we work well together because we work as a team.
This is a very nice place to work, the people are all friendly and If anyone needs help with anything there is always someone there to help. I always think we are only as good as the tools we work with and I must say Sintons do provide all the best equipment and people and it makes the job so much easier if you have things like that in place.”
1896 marked a year of historic new beginnings and breakthroughs.
The year that saw the first modern Olympic Games held in Athens;
The introduction of the X-ray;
The development of the first Ford vehicle, the Quadricycle.
And in such a landmark year as 1896, with events taking place which went on to change history, it is fitting that this was the year when Sintons was founded and the foundations laid for the firm that it would become.
Having been founded as Sutton Cheshire & Thompson on February 8, 1896, to serve the people of Newcastle, the firm then merged with John H. Sintons & Co in 1971 – later becoming Sintons – and has grown into one of the leading law firms in the North of England, acting for ever-increasing numbers of business and private clients both regionally and across the UK.
Over the past 125 years, Sintons has developed a reputation for the quality of its advice, and crucially, the deep and trusting relationships it builds with its clients borne out of the outstanding service it delivers to them.
There are so many momentous events and developments which have taken place over such a long period of time and the world has changed, and continues to change, beyond recognition.
However, throughout that period Sintons has been working alongside individuals, families, businesses and organisations for 125 years, adapting and changing to meet new challenges and will continue to do so for the years to come.
As a law firm for changing times, Sintons continues to evolve, as it has done since 1896, to ensure it stays at the forefront of the legal market and in the best possible position to deliver excellence to its clients.
“Over the past 125 years, we have continually shown we are innovators, we are leaders. We have never been afraid to take bold decisions,” says Christopher Welch, managing partner of Sintons.
“A great example of this is when we invested in our head office, The Cube, in 2004. We were moving to an area of the city which was largely undeveloped and were, largely, surrounded by the old Scottish and Newcastle plant. Looking around us now, this is a thriving, fast-growing and sought-after area, which is the site of huge investment from both business and academia. We had the foresight to buy into these brave future plans and the ambition to want to become part of it.
“In these changing times, we will continue to evolve and develop, as we have done throughout our history, to ensure that at all times we are delivering the very best service to all our clients while also building and investing in the firm from within.
“We have stood the test of time for 125 years and are committed to ensuring Sintons maintains the reputation and presence that has been built so carefully into the future.”
For Christopher, who joined Sintons in 2003, the main differentiator between Sintons and its competitors is its unfaltering commitment to clients.
While continuing to attract new clients nationally, the firm is rightly proud of its longstanding client base, which includes many who have been with Sintons through multiple generations of their family or business ownership.
“The firm’s absolute priority from day one has been our clients and ensuring they receive the highest standards of legal and personal service. Our reputation is built on those foundations, which were laid by our previous generations of Sintons’ lawyers, and is one we are proud to continue to develop further,” says Christopher.
“At Sintons, we care about what we do, how we do it and we never forget that the clients we are working with are depending on us for, often, some of the most momentous decisions of their lives. As a firm, we recognise both the privilege and the responsibility that goes with this, it is fundamental to how we work and to our values as a business.
“Our clients are the front, back and centre of everything we do. We’ve been there for them whenever they’ve needed us for 125 years and that will continue to be the case as we move forward.”
And building further on its reputation for leading the way in the legal marketplace, Sintons continues to innovate to stand out from the crowd.
Having carried out a full rebrand in early 2020, to give the firm a fresh yet timeless identity, Sintons continues to invest in its future.
“Our rebrand was a significant step for the firm,” says Christopher. “Our branding represents the firm that we are; bold, innovative and providing clear and confident advice to our clients – a firm that stands out from the crowd.
“The use of technology to better serve our clients has always been an essential part of our growth strategy. Our founding partners would be aghast at the thought that we were able to have virtually all our colleagues working remotely – with some as far away as the Cayman Islands and Texas – without any impact on client service.
“By investing heavily in our website and online presence, we have created a resource which is available to clients wherever they are in the UK or indeed the world, giving them immediate access to information and support in ways which weren’t available before.
“The legal sector isn’t always the first to embrace change, but we are rightfully proud of the reputation we have built for standing out in that respect. For 125 years, we have taken bold moves, we have never shied away from making investment to equip the business for the long-term, and we have shown foresight and innovation to make the firm what it is today.
“This is a landmark anniversary for us, and in uncertain times, the investment we have made for many years in our infrastructure, development of our people and strategic recruitment means we remain confident in our future and the service we can continue to provide to our clients and to the regional community of which we are a fundamental part.
“These truly are changing times – but with 125 years behind us then we must be doing something right! We know that our business will continue to evolve, with further investments in technology and infrastructure changing how and where we work. However, as we move forward, what is clear is that Sintons will always be right there, by the side of our clients, as we have been since 1896.”
Since its foundation in 1896, Sintons has grown to become one of the leading law firms in the North of England with a client base which extends across the whole UK.
It has become known as a key advisor to businesses and individuals acting on major, complex matters, regionally, nationally and internationally.
Sintons has built a well-deserved reputation for delivering expert legal advice and outstanding service to every client, which is at the heart of the trusting and long-lasting relationships it has built during the past 125 years.
Testament to the quality of service provided is the fact that many of the firm’s clients have been with Sintons for decades, with the firm routinely being trusted to advise multiple generations of families and business owners.
Now, in its 125th year, and despite the ongoing challenges being presented by the COVID-19 pandemic, Sintons remains confident in its future as the firm continues to develop and grow.
The firm can trace its roots back to the formation of Sutton Cheshire & Thompson on February 8, 1896, which merged with John H. Sinton & Co in 1971 to become Sinton & Co, and later Sintons.
The expansion of the amalgamated firm has seen it move offices a number of times in order to house its growing number of employees, moving from Portland Terrace in Jesmond to bigger premises in Osborne Terrace which were soon outgrown, resulting in the relocation in 2004 to its current purpose-built home, The Cube, opposite St James’ Park in Newcastle. A second site was added with the opening of a consulting office in York two years ago to help the firm service its increasing demand for work from around Yorkshire.
The move in 2004 acted as a springboard in the development of Sintons, with many people not having realised how big the firm had grown and heralded a period of strong growth across the firm as a whole, with legal talent continually added to build its expertise and capability further still.
This has been backed by continued investment in its IT infrastructure, digital offering and people, to ensure Sintons is well positioned for the future.
“We are very proud of the reputation we have built over the past 125 years, which has seen us become known on a national scale as a law firm of the highest capability which is absolutely dedicated to its clients,” says Christopher Welch, managing partner of Sintons.
“We have never been afraid to be leaders and to take bold decisions, which have frequently put us at the very forefront of the legal sector. We were, for example, building our online presence and digital business development platforms way ahead of our competitors and long before it was something that was embraced widely within the legal sector.
“Going forward, we are in a strong position, having built on the heritage and legacy of Sintons over the past 125 years to create a law firm with a national reach, regarded in the highest terms for the quality of both our legal and personal client service.
“This is a very significant milestone for us as a business, and while we reach it during some of the most challenging economic conditions in the country’s history, we remain confident in the future of Sintons.”
Please click on the play button below to listen.
While the Government has committed billions of pounds to supporting businesses through the unprecedented challenges of the COVID-19 pandemic, reports of fraudulent claims around furlough leave are rising. By early January 2021, HMRC confirmed they are currently investigating 21,378 cases of suspected furlough fraud.
Whether this has been a deliberate action, or a misinterpretation of the complex rules around the Coronavirus Job Retention Scheme (CJRS), there is an urgent need to rectify matters for any business which has fallen foul of the regulations.
HMRC are looking increasingly closely at claims made through the CJRS, and are performing spot checks on businesses, so it is advisable to ensure that payments are audited now. Any erroneous claims will be found by HMRC, so it is very important that claims and associated information are in order. Businesses must retain all supporting evidence relating to this, including calculations of claims made.
If an error has been made, or the money you received is not to be used to pay wages, tax, NI or pension contributions, you must notify HMRC to avoid a penalty.
The CJRS payments are classified as revenue receipts chargeable either to corporation or income tax and any overpaid amount must be repaid in the relevant time period. The period for sole traders and partners ends on 31 January 2022 and for companies, the period ends 12 months from the end of their company accounting period.
HMRC can recover the full amount by way of a tax assessment, which must be paid within 30 days. A penalty of up to 100% of the CJRS wrongly received can be charged by the HMRC as punishment if they are not told of the over claim within the notification period. The notification period is currently the latest of 90 days after the date of receiving the grant or 90 days after circumstances changed resulting in no longer being entitled to keep the grant.
Repayment and penalties can be sought against any partner in a partnership and officers of an insolvent company.
HMRC can also use the investigation and enforcement powers under the Finance Act 2020 where they suspect deliberate criminal activity has been committed. These can relate to serious offences, including conspiracy to defraud, fraud by false representation, false accounting, cheating the public revenue and money laundering.
Consequences of being found to be in breach of the rules are very serious. Not only is there the reputational damage this could do to a business, but there is also the prospect of a criminal conviction or even imprisonment.
By taking action now to ensure you are entirely compliant with the CJRS rules and in making any claims, you will avert any potential sanctions further down the line.
* Sheila Ramshaw is an associate and regulatory specialist at Sintons. For advice around CJRS compliance, and assistance in preparing for a possible spot check from HMRC, contact Sheila on email@example.com or 0191 226 3739.
Anticipation grows as UK Supreme Court grants permission to appeal class action claim in Lloyd vs Google LLC
On 11 March 2020, the Supreme Court granted Google permission to appeal against the Court of Appeal’s decision in the case of Lloyd v Google LLC () EWCA Civ 1599). The class action brought against Google relates to the alleged tracking of personal data by Google of 4.4 million iPhone users and subsequent selling of the users’ data to advertisers, without the users’ knowledge and consent. Google is appealing the Court of Appeal’s decision to grant Mr Richard Lloyd permission to serve his representative action on Google.
The issue has already been the subject of litigation in the English courts in the matter of Vidal-Hall v Google in 2015 and regulatory action in the U.S., including Google’s settlement payment of $22.5m to the U.S. Federal Trade Commission. In contrast to the decision in Vidal-Hall, however, Mr Lloyd did not allege any financial loss or distress as a result of the alleged infringement, he argued damages should be awarded for the infringement of the claimants’ data protection rights leading to the loss of control of personal data.
There are three main grounds considered by the Court of Appeal which are the subject of the appeal to the Supreme Court.
Whether a non-trivial infringement of the Data Protection Act (DPA), which does not cause any material damage or distress, can amount to “uniform per capita” damages being awarded for “loss of control” of personal data.
Whether it is required that members of a class can be identified, in order to demonstrate the “same interest” when pursuing a representative class action, under Civil Procedure Rule (“CPR”) 19.6(1).
Whether the High Court was correct to exercise their discretion in ruling that the claim should not be permitted to proceed under CPR 19.6 as a representative action.
The Court of Appeal held that damages are, in principle, capable of being awarded for loss of control of data under section 13 of the DPA, without proving pecuniary loss or distress.
The Court relied on Gulati v MGN Ltd (a 2015 phone-hacking case brought on the basis of the tort of misuse of private information) in which damages were awarded as compensation for the loss of control of private information, without proof of pecuniary loss or distress.
