The Bribery Act 2010 came into force on 1 July 2011.  Although the Bribery Act is not primarily a piece of employment law legislation, it is important that employers are aware of the implications of the new law.

The most important aspect of the Act for employers is the new corporate bribery offence which is found in Section 7 of the Act and provides that “a relevant commercial organisation (“C”) is guilty of an offence under this section if a person (“A”) associated with C bribes another person intending to obtain or retain business for C, or to obtain or retain an advantage in the conduct of business for C.”

This means that where an employee bribes a third party on behalf of their employer (whether on direct instructions or not), the employer may be liable under the Act. The penalties for a Section 7 offence are steep: unlimited fines are possible and the employer could be debarred from contracting with public bodies. In addition there is likely to be significant reputational damage as a result of a bribery investigation.

Employers can also be convicted of the direct offences of offering or receiving a bribe, albeit these will be harder for prosecutors to establish and, unlike the offence detailed above, require the company to have deliberate intention.

The key way in which employers can avoid liability under the Act is to show they had in place adequate procedures to avoid bribery. This is not only a defence to the Section 7 offence, but having good procedures in place may even lead the prosecutor to decide not to proceed with a prosecution. This is because the prosecutors must consider whether there is any public interest in bringing proceedings against the organisation.