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Stories included
- Corporate Manslaughter Act comes into effect
- Early trials suggest high level of satisfaction with HIPs
- Pubs face instant closure as part of clamp down on binge drinking
- Government stalling leaves cohabiting couples at risk
- Private rented sector showing increased returns
- OFT offers £100,000 reward for exposing cartels
- SMEs hit by late payments and interest rate rises
- PM announces above inflation rise for minimum wage
- Government adopts new policies to develop brownfield sites
Corporate Manslaughter Act comes into effect
The Corporate Manslaughter Act 2007 has now come into effect making it easier to convict companies of manslaughter if their gross negligence leads to someone being killed.
The new law, effective from 6th April, means companies face unlimited fines if it’s found that they caused death due to gross corporate health and safety failures. Firms can also be ordered to take remedial action to rectify the failures that led to the death.
The court may also order them to publicise the case giving details of what happened and how much they were fined. The damage to a firm’s reputation and brand from such bad publicity could be enormous.
The Government hopes the new law will force company executives to take their health and safety obligations seriously.
The Act removes what used to be a major stumbling block in prosecuting a company for manslaughter. To secure a conviction, it was necessary to prove that all the gross negligence that caused the death could be laid at the door of at least one senior manager or director. This made no allowance for corporate system failures. Indeed, the piecemeal management approach that may have led to the tragedy could be the very same characteristic that prevented prosecution because the responsibility could be shared between several people, none of whom could be singled out as the one guilty of gross negligence.
The Act focuses on failures by senior management but that doesn’t mean that firms could avoid criminal liability by delegating responsibility for safety issues to lower or middle management. In fact, such action could be counter productive as it may be used as evidence of gross negligence in itself.
Directors who are still tempted to cut corners should remember that although the new Act does not increase liability, they can still be held to account as individuals through health and safety laws and the common law of manslaughter.
Firms who haven’t already reviewed their safety policies and management systems for ensuring compliance should consider doing so as soon as possible.
Early trials suggest high level of satisfaction with HIPs
Consumers who took part in the early trials of Home Information Packs (HIPs) were happy with the system, according to a survey carried out by the research organisation Ipsos MORI.
HIPs have been required by law since last December by anyone selling a home of any size in England and Wales. They contain information about the property for sale such as the results of local searches and an energy performance certificate.
The research showed that “72% of sellers were satisfied with the HIP, 79% agreed that it contained everything expected, and 81% understood the documents, including their energy rating, from A-G, in the Energy Performance Certificate (EPC)”.
Nearly one third of buyers said they intended to carry out the recommendations in the EPC to improve the energy efficiency of their home. Just under 60% of buyers said they would have liked to have seen the HIP earlier in the process. Many didn’t get the chance to see it until after they had made an offer on the property.
In response to the findings the Government has organised a public information campaign to raise awareness of HIPs and remind estate agents of their responsibility to make sure the packs are readily available to ensure buyers get the full benefit.
The findings are based on trials that took place between November 2006 and April last year and so many of the problems and delays in providing HIPs have now been ironed out. Housing Minister Caroline Flint said: "Consumers are already benefiting from the introduction of HIPs. Search costs are falling as a result of increased transparency in the market, energy ratings can help people to reduce fuel bills, and first time buyers are receiving important information about their home for free.”
Please contact us if you would like more information about HIPs or any aspect of buying and selling a home.
Pubs face instant closure as part of clamp down on binge drinking
As part of its clampdown on binge drinking the Government is introducing tougher sanctions against licensees who breach their licensing conditions.
Penalties include the instant closure of pubs and clubs in areas where disorder has occurred.
The measures were announced in a ministerial statement by the Culture Secretary, Andy Burnham, as he revealed the initial findings of a study to evaluate the impact of the Licensing Act 2003.
Mr Burnham said the findings revealed a mixed picture and the new legislation had not led to the widespread problems that some had feared. The statement said: “Overall, crime and alcohol consumption are down. But alcohol-related violence has increased in the early hours of the morning and some communities have seen a rise in disorder.
“To specifically address the small but unacceptable proportion of violent crimes occurring in the early hours of the morning, we will undertake further comprehensive research into post-midnight drinking patterns and their impact on crime and order, and will not hesitate to take the necessary action through new legislation and enforcement measures to tackle this. But we will take immediate action now.
“First, we will utilise existing powers to identify problem premises. We will make it easier to review premises where local intelligence suggests there is a problem.
“Second, we will encourage the imposition of tougher sanctions on those found to be breaching their licensing conditions. This includes the stipulation that there be far more instant closures of pubs and clubs in an area where there has been a disorder and indefinite closure by the courts for any breach of licence conditions.