The High Court held that members of Lloyd’s representative class did not share the “same interest” (required by CPR 19.6(1)) because the nature and extent of the breach and the impact it had on individual class members would have varied greatly depending on their personal circumstances; and some may not have suffered any damage at all.
According to the Court of Appeal, as damages were claimed on a ‘per capita’ basis, all claimants had suffered the same loss (i.e., the loss of control over their data) and, therefore, shared the “same interest” and were identifiable.
CPR 19.6(2) allows the Court, exercising its discretion, to direct that a person may not act as a representative. The Court of Appeal considered it was appropriate for it to exercise this ‘discretion afresh’ and concluded that this case “quite properly, if the allegations are proved, seeks to call Google to account for its allegedly wholesale and deliberate misuse of personal data without consent, undertaken with a view to commercial profit”. “It is not disproportionate to pursue such litigation in circumstances where, as was common ground, there will, if the Judge were upheld, be no other remedy. The case may be costly and may use valuable Court resources, but it will ensure that there is a civil compensatory remedy for what appear, at first sight, to be clear, repeated and widespread breaches of Google’s data processing obligations”.
This landmark case is of great importance as it has the potential to significantly widen the scope for claims to be brought in respect of a failure to protect data under the GDPR.
The appeal is not expected to be heard by the Supreme Court until late 2020 or early 2021.
You can read the full Court of Appeal judgment of Lloyd v Google LLC here.
In July 2019 The Information Commissioner’s Office (ICO), revealed its intention to fine Marriott International £99.2m as a result of a data breach relating to residents of 31 countries in the EEA, of which about 7 million related to UK residents.
The ICO said the issue appeared to begin when the systems of the Starwood hotels group were compromised in 2014. Marriott acquired Starwood in 2016, although the theft of customer information was not discovered until last year. The regulator stated that there had been a failure to undertake sufficient due diligence when Marriott acquired Starwood and they should have done more to ensure the IT systems were secure.
Although in September 2018 Marriott International, the parent company of hotel chains including W, Westin, Le Méridien and Sheraton, admitted personal data including credit card details, passport numbers and dates of birth had been stolen in a global hack of guest records, they have appealed against the fine by way of submissions to the regulator and an extension of time has been granted until 30 September 2020. After this agreed deadline, the regulator will make their final decision.
Representative class action
As this investigation continues, Marriott International is now facing a representative class action lawsuit in the High Court from millions of customers, who are seeking compensation after their personal details were stolen.
Technology consultant Martin Bryant is to lead the legal action on behalf of people living in England or Wales who made a reservation to stay at one of Marriott International’s Starwood properties including W Hotels, Sheraton Hotels & Resorts, Westin Hotels & Resorts and Le Méridien Hotel & Resorts before 10 September 2018. These residents will be automatically included in the lawsuit unless they decide to opt out.
When Marriott investigated the breach, they discovered that unauthorised access to their systems had been ongoing since 2014, and unidentified hackers had stolen the details of 339 million guests. There was a failure over several years to ensure that sufficient and adequate organisational and technical measures were in place to protect their millions of guests’ personal data which had been provided to them in trust.
The ICO have stressed the importance of cybersecurity being the responsibility of all people within an organisation. Ongoing training and awareness amongst employees from the board down is critical to ensure a layered approach of people, processes and technology, and to prevent potential customer data breaches.
As a result of their failures, not only do Marriott face a potentially huge fine from their regulator, they are also now being faced with a class action lawsuit filed against them in England and Wales for a mass data breach.
Of the 7 million Marriott customers resident in the UK, a large proportion of these will be resident in England and Wales and automatically included in the claim. Nothing in the data protection legislation prescribes the level of compensation which should be awarded for a data breach, but if the class action is successful and each claimant were to be awarded a modest sum of £500 in damages, the ICO’s proposed fine would be dwarfed by a court judgment in the claimants’ favour.
Following the recent decision in Richard Lloyd v Google LLC  EWCA Civ 1599, representative class actions for data breaches are likely to become a familiar sight on the data protection landscape. As such, when reviewing the strength of your data protection strategy and critical risks to your business, you should be reflecting on the number of individuals whose personal details you retain and how damaging it would be if you were to be faced with a lawsuit by each and every one if a data breach occurred.
Sintons’ Data Protection Team is on hand to discuss any concerns you may have about your data protection policies, infringements and any claims that you might face.
These sessions have come about due to the employment team here at Sintons having been inundated with COVID-19 and furlough questions following the introduction of the Coronavirus Job Retention Scheme and the ever changing government guidance.
The team has also been giving some thought as to what work may look like following the relaxation of the current restrictions.
So, In order to give you an opportunity to share in some of that wisdom, the team have opened themselves up to these Q&A sessions which are going to last until the end of May. During these short, bite sized sessions, members of the employment team will answer three questions, although it will actually be four today, (either COVID-19 related or not) that you haven’t either quite got to the bottom of or that your employees persistently ask you.
Please click on the image below to watch the session.
On 11th May 2020 the Government published further guidance to help employers, employees and the self-employed understand how to work safely during the coronavirus pandemic. There are 8 guides which cover a range of different types of work and include construction and outdoor work, factories, plants and warehouses, labs and research facilities, offices and contact centres, other peoples homes, restaurants offering takeaway or delivery, shops and branches and vehicles. Although business should read those guides relevant to their workplace, all the guidance focuses on 5 main points which are:
- Carry out a COVID-19 risk assessment
- Develop cleaning, handwashing and hygiene procedures
- Help people to work from home
- Maintain 2m social distancing, where possible
- Where people cannot be 2m apart, manage the transmission risk
Additional guidance has been produced by the HSE which helps Employers identify relevant issues which they should consider as part of their risk assessments where employees are proposing to return to work. The HSE make it clear that “These guides should not be used on their own, to decide on the actions that you need to take, but as a starting point to consider what you can do”, therefore every employer will need to ensure and satisfy themselves that the measures they have taken are appropriate so as to properly manage the risk of coronavirus in their workplace.
On the 9th May 2020 the Department of Business, Enterprise and Innovation produced a Return to Work Safely Protocol which is “designed to support employers and workers to put measures in place that will prevent the spread of COVID-19 in the workplace when the economy begins to slowly open up, following the temporary closure of most businesses during the worst phase of the current pandemic. The Protocol should be used by all workplaces to adapt their workplace procedures and practices to comply fully with the COVID-19 related public health protection measures identified as necessary by the HSE”.
Before restarting work you should ensure the safety of the workplace by:
- carrying out a risk assessment in line with the HSE guidance
- consulting with your workers or trade unions
- sharing the results of the risk assessment with your workforce and on your website
It identifies issues employers should consider when assessing risk and potential control measures.
Working safely during the coronavirus outbreak
This guidance is for employers and those who are self-employed and work with or near other people. It may also be useful to workers and their representatives.
During the coronavirus (COVID 19) outbreak, it is important for businesses to operate where it is safe to do so. This guidance is designed to help you work safely and control the risks associated with running your business at this time.
The guidance explains measures you can take to help you carry on working safely during coronavirus (sometimes known as being ‘COVID secure’), for example by putting in place social distancing measures, staggering shifts, providing additional handwashing facilities and how to talk with workers to help them stay safe.
On the 28th April 2020 the FCA published a CEO letter on ensuring the fair treatment of corporate customers preparing to raise equity finance. The FCA say they “have heard credible reports of a small number of banks failing to treat their corporate clients fairly when negotiating new or existing debt facilities, as clients navigate the current exceptional circumstances. In particular, banks may have used their lending relationship to exert pressure on corporate clients to secure roles on equity mandates to which they would not otherwise have been appointed. In some cases, these roles may be “in name only”, with few or no additional services being provided in exchange for a share of the fee pool. The FCA will look into this further but wants any practice of this kind to cease immediately.
Such conduct could breach FCA rules and the Principles of Business. Firms need to observe proper standards of market conduct (PRIN 5), act with integrity (PRIN 1) and in the best interests of their clients (COBS 2.1), and prevent or manage conflicts of interest (SYSC 10.1). Firms and relevant individuals should also consider the senior managers and certification regime (SM&CR), including the individual conduct rules. Clauses in agreements that restrict a clients’ choice of providers for future business could also breach COBS 11A.2 (prohibition of future service restrictions). Firms must also meet their Market Abuse Regulation (596/2014) (MAR) obligations concerning the identification, handling and disclosure of inside information received in connection with renegotiating a corporate client’s existing facilities
A copy of the letter can be accessed here https://bit.ly/2VLNgRz
On 6 April 2020, the High Court in R (on the application of Tesco Stores Ltd) v Birmingham Magistrates’ Court  EWHC 799, dismissed an application for judicial review following the decision of Birmingham Magistrates Court not to allow expert, scientific evidence as a line of defence in a food safety case. The Council had brought 22 charges against Tesco Stores on the basis that, by displaying for sale items of food with an expired use by date, Tesco had committed an offence under regulation 19 of the Food Safety and Hygiene (England) Regulations 2013, because it had placed food on the market that was “unsafe” in breach of article 14(1) of the Food Safety Regulation.
Tesco accepted that all those items on sale were passed their use by dates but relied upon two defences namely (i) that the items were not, in fact, “unsafe”, and (ii) a “due diligence” defence under regulation 12. In relation to the former, Tesco served an expert report from a food microbiologist essential saying that the food products were safe to eat.
At paragraph 48 of the Judgement Hickinbottom LJ said “In my view, the legislative provisions are unambiguous: as a result of article 24, food that is displayed for sale, or otherwise placed on the market, with a labelled use by date that has expired is “unsafe” for the purposes of article 14 of the Food Safety Regulation, and that cannot be controverted by evidence. An FBO which is responsible for placing such food on the market acts in breach of article 14, and is thus guilty of an offence under regulation 19 of the 2013 Regulations.”
A copy of the judgement can be accessed here https://bit.ly/3avz8QH
On the 15th April the Government published their action plan for adult social care in England which sets out their approach for all settings and contexts in which people receive adult social care. Settings and contexts “includes people’s own homes, residential care homes and nursing homes, and other community settings.
It applies to people with direct payments and personal budgets, and those who fund their own care.”
The Plan includes the Governments approach to:
- Controlling the spread of infection in care settings
- Supporting the workforce
- Supporting independence, supporting people at the end of their lives, and responding to individual needs
- Supporting local authorities and the providers of care
The guidance can be accessed here https://bit.ly/3bfGA3w
A joint statement between the HSE, TUC and CBI was released today in response to employers and employees concerns around safe working, especially those workers who are working away from their home. The statements says:
“The health and safety of workers remains paramount. Employers are and must continue to provide workers with information about risks to their health and the actions their employers must take. Social distancing is a key public health measure introduced by Public Health England to reduce the spread of infection. Most employers are going to great lengths to ensure social distancing wherever possible. The HSE, CBI and TUC wish to publicly support these efforts. Firms that can safely stay open and support livelihoods should not be forced to close by misunderstandings about government guidance.
But If it comes to the HSE’s attention that employers are not complying with the relevant Public Health England guidance (including enabling social distancing where it is practical to do so), HSE will consider a range of actions ranging from providing specific advice to employers through to issuing enforcement notices, including prohibition notices.
Where a worker has a genuine concern about health and safety which cannot be resolved through speaking with their employer or trade union, they should contact the relevant enforcement agency – either their local authority, or the HSE.
