Introduction to Legal Responsibilities

There are certain legal obligations that anyone in charge of an enterprise has to fulfil – otherwise they expose themselves to the risk of prosecution.

The information on this page is neither comprehensive nor definitive and is meant to be used only as a guide. Entrepreneurs should ensure that they understand the full extent of their legal responsibilities before setting up an enterprise. For more information click on the appropriate links.   

An entrepreneur’s legal obligations cover six broad areas (some of which overlap). These are:
Health & Safety; Employment; Company law; Insurance; Environmental law; Consumer law

1. Health & Safety

An entrepreneur’s most important obligation is to protect the health and safety of those that he/she is responsible for.

This will include paid staff and volunteers, customers, suppliers and any other visitors – casual or otherwise - that might enter the workplace. Thankfully the number and severity of incidents at work is declining, but there are still many thousands of accidents (and the death and injury that results from them) every year. So H&S is a very serious issue.

Health and Safety legislation is enshrined in the Health & Safety at Work Act 1974 (and numerous subsequent additions/amendments). This law puts a legal obligation on employers to ensure that the workplace is made as safe as possible and the risk of accident and injury is kept as low as possible. http://www.hse.gov.uk/.

2. Employment Law

Once people become paid employees, there are legal obligations around employment law that must be met.

Employees must have employment “contracts”, be insured (see below), enjoy comfortable and safe working conditions, statutory holidays, pension provision, receive pay slips, be free from harassment/discrimination, receive proper warnings/notice period and have their tax and national insurance properly paid.

3. Company Law

Company law dictates things like how Limited Companies should be set up, how few Directors/officers they should have, when they should publish their accounts and make their Annual Returns.  www.companieshouse.gov.uk/companiesAct/companiesAct.shtml.

If you run any sort of registered Company (even a charity, NfP or CIC), you are legally obliged to keep financial records showing all income and expenditure, and to have those records audited and approved by a Certified  accountant each financial year. Copies of these Annual Accounts must be sent by a set date to Companies House.  Directors are also obliged to keep receipts and other financial records for a period of seven years.
You must pay VAT on time (if you are registered). http://www.hmrc.gov.uk/vat/start/register/.

4. Insurance

If engaging any employees or volunteers, entrepreneurs must have arranged Employer’s Liability insurance. This provides cover in the event of an employee or volunteer being injured whilst at work. Public Liability insurance must also be obtained to cover injury to anybody else or damage to other peoples’ property caused by you, your staff or volunteers. These two types of cover are usually wrapped up into one policy and quotes can be obtained though most insurance companies/brokers. Motor insurance is also a legal necessity. http://www.abi.org.uk/.

5. Environmental

Laws relating to the environment in general and to waste in particular are policed by the Environment Agency.

Collecting waste (which is what we do) is governed by the principle of Duty of Care. This puts a legal obligation upon organisations and individuals to know what happens to the waste that they produce, collect or dispose of - and to ensure that it is all handled by properly registered companies and disposed of in properly registered sites. Even though you might pass on your waste to another firm, it remains your legal duty to make sure it ends up in the right place.

There are two formal documents that community wood recyclers have to obtain before starting.

Waste Carriers License - Any organisation or individual that collects and transports anything that might be construed as waste needs a WCL. The application form can be downloaded from the E A website at:

http://www.environment-agency.gov.uk/business/sectors/wastecarriers.aspx.

As at 05/01/11, the WCL costs £154 for three years. You will need to show the License to your customers, so that they can fulfil their own Duty of Care responsibilities.

In addition, community wood recyclers need an exemption from the requirement to have an Environmental Permit. Permits are issued to organisations that sort or process any sort of waste. The Permit states what the organisation is allowed to handle, the volume of material they may have on their site and issues around how it is managed.

Organisations that handle only low volumes of waste can apply for an Exemption from needing an EP and community wood recycling fits in to this low volume category. Although we are hoping that in time there will be a specific Exemption introduced for our activity, in July 2011 we were advised by the Environment Agency that – given the nature of our work - we should apply for exemptions under T6 and U9. Exemptions are free, take a couple of weeks to process, last for 3 years and can be applied for by going to:

http://www.environment-agency.gov.uk/business/topics/permitting/default.aspx.

 

Whenever any waste is disposed of a Waste Transfer Note has to be issued by the collector /receiver of that waste to the waste producer. The WTN must by law contain certain information and a copy kept for 2 years.

6. Consumer Law

Goods and services sold to the public fall under the Sale of Goods Act. Community wood recyclers retail wood, wooden items and other products, so fall under the auspices of the act. Simply put, any item sold must be “fit for purpose” and be replaced or refunded if it fails to be so. To enable prompt redress, customers must be given a receipt or other proof of purchase. http://www.consumerdirect.gov.uk/after_you_buy/know-your-rights/.