Newsletter - May 2016

This issue looks at:

  • Security and commercial contracts.
  • The National Minimum Wage
  • Dress Codes at work

Security Risks


In 2018, the General Data Protection Regulations (GDPR) will come into force. One of the effects is that if there is a breach of data security, the data controller and the data processer will both be legally responsible for the lack of security compliance. This is not the position at the moment. For example if we look at the TalkTalk breach, only the data controller would be liable for any fall out.

Under the new rules, the parties are obliged to be proactive in terms of notifying the Information Commissioner of any significant breach. The data subjects will also have to be notified of the breach.

The GDPR makes clear that if there is a breach, the data subject has the right to claim compensation. In the future there will be a lot of focus on this aspect of the regulation as clients seek compensation.

When looking at contracts between data controller customers and data processors. The controller will want contracts that have unlimited liability clauses and uncapped indemnities. This is unrealistic and data processors may decide to pull out of the market; rather than being exposed to such risks.

Instead the parties should consider focusing on:-

1.       Agree the technology  and procedures to be in place to keep data secure; and

2.       Ensure that the system is tested frequently to avoid breaches;

3.       Review security risks from time to time as threats do evolve.

4.       Have the contract specify what happens when there is a security breach.

5.       Negotiate the extent of liability and indemnity to be provided.

6.       Putting insurance in place.

The above would be beneficial to all as a contract that focuses purely on liability and indemnity is of no use where there is a massive security breach and the company simply folds. A likely event for smaller firms with significant breaches.

National Minimum Wage

On 1 April 2016, the national minimum wage became law. Thus for anyone over the age of 25, an employer will have to pay £7.20 per hour.

The national minimum wage will be paid in accordance with an employer’s work reference period. Thus if you pay your staff on the 28 day of the month, the national minimum wage for your company will need to be paid on the 28 day.

It therefore stands to reason that if an employee is 24, he will not get the minimum wage until the first pay date after his 25 birthday.

The average employee will receive an additional increase in income of approximately £1,000 as a result of the new minimum wage. This may lead some employers to try and restrict their work force to the under 25. Attempts may be made to do this contractually or a simply refusal to accept older workers for the position on offer after an interview; even though they are the right person for the job.

The law is clear, age discrimination is prohibited under the Equality Act 2010 and care should be taken as the savvier employee (or prospective employee) may bring a claim. If for example you had a contract terminating employment at 24 ½, then such an employee can bring a potential claim for automatic unfair dismissal (no need to establish 2 years employment) and a claim for age discrimination. Remember in discrimination claims there is no limit to liability.


Wearing High Heels

Price Waterhouse Cooper (PwC) were in the lime light when a young actress, Ms Nicola Thorp who was employed as a temp was sent home without pay because she refused to wear high heels all day in her day job as a receptionist job.

The young lady was sent home and fought back by creating a petition requesting parliament should make it illegal to force women to wear high heels at work.

Heels at work

 PwC have been quick to point out that this is not written in the firm’s dress code. This aspect of the dress code was in the policy of the temp agency.

So long as it is reasonable, employers can define acceptable staff wear in the workplace. Whereas in the 1960’s it might have been reasonable to expect women to wear high heels all day; in 2016, there is the real risk that such behaviour would be deemed sex discrimination under the Equalities Act 2010. No one should be surprised to learn that the temp agency that employed Ms Thorp has immediately changed its work dress code policy as a result of a discussion with PwC. Ms Thorp is free to work wearing her pumps.

 When I last looked at Ms Thorp’s petition, approximately 63,000 people had signed it. I believe she needs to get to 100,000.

A constant source of amusement with this petition is its potential impact on the fashion industry and the ‘catwalk’. No doubt they will argue the shoes are worn only short term and are essential for this particular the job.



This article is not intended to constitute legal advice, if assistance and advise on the legal topic covered is required, please do not hesitate to contact Johanna Cargill by completing the contact form which can be found here