Newsletter - February 2010
LawWorks for Community Groups
Welcome to the LawWorks for Community Groups newsletter featuring legal articles which may be of interest to small charities, community groups and social enterprises who have contacted us in the past. We aim to keep you updated on key legal developments affecting the charitable sector so that you can apply them to your own groups and obtain more legal knowledge. We hope you find the newsletter useful and interesting – please let us know if you have any feedback or suggestions!
Don't forget to have a look at our fact sheets for useful information on various areas of law. Our latest include updated information on corporate structures, taking into account the provisions of the Companies Act 2006, CRB checks and Safeguarding Vulnerable Groups legislation.
Best wishes,
Ruth Thompson (Newsletter Editor)
In this issue:
Free answers to brief legal questions: LawWorks Initial Electronic Advice
Right to request time to train
Government confirms £500,000 fines for worst data protection offenders
No tax penalties for temporary public benefit failure
Lawyers criticise Charity Commission's decision on gnostics
Employment law developments for 2010
Providing and using references
Payment cap lifted for community interest companies
Free answers to brief legal questions: LawWorks Initial Electronic Advice
Initial Electronic Advice is an automated, web-based system, which allows us to submit a short legal query and have this answered by a lawyer via email. Not for profit organisations and advice agencies can register online to submit questions for entry into the system.
The main legal areas we cover are: advertising, banking, building and construction, charity, clinical negligence, commercial, company, competition, construction, consumer, consumer credit, contract, corporate, costs, crime, debt, education, employment, energy, environment, EU, family, general litigation, health and safety, housing, immigration, insolvency, insurance, intellectual property, IT, landlord and tenant, mental health, mortgages, data protection, finance, insurance, pensions, personal injury, planning, property, public law, small claims, tax, telecoms, trust, welfare, wills and probate.
If you would like to register to submit questions, please see www.lawworksiea.org.uk, where you can also see more information on the service itself.
The LawWorks Choices project was established in July 2009 as a response to the recession, and the high numbers of solicitors being made redundant. Choices enables qualified volunteer solicitors to take part in pro bono work whilst they are seeking permanent employment. The Choices members are able to assist groups with legal advice, such as lease agreements, terms and conditions for competitions, employment issues, and many more. The volunteers are also able to produce factsheets on a legal topic for your organisation.
If you would like the assistance of a Choices volunteer, please contact Lorna Heselton at lh@lawworks.org.uk so that we may discuss your requirements.
Guardian Charities and the Law Series: Charities and Property / Procurement, Contracts and Grants
Lesley Robinson, Guardian.co.uk , Tuesday 5 January 2010 (Property)
Julian Blake and Philippa Hart, Guardian.co.uk , Wednesday 27 January 2010 (Procurements, Contracts and Grants)
Latest in the Guardian's useful series on legal issues for charities are a round up of property law issues, and an article on issues relating to procurements, contracts and grants.
Full article (Procurements, Contracts and Grants)
Right to request time to train
VolResource, 22 Jan 2010
The right for employees to request time to train comes into effect from 6th April 2010 for organisations with 250 or more employees, and from 6th April 2011 elsewhere. The government has published a guide for employers explaining what this entails, available on the Business Link website.
Government confirms £500,000 fines for worst data protection offenders
OUT-LAW News, 12 Jan 2010
Organisations responsible for major breaches of personal information security will face fines up to £500,000 from 6th April this year. The long-awaited penalties for serious data protection breaches have been approved by the Government.
"The Information Commissioner's Office (ICO) will be able to order organisations to pay up to £500,000 as a penalty for serious breaches of the Data Protection Act," said an ICO statement.
No tax penalties for temporary public benefit failure
Civil Society Finance, Tania Mason, 12 Jan 2010
HMRC has decided that those charities that are deemed by the Charity Commission not to be meeting the public benefit test when they are assessed, but who reorganise themselves and eventually make the grade, will not lose their tax reliefs for the period they were deemed to be failing.
Julian Smith, partner at Farrer & Co, raised the issue with the Charity Commission early last year, concerned that a judgement by the Commission that a charity is not providing public benefit could have tax implications.
Lawyers criticise Charity Commission's decision on gnostics
Paul Jump, Third Sector, 26 January 2010
The Charity Commission's rejection of the Gnostic Centre's application for charitable registration is "begging" to be appealed to the charity tribunal, according to charity lawyer Rosamund McCarthy.
An internal commission review decided that gnosticism did not meet the legal definition of a religion because it did not promote "a positive, beneficial, moral or ethical framework" .
But McCarthy, a partner at Bates Wells & Braithwaite, said the case law the commission was obliged to draw on was "absurd" and needed to be tested legally. She said it was also possible that the commission had breached the Human Rights Act, which requires religions and other moral belief systems to be treated equally.
Full article
Employment law developments for 2010
VolResource, 7 Jan 2010
People Management magazine (connected with CIPD) has a round-up of key employment law developments for the new year . These include equality legislation, case law on age discrimination and the 'fit note' arrangements.
Providing and using references
VolResource, 14 Jan 2010
Personnel professionals body CIPD has updated its factsheet on References. It gives basic guidance on the risks in providing references and how to manage them plus key legal aspects of providing and using references.
Payment cap lifted for community interest companies
David Ainsworth, Third Sector Online, 6 January 2010
CIC regulator responds to consultation by lifting limits on amounts that can be distributed to investors.
The Regulator of Community Interest Companies has decided to raise the limits on payments they can make to investors. CIC regulator Sara Burgess announced today that she would raise the dividend cap to 20 per cent of each share and the loan interest cap to 10 per cent of the value of the loan.
The dividend cap was previously five percentage points above the Bank of England base rate, while the interest cap was four percentage points above the base rate. A consultation last year showed that most social investors thought the caps were too low.
The total proportion of profits a CIC can distribute will remain unchanged at 35 per cent.
The regulator's response said: "In broad terms, the responses to the regulator's consultation indicated that the maximum dividend rate per share was too low given the level of risk. The 1 per cent differential between debt and equity finance may not give adequate incentive to investors to make an equity investment; and the interest and dividend-per-share caps were too complex."
Burgess said she would review the changes in two or three years to find out how effective they were.
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