Companies seeking to include compulsory transfer provisions in their articles stating that 'bad leavers' are to receive less than full value for their shares, should ensure they are drafted as primary obligations, and not therefore unenforceable as penalties.
Legal Alert - September 2018
A monthly checklist from Atom Content Marketing highlighting new and pending laws, regulations, codes of practice and rulings that could have an impact on your business.
Case law: Successful appeal means employee treated as having never been dismissed – but beware inadvertent constructive dismissal
Employers should treat an employee who successfully appeals a dismissal under its contractual disciplinary procedures as having always remained in employment. However, they should take care not to do (or fail to do) anything during the appeal that could be treated as grounds for the employee to resign and claim constructive dismissal.
Case law: Owner of trade mark 'LNDR' wins infringement claim against Nike for use of hashtag #LDNR on social media
Businesses considering using a hashtag on social media should ensure it is not identical or similar to an existing trade mark, or risk the trade mark owner taking legal action for infringement of the mark.
Case law: Settlement terms offered 'subject to approval by our board of directors' not legally binding
Businesses negotiating agreements should ensure that terms offered by the other party are not subject to a proviso requiring approval by the other party's board of directors, otherwise they risk the other side arguing they are not legally bound by those terms until the proviso is satisfied.
Case law: Court clarifies how parent companies can manage risk without becoming directly liable to employees of subsidiaries
UK parent companies should consider whether the balance they have set between top-down management of risk, and the delegation of responsibility for risk management to local entities in the group, inadvertently creates a duty of care to employees of their overseas subsidiaries, applying the tests set out in a recent Court of Appeal ruling.
Case law: Employers should consider part-time work for disabled employees returning from long-term sick leave
Employers deciding whether to dismiss a disabled employee who is on long-term sick leave should ensure they consider a part-time return to work, particularly where this is the advice of the employee's GP and/or other medical professionals. If they don't, they risk a disability discrimination claim, a recent ruling makes clear.
Spouses signing a pre-nuptial agreement should ensure they understand how the circumstances at the time it was made, and at the time of the divorce, could affect the extent to which it is upheld if they divorce. However, the longer the marriage, the harder it will be to predict the latter.
Businesses commissioning independent contractors to carry out work in a relationship 'akin to employment' - where their activities are closely connected to that quasi-employment - can be vicariously liable for wrongs committed by those contractors, particularly if the business controls the contractor's activities, a recent ruling makes clear.
Will-makers should ensure they keep their wills up-to-date if there are significant changes in circumstances, such as having illegitimate children, otherwise they risk expensive and upsetting claims against their estates.
Case law: Court gives guidance on interpretation of 'drag-along' rights in company shareholders' agreements
Company shareholders who agree to 'drag-along' clauses in a shareholder agreement that allow a shareholder's shares to be taken away from them in certain circumstances, should construe their obligations according to the usual rules for interpreting commercial agreements.
Disclaimer: These publications from Atom Content Marketing are for general guidance only, for businesses in the United Kingdom governed by the laws of England. Atom Content Marketing, expert contributors and ICAEW (as distributor) disclaim all liability for any errors or omissions.