July 2018 - MLP Law

My employees are resigning, what can I do?!

It’s been another interesting week for the Prime Minister, with ministers and aides resigning one after another to put her under pressure. Whilst these resignations are politically motivated, employers can often find themselves in a similar situation where employees resign en masse in order to leave together and compete with the employer.

As an employer, what can you do to protect yourself in these situations?

Firstly, if you believe a number of employees are resigning as a “team move” you should check the contracts of employment and whether there are restrictive covenants or other contractual clauses which prevent the proposed action by the employees. If there are, then it may be possible to take legal action to stop their plans. Such action needs to be taken quickly and would need specialist legal guidance to ensure the best result. Clauses to look out for include any restriction on competing with the business, clauses covering confidentiality and intellectual property, data protection clauses, and clauses obliging Directors to act in a certain manner while employed, such as a duty to inform the company of wrongdoing or conflicts of interest.

If your employees have garden leave clauses, you can quickly remove them from their duties and keep them out of the business while they work out their notice period. This can help protect your confidential information and you can work on redistributing the clients and customers amongst remaining staff.

Where there are no contractual clauses which help, you may be able to rely on implied duties to help, such as the implied duty not to compete with the employer and implied duties of fidelity and good faith. Whether these apply can depend on the level of seniority of the employee so, again, it is necessary to take advice on the matter to understand what breaches the employees may have committed.
Possible action against the employees can include injunctions to prevent them taking advantage of any unlawful conduct by them, orders for return of documents, and financial remedies. However, this will only be possible where you correctly follow protocol and can institute High Court proceedings quickly. This can be an expensive course of action and needs specialist legal assistance from the outset.

If you are concerned about resignations within your business, our employment team would be happy to discuss this with you. Please contact us on 0161 926 9969 or by email at employment@mlplaw.co.uk.

Persons of Significant Control – are you compliant?

Since June 2017 it has been a legal requirement for all companies to take reasonable steps to identify any persons with significant control (‘PSC’), as well as maintaining their own internal PSC register. Further to a recent update, it is also now a requirement for companies to file this information with Companies House.

There has been some confusion over this requirement since its introduction, and Companies House are now looking to crack down on companies who have not filed the information correctly, or in some cases, at all. To help you understand if you are complying with your obligations and to avoid penalties for incompliance, we have answered some common questions in line with the most recent updates below.

1. Why was the PSC register introduced and what does it do?

The PSC register was introduced following increased media pressure for greater corporate transparency, and a need for increased confidence in businesses.

The requirement to complete this register therefore increases transparency within businesses, as anyone can search Companies House and ascertain who has significant control over a particular company.

2. What is a PSC and how do you identify them?

A PSC is a person or relevant legal entity (for example a limited company) who is registrable.

To identify a PSC you must go through the below checklist:

(a) You would first of all consider whether a person or relevant legal entity:
i. holds, directly or indirectly, more than 25% of the shares;
ii. holds, directly or indirectly, more than 25% of the voting rights; and/or
iii. holds the right, directly or indirectly, to appoint or remove a majority of directors.

(b) If none of the above are satisfied, you would then consider if the person or relevant legal entity:
i. otherwise has the right to exercise, or actually exercises, significant influence or control over the company; and/or
ii. has the right to exercise, or actually exercises, significant influence or control over the activities of a trust or firm which is
not a legal person, the trustees or members of which would satisfy any of the four conditions above.
An example of (b)(i) and (b)(ii) will include anyone who is significantly involved in the management and direction of the company whether that be a lawyer, accountant, or anyone whose recommendations are followed by the shareholders in a vote.

3. What entities does it apply to?

It applies to private companies limited by shares, companies limited by guarantee, LLPs, dormant companies, community interest companies and Societas Europaea.

4. Whose duty is it to identify a PSC?

Reasonable steps must be taken to identify the PSC, and the obligation to do so is on the PSC, others who have information about that PSC, and the relevant legal entity (within scope).

5. Where should I record this information and how do I do it?

As it is a criminal offence if you fail to record this information properly, it is recommended that you instruct a Solicitor to review and record the information on your behalf using the relevant form.

6. What happens if the information changes?

You are under an obligation to update the information with Companies House, as well as your internal registers, within 14 days of any change.

We understand that the requirements explained in this blog can be both daunting and confusing, and we are happy to guide you through the process or complete the register for you. If this is something you might be interested in, or if you have any further questions, please contact a member of the team on corporate@mlplaw.co.uk or call 0161 926 9969, and they will be able to advise you further.

Introducing MLP Flex

With new technology comes differing attitudes and approaches to both personal lifestyle and the way we do business.

A recent report by the broadcast regulator Ofcom hit the headlines this week, showing trends have changed and fewer people are watching live television today. Gone are the days of tuning in to watch your favourite programme once a week, with the arrival of Netflix, Amazon Prime and NowTV taking over. Teenagers are reportedly watching YouTube for an average of one hour per day, with the Internet and online streaming sites taking over and changing the way we do things.