For firms who are unsure about the guidance, please visit here .
Tayside Health Board fined after three patients died in acute psychiatric ward at Murray Royal Hospital
On the 19th March the Health and Safety Executive (HSE) reported that Tayside Health Board had been fined £120,000 following three incidents where patients died by suicide using ligature points. The incidents took place on the Moredun Ward at Murray Royal Hospital, Perth, between 1 April 2012 and 4 November 2015.
The HSE said that their investigation “found that Tayside Health Board failed to assess, manage and control the risk of severe injury and death associated with ligature anchor points. Private bedrooms within the facility had multiple ligatures points which could have been removed to reduce the risk to patients on the ward. The Health Board failed to effectively communicate risks associated with the ligature points to staff who were required to monitor and assess patients. A previous attempt by one patient to secure a ligature to a ligature anchor point was not communicated to the staff who monitored her. She later successfully took her own life by the same method”.
A copy of the HSE report can be accessed here.
In a recent briefing note the Health and Safety Executive (HSE) say that they have taken and number of measures to ensure that they can carry out their role as effectively as possible as the COVID-19 situation unfolds. They have advised that their staff and inspectors remain contactable however “despite the demanding circumstances, compliance with occupational health and safety legal requirements remains with duty holders and HSE will continue its regulatory oversight of how duty holders are meeting their responsibilities in the context of the current public health risk and based on our available regulatory capacity”. As a result of the Covid-19 outbreak the HSE:
- “has suspended targeted inspection activity of high-risk industries that are not part of the major hazard sectors, including construction and manufacturing
- has carried out a short pause on our offshore oil and gas and onshore chemical, explosives and microbiological industry inspection activities so we can give duty holders time to overcome various immediate pressures and challenges and we will then focus our regulatory work so it is re-prioritised onto critical areas and activities. We will continue to regulate major hazard industries throughout this time undertaking regulatory functions remotely
- will endeavour to undertake regulatory activities which do not require site visits as normally as possible, for example Approvals and Authorisation work for biocides and pesticides, Statutory Permissioning activities such as Licensing, Safety Case / Report Assessments, Thorough Reviews, Combined Operations Notifications, Wells Notifications, Land Use Planning Applications, Hazardous Substances Consents etc
- will, across all sectors, continue to investigate work related deaths, the most serious major injuries and dangerous occurrences and reported concerns from the workforce or the public where people are being exposed to risks from work activities and we will still take action to secure compliance with the law. We will conduct as much of our investigation activity using technology as possible, without compromising the collection of evidence and our ability to secure effective control of risk and, where appropriate, justice
- will do as much of our regulatory intervention work as we can remotely, but we will still mobilise to site, including offshore, where it’s necessary to provide public assurance that hazards are being effectively managed and to secure compliance with the law. Where a site visit is required social distancing guidelines will be followed”.
The HSE have said they will keep the situation under review and updates will be posted to their website.
Further guidance was issued today by the Chief Dental Officer for England in relation to Changes to Primary Dental Care services. The guidance stipulates amongst other things the following:
- All routine, non-urgent dental care including orthodontics should be stopped and deferred until advised otherwise.
- All practices should establish (independently or by collaboration with others) a remote urgent care service, providing telephone triage for their patients with urgent needs during usual working hours, and whenever possible treating with:
- Antimicrobial means where appropriate
- If the patient’s condition cannot be managed by these means, then they will need to be referred to the appropriate part of their Local Urgent Dental Care system.
- All community outreach activities such as oral health improvement programmes (e.g. Starting Well, routine non-urgent work in care homes) and dental surveys should be stopped until advised otherwise.
- In order to provide accurate information to the public we are asking that all dental practices:
- Update their messaging and websites.
- Contact their regional commissioner should practice availability hours alter as a result of staffing levels; and
- Inform the commissioner of these changes and the arrangements for cover.
The CQC have commented that “As this change in service provision affects the whole of the dental sector it is NOT necessary for providers to notify us at this time, unless a service closure is permanent. We are sure dental providers will make these changes and work to reduce the risks of Covid-19 infection across the population”.
The advice can be accessed here https://bit.ly/3ajSvgq
The Chancellor has set out a package of temporary and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19.
This includes a package of measures to support businesses including:
- Coronavirus Job Retention Scheme
- Deferring VAT and Income Tax payments
- Statutory Sick Pay relief package for small and medium sized businesses (SMEs)
- 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England
- Small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
- Grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,001 and £51,000
- Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank
- New lending facility from the Bank of England to help support liquidity among larger firms, helping them bridge coronavirus disruption to their cash flows through loans
- HMRC Time To Pay Scheme
Details of the package can be accessed here https://bit.ly/2QHd6nc
On 16 January 2020, the UK government launched the Joint Unit for Waste Crime (JUWC), a new taskforce of environmental regulators, HMRC and the National Crime Agency committed to tackling serious and organised ‘waste crime’.
Waste Crime includes fly-tipping, illegal dumping or burning of waste, the operation of illegal waste management sites and illegal waste export. In 2015 waste crime was estimated to have cost £600 million in the UK.
In 1996 Landfill Tax was introduced which commoditised waste, rendering it more lucrative for those involved in serious financial crime. Between 2013 and 2018 total Landfill Tax cash receipts dropped from £1.189 billion to £888 million. The lower rate of Landfill Tax is £2.80 per tonne, the higher rate being £88.95 per tonne, given the difference in rates, tax evasion figures are expected to be high.
The waste industry is highly regulated, but it mostly focuses on waste sites and their operators. Due to this, brokers and carriers are not as focused on and increasing numbers of organisations and individuals are becoming involved in the waste industry, fragmenting the market and developing increasingly complex transactions and business structures. Waste sites are often located out of site of the general public, making it easier to conceal their workings and easier to conceal illegal money into the legitimate economy.
In an Independent Review published in November 2018, they stated that the structure and organisation of the Environment Agency (EA) belonged to an older and simpler world and did not possess the necessary authority, powers or business model to counter the criminal scourge in the waste sector effectively.
The Review advocated for the EA to be equipped with further powers to search premises and seize materials, for the introduction of a Fixed Penalty Notice for the clear and deliberate mis-description of waste, for increased use of digital waste tracking, a duty of care at each stage in the waste process and a review of funding, amongst other changes.
These powers would bring the EA in line with other regulatory bodies such as HMRC, where under the Criminal Finances Act 2017 HMRC are allowed to target corporates who fail to implement reasonable procedures to ensure they do not facilitate tax evasion by associated persons. Such entities would not need to be engaged in the underlying tax evasion. HMRC do not have to secure a conviction for the underlying evasion before prosecuting the corporate. Sanctions are severe, including unlimited financial penalties, confiscation orders and serious crime prevention orders.
Under section 330 of the Proceeds of Crime Act 2002 there is a requirement to report any suspicion of money laundering, this does not however apply to those in the waste industry. Although this is the case, anyone involved in the regulation of the waste industry should emphasise to industry participants the importance of steering clear of the money laundering offences as well as other forms of criminal activity.
A year ago, HMRC introduced a self-reporting regime encouraging anyone discovering tax evasion to come forward. Any reporting would be reflected in any penalties imposed and would form part of the ‘reasonable procedures’ defence. Unlike other self-reporting regimes such as Code of Procedure 9 in tax evasion cases, there is no assurance of immunity for the person reporting.
On the 21st January 2020 the FCA published a statement on its Assessing Suitability review which “will focus on the advice that consumers receive around retirement income. With a greater number of options now available in retirement planning, it is vital that consumers get good advice at the point they access their pension savings and, if necessary, going forward.” The FCA have said that their aim is to publish the report in 2020. A copy of the statement can be accessed here.
When an FCA-authorised firm enters administration, eligible consumers can bring claims to the Financial Services Compensation Scheme (FSCS). FSCS will then work jointly with the insolvency practitioners (IP) to identify potential claimants.
The Financial Conduct Authority (FCA) are aware that some insolvency practitioners (IPs) and FCA-authorised firms have attempted to sell clients’ personal data to claims management companies (CMCs) unlawfully. This can happen either before or after a firm has gone into administration and where it is likely claims for compensation will be made to FSCS.
In a standard contract, the terms, conditions and clauses, are highly unlikely to constitute sufficient legal consent for personal data to be shared with CMCs to market their services, and may be unlawful. Where companies pass on personal data, they may be failing to meet their obligations under the Data Protection Act 2018 and the General Data Protection Regulation (GDPR).
CMCs intending to buy and use such personal data must be able to demonstrate how they have considered the fair treatment of customers and how their actions comply with privacy laws. In line with the FCA Handbook, CMCs are required to act honestly, fairly and professionally in line with the best interests of their customers. CMCs cannot rely on the grounds of legitimate interest for processing data as they are highly unlikely to meet the requirements of the GDPR. Additionally, any subsequent direct marketing calls, texts or emails carried out by CMCs may breach the Privacy and Electronic Communications Regulations 2003 (PECR).
It has been made clear that, where the FCA or the Information Commissioner’s Office (ICO) identify breaches of the relevant data protection legislation, or relevant parts of the FCA’s Handbook including CMCOB Claims Management: Conduct of Business sourcebook, appropriate action will be taken.
The director of G&L Scaffolding and Roofing Limited, Kevin Leathers, has been sentenced to eight months imprisonment after a builder fell 30ft while working on a basement in Kensington.
In July 2017, Jon Currie was working for G&L when he suffered “catastrophic brain damage” in the fall and died. Mr Currie, who was an experienced scaffolder had lost his footing while taking down a temporary roof of corrugated iron panels. During the investigation, HSE found that Mr Currie and another worker were not wearing safety harnesses and no risk assessment had been carried out.
In April 2017, HSE had issued a warning letter to Mr Leathers reminding him of strict health and safety requirements after HSE officers had noticed his workers Mr Currie and others working on a site in dangerous conditions without safety harnesses.
Mr Leathers pleaded guilty to failing to ensure the health, safety and welfare of employees.
During the sentence hearing at Southwark Crown Court, the HSE prosecutor stated that “Mr Leathers had failed to exercise his duty of care and as a result Jon Currie died while working for him. Leathers intentionally breached, or flagrantly ignored, the law.”
On passing sentence, the Crown Court Judge said: “After the letter in April, Leathers could not have been warned in clearer terms about the dangers of the activities undertaken. He failed to take appropriate steps. If death results from such failure’s you must expect to receive an immediate [prison] sentence.”
A charge of manslaughter by gross negligence was left to lie on file.
FCA and Bank of England encourage switch from LIBOR to SONIA for sterling interest rate swaps from Spring 2020
In a statement published by the FCA on the 16th January 2020 the FCA and the Bank of England have identified the 2nd March 2020 as an appropriate date for market makers to change the market convention for sterling interest rate swaps from LIBOR to SONIA. The market for SONIA derivatives is already well-established with the average cleared over-the-counter SONIA swaps exceeding £4.5trillion per month over the past six months, and the traded monthly notional value is now broadly equivalent to Sterling LIBOR.
Edwin Schooling Latter, Director of Markets and Wholesale Policy at the FCA, has stated that “We have seen great progress in the development of the SONIA derivatives market. I encourage all market participants to join the initiative to put SONIA first over LIBOR from 2 March. This should help make SONIA the market standard in sterling swaps as is already the case in the bond market.” Further, Andrew Hauser, Executive Director for Markets, Bank of England, said that “This move toward a much greater use of SONIA in the sterling derivatives market builds on the strong foundations established in recent years and demonstrates a strong continuing partnership between UK authorities and market participants to bring about a decisive shift away from use of LIBOR ahead of end-2021.”
