The Bribery Act 2010
The Bribery Act 2010 came into force on 01 July 2011. It
has far reaching implications in every business sector, but here we
look its principles and an area of concern applicable to the
recruitment industry.
The Act sets out certain areas where a bribery offence can occur
and that these can be penalised with fines and imprisonment of up
to 10 years. In application to the recruitment sector it is
alarming that end clients and their staff can be liable for bribery
actions by companies lower down the supply chain. It should
also be noted that HMRC are an end user of temps in the recruitment
sector (through their suppliers) and so should be as concerned as
any other corporate entity that they have adequately addressed the
legislation.
Under the Bribery Act it is an offence:
- To offer or receive a bribe
- To not prevent a bribe being paid
- To fail to put into place procedures to prevent a bribe being
paid
Under the Act, the definition of a bribe is very wide and
basically ensures it is an offence to reward another party to
encourage them to "improperly" or "impartially" carry out their
work.
There are six principles on good corporate behaviour in the
guidance document accompanying the Bribery Act 2010, which are set
out to help companies and individuals adopt and understand the
legislation. These principles with brief explanations are:
- Proportionate Procedures
Whilst it is understood that good procedures can never completely
eradicate bribery, a company needs sufficient processes in place so
as to police bribery, without over tying themselves up in
knots
- Top - level commitment
The implementation of good procedures and training must start
at the very top of a company and be directed down the chain through
the staff and to suppliers.
- Risk Assessment
A company should identify areas of bribery risk and focus its
anti-bribery activity in those areas including a review of sector
risk, transaction type risk and business partner risk.
- Due Diligence
Organisations should have due diligence procedures in place
to ensure application of these principles
- Communication
Directives and training to employees must be in place as must
directives and questionnaires to suppliers requesting they have
anti-bribery procedures in place as do suppliers of theirs!
- Monitoring and Review
Organisations should monitor and evaluate the effectives of
their bribery prevention procedures and adapt them where
necessary.
How does this affect the recruitment
industry?
It can quickly be seen how the top end of the recruitment
industry chain can be affected by actions of staffing, outsourcing
and umbrella companies. If there are inducements being
provided lower down the chain then the end client should be aware
of these and take appropriate actions.
It has been prevalent in staffing companies to accept financial
or system rewards from payroll (umbrella and accounting) companies
in return for the introduction of business. That in itself is
likely to fall outside of the scope of the Act as long as the
introduction would have occurred regardless of the settlement of a
fee or provision of software.
In circumstances where the fee or software is demanded by the
staffing company as a condition of the introduction (often in an
exclusive relationship) then it is likely that it will fall within
the description of a bribe under the Act. This will be
further emphasised if the worker suffers in order to reward the
party taking the money ….and beware the end client who has without
knowledge engaged that worker!
Fortunately the legislation specifically excludes corporate
entertainment as being a bribe, as long as it was not used to
generate the business relationship. If it is a simply part of
the process of getting to know your client and ensuring you get the
best out of the relationship by taking them to Wimbledon or the
Grand Prix, then the official guidance to the Bribery Act allows
for that.