Beware Of Using Work Computers For Personal Matters

The perils of using your work computer for personal matters was recently highlighted in the High Court case of Simpkin v The Berkeley Group Holdings PLC. 

In that case the Mr Simpkin was the Finance Director of The Berkeley Group.  Berkeley terminated his employment, removed him as a director and decided that he would not be treated as a “good leaver”.  As a result Mr Simpkin would not receive the substantial financial benefits of a long term incentive plan and bonus scheme of which he was a part.  He therefore issued proceedings against Berkeley.

During Mr Simpkin’s employment with Berkeley he had sent an email from his work email account to his personal email account with an attachment containing an analysis of his expectations under Berkeley’s long-term incentive plan.  He had then forwarded the email from his personal account to his solicitor who was dealing with his divorce.

Berkeley wanted to use the email and attachment in the context of its employment dispute with Mr Simpkin but he argued that they should be prevented from doing so as the documents were protected by legal privilege – broadly speaking communications between a client and their solicitor are protected from use in proceedings by privilege.  However, Berkeley contended that Mr Simpkin was not entitled to claim privilege in relation to those documents because when a privileged document came into the hands of an opposing party in litigation there was nothing to prevent that party from using that document.  They also argued that the document was not confidential as far as it related to Berkeley – it was accepted by both parties that confidentiality was a pre-condition to privilege.

The court decided that the documents were not confidential because:

  • Mr Simpkin had signed Berkeley’s IT policy which provided that emails sent and received on Berkeley’s IT system were the property of Berkeley.
  • Berkeley’s IT department had full access to all emails sent and received by Mr Simpkin.
  • The document was created by Mr Simpkin during the course of his employment with Berkeley and by using its IT system.

It was therefore impossible for Mr Simpkin to have any reasonable expectation of privacy as regard the preparation of those documents as he should have been aware that they would be stored on Berkeley’s servers.  The judge found that the documents in question were never confidential in relation to Berkeley or, if they were, they lost their confidentiality when they were processed on Berkeley’s IT system.

This case highlights one of a number of risks for employees who use work IT systems for private communications.  It is also a reminder to employers to ensure that their IT policies are as watertight as possible to avoid complications such as this arising both during the employment relationship and after it has ended.

Picture of Luke Patel

Luke Patel

Luke Patel
Partner
Commercial Dispute Resolution Team
LPatel@LawBlacks.com
0113 227 9316
@LukeLawBlacks

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Unjustified Threats

Intellectual property owners have always had to tread carefully when it comes to enforcing their rights.  Until recently, part of the law known as the unjustified threats provisions meant that it was possible for someone on the receiving end of threatened proceedings for patent, design right or trade mark infringement to issue their own proceedings to ask the court to issue a declaration that the threats lacked justification, to make an award of damages and to issue an injunction to prevent further threats being made.  For obvious reasons, this could act as a powerful disincentive to trying to stop what might be seen as infringement where the position was not absolutely clear.  Added to that was the fact that lawyers sending a letter alleging infringement could also be separately liable for doing so – the playing field was far from level.

The provisions were meant to stop innocent consumers and retailers, known as secondary infringers, from being faced with infringement claims.  The idea was a good one but over the years the unjustified threats provisions have been used by primary infringers (i.e. those making or importing the infringing goods) trying to obtain a tactical advantage.  To make matters more difficult, the regime was an unwieldy mix of various legal concepts and remedies which led to a lot of uncertainty amongst lawyers and businesses alike.

The Intellectual Property (Unjustified Threats) Act 2017, which came into force last week, is meant to address these issues.  It provides some much-needed clarity.

No longer can an intellectual property rights owner be considered to be making a potentially unjustified threat simply by telling someone that they own a particular trade mark, which could have been the case before.  That is now specifically permitted, as is giving another party notice that you have rights under a certain mark.  The Act also means that a trade mark owner, for example, can demand that a primary infringer (i.e. someone who is importing goods which infringe a trade mark) does not sell those goods.  Slightly bizarrely, before the Act came into force that was something which could land a trade mark owner in hot water.

