Business Law: Legal Systems, Impacts, and Solutions for Businesses

This report provides an overview of the UK legal system and its impact on businesses, focusing on various sources of law such as legislation, common law, and European Union law. It discusses key laws affecting organizations, including the Employment Rights Act 1996, Companies Act 2006, and Finance Act, emphasizing the government's role in law-making and the application of statutory and common law in courts. The report evaluates the effectiveness of the legal system through recent reforms like the Third Parties (Rights against Insurers) Act 2010, the Consumer Insurance (Disclosure and Representations) Act 2012, and the Insurance Act 2015. It further illustrates the potential impact of laws such as Health and Safety at Work Act, Equality Act 2010, and General Data Protection Regulations (GDPR) on businesses. Additionally, the report suggests legal solutions for business problems like contract termination, insolvency, and liquidation, comparing these solutions with alternative legal advice and evaluating their positive and negative impacts.

Business Law
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Contents
Introduction........................................................................................................................3
Section 1– Nature of legal systems and legislations impacting businesses.....................4
LO1 Explain the basic nature of the legal system.........................................................4
P1 Explain different sources of law and laws that organizations must comply with.. 4
P2 Explain the role of government in law-making and how statutory and common
law is applied in the justice courts..............................................................................5
M1 Evaluate the effectiveness of the legal system in terms of recent reforms and
developments.............................................................................................................6
LO2 Illustrate the potential impact of the law on a business.........................................7
P3 Using specific examples illustrate how company, employment and contract law
has a potential impact upon business........................................................................7
M2 Differentiate and analyze the potential impacts of regulations, legislation and
standards....................................................................................................................8
D1 Provide a coherent and critical evaluation of the legal system and law, with
evidence drawn from a range of different relevant examples to support judgements.
....................................................................................................................................9
Section 2 – Legal solutions to business problems..........................................................10
LO3 Suggest appropriate legal solutions to business problems.................................10
P4 Suggest appropriate legal solutions for a range of business problems e.g.
termination of contract, rescue from insolvency and liquidation..............................10
P5 Provide justifications for the use of appropriate legal solutions..........................11
M3 Assess the positive and negative impacts of legal solutions to business
problems...................................................................................................................12
LO4 Recommend appropriate legal solutions based upon alternative legal advice
provided........................................................................................................................13
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P6 Recommend legal solutions based upon a different country’s legal system
and/or a different legal framework............................................................................13
M4 Compare and contrast the effectiveness of these recommendations................14
D2 Critically review and evaluate the use of appropriate legal solutions in
comparison with alternative legal advice..................................................................15
Conclusion.......................................................................................................................16
References.......................................................................................................................17
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Introduction
Law is a set of rules which any community or country recognizes as a fundamental and
guiding principle for conduct of its members, organization and society. The non-
compliance of laws leads to penalties and other legal consequences. Business law is
that branch of law which applies to business. It recognizes the manner in which a
business shall be conducted and defines the rights and responsibilities of persons
associated with such business. In this report, sources from which these laws emerged
and are enacted have been discussed. There are mainly three sources of UK law.
These are legislature which is enacted by Parliament, common law which is passed by
judges and European law which are the rules and laws of European Union (EU) and UK
being a member state must comply with EU laws. This report has further discussed
various laws applicable on business such as laws relating to health and safety at
workplace, equal opportunity laws and laws for data protection.
The second section of the report is discussing two different case scenarios. The
scenarios relate to business laws and appropriate recommendations have been given to
business owners for their business problems. The case scenarios relate to winding up
of company when it is unable to pay off its debts and notice required to be served by
employee at the time of termination of employment contract.
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Section 1– Nature of legal systems and legislations impacting businesses
LO1 Explain the basic nature of the legal system
P1 Explain different sources of law and laws that organizations must comply with.
The meaning of “Every year the government announces its programme for
legislation by way of the Queen’s Speech at the State Opening of Parliament in
October or November” has been discussed below. An event is held in Parliament of
UK at the beginning of session commonly known as ‘State opening of Parliament’.
During this event, a speech is given by Queen known as Queen’s Speech. This event is
held in month of November every year and is held in front of both houses of Parliament
i.e. House of Lords and House of Commons. The Queen’s Speech outlines the agenda
of government and Parliament for coming session. This event attracts large crowds and
media. The Queen delivers the speech from the throne in House of Lords (Sparrow,
2015).
Source of Law
There are three major sources of UK laws. These are Legislation, Common Law and
European Union Law. These laws are followed by judges of courts in deciding any case.
These are explained as under:
 Legislation:
Legislations are laws enacted by Parliament of United Kingdom. The laws
enacted by Parliament are Act of Parliament. The laws are enacted as an Act
when the they are passed by both houses of Parliament i.e. House of Lords and
House of Commons. The laws enacted by parliament are also called statutory
laws.
 Common Laws:
Common laws are those laws which are enacted by judges of superior courts.
These are also called judicial precedents as these are the decisions of superior
courts in any previous legal case decided by them and is established as a law
which is required to be adhered to by junior courts while deciding cases of similar
nature as the case in which the law was established (Koprowski, 2017).
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 European Union (EU) Laws:
UK is a member nation of European Union and therefore is required the comply
the laws and regulations established by European Union. These laws are
precedents over UK laws. Therefore, in case of any contradiction between EU
laws and statutory laws, EU laws shall supersede.
Laws Applicable on an Organization
There are several laws which are applicable on an organization. These are as follows:
 Employment Rights Act, 1996: The rights of employer and employees in
relation to employment are established and guided by this Act. It also includes
the duties of employers and employees and terms of employment.
 Companies Act, 2006: This Act contains the provisions relating to company’s
incorporation and includes procedures to be followed by company for running its
business. All the companies in UK must comply with provisions of this Act.
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S o u rc e s o f L a w s
Legislature
Common Laws
European Union
(EU) Laws.