“Third, we will change the offence of “persistently selling alcohol to a person under 18” from ‘three strikes’ to ‘two strikes’ in three months. This means that any seller who twice sells to under age drinkers and is caught doing so will immediately lose their licence.
“Finally, the message must be clear to all: breach your licensing conditions and you face severe and costly restrictions on your business – with a new “yellow card and red card” alert system. A yellow card will put the problem premises on immediate probation together with tough and uncompromising sanctions. And when the circumstances are right, it will be a straight red card leading to withdrawal of the licence.”
The Government also intends to bring forward legislation to tackle anti-social behaviour associated with alcohol consumption. The proposed measures include making it easier for police to disperse anti-social drinkers and to increase the maximum fine for anyone not obeying an instruction to stop drinking in a designated public place from £500 to £2,500.
Mr Burnham said the measures announced so far are not the end of the story. Research is still being carried out and there will be further developments over the coming year.
We shall keep clients informed of developments.
Government stalling leaves cohabiting couples at risk
The Government has backed away from proposals to give two million cohabiting couples similar rights to those of married couples.
It means many cohabitees remain vulnerable and could find themselves thousands of pounds out of pocket if their relationship breaks up.
More than 50% of people still believe that there is such a thing as common law marriage giving cohabiting couples legal protection, according to the latest British Social Attitudes report published in January.
That is in spite of Government campaigns over the last three years pointing out that common law marriage has no legal meaning and is just a myth; a very dangerous myth unfortunately because it gives people a false sense of security in which they think they have rights which simply do not exist.
Family lawyers regularly come across distressing cases where a cohabiting partner suffers a clear injustice.
There are numerous pitfalls. For example, if your home is in your ex-partner’s name then you will have no automatic right to stay there if you are asked to leave. Nor will you automatically be entitled to a financial share in the house, even if you helped to pay for it over several years. Your former partner won’t have to pay maintenance for you, even if you gave up your job to look after the children while he or she went out to build a lucrative career.
Last summer the Law Commission put forward some proposals that would give cohabiting couples more legal protection. The main recommendation was that couples who split up should be entitled to financial settlements which reflect their contribution to the relationship.
Courts would be able to order one of the partners to pay lump sums or sell their home to provide the other with a fair settlement. While this would have been a major improvement it would still be far short of the protection created by marriage. Now, however, the Government has baulked at providing even this level of protection, even though it is already available in Scotland. Ministers say no action will be taken until they have had more time to consider all the cost implications. They have given no indication of when they will make a decision and the fear is that the proposals will simply be shelved.
Resolution, the association representing family lawyers, has criticised the decision saying it means there will be more distress and hardship for cohabitees.
Given the Government’s reluctance to legislate, cohabiting couples who don’t wish to get married have little choice but to provide their own legal protection.
Ownership of the family home is one of the most important issues. If it is in just one person’s name then the other partner could lose out. You may want to consider owning it as joint tenants or tenants in common which will make a huge difference to your rights.
If you don’t already have a will then you should draw one up as soon as possible. Otherwise your estate will pass to your relatives rather than your partner.
Unmarried fathers don’t automatically have parental responsibility for their children but they can acquire it with the agreement of the mother or by applying to a court. It is clearly better to deal with the matter while your relationship is strong rather than wait until after it has broken down.
Many couples protect themselves by drawing up living together agreements which state in advance how their assets should be divided if their relationship fails. A few years ago the government started a campaign urging couples to draw up such agreements to cover things like finances, property and pensions.
Some people may feel embarrassed at first to be making such legal arrangements as it seems that they don’t fully trust each other. However, such concerns soon disappear and most couples end up feeling their relationship is stronger because both partners feel more secure.
Private rented sector showing increased returns
Rents for houses in the private rented sector rose by an average of 4% in the three months to the end of February, according to the Association of Residential Letting Agents (ARLA).
Rents for flats rose by 2% over the same period. The average returns for renting out houses rose from 4.8% to 5% and the return from flats rose from 4.9% to 5%. The figures have been compiled following a survey of more than 400 letting agents. They show that the sector is still buoyant. The number of agents reporting that they have more tenants than properties is at its third highest level since the surveys began six years ago.
ARLA sees the figures as representing the start of a new housing cycle linked to house prices which have been falling in most parts of the country recently. ARLA’s head of operations said: “Whenever property prices soften or fall, rental demand, rents and yields all increase. As we begin a year of uncertainty in the sales market, it is inevitable that our member letting agents should report that they have more tenants than properties available for them.”
The increased demand is partly being driven by migration with the number of properties taken by immigrants, most of whom are from the European Union, showing a 20% increase. ARLA believes the supply of rented property will now have to increase to meet the rising demand.