Just as importantly, especially for the lawyers, a threats action cannot be brought against a legal adviser acting on instructions where the identity of the client has been included in correspondence.

The aim of those who drafted the Act was to encourage parties to try to resolve disputes before issuing proceedings.  It has been a long time in the pipeline but at first glance, it seems that it may well have that effect.

Phil Gorski

Phil Gorski

Phil Gorski
Solicitor
Commercial Dispute Resolution
PGorski@LawBlacks.com
0113 227 9318
@PhilLawBlacks

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Sleeping on the Job: Government suspends National Minimum Wage enforcement for Sleep-in pay in the Social Care Sector

On 26 July 2017 the Government announced that it had temporarily suspended enforcement activity and that it was officially waiving historic financial penalties owed by employers who have underpaid their workers for overnight sleep-in shifts before this date.  It has also prevented HM Revenue & Customs (“HMRC”) from pursuing social care charities over any historical payments (i.e. those that should have been made prior to 26 July 2017) until a new approach is agreed.  On 28 September 2017 the Government announced that the suspension would be extended by another month.

This action follows recent calls by a number of social care providers which assert that the national minimum wage (“NMW”) threatens the stability of the sector and may prove the undoing of numerous providers that cannot cope with ensuring workers are given the NMW for sleep-in shifts.  This is a common-place shift or form of work in the social care sector whereby an employee sleeps at their workplace so they are available to support other people during the night, should the need arise.

Previously, it was common practice for care sector workers to be paid a fixed allowance for sleep-in shifts which would often fall short of NMW requirements.  This resulted in a number of claims being issued in the Employment Tribunals which culminated in a collective appeal on whether care workers’ sleep-in shifts constituted work that attracted a compulsory payment of the NMW.  Collectively, these cases, and in particular the case of Royal Mencap Society v Tomlinson [2017] confirmed that sleep-in shift workers were entitled to be paid the NMW.

Unfortunately, the cases have also failed to provide clear guidelines as to what exact type of sleep-in shift constituted work that would attract a NMW payment.  Instead the Tribunal identified factors that would be indicative of this whilst asserting that no single factor is to be determinative and that the relevance and weight of particular factors would vary with and depend on the context and circumstances of the particular case in question.  As guidelines, the Employment Appeal Tribunal did indicate that the following would play a role in determining whether sleep-in shifts should be taken into account in the NMW calculation:

  • the employer’s purpose such as having someone present due to regulatory or contractual requirements;
  • the extent to which the worker is restricted by the requirement to remain on the premises including whether disciplinary action would ensue if they were to leave;
  • the degree of responsibility of the worker i.e. contrasting a duty to simply make an emergency services call with the position of a night sleeper in the home of a disabled person with a more significant personal responsibility in relation to the night duties that might have to be performed; and
  • the immediacy of the need for the worker to provide services or intervene if something untoward occurs or an emergency arises.

As a result of that finding Mencap were also ordered to pay their workers additional pay for shifts going back as far as 6 years to bring the pay in line with the NMW.  This has had ramifications for many social care providers which now face the threat of financial penalties. Repayment of arrears of wages owed to workers who have been underpaid may also be payable following the investigations that HMRC are carrying out into the sector.  This is significant as the financial payment of the latter is usually 200% of any arrears found.

Following this ruling Mencap, unsurprisingly, has been particularly vocal about the losses the sector is set to suffer (with some estimations coming in at over £400 million).  When taken in context, the outrage from social care providers is understandable when one considers the numbers.  Comparatively, a typical 8 hour sleep in-shift payment, which had long been the norm, would cost between £35 to £45 per shift.  The same shift using the standard NMW calculated (with the NMW standing at £7.50 per hour) will set an employer back £60.  As a bare minimum that is an increase of 25% or more that the employer will now have to pay, or face further fines from HMRC.

The Government has now sought to balance these concerns whilst ensuring that workers in the sector are set to receive the NMW.  Waiving the historic financial penalties owed by employers is a significant stride towards the Government reinforcing their support for the social care sector and supplements the already allocated £2billion of funding to the sector (as announced in the Spring Budget). The guidance also reiterates that the area is to be kept under constant review to ensure that the NMW does not play havoc upon providers and that they are kept afloat despite the recent rulings.

