Care costs & the elderly

Saga warns on care costs for the elderly

First, the good news. A report is due to be published tomorrow, commissioned by the Government, which is likely to recommend that the considerable stress, anger and anxiety currently felt by the elderly about their homes being sold to pay for long term care costs should be somewhat allayed, with a cap on the amount they can be asked to pay. This cap is likely top be suggested at perhaps around £50,000.00.

The bad news is that if this is the recommendation, it could cost over £2 billion annually in the short term and much more in the long term as the population lives longer and it is likely the government may baulk at the cost. The other issue is that any family law changes are likely to be delayed until 2014, which will not help some 250,000 families in the short term, with costs for residential care being generally upwards of £25,000.00 per annum.

Apparently, at the moment 1 in 5 elderly people in care spend over £100,000.00 on care costs.

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Who are New id ?

New id are a top interior design company based in London with an excellent reputation not only for super interior designers but also in providing excellent service. Based on it’s ongoing success, the business also has 2 specialist divisions, one for flooring, including carpets, laminates and commercial flooring and another for providing furniture packs. These guys are excellent to deal with, why not get in touch with them….

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Debt buying, selling & Madoff

Money to be made from Madoff ?

Particularly in the current economic climate and as is always the case, there is a bull markey somewhere. That bull market can arise from negatives rather than positives and this is a case in point.

Few people will be unaware of the biggest financial scandal of modern times, the Madoff fraud. As matters have unraveled and asset tracing has had time to reap rewards, a proportion of the funds fraudulently obtained by Madoff are being collected and work continues to lay claim to other amounts. This of course will only ever be a fraction of the huge total lost, but one aspect also now coming to the fore is debt trading relating to Madoff.

Some banks and financial institutions, apparently on behalf of clients, are starting to look at buying the debts owed to other institutions by Madoff, on the basis they will pay a small percentage of the value of the debt and then seek to collect, hopefully a much bigger percentage by way of any ultimate payout  to creditors.

Among those banks understood to be buying such debt from other creditors are Royal Bank of Scotland and UBS.

The amount payable for debt can vary widely from as low as less than 10% with very risky unsecured debt for consumers to as high as 70% of the debt where there are reasonable prospects of recovery and the payor is financially quite sound. Apparently, Madoff related debt has fluctuated at somewhere between 30-70%.

For bespoke debt sale, debt purchase and debt recovery, Bluestone ARM is an up-and-coming niche player in this market, which has a highly individual approach to individual, hard to recover debts.

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Internet and email policy for employees

What should an email and internet use policy include ?

  • clear standards for conduct and performance.
  • provide examples of appropriate and inappropriate use of electronic communications
  • types of internet sites which should not be visited (including pornographic or obscene sites and sites which might be illegal for other reasons as well as sites which might be a source of viruses, such as webmail services);
  • a clear policy on blogging or message rooms making it clear that there may be legal implications of commenting or issues likely to bring the employer into disrepute;
  • clear rules and procedures for downloading software, generally this should not take place  without the approval of the IT department
  • a prohibition on distributing chain e-mails or jokes
  • a warning regarding forwarding of copyright information obtained from the internet;
  • advice on house e-mail style; and
  • a reminder that the content of e-mails must not breach equal opportunities, anti-harassment policies or be defamatory.
  • Make it clear that inappropriate use of email and the internet and electronic communications policy generally will be dealt with under the disciplinary procedure.
  • Provide a warning that e-mails can be used as evidence in court proceedings.
  • Provide a warning that e-mails can be forwarded easily and should not be treated as confidential (any confidential information should be encrypted).
  • State that the employer’s standard disclaimer must be used at all times.
  • State rules for private use of office equipment when used away from the workplace or the employee’s home.
  • Provide a warning that attachments to e-mail should be sent to the IT department for opening if from an unknown source.
  • Provide guidance on passwords, any specific security guidelines and advice on excessive processing.
  • State whether personal use of office computers is permitted and if so, what level and at what times personal use is acceptable.
  • State the employer’s retention and deletion policy (and deal with any overlap with hard copy policy).
  • cover the use of office telephones, mobile telephones, laptops, blackberries and similar devices and PDAs, and include guidance on blogging, social networking sites and “twitter”.

The policy should also be communicated clearly by:

  • Being supplied to employees at the beginning of their employment.
  • Regular reminders and updates on the policy.
  • Insisting that employees read the policy and confirm this and accept the term of the policy formally.

It is imperative that the policy is applied consistently and fairly to avoid claims for unfair dismissal and discrimination.

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Pre-emption rights

What are pre-emption rights ?

Pre-emption rights are the priority rights shareholders may have to participate in new issues of shares in priority to those shares being offered offered to non-shareholders.

The most common entitlements for pre-emption are a pro rata right for existing shareholdings but subject to the number of shares taken up by the other shareholders. A key point is that pre-emption rights ensure that all existing shareholders have an opportunity to prevent their stake being diluted by new issues.

Shareholders do not have to take up their pre-emption rights and often refuse where the new shares on offer are perceived to be too expensive.