There’s always an exception to the rule and ITV2’s Love Island has sent the nation into a frenzy with 3.4 million people tuning into the launch, breaking the record for ITV2’s highest overnight rating ever since records go back. The show has a solid following and people are dedicating every night between 9pm-10pm to catch up on the latest drama from The Villa. However, this is only around for 8 weeks, with 1 week to go until the final. People will then most likely revert back to the more flexible services offered by the streaming sites.
The flexibility of monthly streaming services such as Netflix allow people to watch their favourite shows as and when it suits them, regardless of when or where they are.

At MLP, we are following in these footsteps and want to provide a service to our clients that suits them… Introducing MLP Flex.
MLP Flex gives you access to all of our specialist teams who get to know your business journey and work with you long-term and pro-actively. MLP Flex enables you to budget over an agreed period of time (minimum 12 months) for your legal requirements and is based on a set number of hours, at a significantly reduced hourly rate, paid monthly. This enables our clients to access the support they need without having to agree separate fees each time advice is needed. We are challenging the way legal services are delivered to enable easy access and flexibility for everyone. #

For more information on MLP Flex, changing the way you access legal services and what to do, or if you would like any further information, our team would be happy to discuss with you further. Please contact us on 0161 926 1551 or by email at lucyc@mlplaw.co.uk to arrange the best time for you.

Top 7 tips for international students wanting to work in the UK

Many international students at UK universities will be keen to continue their lives in the city or town in which they have spent years studying. The UK’s visa system can be strict and difficult to navigate, which is not helped by the fact it is politically charged.

Students who are keen to remain in the UK should familiarise themselves with the various visa options early, rather than focus on job hunting once their studies are over. One way of acquiring a visa for working in the UK is switching from Tier 4 to Tier 2. It is necessary to be aware that there is more than one type of visa that could be suitable for your purposes however, this blog focuses on Tier 4 graduates switching to Tier 2 from inside the UK.

1. Do your research on the Points Based System – for a Tier 2 visa you need to score 70 points through the following:
  • Certificate of Sponsorship – 30
  • Salary – 20
  • English Language – 10
  • Maintenance – 10

You should make sure you understand how you score the points in each category so you can make sure you are prepared when the time comes to make an application.

2. Know the employers who are already able to sponsor Tier 2 workers

All employers who hold a Tier 2 sponsor licence are on the Government’s register here: https://www.gov.uk/government/publications/register-of-licensed-sponsors-workers
You could search the document for a specific employer or search for a specific location and see what companies in that area are sponsors.

3. Understand the requirements for a Certificate of Sponsorship

An employer can only assign a certificate of sponsorship where the job on offer is considered skilled enough and will be paid at, or above the minimum salary set by the Government. To check if your desired job will be skilled enough you should review Appendix J; jobs at RQF level 6 or above are the only ones which can be sponsored for Tier 2. The stipulated minimum salary is at least £20,800 for students switching to a Tier 2 visa, but you should check the thresholds for the job in question as this may be higher. You can familiarise yourself with the job descriptions and salaries here:https://www.gov.ik/guidance/immigaration-rules/immigration-rules-appendix-j-codes-of-practice-for-skilled-work

4. Consider sectors which regularly hire international graduates:

The most common professions for Tier 2 jobs after graduation are:

  • Accounting, Consulting & Professional Services
  • Banking, Finance & Insurance
  • Engineering & Tech
  • Info & Communications
  • Healthcare
  • Professional, Scientific & Technical
  • Education
5. Weigh up your route to work options:

1) Graduate schemes
Pros: Run by large organisations likely to be on the sponsor register and likely to be accommodating to Tier 2 applicants.
Cons: Competitive process with early deadlines.

2) Individual graduate level roles
Pros: Greater flexibility.
Cons: Less likely to have a certificate of sponsorship, may be more hesitant to apply to be on the register, don’t hire many graduates each year and may not provide a minimum salary suitable for Tier 2.

6. Use your Tier 4 visa for work to gain experience during your studies

Generally, Tier 4 students are allowed to work 20 hours a week during term time and full time during vacation periods. You can therefore use this time to do part time work with employers to gain experience and build relationships with managers who are responsible for graduate recruitment.

7. Be aware of the alternative options:

If you are a budding entrepreneur or merely looking for temporary work within the UK then Tier 1 or Tier 5 could be a more appropriate visa option. Tier 1 visa categories are for individuals who are setting up a business or investing in the UK, or individuals who are exceptionally talented. Tier 5 categories are for short term work placements for 1 or 2 years, predominantly to gain work experience.

