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COMP3219 > Week 6 > Flashcards

Week 6 Flashcards

1
Q

Unincorporated Business

A

No separate legal entity from participants
Sole trader
Partnership

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2
Q

Incorporated Business

A

Legal entity in its own right
Private limited company
Public limited company
Limited Liability Partnership

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3
Q

Sole trader

A

No distinction between business and individual
Entitled to keep all profits after tax
Unlimited and personal liability

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4
Q

Sole trader formation

A

No formal regulatory requirements
Register with HMRC
Can run the business however they wish

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5
Q

Sole trader business ending

A

Ensure no debts/unpaid tax
Notify HMRC
Bankruptcy procedures start if they can’t pay their debits

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6
Q

Partnership

A

Two or more persons come together and act in common to form a business with a view to profit

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7
Q

Partnership debts

A

Partners are jointly and severally liable for debts/torts
Firms creditors can take action against any partner
Liability shared equally based on their percentage of ownership

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8
Q

4 types of partner

A

Typical
Salaried
Silent
By estoppel

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9
Q

Typical partner

A

Has right to take part in management

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10
Q

Salaried partner

A

Paid, on letterhead, no rights/role

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11
Q

Silent partner

A

Invests money, no role in management

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12
Q

Partner by estoppel

A

Appear as partners, no participation

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13
Q

One partner can satisfy a debt but others cannot

A

That partner is responsible for the full debt, they can then seek the money owed from any defaulting partners

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14
Q

Partnership creation/dissolution

Partnership liability

A

Liability cannot be imposed on a partner for acts that occurred before they entered the partnership
Partnerships created with a partnership agreement
Liability continues even when a partner has left the partnership for acts conducted whilst a partner
Dissolved via agreement/lapse of time etc
Partnership liable for one partner committing a tort or crime in the course of business (actual or apparent authority)

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15
Q

Limited Liability Partnership

A

Separate legal entity
Contracts formed with LLP, not partners
Properties owned by LLP
LLP has unlimited liability

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16
Q

LLP dissolution

A

LLPs continue until wound up/dismissed, even if their internal membership changes
Wound up through the application by the majority of its members (other conditions)
Wound up through their insolvency

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17
Q

LLP Limited meaning

A

Individual partners are liable only up to their investment

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18
Q

LLP creation

A

Filing documents with the companies house, allowing them to start trading (Incorporation document and a statement of compliance)
Issued with a certificate of incorporation

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19
Q

Limited companies

A

Assets/Revenues are separate from the owner’s.

Can be private or public

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20
Q

Limited companies dissolution

A

Remain in existence until wound up
Can be wound up by applying to be struck from the register, or liquidation (voluntary or involuntary for insolvent companies)

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21
Q

Limited companies, limited meaning

A

Companies Act 2006
Company itself has unlimited liability
Shareholders do not have unlimited liability unless the company has insufficient assets. In this case, they are liable up to their share value or guaranteed sum

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22
Q

Limited company formation

A

Established through royal charter, statute and registration (with the companies house)
Need to write a memorandum of association (specifies private or public), articles of association and complete form IN01
Get a certificate and an entry in the Gazette

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23
Q

Illegal actions in limited companies

A

Limited companies can commit criminal offences/torts. Directors can be convicted for their actions.

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24
Q

Private Company

A

Ends with Ltd or limited
Prohibited from offering its shares to the public
Not required to have a secretary
No need for AGM
No minimum share capital
1 director required
Pass written resolutions without a meeting