Pre-emption rights do not apply to the sale of treasury shares (which were introduced by the 2006 Companies Act) because transactions in treasury shares may not lead to dilution of holdings

The default position under company law now is for private limited companies under The Companies Act 2006 (CA) is that a company proposing to allot new shares may not allot them for cash unless they have previously offered them on the same or more favourable terms to the other shareholders. These pre-emption rights can be disapplied but a procedure needs to be followed and remember that this default right relates to the issue of new shares and not the situation where for example, an existing shareholder wants to sell his, her, their existing shares.

Relevant shares mean all the shares in the company except:

•          Shares of a different class, e.g a proposed allotment of Ordinary Shares will not trigger pre-emption rights in Preference shareholders

•          Shares allotted (or to be allotted) under an employees’ share scheme

Disapplication of pre-emption rights

A company can disapply the pre-emption rights of existing shareholders in relation to either a specified allotment or to allotments generally by passing a special resolution of the members in general meeting. The resolution must be proposed to the members, with sufficient notice, by the directors who must give reasons for their recommendation, the price for the shares being allotted and the directors’ reasons for determining that price

It is unusual for a company by way of a general meeting to disapply pre-emption rights in relation to specific allotments of shares. Instead, it is more usual for company directors to be granted general authority to allot shares. A company can, under company law, overrule the provisions of the Companies Act detailed above. However, it is vital that any decision to disapply is be contained in the articles of association of the company or clearly and specifically authorised by way of a special resolution, failing which shareholders rightsmay be breached and the directors could find themselves possibly liable.

Stock Exchange requirements relating to pre-emption rights

A listed company intending to issue shares must comply with specific rules  on pre-emption. For more information on this, commercial law solicitors should really be consulted as the rules are technical.

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Massive injection of funds by central banks

Three trillion pounds has been pumped into world financial system !

The astonishing figure of £3 trillion is the estimated amount pumped into the world economy during the economic crisis by the world’s 4 major central banks. Economists and lawyers have speculated that this sum, rather than a genuine recovery, is what is keeping stock markets stable and avoiding further seismic economic problems, but for how long can this be sustained ?

Measures which have been implemented include central banks  buying up bonds to keep  money circulating. Further cause for ongoing concern perhaps ?

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Child abuse and neglect – depressing figures

Child abuse – depressing figures

Calls to the NSPCC Helpline reporting suspected child abuse and neglect have reached record levels, the children charity has disclosed.

  • In 2010/11 NSPCC counsellors referred over 16,000 serious cases to police or social services, a 37% increase on the previous year and the biggest annual increase in referrals recorded.
  • 46% of reported concerns so serious they had to be passed on to the authorities – a huge increase of 39% from the previous year.
  • NSPCC research suggests nearly 1 in 5 secondary school children in the UK has been severely neglected during childhood, with figures up 81% to 6,438 cases, followed by some 4,100 cases of reported physical abuse, just over 1,500 cases of sexual abuse and 2,932 cases of emotional abuse.

These figures clearly reflect societal change, the breakdown of family law and extended families and the pressure on parents financially. There would appear to be no short term fixes for reform of legal services and the worry is that these figures are perhaps strongly indicative of a country or society underlying “health” and the signs are not positive. What do you think ?

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Vicarious liability – what is it ?

An employer is responsible for the behaviour of its employees while conducting business for the employer. As such, the employer is legally entitled to expect a minimum standard of behaviour from its employees. Where this standard is not met, this may lead to grounds for disciplinary proceedings against the employee. Disciplinary proceedings in employment law may also come about as a result of the employee failing to come up to a required standard of work or by him / her being regularly absent from or late for work. Where disciplinary measures are to be undertaken against an employee, there are particular legal formats that must be adhered to by the employer.

Lack of knowledge of the law is no defence in the legal system, however this does not extend to employment law. It is the employer’s responsibility to ensure that all of its employees are aware of the disciplinary processes it follows. Failure to do so will invalidate any disciplinary processes that the business attempts to enforce, because those particular contractual terms are unknown to the employee and are therefore technically outside the contract of employment. In basic terms, the employee should be provided with an employee handbook wherein a section listing disciplinary measures and the employee’s right to appeal is clearly stated. Alternatively, access to a shared public drive on the business intranet would be an acceptable means of communicating the disciplinary and grievance procedure to the employee, providing that the employer has communicated knowledge of the whereabouts and contents to the employee. Many employers use an employee induction day to ensure this ground is always covered with new staff. Any updates to company policy and procedures should equally be communicated to all existing employees to ensure their awareness of change.

The disciplinary policies and procedures alter slightly from one business to the next, however there are certain prerequisites that must be included to make those policies and procedures valid. Communication has already been considered above. Besides communication is the fact that the policy must be in writing and they must be written clearly and intelligibly. A vital piece of information to be provided to each employee regards the person to whom they have the right to appeal if they are subsequently disciplined and wish to appeal against such measures. Failure to provide an employee with any of this basic information may lead to an award being made to the employee based on between two and four weeks’ pay in the event of any future tribunal hearings against that employee.