Recent Guidance from Public health England reports that “On 31 December 2019, the World Health Organization (WHO) was informed of a cluster of cases of pneumonia of unknown cause detected in Wuhan City, Hubei Province, China. On 9 January 2020, WHO announced that a novel coronavirus had been detected in patient samples in Wuhan. On 12 January 2020 it was announced that a novel coronavirus had been identified in samples obtained from cases and that initial analysis of virus genetic sequences suggested that this was the cause of the outbreak. This virus is now referred to as 2019-nCoV, and the associated disease as ‘2019-nCoV acute respiratory disease”. On 30 January 2020, the WHO Emergency Committee agreed that the outbreak now meets the criteria for a Public Health Emergency of International Concern and 2019-nCoV acute respiratory disease has been classified as an airborne high consequence infectious disease (HCID) in the UK.
Coronaviruses (CoV) are a large family of viruses that cause illness ranging from the common cold to more severe diseases such as Middle East Respiratory Syndrome (MERS-CoV) and Severe Acute Respiratory Syndrome (SARS-CoV). Common signs of infection include respiratory symptoms, fever, cough, shortness of breath and breathing difficulties. In more severe cases, infection can cause pneumonia, severe acute respiratory syndrome, kidney failure and death. Standard recommendations to prevent infection spread include regular hand washing, covering your mouth and nose when coughing and sneezing, thoroughly cooking meat and eggs and avoiding close contact with anyone showing symptoms of respiratory illness such as coughing and sneezing.
What does this mean for Healthcare professionals?
The situation changes daily and practices are advised to stay up to date with developments on Public Health England’s website at https://bit.ly/2On49hy.
The Financial Conduct Authority (FCA) have always required firms to treat customers fairly and again, in this instance, they have written to credit card firms telling them to review their approach to borrowers who are stuck in persistent debt, where they are paying more in interest, fees and charges than they are paying off their balance.
Firms will be required to propose and agree plans with customers to resolve the situation where they have been caught in a cycle of persistent debt for three years. The FCA has outlined a number of areas firms need to review to ensure their approach is in line with expectations.
Prior to firms issuing letters which set out proposals to their customers who have been in persistent debt for three years, and to ensure the firms’ approaches to the rules are working in the best interest of consumers, firms must encourage customers to speak with them to discuss potential repayment arrangements. If customers can’t afford the options proposed by the firm, they must be treated with forbearance and due consideration, by reducing, waiving or cancelling any interest or charges. In cases where customers are willing to engage and come to an agreement, firms are not allowed to suspend a credit card, unless they have an objectively justifiable reason.
Executive Director of Supervision for Retail and Authorisations at the FCA, Jonathan Davidson, said:
‘Under our rules, firms must help customers to reduce the level of debt they have on their credit card more quickly. If a customer cannot afford the firm’s proposals for how to do this, the firm must offer forbearance, potentially including: reducing, waiving or cancelling any interest, fees or charges.
‘My advice to consumers is don’t bury your head in the sand. If you can’t afford to meet the repayment schedule that the credit card firm is suggesting, don’t be afraid to tell them. If we find firms are not offering their customers the appropriate level of help, we will not hesitate to take action’. ‘If the firms do this right, we estimate that this could save customers up to £1.3bn a year in lower interest charges.’
The Financial Conduct Authority has been ordered to pay a £2,000 fine by The Pensions Regulator over a lack of details in its defined contribution scheme documentation. An FCA spokesperson said: “In considering the FCA Pension Plan’s application to become an authorised master trust, TPR reviewed its 2018 DC governance statement and ruled it contained insufficient detail….The FCA Pension Plan trustee has apologised to members of the plan, and reviewed systems and processes to ensure all the required information is available to members and the 2019 governance statement (provided in October) was fully compliant….The plan’s application to become an authorised master trust has been approved.”
HMRC have contacted approximately 220,000 VAT registered UK businesses by post, who may import and export between the UK and the EU. The letter explains what they can do next to prepare for changes to customs arrangements after the UK has left the EU.
During the implementation period (between 1 February and 31 December 2020), there will be no changes to the terms of trade with the EU or the rest of the world.
However, from 1 January 2021, the way businesses trade with the EU will change and preparations will need to be made for working outside the EU, including new customs arrangements.
If you import and export between the UK and the EU, you can start your preparations now by ensuring you have a UK Economic Operator Registration and Identification (EORI) number and preparing to make customs declarations.
If you have not received the HMRC letter and believe the changes may affect you, you can follow the link to find the letter they have published on GOV.UK.
For the first time, the Financial Conduct Authority (FCA) have brought enforcement action against a person who discharges managerial responsibilities (PDMR) for breaching article 19(1) of Market Abuse Regulations (MAR).
Under the Regulations, a PDMR of a publicly traded company must notify the company and the FCA within three business days if they deal in the company’s shares above a threshold of €5,000 in a calendar year.
All company directors are PDMRs, as may non-directors be, if as a senior executive they have regular access to inside information and the power to make managerial decisions that affect the Private Limited Company’s future development.
In this case, the executive sold shares in the company for an approximate amount of £71,000 three times between August 2016 and January 2017. The executive failed to notify the company or the FCA and following an investigation, the FCA imposed a fine of £64,300, reduced to £45,000 if settled early.
The executive was not a board director, or an FCA-Approved Person, but a member of the company’s executive committee, along with two senior executives and the CEO. He regularly had access to inside information, including monthly management accounts.
The company informed him in July 2016 that he was considered a PDMR as he had access to inside information by virtue of his role. A memo was sent to him on MAR and inside information with the company’s share dealing policy and acknowledgements which he countersigned in November 2016.
During the FCA investigation, it was noted that the executive was not provided with individual training on MAR or their responsibilities as a PDMR. Although there was no comment on the adequacy of the PLC’s compliance with the policies and procedures in relation to MAR, companies should provide appropriate training alongside their documentation when advising PDMRs on their duties.
To read the full FCA final notice on this case please click here.
First-tier Tribunal upholds decision to fine Hall and Hanley Limited for data breaches and unauthorised copying of client signatures
The First-tier Tribunal (the Tribunal) has upheld a fine of £91,000 imposed on Hall and Hanley Limited (H&H) by the Claims Management Regulator (CMR), the former regulator for claims management companies (CMCs), after finding it had acted negligently and ignored previous compliance warnings from the former Claims Management Regulator. The fine was initially imposed for numerous data breaches and unauthorised copying of client signatures.
Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA said, ‘The failure by Hall and Hanley to take previous advice and warnings from the former claims management regulator and the firm’s repeated use of consumer data and customer signatures without their consent are clear examples of a firm falling short of the standards we expect….The decision by the Tribunal to uphold the findings of the CMR is another important message to industry that firms must conduct all business with integrity and due care, skill, and diligence.’ The Tribunal decision can be accessed here.
Ping Europe Limited (Ping) makes and distributes golf clubs, golf accessories and clothing. It operates a selective distribution network of 1,200 authorised dealers throughout the UK. In August 2017, the Competition and Markets Authority (CMA) decided that Ping’s ISP prevented two UK retailers from selling Ping golf clubs on their websites. The CMA found that these agreements restricted competition by object and decided to fine Ping £1.45 million for breach of competition law. On 7 September 2018, the CAT gave judgment, upholding the CMA’s decision that Ping’s online sales ban constituted a restriction of competition by object under EU and UK competition law. Permission to appeal against the judgement of the CAT was granted by the Court of Appeal with the appeal being heard on 5-6 November 2019.
The Court of Appeal handed down their judgment on the 21 January 2020 dismissing the appeal by Ping and upholding CMA`s decision that Ping’s online sales ban constituted a restriction of competition by object pursuant to the Chapter I prohibition of the Competition Act 1998 and Article 101 of the TFEU. The effect of the ruling means that Ping must now allow retailers to sell its products online A copy of the judgement can be accessed here.
In a press release from the CQC on 14 January the regulator has indicated that they have concerns about the management of Cygnet Health Care following a review in the summer of 2019. The CQC carried out a provider well-led review of Cygnet Health Care between 2 July and 2 August 2019, after significant concerns were identified regarding the safety and culture of Cygnet Whorlton Hall following the BBC Panorama programme aired on 22 May. At the time of the review several Cygnet Health Care’s services were being inspected or subject to the early stages of enforcement action. Prior to publication of the report 9 services had been rated inadequate or placed in special measures. The CQC have told Cygnet that they “must now take immediate action to address our concerns”. The press release can be accessed here.
The TikTok app is one of the most downloaded apps in the world available in 150 markets and used in 75 different languages. Research by Check Point Software Technologies has revealed a series of vulnerabilities in the app leaving the personal information of its users vulnerable to exposure and could also enable cyber criminals to manipulate content on user accounts. The vulnerabilities allow attackers to get a hold of TiKTok accounts and manipulate their content, delete videos, upload unauthorized videos, make private “hidden” videos public and reveal personal information saved on the account such as private email addresses. A copy of the research can be accessed here.
On 10 January 2020, the FCA announced that it has commenced civil proceedings in the High Court against Bright Management Solution Ltd [sic] (the Firm), Soccer League International Ltd, Soccer League UK Ltd, as well as senior individuals at these companies. The FCA alleges that the defendants have been carrying on unauthorised deposit taking by accepting money from the public for different projects, including forex trading and cryptoassets. The FCA has secured an interim injunction, by consent, stopping these activities from continuing and freezing up to £1.3 million in assets pending further hearing.
The FCA is seeking a declaration from the court that the defendants’ actions amounted to unauthorised deposit taking as well as an order preventing them from carrying out this activity in the future. The FCA will also seek a restitution order to return frozen funds to consumers who were affected by these alleged breaches. You can view the press release by clicking here.
The ICO has fined DSG Retail Limited £500,000 after a ‘point of sale’ computer system was compromised as a result of a cyber-attack, affecting at least 14 million people. An ICO investigation found that an attacker installed malware on 5,390 tills at Currys, PC World and Dixons Travel stores between July 2017 and April 2018, collecting personal data during the nine month period before the attack was detected. The company’s failure to secure the system allowed unauthorised access to 5.6 million payment card details used in transactions and the personal information of approximately 14 million people, including full names, postcodes, email addresses and failed credit checks from internal servers. DSG was found to have poor security arrangements and failed to take adequate steps to protect personal data. This included vulnerabilities such as inadequate software patching, absence of a local firewall, and lack of network segregation and routine security testing. The ICO fined Carphone Warehouse £400,00 in January 2018 for similar security vulnerabilities. A copy of the penalty notice can be found here.
The Money Laundering and Terrorist Financing (Amendment) Regulations 2019 were finally made on 19 December 2019 and laid before Parliament the next day. The implementation date is 10 January 2020
The most significant changes are to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs).
One of the key changes MLD5 brings was how cryptoassets would be defined, ultimately effecting which businesses would come within scope of the MLRs. Treasury has defined cryptoasset as a “cryptographically secured digital representation of value or contractual rights that uses a form of distributed ledger technology and can be transferred, stored or traded electronically”.