Despite this, the announcement is more of a stop gap rather than a direct answer to the problem many employers may face in the future.  Any arrears of wages occurring after 26 July 2017 will be subject to investigation from HMRC and employers may still face financial difficulties as a result.

Whether the balancing act will succeed is anyone’s guess however due to the sensitive nature of the sector many care providers need to have workers around the clock or for them to be on standby 24 hours a day.  This makes it likely than more often than not employers will struggle to come to terms with this new status quo unless the Government supplements payments for care providers so as to include the additional costs they now face in light of the NMW.

Paul Kelly

Paul Kelly

Paul Kelly
Partner
Employment Team
0113 227 9249
PKelly@LawBlacks.com
@PaulLawBlacks

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Is the law governing boundary disputes about to change?

Boundary disputes are a bit like “The ‘X’ Factor”. Emotionally draining for all parties involved, they take a long time to resolve and when the winner is finally announced, most people aren’t that thrilled with the outcome. In fact, sometimes even the winner often wonders whether the whole business was really worth the effort.

Everybody needs good neighbours…

Getting involved in a dispute with your neighbours is not a decision to be taken lightly. Quite apart from the inevitable deterioration in relations, litigating a boundary dispute usually requires a detailed review of the historic title documents (which are often unclear and not definitive), a site investigation (to determine whether there is or was anything on the ground which might assist in determining the boundary line), photographic and witness evidence as well as a report from a surveyor.

Economic madness!

The adversarial nature of litigation and the accruing liability for costs can lead the parties to become more entrenched in their positions. The longer the case goes on, the more the parties are keen to “have their day in Court”, making settlement (via mediation or otherwise) nigh on impossible.

Where boundary disputes have made it to a final hearing, the Judges are often astonished, unimpressed or downright depressed that the case has got that far, particularly as the land fought over might only be a few centimetres wide.  In one case, the Judge commented that “a party can litigate over a tiny strip of land, although I would certainly agree that it is usually economic madness to do so, but a person remains entitled in law to protect and preserve that which is his or hers”.

But is this all about to change?

The Property Boundaries (Resolution of Disputes) Bill, a private members’ bill, is making its way through the House of Lords, having had its first reading (in this form) in the Lords in July.  The Bill’s aims include a desire to speed up the resolution process, reduce parties’ costs and free up Court time. The Bill seeks to completely change the approach to boundary disputes (and to certain disputes relating to the extent or location of a private right of way) by introducing a compulsory expert determination procedure.

Where the owner of land wants to establish an exact boundary line (or the location or extent of a private right of way), he or she must serve notice on the adjoining landowner.  If the adjoining landowner objects or fails to respond within the timescale, then a dispute is deemed to have arisen.  Like the Party Wall Act 1996, on which the procedure is modelled, the Bill then provides for a mandatory expert determination – a surveyor will be appointed to determine the dispute.  If either party is unsatisfied with the determination, they may appeal to the High Court within 28 days.

On its face, the proposals contained in the Bill seem like a sensible attempt to simplify boundary disputes and reduce cost, by taking the procedure out of the hands of the parties and into the hands of expert surveyors.  It is an attempt to introduce a ‘one size fits all’ approach and pre-supposes that there will be no legal issues to resolve during the course of the dispute. Although the current system has its faults, we are yet to be persuaded that a mandatory expert determination is appropriate in every instance. If nothing else, the Bill may discourage parties from escalating the dispute in the first place.

What next?

The Bill is due to be debated although a date has not yet been set – let’s see what the Lords make of it!


Rachael Donnelly
Associate
Property Litigation Team
RDonnelly@LawBlacks.com
0113 207 1094

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The GDPR – a guide for park owners

It may not be the first thing a park owner thinks about, but data protection laws here in the UK apply as much to holiday and home parks as they do to any other business sector.  In May next year the General Data Protection Regulation (GDPR) will come into effect and is set to introduce some significant changes.