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25
Public company
End with Public limited company or PLC Entitled to offer its shares and debentures for sale to the public May be listed on the London Stock Exchange Requires a secretary Must hold annual AGM Allotted share capital of £50000 (one quarter of the value of which must have been paid upon allocation) 2 directors required Cannot pass written resolutions without a meeting
26
Definition of an agent
An agent has the right to facilitate contracts between the principal and other third parties Contracts formed are not binding on the agent
27
Agent duties
Act in the best interests of their principal (Fiduciary duty) Avoid conflicts of interest/No profit rule Refrain from disclosing confidential information Obey lawful instructions Perform them personally with care and diligence Maintain proper accounts Delegation allowed if agreed with principal
28
3 main agent rights
Indemnity Payment Maintain the Goods
29
5 methods for the creation of an agency relationship
Express appointment (Actual authority) Implied appointment (Implied authority) Impression of representation (Apparent authority) Authority through ratification Situation of emergency (Authority through necessity)
30
Express appointment (actual authority)
Established via contract/express agreement outlining the extent of authority the agent has
31
Implied Appointment
Inferred when agent, by word or conduct, acts as if they have such authority and principal acknowledges they were entitled to act as such
32
Impression of representation (Apparent authority)
Principal has represented to the third party that the agent has the authority to act on their behalf Must have been a representation which is then conveyed by the principal which the third party then acts on
33
Authority through ratification
Agent exceeds their authority and principal accepts any negotiated contract. (Person who has no authority acted as if they had the authority) Only valid if given in reasonable time, principal exists at time of contracting, third party aware of principal existence and agent acts on their behalf and principal has the capacity to contract Ratification may be expressed or implied
34
Situation of Emergency (Authority through necessity)
One party acts on behalf of another during emergency situations Court can bind principal in actions of agent if not possible for agent to discuss issue with principal, agent acted in good faith, action was necessary to prevent loss or damage to principal
35
Indemnity
Protection against liability or costs incurred in their duties, unless agreed otherwise or if they exceeded their authority
36
Payment (Agent right)
Result of express agreement between the parties (rate and frequency) or implied by their conduct/circumstances
37
Maintain the goods
If principal is indebted to the agent, they have the right to maintain control over goods related to it until said debt is cleared
38
Agent commits a wrongful act
Agent is personally liable and must pay damages Principal may also be jointly and severally liable provided there is a sufficiently close connection Wrongful conduct can fairly/properly be regarded as being done by the agent in the ordinary course of the principal's business (vicarious liability) Deep pocket theory
39
Agent has not identified the existence of a principal to the third party
Agreed contracts are between the agent and the third party Undisclosed principal may assume obligations, not if the third party wouldn't have agreed knowing they were the principal, or if third party was denied the identity of the principal or the agent lied
40
Agent can be terminated
``` Agreement Expiry Accomplishment Alteration of purpose Bankruptcy Death Illegality ```
41
Employment Law
Regulates conduct between an employer and their employee
42
Labour law
Regulates conduct between unions and employers (collective agreements)
43
Contracts of employment requirements
``` Unconditional offer Unconditional acceptance Intention to form a legal agreement Consideration Certainty If a job is subject to constraints, they must be met before the offer is made Doesn't have to be in writing ```
44
Express terms
Written into contract/statement of terms, incorporated from collective agreements or from work handbooks Prevail over implied terms
45
Written statement of terms must:
Be given to the employee within 2 months of the employee starting Contain: Name of persons, starting date, renumeration, pension scheme, notice period, place of work, T&Cs for sick pay/holidays
46
Implied duties owed by employers
``` Pay Provide work Indemnify Safety/duty of care Mutual trust and confidence ```
47
Implied duties of the employee
``` Duty of mutual trust and confidence Ready and willing to work Reasonable skill and care Obey lawful orders Take care of the employer's property Act in good faith ```
48
Comparison of employees, workers and independent contractors
Employee (full rights, unfair dismissal rights, minimum notice periods, flexible working, redundancy payments et al.) Often qualifying periods of employment needed Worker (some rights) Independent contractor (no rights)
49
Differentiating between employee and independent contractor
Employee: Someone under a contract of employment | Independent contractor: Someone under a contract for service
50
4 parts of common law multifactorical test to see if you're an employee
Control test Integration test Economic reality test Mutuality of obligations test
51
Control test
Who is the master and who is the servant? | Have they set hours of work?
52
Integration test
The more integrated within the business one is, the more they're an employee
53
Economic reality test
Who is assuming the financial risk? If the person is taking on the risk, they're more likely to be an independent contractor
54
Mutuality of obligations test
Is there an obligation for the employer to pay and provide work and for the employee to work
55
Lawful dismissal
Reasonable notice Summary dismissal for cause without notice Non-renewal of a fixed-term contract
56
Wrongful dismissal
Claim for damage by an employee if the employer breached a term (substantive or procedural) when dismissing the employee, causing loss
57
Unfair dismissal
Employer acts unfairly without good reason Is claimant entitled to take a case (BoP Employee) Main dismissal reason lawful? (BoP Employer) Automatically unfair, automatically fair, potentially unfair If potentially unfair, did the employer hande the dismissal in a reasonable way? (BoP neutral)
58
Termination of the contract of employment
Lawful dismissal Wrongful dismissal Unfair dismissal Redundancy