Where the discipline is on the grounds of gross negligence or gross misconduct, such as fighting or operating machinery while inebriated, the disciplinary process can leap to the final stages of the normal procedure. This does not mean that the employee can be ‘sacked on the spot’. The individual concerned is still legally entitled to an investigation and a hearing where they may put forward their side of the situation, including any mitigating circumstances. In such cases as these, the individual is usually suspended on full pay pending an investigation and hearing and should receive fair and due written notice as to when these hearings are scheduled to take place, where the hearing is to take place and who will be conducting / present at the hearing. The individual must also be informed in writing before the hearing that they have the right to legal representation at the meeting. The representation may be from a union official or work colleague. The employee is not, however, entitled to bring in anyone from outside the business to represent him unless that person is union affiliated.

Disciplinary proceedings that are to be undertaken for any other incidence than for gross negligence or gross misconduct, such as poor time keeping or sub-standard work, must follow the company’s disciplinary procedures as stated in the employee handbook or contract. These tend to follow a similar format, which is a verbal warning, followed by a first written warning and a final written warning. A verbal waning should be recorded in writing to commence an evidentiary trail, as should any minutes taken of any later written warnings. At each stage, the employee should be reminded of their right to appeal against the warning; courtesy alone dictates that the employee is reminded where to find these terms of appeal and who their appropriate line manager is. There is a legal time period after which any warning given to an employee expires, although it is normally stated in either the employee handbook or disciplinary policies. Similarly, an employee only has a limited amount of time in which to lodge an appeal, usually seven working days where reasonably practicable.

Vicarious liability will also apply to personal injury claims as well as employment law issues.

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Losing a Job – unfair dismissal ? Remedies ?

It is very traumatic for an employee to lose his job, especially when a family or other dependents rely on the income. As the effects of the economic downturn have been felt across the country, issues of redundancies and job losses have been a regular feature in the headlines in the news together with reports of increasing unemployment. Added to this trauma, if the employee feels as if the employer was not acting appropriately in ending his employment, what can be done? Are there any legally remedies for the employee to take the matter up with his employer?

In order for an employee to make a case against his former employer for unfair dismissal, it is important to make sure that certain criteria are fulfilled so that the employee could be entitled to make a claim. Although it may be clear to the employee that he has lost his job, he has to make sure that the termination of his employment qualifies as appropriate ‘dismissal’ according to the legal tests. For example, the employee would not be entitled to claim ‘dismissal’ if he resigns from his position or leaves by agreement with his boss. In brief, an employee is only entitled to claim he has been dismissed if either the employer terminates his contract (with or without notice), the fixed term of employment comes to an end without being renewed or an employee is ‘constructively dismissed’. This last case of ‘constructive dismissal’ means that the employer’s conduct amounts to a serious breach of the employment contract, leading to the employee leaving the job because of it (for example, the boss decides to reduce wages without the employees agreement and the employee subsequently walks out).

Although some cases will fit easily into these categories, it is worth checking with an employment lawyer whether the case qualifies, as sometimes the situation is not always as clear-cut as it may appear. For instance, if circumstances change so that an employee can no longer work for his boss, this may not amount to dismissal. On the other hand, resignation may sometimes be seen to be dismissal if the employee resigns as a result of a constructive dismissal (see above).

Another criterion that must be fulfilled to qualify for unfair dismissal claims is whether the employee is eligible to claim. Some categories of workers, such as independent contractors or freelance agents are not seen as employees for these purposes in the eyes of the law. Also, employees who are obliged to retire at the normal retirement age are unlikely to be seen as unfairly dismissed provided the employer has behaved correctly. As a general rule, the employee must have worked for the employer for a minimum of a year to claim unfair dismissal (however, there are exceptions to this rule).

Next it is necessary to consider the reasons for the dismissal. This is important because sometimes the reason means the dismissal is automatically unfair, such as if the employee is taking action over a health and safety issue, or a new owner takes over the business, or the employee is pregnant. Importantly, in some of these cases the employee does not have to have worked for the employer for a year to qualify for automatic unfair dismissal. If the reason for the dismissal is not ‘automatically’ seen as unfair, however, it is necessary to assess the reasons for the dismissal and the procedure which the employer has followed in order to work out whether the employee could make a successful claim for unfair dismissal. It is usually necessary for the employee to bring a claim within a three month period from the date of dismissal to take the matter to an employment tribunal. If an employee believes there has been some form of discrimination, such as on grounds of age, disability, gender or race, a claim for discrimination can be brought at the same time as a claim for unfair dismissal.

What is the procedure that the employer should follow when dismissing employees? The answer depends on when the employee was dismissed and so it is recommended that legal advice is sought for further details of the various obligations on the employer. For example, after 6 April 2009, an employer taking disciplinary action or dismissing employees is advised to follow the Acas Code of Practice on disciplinary and grievance procedures to avoid paying more compensation in a successful claim.

Before making a claim for unfair dismissal, it would be advisable for the employee to consider the likely level of compensation available. Compensation usually comprises a basic award and a compensatory award. A basic award is calculated by looking at the time of service of the employee and the level of pay – a maximum basic award would be £12,000 for a termination from 1 February 2011. The compensatory award relates to loss of earnings (including other employment benefits) and can be substantially higher.

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