· 2 min read · News

Getting ready for the Bribery Act


The Bribery Act 2010 comes into force in April 2011. The Act prohibits a number of offences, including paying bribes, receiving bribes and, controversially, failure of commercial organisations to prevent bribery. This last offence is likely to have a serious impact on HR professionals when it comes to internal governance.

The 2010 Bribery Act puts into place strict corporate liability, unless an organisation can show that it had 'adequate procedures' designed to prevent the bribery taking place. Businesses and HR professionals need to act now, before official guidance is released, taking the steps they need to be ready for the new legislation.

It is unlikely that this will constitute a separate anti-bribery procedure. Instead, provisions can be made elsewhere – and a whistleblowing policy might be a good place to start. While such a policy is not mandatory, most larger organisations already have one in place to cover a whole range of wrongdoing, criminal activity or general unlawful conduct within a business.

Its value comes from putting in place a mechanism for employees who have concerns to report in confidence to identified senior individuals, such as a non-executive director, head of governance or head of audit committee. This is often supported by an anti-victimisation policy to protect the whistleblower.

To satisfy the requirements of the Bribery Act, it is important to add bribery or corruption to any list of specified offences in the policy. This will help to demonstrate that the employer takes the area very seriously and has made provisions to facilitate reporting.

Improving employment contracts could be another way to protect your organisation against prosecution, by introducing a clause requiring employees to report bribes or, indeed, any other unlawful activity. Such a contractual requirement brings with it an interesting legal point – are employees required to bring to the attention of their employer their own wrongdoing?

In general, this will only be the case if individuals owe the organisation a fiduciary duty, for example, directors, whereas less senior staff members do not have such an obligation. This can arguably be rectified by making a specific provision in the contract that employees must disclose any concerns, whether in regard to other staff members, contractors or themselves. This should help to minimise the employer’s exposure to breaches of legislation.

Contracts can also work to discourage bribery by changing the way in which the business remunerates its employees. For example, in circumstances in which a person might receive a large bonus or commission for closing a specific deal, they may be more inclined to take a bribe that would "reward" them twice.

It is also important to ensure that the company’s disciplinary procedure captures bribery and corruption effectively. Most policies will give examples of gross misconduct – and bribery can easily be added, to demonstrate both that people will face severe consequences if they are found to have committed any offences, and that reasonable procedures are in place.

Training will be another key area where HR professionals can help to reduce the risk of prosecution under the Bribery Act. Simply by informing people about the law – particularly with regard to personal liability and the possibility of imprisonment – can act as a disincentive. Those most likely to find themselves in an illegal situation should also be advised on the best course of action should they find themselves in a position where they might be compromised.

At all stages, HR professionals should be assisting management to ensure that they have adequate procedures that prevent employees committing an offence, and in the event that an offence is committed, that show that employers should be relieved from liability.

Ashley Norman is an employment partner at employment law solicitors Cobbetts