59
At least a worker to get
``` Minimum wage Paid holiday Rest breaks Limits on maximum working time per week Statutory sick/parental leave pay ```
60
Redundancy causes
Business/workplace closure | Reduced requirement of employees
61
Statutory redundancy protection
Compensation for the loss of the job to an employee dismissed by reason of redundancy Employer must apply proper and fair redundancy procedures (pools, selection criteria, consultation) Employer must inform employees that they are being made redundant, payment of wage and contractual benefit for period of notice of termination
62
Who does the equality act apply to?
Those who are employed to do work/applying to do work | Requires contract, mutuality of obligation, personal service as dominant purpose and subordination
63
Protected characteristics under the equality act
Age, disability, gender, sexuality, race, pregnancy, religion etc
64
Age and ability discrimination excluded from?
Armed forces
65
Who shouldn't discriminate?
Employers Employees/workers/employed persons Vocational training providers Trade unions and employer's associations
66
What does the equality act cover?
``` Recruitment Employment relation & terms of employment Access to training/other opportunities Dismissal/other detriments After dismissal ```
67
Prohibited conduct
``` Direct discrimination Direct discrimination by association Direct discrimination by perception Indirect discrimination Harassment Victimisation ```
68
Direct discrimination
Treat a person less favourably because of a protected characteristic. Discriminator can also have characteristic Exceptions include occupational requirements (Proportionate means of meeting a legitimate aim) Comparison -> Adverse effect -> Causative link
69
Indirect discrimination
Provision, criterion or practice is neutral at face value but would put those with protected characteristics at a particular disadvantage Show that it is not a proportionate means of meeting a legitimate aim and make a comparison to show that you or a particular group has suffered a disadvantage
70
3 types of harassment
Related to sex/gender Sexual harassment Less favourable treatment due to acceptance or rejection of the first two types
71
Harassment
Unwanted conduct related to the relevant protected characteristic which has the purpose or effect of violating the victims' dignity or creating a hostile environment Pregnancy/maternity & marriage/civil partnership not covered
72
Harassment proof
Perception of the alleged victim Other circumstances of the case Reasonable for the conduct to have that effect
73
Victimisation
Employer subjects a person to detriment because they brought proceedings under the act, gave evidence in connection to any proceedings, or alleged that another person has contravened the EA Person has done a protected act
74
Victimisation test
In relation to any of the prohibited circumstance (causation) Detriment from employer Because employee had done a protected act or the employer believed they had or the employee may do a protected act
75
Equality clause
Statutorily imposes an equality clause in the terms of a contract of employment Equal pay for equal work Pay includes all consideration worker receives from employer
76
Equality clause proof
Make a claim based on similar work, work related as equivalent or work of equal value Reference to a comparator from the same employment (hypothetical)
77
Material factor defence
Difference in pay is not due to sex but due to reasons such as responsibility/experience
78
Work-life balance rights
``` Pregnant workers (dismissal is automatically unfair) Maternity rights (leave/pay) Employees make take time off to help a dependent ```
79
Working time regulations requirements for employers
Employers must implement the working time directive and young workers' directive for health and safety reasons
80
Working time regulations for time off
Minimum daily, weekly and annual periods of rest Entitled to adequate breaks Entitled to holidays and annual leave Armed forces, police and doctors in training etc are exempt to WTR
81
Working time definition
Periods when you're carrying out duties or receiving training
82
Working time regulations for time working
Work at most 48 hours a week, over a period of 17 weeks Young workers can only work 8 hours/day or 40 hours a week Night shift workers cannot exceed an average of 8 hours of work per 24 hours Can opt out by individual agreement Some unmeasured working time workers (managing executives, family workers and professionals)
83
Breaks for adult workers
11 hours rest every 24 hours 24 hours rest every week 20 minutes away from your workstation every 6 hours
84
Breaks for young workers
12 hours rest every 24 hours 48 hours rest every week 30 minutes away from your workstation every 4.5 hours
85
Annual leave
5.6 weeks in any leave year taken in leave year which it was due
86
3 issues with leave
Rate of holiday pay based on normal working hours No carry forward with the exception of sick leave or employer doesn't allow worker to exerise their entitlement to paid leave Employers cannot "roll up" holiday pay - Must be given when the holiday is taken
87
Working time regulation enforcement
Criminal and civil proceedings used to enforce it's provisions
88
National Minimum Wage
Over 23s is £8.91 Rise in april 2022 Includes everyone who is a worker, works ordinarily in the UK under contract and is not of of compulsory school age Doesn't include voluntary workers, people treated as members of family, armed forces etc
89
Pay definition
Counted over a period of time discounting tips/expenses Individuals have right to inspect their pay records and not be victimised for taking action Burden of proof is reversed, assume worker is entitled to minimum wage and employer must prove they're not
90
Health and safety
Enforced by the health and safety at work act 1974 Employers owe a duty to take reasonable care of the health and safety of all wokers. An employee can claim for any injuries or damage suffered due to the employer's negligence.
91
Health and safety act enforcement
Fine or imprisonment of the employer
92
Employers duties under health and safety act
Provide safe plant and systems of work Safe handling and use of articles and substances Relevant and necessary information for health and safety provided Maintaining safe work environment Safe environment, systems of work, safe handling of substances/articles, safe plant, providing relevant/necessary information and training

COMP3219 (14 decks)

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