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Employment Law - Bribery Act – a summary

This Act was in 1 July 2011 and was the amalgamation of several pieces of legislation, some over 100 years old. Under the Act there will be four possible offences:-

  1. Bribing another person – offering, promising or giving a reward to induce someone to act improperly
  1. Being bribed – the accepting of, agreeing to accept or requesting of a reward in return for performing improperly
  1. Bribing a foreign public official – trying to influence an official with the intention of obtaining or retaining business when the official was not permitted to be influenced
  1. Failure to prevent bribery (the ‘corporate’ offence)

What does this have to do with me?

If one of your employees is found to have committed one of the first three offences, then the company may need a defence against the fourth. For that you would have to show you have adequate procedures in place to try to prevent bribery from occurring. If a Company is unable to defend itself they could face an unlimited fine and be prevented from bidding for public sector contracts.

The Government published six guiding principles setting out how you have adequate procedures in place to try to prevent bribery happening. The good news is that the procedures you need to be put in place only have to be in proportion to the size and nature of the business i.e companies with modest risk of bribery only require modest procedures in place!

The six guiding principals are:-

  1. Proportionate procedures – to prevent bribery by people associated with the business. Procedures should be proportionate to the bribery risk faced by the company and they should be clear, practical, accessible, implemented effectively and enforced.
  1. Top level commitment – to preventing bribery by everyone associated with the Company. Managers should promote a culture where bribery is seen as unacceptable and they should get involved in creating procedures, training staff and communicating the Company’s view on bribery
  1. Risk Assessments carried out – to assess the level of risk, nature and extent of possible bribery either internally or externally to the Company. These assessments should be carried out on a regular basis and documented. The government guidance suggests these risks can be divided into five categories:
    • Country – is there a culture of corruption in a particular country that the company deals with, or no anti-bribery legislation?
    • Sector – is the Company operating in a sector where bribery is more common?
    • Transaction – Does the company deal with transactions where bribery is more common?
    • Business opportunity – does the company deal in activities of particularly high value, or involving a lot of different groups?
    • Business partnership – are there a number of intermediaries involved in company transactions?
  1. Due Diligence - procedures which take a risk based approach to those involved or carrying services out on behalf of the Company in order to reduce identified bribery risks
  1. Communication and training to advice employees and consultants the Company’s view on bribery.  Training should educate individuals about how to address situations where bribery might occur and emphasis the anti-bribery culture within the Company.
  1. Monitoring and review of Company anti-bribery procedures should be regularly undertaken with action being taken to address any issues raised.

What should you be doing?

  1. Assign one member of the Board  / Senior management to be responsible for overseeing all anti-bribery actions
  1. Board / Senior Management should issue a formal statement confirming the importance of anti-bribery
  1. Conduct a risk assessment of company situations where bribery could occur within the business. These assessments should be reviewed by the senior manager and any appropriate actions should be taken. Note :- if the risk of bribery in the company is low then the steps the company needs to take can also be low
  1. Have an anti-bribery policy in place
  1. Ensure the following procedures are reviewed / updated for preventing bribery:-
  • Hospitality
  • Gifts, promotional expenditure and charitable and political donations to ensure they contain adequate controls to prevent bribery from occurring
  • Bonus payments
  • Disciplinary procedure to specifically detail bribery and corruption as a gross misconduct
  • Whistle-blowing to ensure it specifically mentions situations about bribery and corruption
  • And finally, employment contracts, to include a clause, as appropriate, about bribery and anti-corruption
  1. Promoting a culture whereby bribery is never acceptable
  1. Train employees who may potentially be involved in situations where bribery could occur. The training should make it clear to employees what is and what is not acceptable and what to do if they find themselves in a bribery situations.
  1. Review financial controls with regards to the level of signature required for different level of transactions and that multiple authorisations are required for significant transactions
  1. Have a process in place to monitor and review anti-bribery procedures and training and make any appropriate amendments

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