This came just two months after the introduction of the Act, which provides that businesses can also be prosecuted and face unlimited fines under Section 7 of the Act for "failing to prevent bribery" by employees and "associated persons" - the "Corporate Offence". Mr Patel's employers will not be facing prosecution as only offences under Section 1 (bribing) or Section 6 (bribing a foreign public official) trigger the Corporate Offence. But the forthcoming prosecution of Patel will be a reminder to all businesses of the potential consequences of non-compliance with the Act.
Businesses can be prosecuted for the Corporate Offence even where acts take place outside the UK and the business has no knowledge of it. Businesses can establish a defence if they can show they had "adequate procedures" in place to prevent bribery. Extensive guidance has been issued by the Ministry of Justice as to what this means in practice.
But how can HR departments play their part in preventing bribery and supporting an adequate procedures defence?
The first step is to undertake a review of potential bribery risks. There is no "one size fits all" approach - what is necessary for each business will vary. Risk assessments provide the starting point for developing anti-bribery procedures that are proportionate to the risks identified.
Policies and procedures
Having identified areas of risk, an anti-bribery policy should be drafted that reflects the nature of the business. Training will support the policy and ensure that employees understand their obligations. Cross references to the disciplinary policy should be included to highlight that a breach may constitute gross misconduct and result in summary dismissal.
These should require that employees adhere to the anti-bribery policy. Policies and contractual provisions should require reporting of suspicious acts, possibly supported by confidential reporting hotlines.
Managers can potentially be personally liable, and open the business up to liability, if they are complicit in the acts of employees or if they "turn a blind eye". Training is particularly important for senior managers to ensure they understand the requirements of the Act and buy in to the compliance regime. Managers may also be given training in how to identify potential signs of bribery when conducting annual appraisals or performance reviews.
Provisions may be included whereby discretionary bonuses or commission can be withheld pending investigation into suspicions of bribery.
Whilst there are no clear limits as to what is acceptable, businesses should ensure hospitality is reasonable and proportionate in all the circumstances. This will mean acting within industry norms and ensuring that hospitality does not suggest any attempt to influence business decisions of recipients improperly. Clear policies on gifts and hospitality combined with a register will inform as to industry norms and highlight suspicious patterns.
Agency workers, consultants and third party suppliers could all be "associated persons" for the purposes of the Corporate Offence and expose businesses to liability. Contracts with businesses supplying personnel should mirror obligations placed on employees and include appropriate summary termination and self reporting mechanisms. The supplied personnel/agents should also be aware of internal company procedures and receive appropriate training.
Co-operation with authorities and self-reporting are likely to influence decisions on whether to prosecute. HR may have a key role in reporting suspicious incidents to the business which may need to be reported to the authorities.
Anti-bribery actions should be kept under constant review and evolve with the changing risks. Reviewing implementation periodically to ensure that employees are aware of the structures and the "zero tolerance" approach will all assist in keeping the business compliant.
Although the HR team will not be solely responsible for anti-bribery compliance, it is clear from the points set out above that HR have a large part to play in both designing appropriate anti-bribery policies and ensuring these are upheld throughout the business.
Dan Aherne is a Partner and Libby Payne is an Associate in the Employment Group at Olswang LLP