The relevant thresholds for electronic money products to fall within the MLRs have changed, from the CDD requirements, and in relation to the general exemption for e-money products, it goes from €250 to €150 and from €100 to €50 or €50 per transaction in relation to the limits for CDD relating to cash redemptions.
A new requirement allows credit and financial institutions acting as acquirers on payments using anonymous pre-paid cards issued by a third country, to only accept payment where the card satisfies the requirements similar to those in the MLRs.
There is a new definition of cryptoasset exchange provider: someone who by way of business provides any one or more of the following services, including if it is the creator or issuer of any relevant product – exchanging, arranging or making arrangements with a view to the exchange of cryptoassets for money or vice versa or for other cryptoassets or operating a machine which uses automated processes to exchange cryptoassets for money or vice versa, when they are providing the services.
In addition, there is a new definition of Custodian wallet provider: someone who, by way of business, provides services to safeguard, or to safeguard and administer, cryptoassets on behalf of customers or provide cryptographic keys on behalf of customers to hold, store and transfer cryptoassets, when they are providing the services.
Both entities now fall under the need for registration under the MLRs by the FCA. The fit and proper test must apply to applicants for cryptoasset businesses and require relevant businesses to inform their customers before entering into any transaction whether the activity is within or outside the scope of the Financial Ombudsman Service and Financial Services Compensation Scheme.
Additionally, the MLR now set reporting requirements for cryptoasset businesses and allow FCA to require skilled persons reports on those businesses.
Most of the changes will come into force from 10 January 2020, however, the provisions on due diligence on anonymous pre-paid cards will take effect from 10 July 2020, and those on the bank account portal 10 September 2020.
The FCA has stated that where a cryptoasset business starts trading after 10 January 2020, they must be registered prior to carrying on the relevant activity.
For new firms coming into scope of the MLRs and the requirement to register for supervision will need to comply with the MLRs from 10 January 2020, although the FCA have stated there will be a grace period within which firms must apply for registration. Where registration is not completed and approved by 10 January 2021 the firm must cease trading.
To read the Money Laundering and Terrorist Financing (Amendment) Regulations 2019 click here.
Doorstep Dispensaree Limited, a London based pharmacy who supply medicines to customers and care homes, failed to ensure the security of special category data and has been fined £275,000 by the Commissioner.
Approximately 500,000 documents, which included names, addresses, dates of birth, NHS numbers, medical information and prescriptions that belonged to an unknown number of people, were found left in unlocked containers at the back of their premises in Edgware.
Although the documents were dated between June 2016 and June 2018, in setting the fine, the ICO only considered the contravention from 25 May 2018, when the GDPR came into effect.
Failing to process data in a manner that ensures appropriate security against unauthorised or unlawful processing and accidental loss, destruction or damage is an infringement of the GDPR.
Due to the significance of the contraventions, Doorstep Dispensaree has also been issued an enforcement notice and ordered to improve its data protection practices within three months. Failure to do so could result in further enforcement action being taken by the ICO.
To read the full details of the ICO investigation, visit the ICO website, or click here.
On Thursday 12th December 2019, Keith Wilson of Old Springs Farm, Market Drayton was fined £800 and ordered to pay £6,000 costs at Telford Magistrates Court after he admitted illegally burying waste dust on his land near Market Drayton. He pleaded guilty to a single charge under regulations 12 (1) (a) and 38 (1) (a) of the Environmental Permitting (England & Wales) Regulations 2016.
Officers from the Environment Agency brought the case following reports a large pit had been dug and filled with around 2500m3 of waste dust produced in the making of animal bedding. The area was designated as a Nitrogen Vulnerable Zone (NVZ) indicating that the local environment is particularly vulnerable to excessive organic deposits. Farmers whose land is in a NVZ area must plan the management of organic materials and wastes carefully to avoid pollution. Nitrates in groundwater can affect the safety of drinking water and cause pollution to rivers The Court was told that the defendant had no environmental permit and that the pit had been filled without having regard to the impact on the environment.
The report from the Environment Agency can be accessed here.
The extension of the Senior Managers and Certification Regime (SM&CR) is designed to create a more positive culture of individual accountability across the financial services sector. Since 9 December 2019, the regime has been extended to around 47,000 firms regulated by the Financial Conduct Authority (FCA).
The SM&CR encourages greater individual accountability and sets new standards of personal conduct. It should be applied in a flexible and proportionate manner.
Firms are required to certify that their staff are fit and proper, senior managers are accountable for conduct in their areas of responsibility and individual conduct rules should be followed to ensure there is a minimum standard of behaviour.
There are 5 Individual conduct rules:
- You must act with integrity.
- You must act with due skill, care and diligence.
- You must be open and cooperative with the FCA, the PRA and other regulators.
- You must pay due regard to the interests of customers and treat them fairly.
- You must observe proper standards of market conduct.
Transitional arrangements have been put in place by the FCA, providing firms additional time to comply with all the SMCR requirements.
By 9 December 2020, all solo-regulated firms must ensure that all relevant staff are trained on the Conduct Rules and how they apply to their roles, that all staff in certified roles are fit and proper to perform that role and are issued with a certificate and that data is submitted to the FCA for the new Directory of key people working in the financial services industry.
For more information on SM&CR categorisation for solo-regulated firms, please follow the link here.
On the 22nd November 2019 Ofcom announced that it had opened an investigation under Section 2 of the Competition Act 1998 and Article 101 of the Treaty on the Functioning of the European Union (‘TFEU’) into agreements between providers of parcel delivery and pick-up services which it suspects establish minimum prices and impose online sales restrictions. Ofcom has said that the “investigation will examine whether there are agreements between providers of parcel delivery and pick-up services which establish minimum prices and impose online sales restrictions and have as their object or effect the prevention, restriction or distortion of competition in the UK and/or European Union”. Further details can be found here.
Professor Ted Baker, Chief Inspector of Hospitals at the CQC advised in a recent letter that the CQC had recently inspected 65 independent cosmetic surgery providers and whilst they recognised some good areas of practice, they also identified a number arears of inadequate practice across the cohort of providers. The common areas of concern include;
- Clinicians without the appropriate training, qualifications and competencies to carry out their role
- unsafe practice in the use of sedation and anaesthetics
- poor monitoring and management of patients whose condition might deteriorate
- a lack of attention to fundamental safety processes
- variable standards of governance and risk management
- failure to ensure consent is obtained in a two-stage process, with an appropriate cooling off period between initial consultation and surgery
- infection prevention and control standards not always being followed
- concerns about equipment maintenance
A copy of the letter can be accessed here.
The HSE has published is statistics on health and safety in Great Britain for 2018/2019. The headline figures read as follows;
- 1.4 million working people suffering from a work-related illness
- 0.6 million working people suffering from work related stress, depression and anxiety
- 0.5 million working people suffering from work related musculoskeletal disorders
- 0.6 million working people sustaining an injury at work according to the Labour Force Survey
- 2,526 mesothelioma deaths due to past asbestos exposures (2017)
- 12,000 lung disease deaths due to past exposures at work
- 147 workers killed at work
- 69,208 non-fatal injuries to employees reported under RIDDOR
- 28.2 million working days lost due to work-related illness and workplace injury
- £15 billion estimated cost of injuries and ill health from current working conditions (2017/18)
The rate (per 100,000 workers) of self-reported work-related ill health and non-fatal injury by industry is reported to be highest in the following; electricity, gas, steam, air conditioning, public administration/defence, human health/social work, agriculture, forestry, fishing, education and construction. In comparison with the EU, the UK consistently has one of the lowest rates of fatal injuries, work-related injuries and health problems resulting in sick leave across the EU.
In terms of enforcement action, in 2018/19 there was a fall in the number of cases prosecuted by the HSE and COPFS from 493 in 2017/18 to 364 and a decrease in the level of fines following a successful prosecution and conviction from £76.2 million in 2017/18 to £54.4 in 2018/19. There were 11,040 enforcement notices issued in 2018/19 by the HSE and local authorities which was a slight decline from the previous year at 11,522.
A copy of the full report can be found here.
On 12th November, the Competition Appeal Tribunal (CAT) handed down its judgment in Royal Mail’s appeal against Ofcom’s August 2018 decision fining Royal Mail £50 million in respect of discriminatory pricing in relation to the supply of bulk mail delivery services in the UK. Ofcom found that Royal Mail had infringed the Chapter II prohibition under the Competition Act 1998 (“CA 1998”) and Article 102 of the Treaty on the Functioning of the European Union (“TFEU”) and imposed a fine of £50 million on Royal Mail.
The Tribunal dismissed Royal Mail’s arguments that:
- Ofcom erred in law and in fact by concluding that, when Royal Mail announced the new prices, prices were applied for the purposes of Article 102(c) TFEU and section 18(2)(c) CA 1998.
- Ofcom erred in concluding that transactions undertaken between Royal Mail and all of its different access customers were equivalent in all material respects, and that the price differential could not be justified.
- Ofcom erred in its assessment of whether the price differential was likely to give rise to a competitive disadvantage and/or a restriction of competition because it failed to have proper regard to the impact of the conduct on an ‘as efficient competitor’.
- Ofcom erred in finding that any abuse was not objectively justified under Article 102 and/or Article 106(2) TFEU by reference to the need to preserve the viability of the universal service under economically acceptable conditions.
- Ofcom committed a fundamental procedural error by basing its findings of a likely competitive disadvantage in the Decision on evidence and analysis that was not previously included, or relied upon, in the Statement of Objections, or otherwise put to Royal Mail during the administrative phase.
- Ofcom erred in imposing a £50 million fine on Royal Mail.”
Accordingly the Tribunal upheld Ofcom`s decision. A copy of the 234 page judgment can be found by clicking here.
Draft guidance has been published by the Information Commissioners Office (ICO) in relation to data subject access requests (DSAR’S). The draft for consultation is open until 12 February 2020 and invites stakeholders and members of the public to give their views, particularly on issues businesses have faced in responding to DSAR’S since the GDPR came into force on 25 May 2018.
The guidance states that a large volume of data may add to the complexity of a request, although noting, that the volume alone cannot be a reason to consider the request complex. Where a request involves other individuals who can be identified, the guidance provides clarity on the UK Data Protection Act 2018 exception for third party data. A section of the guidance includes what should be considered when there may be a fee involved in a request, examples would be printing/photocopying as administration costs, however, not charging for the time taken.
The draft guidance can be read in full by clicking here.
On the 26th November 2019 the FCA released a statement saying they were using their product intervention powers to ban the marketing of speculative mini-bonds to retail customers. The restriction comes into force on the 1st January 2020 and will last for 12 months.
Mini-bonds are a form of debt that allows investors to invest in a company and receive a fixed return over a set period of time, with the initial investment returned at the end of the prescribed duration. Essentially Mini-bonds allow you to lend money directly to businesses. The FCA have said that “The ban announced today will apply to more complex and opaque arrangements where the funds raised are used to lend to a third party, invest in other companies or purchase or develop properties. There are various exemptions including for listed mini-bonds, companies which raise funds for their own activities (other than the ones above) or to fund a single UK property investment”. The FCA ban will mean that unlisted speculative mini-bonds can only be promoted to investors that firms know are sophisticated or high net worth.
Over the last 12 months the FCA has examined more than 80 cases of possible unauthorised activity and have reviewed over 200 financial promotions cases which appear to be non-compliant.