The impact of these changes and identifying what issues are relevant will be a challenge for many park owners.  So what is changing and what should you be doing now to make sure that next year does not hold any nasty surprises?

Does the GDPR apply to me?

The answer is almost certainly yes.  The obligations of GDPR fall on all organisations which process personal data regardless of their size or type.  “Processing” includes using data in almost any way whatsoever (including receiving it, storing it, copying it and destroying it); personal data is any information from which a living individual can be identified.  Those definitions are very broad and as a park owner or operator you are almost certainly subject to the GDPR and everything in it.  

Brexit and GDPR

One thing to note at the outset is that there is almost no chance of the GDPR going away.  Technically it is already part of UK law and both the government and the Information Commissioner have made it clear that it will come into force as planned, regardless of how Brexit negotiations go.  Even if there was a complete change of direction, you would still have to comply with the GDPR if you sell goods or services to EU citizens.

The changes: rights of individuals

In a nutshell, old rights are being strengthened and new rights being introduced.  There is a new “right to be forgotten” which gives individuals the right to require you to remove their data from your systems and the right to data portability, designed to allow individuals to obtain and reuse their personal data for their own purposes across different services.  Subject Access Requests, which are nothing new, will have to be complied with in less time (one month as opposed to 40 days) and the right to impose a fee of up to £10 is being removed.

Obligations

Even where individuals’ rights remain the same, the obligations placed on organisations in relation to them are set to become stricter. Keeping a record of the decisions you make regarding data protection is now a legal requirement, as is maintaining records of what data you have and why you have it. Much more information is now expected to be provided to individuals as well in the form of privacy policies.

It is important to note that these obligations apply regardless of the size of your operation.

What to do now? 

  1. Make sure that the key decision makers are aware of data protection generally and that the law is changing in less than a year. Provide staff training to those who handle the data on a day to day basis and ensure they are up to speed with the obligations on the business and the way to use/store data that is obtained.
  2. Assess what information you have, where it came from and who you share it with. What you will need to do will depend on the data that you have.
  3. Document the result of your assessment.
  4. Check that you have privacy policies in place and if so that they set out the basis for processing data and what you do with it.
  5. Familiarise yourself with the rights of individuals and satisfy yourself that you can deal with a request for those rights to be acted on. If you are a large operator, you should have written procedures in place to do so and make sure that your employees recognise such a request if one comes in.
  6. Make sure you know what to do if there is a data breach (for example, if an individual’s data goes astray). Put a procedure in place to deal with reporting and investigating a breach.
  7. Record everything you do. Accountability, being able to show what you have done to comply with your obligations, will be vital.
  8. Don’t leave everything until the last minute do a data protection audit now!
Phil Gorski

Phil Gorski

Phil Gorski
Solicitor
Holiday and Home Parks Team
PGorski@LawBlacks.com
0113 227 9318
@PhilLawBlacks

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Rugby Union doing a ‘Neymar’

There has been something in the water this summer, in the parallel transfer markets of rugby union and football.

In the latter, Neymar Jr. transferred to PSG in a deal worth an eye-watering £370m, a sum of money inconceivable within world rugby. For context, Sunderland A.F.C, currently have their entire football club for sale, including squad and stadium, for £170m.

Traditionally, rugby union players in England’s professional leagues have moved between clubs by way of ‘free transfers’. Something commonplace in football, which had not previously been seen in rugby union, is a release clause triggered upon promise of a certain transfer fee by the buying club. It was this mechanism which facilitated Neymar’s move away from the Nou Camp. His £199.1m release fee was supposed to act as a deterrent, but Qatari Sports Investment, the financier of PSG, instead saw it as an affordable opportunity to generate publicity and revenue. Leicester Tigers earlier this summer shrewdly used a largely unknown regulation in the Premiership code of conduct which allowed a player to be bought out of their playing contract by another club for a set fee. This fee was a one-off payment of a season’s earnings for what the player was being offered by the purchasing club or his current salary for a season, whichever was the higher.

The regulation was in place with the view to protect the interests of backroom staff and had not been drafted with players in contemplation. The 12 Premiership clubs unanimously supported that the regulation be amended to prevent such transfers being triggered again in the future.

