Category Archives: Risk

Legal risk management in uncertain times

“While the impact of the current pandemic has left many businesses feeling uncertain about their future, from an operational and financial perspective it is certain that there is more opportunity for legal risk.”

From an operational and financial perspective, risk and uncertainty are not the same thing. Uncertainty arises when we are unsure about future outcomes usually due to a lack of knowledge or insight. Businesses that operate in a climate of uncertainty are likely to find over time that operational and financial objectives will be severely impacted and the outcomes may be unpredictable. On the other hand, risk focuses on the good or bad outcomes of our actions or inactivity which means that the outcomes can be managed and controlled to achieve better results.

Replace uncertainty with risk management

There are many different types of threats which could damage your business from financial uncertainty created by the economic outlook, an IT security attack which could take the business down for days to an expensive and time consuming legal challenge by a client who is unhappy with a product or service or an employment tribunal claim by an employee who alleges they have been harassed by a colleague.

Awareness of the threats means a business is in a stronger position to respond to the negative impact the business may experience.

“There are five basic elements to a successful risk management process that will help develop a plan to mitigate against your biggest threats.”

In very simple terms, risk management is the process of:

Build resilience

Instead of having no idea whether your business objectives can be achieved or what might get in the way of their delivery, a systematic approach to risk management based on these five simple steps forces you to face up to the risks and enables you to make the right decision to make your business more resilient.

Prioritise legal risk

Any business that has not come out the right side of a legal dispute will want to avoid being in such a situation in the future. Therefore, any risk management plan should incorporate a section which considers legal risk.

“The nature of the business and the industry sector will determine those areas that create the most threat.”

Common legal risks are likely to arise from factors such as contractual relationships with third parties, changes in the law, technology and data security, intellectual property, competitors and employees.

Have you for example examined the potential legal risks that are involved in employing people in your business or are you prepared to leave things to chance? A workplace that is reliant upon out of date contracts of employment, has no clear policies and procedures and is not operating in line with current employment laws and regulations is likely to be faced with outcomes that are unpredictable when it comes to legal disputes in the employment tribunal.

However, the five-step approach to risk management will assist in identifying and managing legal risks with the aim of preventing these risks becoming costly legal liabilities and creating more certainty about operational and financial outcomes. This will mean having legally compliant contracts of employment and up to date policies and procedures underpinned by appropriate legal compliance training for managers and supervisors.

A more confident future

Overall, businesses that prefer to operate in a culture where it is unsure about what happens next will have an uncertain future. Those who want a more confident future will have a strong risk management culture that recognises the need to identify and manage legal risks.

FG Solicitors are experts in helping its clients safeguard their businesses from legal risks, so they have greater certainty over their financial and operational outcomes.

If you require further guidance on how to manage legal risks within your business, please feel free to call us on 0808 172 9322 for a no obligation discussion.

For further details about the legal services and assistance we provide to businesses, please click here.

 This publication is for general guidance only. Advice should be taken in relation to a particular set of circumstances.

Apprentices – Four Reasons and a Risk

160607 Apprenticeship Training CareerSUMMARY: Four reasons to engage an apprentice and how to overcome the main risk

The government has been encouraging employers to engage apprentices and many employers are now seeing the benefits of them.

Four key benefits

1. National Insurance Contributions (“NICs”)

Since 6 April 2016, employers do not have to pay class 1 NICs for apprentices who are earning less than £827 a week (£43,000 a year) and are:

  1. under age 25; and
  2. following an approved UK government statutory apprenticeship framework.

Specific evidence is needed to show that these two requirements are satisfied. For example, an appropriate agreement.

 2. Apprentice rate minimum wage

If the apprentice is in the first year of their apprenticeship or is under the age of 19, employers can pay the apprenticeship rate, which is currently £3.30 per hour.

3. Gain skills in areas your organisation needs to grow

Organisations will be constantly considering and implementing new ways to grow.  Apprentices can be a cost effective way of supporting the larger strategic aim.

4. Funding

There could be funding available from the Skills Funding Agency to your business to support apprenticeship programmes.  Further information can be found at www.gov.uk/government/organisations/skills-funding-agency

Risks

The intention is for the apprenticeship relationship to be a positive and beneficial one for the organisation and the individual. However, not all working relationships will be harmonious.  If things do not work out, employers need to be able to address problems and ultimately dismiss individuals both fairly and lawfully if problems subsist; this is often where the risk lies.  Why?  Apprentices can have enhanced rights on dismissal, which limits the ability to terminate the agreement without potentially a significant financial liability.

Having the right agreement in place lowers the risk by ensuring an apprentice can be dismissed in the same way as an employee.

More Information

For more information on apprenticeships and how you can make them work for you, please visit: http://www.fgsolicitors.co.uk/news/apprenticeships-make-them-work-for-you/

Alternatively, if you would like more information on other contract essentials, please visit: http://www.fgsolicitors.co.uk/news/contract-essentials/

Contact Details

If you are considering recruiting an apprentice and want to benefit from the above advantages, without worrying about the risk, please contact us:

fgmedia@fgsolicitors.co.uk

+44 (0) 808 172 93 22

This update is for general guidance only and does not constitute definitive advice.