Given Brexit, the future of the Points Based System is uncertain however, at least for now, Tier 2 provides a valuable route for international students accessing employment in the UK.
If you want more information about the contents of this blog, please contact our business immigration specialist Charlotte Ashton 0161 926 1592 or email charlottea@mlplaw.co.uk.

Employers’ guide to EU Settlement Scheme

The Government is still trying to reach agreement with the EU on what the future relationship with the EU looks like. The rights of EU citizens in the UK, and UK citizens in the EU, was one of the quicker points to be agreed in principle; the position being that EU citizens in the UK by 30 March 2019 would have until December 2020 to apply for Settled Status (or register their status in order to apply for Settled Status once they had reached 5 years in the UK).

At the time of writing, there has been another change in personnel, with the Prime Minister taking over negotiating with the EU and the Department for Exiting the EU being tasked with working on both ‘deal’ and ‘no deal’ Brexit options.

Despite the ongoing negotiations, the Home Office has issued an employer toolkit to help employers give out information to their EU workers and their families about the Settlement scheme. A generous view of this is that the Home Office is attempting to provide timely and useful information to help EU citizens obtain the Settled status as soon as the scheme is up and running, with little difficulty. A more cynical view is that the Home Office is asking employers to shoulder the burden of publicising the scheme, possibly fuelled by the report from the Migration Observatory which warned that tens of thousands of EU citizens could inadvertently become ‘illegal’ residents in the UK.
The toolkit comprises guidance on how to use it, a briefing pack, leaflets for employees, and posters to display.

Whilst this is useful information for employers, employers do need to be careful that the information and assistance they provide does not amount to “immigration advice” as it is a criminal offence to provide immigration advice without being regulated by the Office of the Immigration Services Commissioner or a member of certain professional bodies (such as the Law Society, Bar Council, etc.)
In addition to this risk, employers do not necessarily have the time or resource to dedicate to digesting the wealth of information on Brexit and EU citizen’s rights, nor promoting the Settlement scheme to their employees. Employers may therefore feel reluctant to talk to employees about the Settlement scheme for fear of providing too little, or incorrect information.

At MLP we are able to provide advice to you and your employees on the new Settlement scheme as well as other immigration matters. If you would like to discuss your options for assisting your EU workers and their family please contact Charlotte Ashton on 0161 926 1592 or email charlottea@mlplaw.co.uk.

Proactive vs Reactive: use your time wisely

The Telegraph has reported that one of the major ways businesses waste time is by failing to outsource. They report that:
‘Every company likes to think that it’s good at everything, and there’s a natural desire to keep everything in-house. This is not a good way of working, and a failure to outsource can cost your business in time, money and expertise. With the right partners, you can outsource parts of your business to experts in that area, reducing cost and making your business work faster’.
Outsourcing legal work is one way that senior managers and business owners can save time, money and stress. Why not outsource to experts?

When it comes to protecting yourself and your business, there is no time to waste time!

Senior managers and business owners spend a lot of time worrying about things that they don’t need to worry about. There are, naturally, certain things that need their attention and constant support but there are other things that can be handled by different people for peace of mind and to eliminate some of the stress that these roles carry.

It’s all about planning ahead.

A company can create a proactive growth plan to ensure they have solid foundations in place on which to build and maintain a successful business.
Reactive legal services are designed solely to resolve issues as they arise. It is important to think about both sides of the coin. There will be some needs that arise unexpectedly and therefore need to be dealt with as and when however, there are a lot of situations that a business can be thinking about in advance and approach proactively.

It is a popular misconception that by only engaging legal services as and when required, this is a more cost effective solution, however, this is not the case and approaching your legal services provider in this way will cost more over time.
A proactive approach to legal services allows a long-term relationship with your legal provider and actively protects and improves the business as a result. This adds value to the business and mitigates against issues before they can arise.

Decisions, Decisions, Decisions…

Business owners and key decision makers within organisations need to make the best choice for the business. It is important to consider whether monthly costs for a future proof and fail safe legal services solution is better value than the ultimate cost of a law suit on your desk, and the loss of trust and customer relationships or ultimately, the loss of the business.
A proactive legal retainer is the best option for most businesses. Whilst the annual cost of this may seem higher than if you contacted a solicitor only when issues arise, long-term this option will add value, mitigate against potentially costly issues and give senior managers and business owners the peace of mind they need to do what they do best and keep growing the business.

How can we help?

MLP Flex gives you access to all of our specialist teams who get to know your business journey and work with you long-term and proactively. MLP Flex enables you to budget over a period of 12 months for your legal requirements and is based on a set number of hours, at a significantly reduced hourly rate and is paid monthly. This enables our clients to access the support they need without having to agree separate fees each time advice is needed whilst spreading the cost.
For more information on MLP Flex, changing the way you access legal services and what to do, or if you would like any further information, our team would be happy to discuss with you further. Please contact us on 0161 926 1551 or by email at lucyc@mlplaw.co.uk to arrange the best time for you.