The restrictions are set out in the Conduct of Business Sourcebook at COBS 4.14, click here for further information.
The interest rate benchmark LIBOR is expected to cease to have affect at the end of 2021. The FCA published a statement on the 19th November in relation to the conduct of risk arising from the LIBOR transition in response to a letter from the Working Group on Sterling Risk-Free Reference Rates. The FCA have stated that “supervision of firms’ transition away from LIBOR is focused on firms effectively managing the risks arising from transition, including prudential, operational and conduct risks” and outlined their core expectations that;
- firms have a strategy in place and take necessary action during LIBOR transition
- customers are treated fairly by following our rules and guidance
In a speech by Edwin Schooling Latter, Director of Markets and Wholesale Policy at the Risk.net LIBOR Summit in London on 21st November 2019 he indicated notably that there were now liquid markets for swaps and futures based on SONIA – the market Sterling Risk Free Rate and stressed that there had been a number of landmark achievements in recent weeks which include “the successful conversion to SONIA of £4.2 billion in previously LIBOR-referencing securities – with some of these consent solicitations achieving 100% investor agreement – as well as new firsts for the conversion to SONIA of a LIBOR loan, and a first SONIA swaption”.
It is recommended that business should be in the process of preparing their LIBOR transitions plans in earnest as the best way to avoid LIBOR-related risks is to move off LIBOR altogether.
The Fifth Money Laundering Directive (5MLD) is due to come into force in the UK on 10th January 2020, making amendments to the Fourth Money Laundering Directive on the prevention of the use of the financial system for the purposes of money laundering and terrorist financing.
HM Treasury closed their consultation on 10 June 2019 but the final version of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (the MLRs) has yet to be published making it very late to prepare for the new requirements.
Firms should be aware of the main points in the draft MLRs, which have been listed below:
- Expanded scope:Certain tax advisors and providers engaged in exchange services between cryptoassets and flat currencies and custodian wallet providers will, for the first time, become subject to the MLRs.
- Customer due diligence:Additional identification and verification obligations, collection of proof of registration on beneficial ownership registers (where relevant) and, in certain cases, a requirement to refresh customer due diligence.
- Enhanced due diligence:A requirement for firms to apply enhanced due diligence to business relationships and transactions involving high-risk third countries. Obliged entities will need to obtain additional information on; the customer and beneficial owner(s), the intended nature of the business relationship, the source of funds and wealth of the customer and beneficial owner(s) and the reasons for the intended or performed transactions.
- Reporting discrepancies:A requirement for firms to report any discrepancies discovered between the beneficial ownership information available in the central registers and the beneficial ownership information available to them.
- Express Trusts:A requirement for UK express trusts and some non-EU express trusts to register with HMRC’s Trust Registration Service.
- Risk assessments:A potential requirement for financial sector entities to undertake risk assessments (and policies) prior to the use of new products, business practices and delivery mechanisms.
- Whistle-blowing protections: A requirement that certain protections be put in place for whistle-blowers within obliged entities.
Firms should begin reviewing their procedures and policies now against the draft requirements.
To read the HM Treasury Transposition of the Fifth Money Laundering Directive consultation, click here.
The Senior Managers and Certification Regime (SM&CR) which replaced the Approved Persons Regime (APER) came into force for banks, building societies and credit unions in March 2016 and in December 2018 was extended to insurers. From the 9th December the SM&CR will apply to all FCA solo-regulated financial services firms authorised under the Financial Services and Markets Act (FSMA). The aim of the SM&CR is to reduce harm to consumers and strengthen market integrity by creating a system that enables firms and regulators to hold individuals to account.
A copy of the FCA guide on the SM&CR can be found here.
Overview of the SM&CR regime can be found in the FCA handbook here.
PRA fines Citigroup’s UK operations £44 million for failings in their regulatory reporting governance and controls
The PRA has fined Citigroup £43.9 million for failings in relation to their internal controls and governance arrangements which led to them failing to submit complete and accurate regulatory returns to the PRA between the 19th June 2014 and 31st December 2018.
In particular the PRA found that;
- Citi failed to ensure that systems and controls supporting its UK regulatory reporting framework were designed, implemented and operating effectively;
- Citi failed to allocate adequate human resources to ensure that CGML’s liquidity returns were complete and accurate;
- Citi’s documentation of multiple aspects of its UK regulatory reporting control framework was inadequate given its size, complexity and systemic importance;
- CGML’s approach to technical interpretations of reporting requirements was insufficiently robust given the complexity of those decisions and the impact they could have on the accuracy of the returns; and
- Citi’s oversight and governance in relation to regulatory reporting fell significantly below the standards expected of a systemically important institution.
A copy of the PRA press release can be found here.
To coincide with International Fraud Awareness Week, Sheila Ramshaw from Sintons reminds businesses of the importance of remaining aware of the risks of fraud, and of taking even the simplest of steps to safeguard their operations
Fraud is something that all businesses, no matter their size, sector or stage of development, need to have firmly on the agenda. To fall victim to fraud can be devastating, both financially and reputationally, and its impact can be long-lasting.
Organisations worldwide lose an estimated five per cent of their annual turnover to fraud, research from the Association of Certified Examiners (ACFE) 2016 Report to the Nations on Occupational Fraud and Abuse revealed, which lays bare the scale of the problem.
While fraud is not always preventable, all businesses should look at what steps they can take to lessen vulnerability and increase protection. Some steps can be very basic and can be done immediately, and while they may be seen as being quite small actions, their potential impact can be huge.
International Fraud Awareness Week offers a reminder of the severity of the impact of fraud and provides an opportunity for businesses to invest the time to examine existing policies and procedures and introduce new safeguarding measures as appropriate.
We would advise businesses to:
- Be proactive – don’t put off checking the robustness of your systems or consider fraud to be something that won’t happen. Continually review your processes and improve them as necessary.
- Adopt a code of ethics for management and employees – for fraud protection to work effectively, everyone within the business must be working to the same stringent standards.
- Evaluate your internal controls for effectiveness and identify areas of the business that are vulnerable to fraud – this should be done regularly and make changes as necessary.
- Establish recruitment procedures – when hiring staff, conduct thorough background investigations. Check educational, credit and employment history (as permitted by law), as well as references.
- Train employees in fraud prevention – do workers know the warning signs of fraud? Ensure that staff members know basic fraud prevention techniques.
- Implement a Fraud Hotline – fraud is still most likely to be detected by a tip. Providing an anonymous reporting system for your employees (whistleblowing), contractors and clients will help uncover more fraud.
- Communicate regularly to staff about anti-fraud policies, ways to report suspicions of misconduct, and the potential consequences (including termination and prosecution) of fraudulent behaviour.
By taking the time to implement and review fraud prevention policies, organisations can safeguard themselves as much as possible.
Sheila Ramshaw is an Associate in Sintons’ regulatory team who has worked extensively in fraud and has many years of experience in supporting businesses with fraud prevention. To speak to her, please contact Sheila on 0191 226 3739 or Sheila.Ramshaw@sintons.co.uk.
Duncan Lawrence, a care home consultant has been sentenced to four months custody for withholding evidence/documentation from an inquest into the death of a young care home resident.
The case created significant media attention, sending a clear message that deliberately failing to assist a coroner will result in severe financial and criminal consequences.
Although this case is one with serious consequences, if witnesses are transparent and honest but make a mistake, they are unlikely to be prosecuted under Schedule 6 of the Coroners and Justice Act 2009 (“CJA”).
The outline of the case is as follows:
A resident at Lancaster Lodge, 19 year old Sophie Bennett, fell under the care of Mr Lawrence. Complaints on the regime Mr Lawrence had imposed had been made to the CQC and following an inspection conducted in March 2016, several residents were moved to other care homes. Sophie Bennett was not one of the residents moved and sadly, on 2 May 2016, she was found dead having hanged herself.
In January 2019, an inquest was held where the coroner issued a Schedule 5 CJA notice to Mr Lawrence requiring him to give evidence. Although Mr Lawrence suggested that he give his evidence by Skype, he then did not attend the inquest nor give evidence. He had not provided a complete statement or disclosed documents that he had referred to in his statement.
In May 2019, the coroner exercised his powers under Schedule 6(1) CJA, imposing a fine of £650 on Mr Lawrence for his failure to comply with the Schedule 5 notice.
Having been fined by the coroner, Mr Lawrence was investigated for criminal allegations under the CJA. Schedule 6 paragraph 7(2)(a) states that it is a criminal offence for a person to intentionally suppress or conceal a document that is, and that that the person knows or believes to be, a relevant document from an inquest. Paragraph 7(1)(b) states that it is a criminal offence if a person does anything that is intended to have the effect of preventing any evidence, document or other thing from being given, produced or provided for the purposes of an inquest.
Mr Lawrence was subsequently charged and pleaded guilty to withholding evidence/documentation from the inquest. At the sentence hearing on 30 October 2019 Mr Lawrence was sentenced to a term of 4 months imprisonment.
Sintons is widely regarded as a leading advisor in regulatory matters, including those involving the Health & Safety Executive, Care Quality Commission and other bodies, and acts for a host of prominent and high-profile private, public and third sector organisations in areas also including cyber crime, data protection and other compliance matters.
Now, it is expanding its specialist offering into the financial services sector, to handle regulatory issues affecting banks, building societies, financial advisors, investment firms, insurers and commercial lenders.
Sintons becomes one of only a handful of advisors in this specialist field in the region, with Leeds and Manchester traditionally being the dominant centres in the North.
Its expansion is being overseen by Neil Smart, newly-appointed head of regulatory at Sintons, who joins the firm after a lengthy career as a leading barrister, most recently practicing in Leeds. He is joined by associate Sheila Ramshaw, a well-known specialist in her field. Both have extensive experience in regulatory and compliance work.
The department – a multi-disciplinary team which brings together expertise from across the firm – is also looking to introduce training to organisations across all sectors, to update on compliance matters, review policies and procedures and ensure they are adhering to existing requirements, as a pre-emptive measure to safeguard against potential breaches.
Neil said: “We will continue to develop Sintons’ outstanding reputation for acting in the more traditional regulatory areas such as healthcare, cybercrime, HSE and CQC matters, these are areas in which both Sheila and I have worked in for a number of years. Our experience will add even greater depth to what we have already here at Sintons.
“To add to this, we are developing a specialist financial regulatory service, which will have reach across the North of England. I have practiced extensively in this area during my many years as a barrister and in Newcastle, a city which has such a strong fintech community, there is most certainly a need for high-calibre specialist advisors in this area. Sintons will take a lead on this and we have great ambitions for this area of the business.
“I am delighted to join Sintons at such a time of growth and development for the department and business as a whole, and relish the challenge of leading the progress of the regulatory team.”
Mark Quigley, managing partner of Sintons, said: “We have, for many years, been a leading advisor in regulatory and compliance matters across the North East and beyond and the introduction of a financial regulatory service is a particularly exciting development for the firm and one which holds great promise.
“The appointment of Neil and Sheila really shows our ambition in this area, and in the growth of our regulatory offering in general. Neil is a hugely experienced and respected name in this field through his work as a barrister, and we are delighted to have him leading the team. Similarly, Sheila has an excellent reputation in this very specialist area and we are very pleased to welcome her. Working alongside the wider regulatory team, we are confident Neil and Sheila will help us achieve new levels of achievement and reputation.”