There has been an emerging global trend of rugby players moving clubs before the end of their contracts. Perhaps the clearest illustration of this shift in culture is Louis Picamoles of Northampton Saints signing a pre-contract agreement with Montpellier, despite having three years left on his existing deal. The compensation sum required from Montpellier to free him from his Saints contract would take the form of a seven-figure sum, making him rugby’s first £1million player, and rugby’s equivalent of football’s Trevor Francis 38 years earlier.

Within the last year we have seen Carl Fearns backtrack on his contractual agreement to return from France to Gloucester because of Lyon’s willingness to foot the bill of his U-turn, and perhaps more incredulous was Denny Solomona ‘retirement’ from rugby league in order to walk away from his contract with Castleford Tigers and join rugby union side Sale Sharks. This left his former club without any compensation immediately following his departure and the ‘League Leaders’ were left with no recourse but to issue legal proceedings. The outcome was a hefty out of court settlement for the Tigers who had lost the services of Super League’s top try scorer from last season with two seasons left to run on his deal.

These behaviours are symptoms of a market desperate to follow the precedents set by the round ball game following the hike in the salary cap ceiling and the surge in TV revenue. Rugby players and their agents are now acutely aware of not only the enlarged salaries on offer, but of other clubs’ willingness to swoop in and free them from the contracts they are currently bound to.

Andy Boyde

Andy Boyde

Andy Boyde
Solicitor
Sports Law
0113 227 9319
ABoyde@LawBlacks.com

 

Contribution from Tom Grahamslaw

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Foot Dragging On Mediation Will Not Be Tolerated

The Court of Appeal recently reminded litigants that they must give mediation proper consideration and that anything less will result in cost penalties being imposed.

In the recent case of Thakkar v Patel, the claimant owned a building that was leased to the defendant.  The property was vandalised and as a consequence suffered flooding.  The claimant delayed carrying out repairs for several months during which time the building could not be used. The lease subsequently came to an end and the claimant made a £210,000 claim for dilapidations.   The defendant counterclaimed for £41,875 in respect of rent which it had paid when the premises could not be used.

The claimant proposed mediation and, following an initial agreement to mediate, was proactive in making arrangements and identifying possible mediators.  The defendant, by contrast, was slow to respond and raised hurdles that ultimately frustrated the claimant’s efforts.  The claimant eventually lost patience and told the defendant that they no longer had any confidence that mediation could be arranged.

At trial, both parties were successful with their respective claims.  The claimant was awarded £44,933.52 and the defendant was awarded £16,750 on their counterclaim.

In deciding the issue of costs, the court examined the parties’ conduct in relation to mediation.  It found that neither had refused to engage in mediation or ignored the request to consider it.  However, the claimant had been more proactive and, by contrast, the defendant was unenthusiastic and had shown no flexibility when it came to agreeing the mediation arrangements.  The court considered that there had been real prospects of a settlement being achieved had the parties engaged in mediation.   For those reasons, it held that the defendant should pay 75% of the claimant’s costs and the claimant should pay the costs of the defendant’s counterclaim.  The defendant appealed.

The Court of Appeal held that the vast majority of the costs of the proceedings would have been saved had there been a settlement and, while the decision to penalise the defendant in costs was tough, it was not so tough as to warrant interference by it.  The appeal was therefore dismissed.

In a clear warning to all litigants, Lord Justice Jackson stated: “…in a case where bilateral negotiations fail but mediation is obviously appropriate, it behoves both parties to get on with it. If one party frustrates the process by delaying and dragging its feet for no good reason, that will merit a costs sanction. 

This case acts as a reminder to all parties that they are required to give proper consideration to mediation.  Avoiding it is not an option.  The parties cannot ignore a request to mediate; they cannot blankly refuse to mediate; they should engage in the process rather than simply pay lip service to it.  Failure to do so will result in costs penalties being awarded against them.

Picture of Luke Patel

Luke Patel

Luke Patel
Partner
Commercial Dispute Resolution Team
LPatel@LawBlacks.com
0113 227 9316
@LukeLawBlacks

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