Information relating to sterling cheques issued in the UK
From the 30 October 2017 a new “Next Business Day cheque clearing cycle” will be introduced for all banks in the UK. This will run alongside the existing “6 Business Days cheque clearing cycle”. The clearing cycle used will depend on which bank a cheque is deposited with, and by the method of deposit. From 30 October 2017, until the 6 Business Day clearing cycle is removed, both clearing cycles will be in operation. You should anticipate money from cheques you write leaving your account on the next Business Day; and money being cleared from cheques you deposit within 6 Business Days. You should always ensure you have sufficient funds in your account prior to issuing a cheque.
This is how the current cheque clearing cycle works for a Sterling cheque paid into a Sterling account on a Tuesday morning:
If you hold information about customers, staff or contacts, and someone else could use it to identify the person, you may need to notify the Information Commissioner’s Office (ICO).
Whatever your business, you must follow the principles of the Data Protection Act 1998 which applies to information on websites as much as to computer and paper records.
There are eight areas of good practice concerning data that you must enforce. Data must be:
- Fairly and lawfully processed.
- Used for limited purposes.
- Adequate, relevant and not excessive.
- Kept only as long as necessary.
- Processed in line with the subject’s rights.
- Not transferred to countries that don’t have adequate protection.
- Secure: you are responsible for security (even if you accidentally disclosed personal information you could still be liable to pay compensation to the individual concerned).
Data processing is allowed only if you have met one of the following conditions:
- The person concerned has permitted you to process their data.
- The processing is essential in order to fulfil a contract you have with the individual.
- It’s done to safeguard the person’s vital interests.
- It’s for compliance with a particular law.
- It’s in the legitimate interests of your business (unless this negatively affects the person).
It’s a criminal offence to break the law on data protection. If you are caught doing this, you could face a fine, a custodial sentence or community service. Find out more about employment law.
When you advertise
- Always check that your advertising is accurate, truthful and not unfairly discrediting your competition. Only make claims in your advertisement that are true, or the Advertising Standards Authority may demand that you stop running it. Trading Standards Officers can take action against your business if they believe an ad contains false or misleading information.
- Be mindful when you compare your business or brand with your competitors, whether it’s by implication or explicitly. Whatever you say should be clear, fair, true and accurate. The legal restrictions are described in the British Code of Advertising – find them on the Advertising Standards Agency website: www.asa.org.uk.
Your and their intellectual property
The reason we have copyright is to protect creative works such as articles, poems, photographs, designs, sculptures and songs. You do not have to register copyright, but be very careful about copying material belonging to others. If you want to use their photographs or drawings, always ask for their permission.
- Copyright only concerns the original works, not copies, and only the way a concept is expressed, not the concept itself. So if, for example, someone writes an article, only the words, not the ideas in it, are protected by copyright.
- If you want to protect an invention, you will have to apply for a patent. You must do this before its details are made public anywhere.
- To protect your logo or a slogan, you must register it as a trademark.
- In case you ever have to defend your intellectual property rights, you might want to take out intellectual property insurance.
When you employ staff
If you hire people to work in your business, by law you have particular responsibilities and obligations. If you fail to meet these you may face legal action.
- Be sure to check that all your new employees are legally entitled to work in the UK, or you could be heavily penalised. You’ll find a list of the documents you should request and take copies of, and general guidance on employing foreign workers, on the Border and Immigration office website: www.bia.homeoffice.gov.uk.
- You should have a signed contract of employment ready from the day any employee starts work. To see a sample contract, speak to a solicitor.
- Take independent legal advice before you alter terms and conditions of employment, make people redundant or dismiss them for other reasons, such as their conduct. This will help you avoid claims for unfair dismissal, discrimination, failure to inform and consult and breach of contract.
- Warn employees that you will not tolerate any discrimination, harassment and other illegal acts. As their employer you could be found liable if you’ve failed to take action in such cases.
- Consider other requirements such as how you will arrange pensions for employees.
Health & Safety matters
As a business owner, you have important legal obligations concerning health and safety. By failing to carry these out, you could face prosecution, your insurance premiums could rise, and you could find it hard to buy any insurance at all.
Find out more about health and safety for business from the Health & Safety Executive website: www.hse.gov.uk.
Insuring your business
If you employ people, whether it’s full-time or on a casual, part-time basis, by law you must have employer’s liability insurance in the UK.
You may also want to think about:
- Product liability insurance. This helps protect you if a defect in your product causes an injury.
- Professional indemnity insurance. If you offer services or advice, this can protect you against the effects of a mistake in a service or product you have provided. Many professional bodies insist on their members taking out professional indemnity insurance.
Find out how Bank of Scotland Business Insurance can protect you and your business.
Your business and the environment
Your business must comply with environmental obligations; for example, concerning the control and disposal of hazardous substances. To find out more, visit the Environment Agency's Netregs site: www.netregs.org.uk.
When you trade
Refunds, returns and the law
Remote buyers (e.g. customers buying on the telephone, Internet or by direct mail) have rights under The Consumer Protection (Distance Selling) Regulations 2000. These include the right to cancel an order within seven days. You must make these rights clear to your customers.
There are exceptions, which could include holidays, perishable goods and personalised goods. Tapes, CDs, videos and computer software are also excluded unless customers return them to you unopened.
You’ll need to comply with statutory rights for refunds – make sure that you are aware of the customer’s rights, as well as your own, when you are asked to refund money. In order to protect your business, make conditions clear to customers at the time of purchase.
Agreements and contracts
Business relationships are based on contracts. These can be oral or even implicit, but it’s best to have them in writing. If you breach a contract you have with another party, they will be entitled to damages.
To be binding, a contract must be clear as to what all parties are to do. Both parties must agree on it, and it should include an intention from both parties to be bound to the contract.
Terms and conditions
To make sure you have effective means of debt control, you should spell out your terms and conditions of trade (T&Cs). Also, make your customers agree to, and ideally sign them, when they place an order.
If you use a service that provides you with generic terms and conditions which can be adapted for your business, have a solicitor check them first to make sure they offer you the best protection. Watch out for:
- Retention of title clauses. With these, you retain ownership until payment – if your customer becomes insolvent before they’ve paid in full, you may not be able to reclaim your goods without such a clause.
- Payment terms. Make it clear to your customers the date when you expect payment from them for goods or services.
With some trades, e.g. the food industry and financial services providers, you must have specific licences to operate. You’ll find a list of licences for different trades at www.gov.uk/browse/business/licences.
If your business doesn’t have enough cash to operate, it becomes insolvent. It is a criminal offence to continue trading when you know your business is insolvent, and directors of limited companies can become personally liable.
If your business ever has financial problems, seek professional advice immediately. You may be able to reschedule debts through a Voluntary Arrangement. Be aware that your business could end up in liquidation or receivership.
*Subject to post payment fraud measures.
More information about how the cheque clearing cycle works across UK banks can be found on the payment scheme website managed by the Cheque and Credit Clearing Company.
These timescales are industry guidelines. Interest calculations and the availability of funds may be earlier in certain circumstances.
Cheques paid in at a branch after 17:00 on a Business Day or any day which is not a Business Day may not begin to be processed until the next Business Day. Some branches have an earlier cut-off than 17:00. A notice will be displayed in such branches which will specify the earlier cut-off time. Cheques paid in via alternate methods than a branch will have different cut-off times. Please refer to the specific T&Cs for that method of deposit for more details.
Timescales for bulk cheque schemes may be different. Please contact your relationship team for further information.