The importance of ensuring that suitable and sufficient risk assessments are undertaken was highlighted once again in the prosecution brought by the Health & Safety Executive against Northumbria University after two students were administered potentially life threatening levels of caffeine.
The second year sports science study students had been participating in a test intended to measure the effect of caffeine on exercise.
Unfortunately, through lack of appropriate training, instruction and supervision, the technicians involved in administering the test delivered the incorrect dosage. The amount of caffeine mixed into a solution of water and orange juice was 100 times greater than the recommended dosage.
Both students were hospitalised as a consequence of this error and required emergency treatment for what was a potentially life threatening error.
The Health & Safety Executive issued Improvement Notices immediately after the incident occurred in April 2015. They considered that there was a breach of the general duty owed by employers to those not in their employment under Section 3 of the Health & Safety at Work Act 1974 as well as a failure to comply with the Management of Health & Safety at Work Regulations 1999.
In the opinion of the Health & Safety Executive there was a failure to ensure that there was a suitable and sufficient risk assessment in place, inadequate supervision and checks and a failure to have regard to what was a clearly foreseeable risk inherent in the caffeine experimentation.
A prosecution ensued and on the 25th January 2017 the Crown Court in Newcastle upon Tyne imposed a financial penalty of £400,000, following sentencing guidelines which came into force in January 2016. These guidelines require the Court to consider the degree of culpability on the part of the Defendant which gives rise to the breach of Health & Safety Legislation, the risk of harm which the breach created as well as the financial circumstances of the Defendant.
The guidelines also require the Courts to have due regard to any aggravating and mitigating factors. No doubt the earlier admission on the part of the University together with genuine regret at the injuries sustained by the students would have counted in their favour when the Court came to determine the appropriate level of the fine.
If we can assist you in any way, or if you simply want to discuss a regulatory issue, please contact us at any time.
The Sentencing Council have published a review of the impact of Sentencing Guidelines which came into force on 1 July 2014 and which apply to certain environmental offences relating to waste and environmental permitting.
When the Guidelines were introduced it was made clear to both the judiciary and offenders that when approaching sentencing upon conviction the outcome “must be sufficiently substantial to have a real economic impact which will bring home to both management and shareholders the need to improve regulatory compliance. Whether the fine will have the effect of putting the offender out of business will be relevant; in some bad cases this may be an acceptable consequence”.
The Guidelines identify a number of steps that the Court is required to follow when dealing with the sentencing of both organisations and individuals.
This involves consideration of the offence category which in turn requires an assessment as to the degree of culpability and certain harm factors.
Culpability ranges from the deliberate in cases of intentional breaches of the law through reckless to negligent then low in circumstances where an offence is committed with little or no fault on the part of the Defendant.
Harm is determined by reference to 4 categories ranging from category 1 which encompasses the most serious cases where there is a major adverse effect or damage to air or water quality, amenity value or property and where major costs may be incurred through clean-up, site restoration or animal rehabilitation down to category 4 involving a risk of minor, localised adverse effects or damage only.
In considering the extent to which the Guidelines are having the desired outcome, the Sentencing Council have acknowledged some difficulties in arriving at definitive conclusions as the data used to compare sentencing prior to and subsequent to the introduction of the Guidelines does not indicate the seriousness of the offence. Furthermore, in March 2015 the cap on Magistrates’ fining powers was removed which may also have a bearing on the financial penalties imposed.
Nevertheless, the findings of the analysis suggest that the Guidelines are having the desired result so far as the sentencing of organisations are concerned but not individuals.
Approximately 90 organisations were sentenced in 2015, the majority for offences relating to contravention of the requirements of an environmental permit. Most of these cases were dealt with in the Magistrates Courts. However, the data suggests that those cases which were dealt with in the Crown Court resulted in a significant increase in the level of fines compared to the period prior to the introduction of the Guidelines.
In the case of individuals, the majority of the offences related to the unauthorised or harmful deposit, treatment or disposal of waste. Again, most cases were dealt with in the Magistrates Courts. The data disclosed no evidence to date to suggest that fine amounts overall have increased noticeably since the Guideline was introduced in 2014.
The analysis also looked at the Court’s approach to determining the harm category and degree of culpability which should apply when considering sentencing.
For organisations the main harm category was 3, covering 66% of cases with a further 21% falling in to category 2. In terms of culpability, 27% of cases fell within the definition of deliberate, 20% were deemed reckless and 45% negligent.
Perhaps unsurprisingly given the nature of waste offences, the main harm category determined for the purposes of sentencing individuals was 3 and the category of culpability for adult offenders in the period July 2014 – December 2015 was deliberate (60%) or reckless (20%).
The analysis published by the Sentencing Council also includes some interesting information concerning aggravating and mitigating factors which have been taken into account by the Courts, although these findings ae drawn from a small sample of cases.
The most common aggravating factor for organisations is offending over an extended period of time (or repeated incidents), which featured in 43% of cases where information was provided to the Council and a further 32% of cases involved a history of non-compliance and 25% of cases where an offence was committed for financial gain.
The most common mitigating factors were evidence of steps taken to remedy the problem (40%) and self-reporting, cooperation and acceptance of responsibility (41%) with no previous convictions featuring in 36% of cases forming part of the analysis.
For individuals, the most common aggravating factor was that the offence was committed for financial gain, applying in 51% of cases taken into consideration in preparing the analysis with 42% of such cases involving offending over an extended period of time or where there were repeated incidents and in 41% of cases there was a history of non-compliance.
The most common mitigating factor for adult offenders was the lack of previous convictions (33%) with 26% of cases involving self-reporting, cooperation and acceptance of responsibility and 19% of cases demonstrating evidence of steps taken to remedy the problem.
Whilst acknowledging that this data is drawn from a small sample of cases the Sentencing Council consider that there are grounds for concluding that the Guidelines are generally being applied in the manner intended.
Only time will tell whether the upwards trend in relation to sentencing of organisations, particularly for the serious offences dealt with in the Crown Court, will continue and whether sentencing of individuals will follow the same pattern.
If we can assist you in any way, or if you simply want to discuss a regulatory issue, please contact us at any time.
A Care Home Company has been fined £1.6m as a consequence of the death of a resident at Oaklands Country Care Home near York in November 2012. The penalty was imposed on 28 September 2016 at York Crown Court after the company had previously pleaded guilty to a breach of the Health and Safety at Work Act 1974.
At the time of her death, Mrs Annie Barritt had a body temperature nearly 10 degrees below the hyperthermia threshold of 35C. A subsequent investigation disclosed that there were longstanding problems with the heating system at the home. Furthermore, on the day of her death, Mrs Barritt had been given neither hot food nor drink. In addition, her care plan had not been updated subsequent to her discharge from hospital a week before her death; the Court heard evidence that the need to keep her warm as her temperature was low was clearly highlighted.
According to a report in the Guardian Newspaper, the sentencing Judge described this tragic incident as “an accident waiting to happen”. He considered that there were “systematic, systemic failures” which resulted in Mrs Barritt’s death.
In the same report, Mr Tony Moule, the Environmental Health Officer at Harrogate Borough Council, is quoted as saying that “our investigation revealed that there were a number of serious failures with regard to health & safety legislation”.
Whilst no-one would argue with his comment that “no fine can ever compensate the family for the loss of their mother in such shocking circumstances” the level of the financial penalty imposed by the Court is yet another reminder of how Sentencing Guidelines introduced in February 2016 are achieving their stated aim.
As the guidelines make clear, the Courts are required to apply general principles when setting a financial penalty in such cases. The fine must be “sufficiently substantial to have a real economic impact which will bring home to both management and shareholders the need to comply with health & safety legislation”.
The Guidelines require the Court to consider the offence category by reference to the degree of culpability, the seriousness of the harm risk and the likelihood of harm being caused before then considering the starting point for the fine by reference to the size of the business.
The owners of the home, Maria Mallaband Care, with an annual turnover of £50m, would be classified as a large organisation for the purposes of assessing the level of the fine. It is also probable that Harm Category 1 was assigned to this case on the basis that the company’s breach of the 1974 Act resulted in the death of a resident. Whilst credit would have been given for the fact that the company entered a guilty plea at an early stage of the Court proceedings the comments of the sentencing Judge suggest that aggravating features also played a part in determining the level of the fine.
The level of the fine imposed by the Court, together with an Order that the costs of the Local Authority who brought the prosecution, amounting to £45,560, is yet a further reminder of the importance of ensuring compliance with health & safety legislation.
If we can assist you in any way, or if you simply want to discuss a regulatory issue, please contact us at any time.
Please click on the link below to listen to the webinar, we hope you find it useful.
The financial consequences of breaching health and safety legislation are starkly illustrated by two recent cases where fines totalling £9m have been imposed by the Courts.
Network Rail pleaded guilty to a breach of Section 3 of the Health & Safety at Work Act 1974 (HSWA), in light of an investigation and prosecution brought by The Office of Rail & Road (ORR) subsequent to the death of an 82 year old woman on a level crossing in August 2011. On 21 September 2016 a fine of £4 million was imposed after a two day sentencing hearing at Ipswich Crown Court.
Section 3 imposes a duty on employers to conduct their undertaking in such a way as to ensure that those not in their employment are not exposed to risks to their health or safety.
Tragically, Olive McFarland was struck by a train travelling at 100 mph by a train travelling from London to Norwich at the Gypsy Lane crossing near Needham Market in Suffolk. The investigation undertaken by the ORR found that Network Rail had failed to act on what was described as “substantial evidence” that pedestrians were at increased risk of being struck by a train on the crossing due to concerns about the lack of visibility.
On the 27th September 2016 the owners of Alton Towers theme park, Merlin Attractions Operations Limited, were fined £5m plus costs of almost £70,000, again as a result of a breach of Section 3 of the 1974 Act.
The prosecution related to an incident which occurred in June 2015 when 16 people were injured, some seriously, following a rollercoaster collision.
An investigation undertaken by the HSE found “the root cause” of the accident to be “a lack of detailed, robust arrangements for making safety critical decisions”. Speaking after the sentencing of the company, Neil Craig, head of operations for HSE in the Midlands said “this avoidable incident happened because Merlin failed to put in place systems to allow engineers to work safely on the ride while it was running.”
The fact that both Defendants received such significant financial penalties is an inevitable consequence of the introduction of new Sentencing Guidelines which came into force on the 1st February 2016, regardless of the date of the offence.
The intention behind the Guidelines was to ensure a consistent, fair and proportionate approach to sentencing. The Guidelines require the Court to consider the degree of culpability on the part of the Defendant, the seriousness of the harm risked and the likelihood of harm arising. The Court is then required to determine the starting point for a financial penalty by reference to the turnover of the Defendant and then take into account any aggravating or mitigating features as well as ability to pay.
The Guidelines emphasise the general principle that the Court must have regard to when sentencing those who have been convicted of Health & Safety breaches:
“The penalty imposed must be sufficiently substantial to have a real economic impact, bringing home to management and shareholders alike the need to comply with Health & Safety legislation”.
If these recent decisions are anything to go by, the Courts have taken heed and, far from being an aberration, it is likely that similar or even higher penalties will be imposed in the future, particularly where the offence has been committed by a large undertaken with a high degree of culpability.
What could you buy for £1.99 per year?