OFT offers £100,000 reward for exposing cartels
The Office of Fair Trading (OFT) is offering rewards of up to £100,000 for information that enables it to take action against cartels which are prohibited under the Competition Act.
Businesses found to be taking part in a cartel to collude on prices can be fined up to 10% of their turnover. The Enterprise Act also makes it illegal for individuals to take part in such anti-competitive activity with offenders facing penalties such as an unlimited fine and/or up to five years in prison.
The OFT says clamping down on cartels in now one of its priorities. Simon Williams, OFT Senior Director of Cartels and Criminal Enforcement, said: “Cartels are very damaging both to businesses and consumers and they are usually conducted in secret making them hard to detect.
“Cartels are not the preserve of big business - for example, if a local authority needs to find a contractor to refurbish its schools, it is unacceptable for local contractors to seek to rig the tender process by colluding on price. That's bad for taxpayers, consumers and other businesses.
“We believe that it is in the public interest to offer financial incentives in the hope that it will encourage more people who have good information about the existence of hard core cartel activity to come forward, and in exceptional circumstances these incentives may be as high as £100,000.”
The reward system will be tried out for 18 months before deciding whether it should become a permanent arrangement.
SMEs hit by late payments and interest rate rises
Getting customers to pay their bills is the number one problem facing small to medium size enterprises in Britain, according to new research.
The survey was carried out by the Asset Based Finance Association (ABFA). It showed that nearly half of all SMEs found it difficult to get paid by customers within their payment terms. As many as 44% of companies report that customers have asked for extended credit in the last six months.
The Chief Executive of ABFA, Kate Sharp, said: "Cashflow problems, caused by limited working capital and poor credit management, is a major contributing factor to corporate failure in this country."
"In order to reduce this type of pressure it's important to examine where the cash is being tied up. More often than not unpaid invoices are the main culprit. Britain's SMEs must keep abreast of their debtor schedule to ensure they have the capital needed to support the business."
ABFA’s research also showed that 48% of SMEs believed that interest rises in 2007 had a detrimental effect on their business. Firms turning over less than £100,000 were the worst affected. In spite of these difficulties, 40% of firms believed they were financially robust and 55% expected to increase their turnover this year.
The ABFA findings are supported by research done by BACs which showed that over the last year, the amount of outstanding payments owed to SMEs rose by £2.6bn to £18.6bn. At any given time, the average SME is owed £30,000.
In the current climate brought on by the credit crunch and falling confidence, the incidence of late payment is likely to increase. Firms should seek legal advice as soon as possible when faced with such problems. Early action by a solicitor will often result in prompt payment which can help a company’s cash flow and even ensure it survives in a difficult financial climate.
PM announces above inflation rise for minimum wage
The Prime Minister Gordon Brown has announced that the minimum wage will rise by more than the current rate of inflation.
He told the Commons that the new hourly rate will rise from £5.52 to £5.73. The rate for 18-21 year olds will increase from £4.60 to £4.77, while the rate for 16-17 year olds will rise from £3.40 to £3.53. All the increases will take effect from October.
The chairman of the Low Pay Commission, Paul Myners, said the increase means the minimum wage rate will have risen by 59% since it was introduced in April 1999. That is almost double the growth in prices over the same period.
The Government has also announced new measures to enforce the minimum wage and crack down on rogue employers. These include increasing the maximum penalty for not paying the minimum rate to an unlimited fine. The most serious cases on non-compliance will be tried in the Crown Court.
There will also be a fairer method for settling minimum wage arrears so that workers do not lose out as a result of underpayment.
Government adopts new policies to develop brownfield sites
The Government has accepted proposals designed to free up vast tracts of brownfield land for development.
The recommendations were put forward by English Partnerships, the national regeneration agency which helps the Government to support sustainable growth in England.
The agency put forward a National Brownfield Strategy for England designed use 52,000 hectares of previously developed, vacant or derelict land to support Government plans to build three million new homes by 2020. It’s hoped that at least 60% of those homes will be on brownfield sites. This is intended to bring a double benefit of protecting greenfield land at the same time as improving the general environment for local communities by clearing up derelict and blighted land.
Communities and Local Government Minister Iain Wright said: “Since 1997, the amount of new development on brownfield land has risen significantly from 60% to 75% - a real achievement. But we want to go further and regenerate the most challenging sites.
"Brownfield land development is not just about building much needed homes, it is also about decontaminating blighted areas, recycling derelict sites and creating open green spaces in urban centres.
The National Brownfield Strategy identifies nine policy strands that need to be implemented between now and 2013 to make the proposals succeed. These include identifying suitable sites to ensure there is an adequate supply of land when it is needed and putting proper safeguards in place to protect the environment.
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