According to the workforce survey published by the Chartered Trading Standards Institute in June 2016 this is the average sum per citizen per year available to Local Authority trading standards services to monitor traders to ensure compliance with and enforce consumer protection legislation.
According to the Institute, the total spend on Local Authority trading standard services has fallen to an estimated total of £124 million, down from £213 million seven years ago.
The majority of trading standards offices who participated in the survey consider that budget cuts have had an adverse impact on their ability to properly investigate cases where traders may have breached consumer protection law and in doing so put not only consumers at risk but also gain an unfair competitive advantage against those who comply fully with their legal obligations.
The Institute considers that further challenges lie ahead due to economic uncertainty arising from the recent vote to leave the European Union. The Institute’s Chief Executive, Leon Livermore has said that “outside the EU it is arguably more important than ever that the UK is able to demonstrate high standards and regulatory compliance and consumer protection in order to gain access to key markets”.
In an article in the Guardian newspaper published on 7th August 2016, those involved in the prosecution of businesses deemed to have breached consumer protection legislation speak of “a chilling effect on the willingness of Councils to take on larger, well-funded offenders” through fear of the prosecution failing, giving rise to a liability to pay legal costs.
This would appear to have an impact not only on the number of cases which are pursued but on the nature of such cases, with smaller traders who may lack the resources to mount a robust challenge being targeted for investigation and enforcement action as opposed to well resourced, national businesses.
It is also suggested that the outcome of such investigations may differ markedly to the position a few years ago, with the use of undertakings and cautions being preferred to potentially costly prosecutions.
Given the ongoing uncertainty as to Britain’s relationship with the EU and no imminent sign of a change in direction so far as the Government’s austerity measures are concerned, it is likely that trading standards officers will continue to struggle to provide an effective service – which affords protection to both consumers and responsible businesses alike – for some time to come.
It is said that Zhou Enlai, a prominent Chinese communist leader, responded to a request to comment on the significance of the French Revolution to the effect that it was too soon to say.
Setting aside the dubious provenance of this attribution (he was probably referring to the events in Paris in 1968 not 1789), it would be a brave commentator indeed who would commit to a firm view at this stage as to how the vote to leave the European Union may affect the law in relation to health and safety.
There is no doubt that for some time many businesses and employers have been concerned about what is widely perceived to be a burden imposed by the need to comply with a seemingly ever increasing number of rules and regulations in this field.
It is also the case that most health and safety legislation in recent time has emanated from EU Directives which, in accordance with our Treaty obligations, the UK Government has been required to incorporate into domestic legislation.
The level of concern was sufficient to prompt the previous coalition Government to commission a review into Health & Safety legislation. Now would appear to be an appropriate time to revisit the report of Professor Ragnar E Lofstedt delivered in November 2011, entitled Reclaiming Health & Safety for All.
Professor Lofstedt concluded that, in general, “there is no case for radically altering current Health & Safety legislation.”
He reported that the outcome of his investigations was to the effect that “there is a view across the board that the existing regulatory requirements are broadly right…that regulation has a role to play in preventing injury and ill health in the work place [and] proportionate risk management can make good business sense”.
Nevertheless, he made a series of recommendations in an effort to address those factors which “drive businesses to go beyond what the regulations require and beyond what is proportionate”. In doing so, he sought to “enable businesses to reclaim ownership of the management of Health & Safety and see it as a vital part of their operation rather than an unnecessary and bureaucratic paperwork exercise”.
These proposals, which have been largely implemented, included the exemption from Health & Safety law of those self-employed whose work activities posed no potential risk of harm to others, a review by the HSE of their Approved Codes of Practice and simplification of the regulatory framework through implementation by the HSE of a programme of sector specific consolidation of regulations.
In his report, Professor Lofstedt acknowledged the increasing role of the European Union in driving UK Health & Safety regulation. His report analysed the extent to which these were considered to be of benefit and where there was room for improvement.
He reported that a number of regulations introduced as a result of EU directives were considered by businesses to be helpful. He gave the specific example of the Provision & Use of Work Equipment Regulations and reported that responses to his survey suggested that these led to improved working practices without causing significant financial concerns.
His report also cited the example of the Manual Handling Operations Regulations and referred to a case study of an organisation reporting a 6% reduction in sickness absence and a 50% fall in loss time due to accidents directly as a result of measures introduced to comply with this law.
His report went on to comment on specific regulations which were widely considered to deliver minimal benefit commensurate with the expense and effort involved in compliance. These included the Health & Safety (Display Screen Equipment) Regulations 1992. Professor Lofstedt highlighted the fact that employers had a concern about the validity of the requirement to provide eye tests when many employees regularly use personal computers, laptops and other devices outside the work place.
In due course, it may well be that regulations of this type will be subject to renewed scrutiny. It is conceivable that some regulations may be revoked but it remains to be seen what overall impact this may have on business.
It is worthy of comment that Professor Lofsedt’s report contains a quotation from a former Chairman of the EU Scrutiny Committee in the House of Commons to the effect that “probably 90%” of all EU laws currently in force in the UK would have existed in any event.
The law constantly evolves in response to changing times and circumstances. The primary legislation governing Health & Safety obligations remains the Health & Safety at Work etc. Act 1974, implemented without any reference whatsoever to any EU Treaty obligations.
It is inconceivable (and no politician has suggested otherwise) that there will be any fundamental amendment to the 1974 Act. The primary duties contained within the Act will remain unchanged. Whilst certain specific regulations may no longer be on the statute book it may well be that, as they assess the extent to which duty holders have complied with their statutory obligations, the HSE will have due regard to the detail contained within EU Directives in order to assess the extent to which duty holders have done all that is reasonably practicable to ensure health, safety and welfare to those to whom they owe a duty.
As most of the regulations implemented through EU Directives have been on the statute books for many years it may well be that HSE Inspectors will adopt them as the benchmark for determining whether or not they consider that an offence has been committed and whether enforcement action should follow.
In the fullness of time it may well be that the decision to leave the EU will have little if any impact on the obligations imposed on businesses to comply with Health & Safety law. For the moment those who owe duties under existing Health & Safety legislation may wish to pay heed to the words of wisdom issued by the Government many years ago, immortalised on posters, tea-towels and crockery throughout the land: Keep Calm and Carry On.
27 June 2016.
(Mark is a Partner and Head of our Regulatory department. As well as representing clients he regularly delivers training, often appearing alongside representatives of various regulators. Mark is conducting a complimentary seminar on 30th June entitled 'CQC Update', click here for more details).
On the 30th January 2014 Paul Wilson, aged 38, ordered a takeaway meal from the Indian Garden Restaurant in Easingwold, North Yorkshire.
When placing his order, Mr Wilson expressly requested that his meal be prepared without containing nuts as he had a severe peanut allergy.
The lid of the takeaway meal was clearly marked “no nuts”. However, tragically, the dish contained high levels of peanut which proved fatal to Mr Wilson.
At the time of his death the takeaway, owned by Mohammed Kalique Zaman of York, was already under investigation by Trading Standards as a consequence of an incident which occurred a few weeks earlier. A 16 year girl was admitted to hospital for several days having also suffered an allergic reaction to food purchased from the restaurant.
It transpired that Mr Zaman instructed his staff to use ground nut powder in meal preparation and continued to do so despite warnings against this practice prior to Mr Wilson’s death.
In short, his death was entirely foreseeable and preventable.
Given the facts of the case, there would have been little doubt from the outset that a conviction would have been secured against Mr Zaman for breaches of Food Safety Legislation. Food Hygiene Regulations make it an offence to render food injurious to health, sell food which is not of the nature or substance or quality demanded and food which is falsely or misleadingly described.
On this occasion however, perhaps due to evidence that the legislation had been breached deliberately and for commercial gain, Trading Standards worked alongside colleagues in the Crown Prosecution Service with a view to prosecuting Mr Zaman for the offence of gross negligent manslaughter.
The House of Lords have laid down a four stage test which needs to be satisfied before the offence can be established. The Prosecution must show that:
- A duty of care was owed by the Defendant to the deceased;
- There has been a breach of that duty;
- The breach caused or significantly contributed to the death of the deceased and; &
- The breach should be characterised as gross negligence and therefore a crime.
On this occasion, the Jury had little difficulty in concluding that the offence of gross negligence manslaughter had been committed and as a result Mr Zaman was jailed for 6 years.
Thankfully, incidents of this type are rare although this will be of scant comfort to the bereaved family of Mr Wilson. The case does nevertheless highlight the importance of ensuring that appropriate systems are in place to prevent entirely foreseeable and avoidable tragedies of this kind occurring again.
Glastonbury Festival is the world’s largest music festival. Whereas around 1,500 people attended the first event in 1970, the festival now attracts up to 175,000 people each year.
Given the size of the festival it is hardly surprising that the organisers face significant challenges in organising the event in such a manner as to ensure that they comply with all statutory obligations, including legislation intended to protect the environment.
In June 2014 a pollution incident occurred when untreated sewage escaped from a temporary storage tank. Human waste entered Whitelake River resulting in harm to aquatic life.
The Environment Agency brought a prosecution on the basis that there was breach of the Environmental Permitting (England & Wales) Regulations 2010. The offence was causing or knowingly permitting a water discharge activity. As there was no doubt that the festival organisers had caused the discharge it comes as no surprise that they pleaded guilty to the offence.
Since 1 July 2014 the Courts have been required to follow guidelines issued by the Sentencing Council when considering the penalty which Defendants should face upon conviction for environmental offences.
The guidance makes it plain that the outcome “must be sufficiently substantial to have a real economic impact which will bring home to both management and shareholders the need to improve regulatory compliance.
The Court is required to determine what is termed the offence category which in turn involves consideration of the degree of culpability giving rise to the commissioning of the offence.
Culpability may be deliberate (in cases of intentional breach of the law), reckless, negligent or low (in cases where an offence is committed with little or no fault on the part of the organisation as a whole).
Once the degree of culpability is established by the Courts it is then necessary to assess the severity of the harm which the offence has given rise to. Harm is determined by reference to four categories ranging from category 1 in the most serious cases down to category 4 where there was a risk of minor, localised adverse effects or damage to water quality.
As there was a significant dispute between the prosecution and defence as to the most appropriate classification of this offence the Court ordered what is termed a Newton hearing so that the Court could decide this point.
The Environment Agency considered this to be a serious pollution incident which had a significant impact on water quality and the fish population and contended for a sentence based on a finding of negligence on the part of the festival organisers and category 1 level harm.
The Court concluded that the festival organisers’ actions were not negligent and that there was low culpability. The Court also concluded that the appropriate harm category was category 2, namely that there was a significant adverse effect or damage to water quality.
Further argument ensued as to the appropriate starting point for determining the level of the financial penalty as, whilst the turnover of the festival was large, evidence was submitted to the Court to demonstrate that substantial sums were donated each year to charitable causes.
Ultimately, the total fine (which included consideration of a subsequent incident from 2015) amounted to £12,000 plus payment of a proportion (but not all) of the Agency’s costs in bringing the prosecution.
In passing sentence, Judge Simon Cooper sitting at Bristol Magistrates’ Courts on the 23rd and 24th May 2016 praised the festival organisers for their planning and their response to this incident, factors which undoubtedly also played a part in determining the level of the fine.
The case provides a timely reminder of the role of the sentencing guidelines and the need to fully prepare for sentencing hearings.