 Finance Act: This Act is amended every year based on the requirements. All
companies or any other establishments must follow this Act for matters relating to
finance, such as applicability of taxation procedures and exemptions that can be
claimed (Arden, 2016).
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P2 Explain the role of government in law-making and how statutory and common
law is applied in the justice courts
The government plays a significant role in law making. An Act is enacted by Parliament
after a bill is presented for approval by both houses of Parliament i.e. House of Lords
and House of Commons. Following procedure shall be followed for enactment of an Act:
 First reading: Here, the title of bill is published followed by second reading.
 Second Reading: In this stage, a debate is carried by members of parliament on
contents of Bill in House of Commons.
 Committee Stage: Here, required amendments are made in the bill after
detailed examination.
 Report Stage: In this stage, amendments made in the bill are discussed and a
debate is carried. The members, in this stage vote on the amendments.
 Third Reading: The members vote on final bill in this stage. The proceedings of
House of Commons end in this stage.
 House of Lords: After third reading, bill is sent to House of Lords for approval
and if any amendments are required to be made, then the bill is sent back to
House of Commons for approval of amendments.
 Royal Accent: The Bill when approved by both houses of Parliament is
presented for Royal Accent. When Royal Accent is received, the bill enacts as an
Act (Open Learn, 2018).
Application of statutory and common law in judicial courts
When there is no application of laws, then the significance of laws is lost. For a strong
mechanism, both statutory and common laws must be applied by courts in decision
making. The statutory laws are laws enacted by Parliament and are applied by both
superior and junior courts in decision making process. The common laws are laws
enacted by superior courts and are applied by the junior courts in deciding cases of
similar nature in which such law was enacted (Koprowski, 2017).
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M1 Evaluate the effectiveness of the legal system in terms of recent reforms and
developments
Law Commission is an independent body appointed by Parliament to keep the laws
under review and recommend reforms whenever needed. The aim of Parliament and
law commission is to ensure that the laws implemented are fair and updated. Recently,
reforms have been introduced in UK insurance laws followed by extensive consultation
carried out between Scottish Law commission and UK Law Commission. Under these
reforms, three new Act of Parliament have been adopted. These are: The Third Parties (Rights against Insurers) Act 2010. The Consumer Insurance (Disclosure and Representations) Act 2012. The Insurance Act 2015 (Hertzell, 2016).
Therefore, it can be concluded that the legal system of UK is effective as reforms are
introduced in laws continuously.
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LO2 Illustrate the potential impact of the law on a business
P3 Using specific examples illustrate how company, employment and contract
law has a potential impact upon business.
 Health and Safety Regulations
The employer must ensure that all the employees of company and others at
workplace are provided safe and healthy working environment. The law
applicable for ensure health and safety at workplace is Health and Safety at
Work Act, 1974. It defines a fundamental structure that is required to be followed
and implemented by employers at workplace to provide safety and proper health
care precautions to its employees. This Act requires the employers to perform
certain duties to protect his employees and other people at workplace premises.
The other subjects included in the Act are prevention of use of harmful chemicals
beyond specified limits, emissions of harmful gases in atmosphere and many
more similar provisions (Jamieson, 2015). In case scenario specified, JPM
Publishing must comply with the provisions of Health and Safety at Work Act to
provide safety and better working environment to its employees. Such
compliance can attract better skilled workforce and can enhance the goodwill of
company. The compliance of provisions of this Act can also help the company in
avoiding any legal consequences.
 Equal Opportunities Regulations
The laws applicable for providing equal opportunities to all employees is
Equality Act 2010. This Act protects the employees for any discrimination at
workplace and provide equal rights to all the employees. This Act outlines certain
provisions and standards based on which no discrimination shall be done among
employees at workplace or in society. Protection against any discrimination on
basis of sex, caste, religion, age, gender, disability, marital status or sex is
provided to employees under procedures of this Act (Cole, 2017). In given case
scenario, JPM Publishing must follow the procedures provided under this Act for
protection of employees from discrimination and equal rights must be provided to
them. If the managers or any other person discriminates the employees on any
basis, then such person shall be prosecuted under provisions of Equality Act,
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2010. The companies must comply the provisions of this Act and must ensure
that all its employees are treated equally, and no discrimination is done on any
basis.
 General Data Protection Regulations (GDPR)
For protection of data, EU General Data Protection Regulation (GDPR) are
applicable. These regulations have superseded UK Data Protection Act, 1998.
This Act specifies the rights of individuals to exercise control over the manner in
which their data is collected, processed and utilized. This Act requires
organizations using personal data of individuals to be more accountable for
protection of such data. The major benefits of this Act include better governance
of data, improved information security and improvement in brand image and
reputation of company. It also helps the companies in gaining competitive
advantage and build customer trust (Nadeau, 2018). JPM Publishing, in given
case scenario, must comply with the provisions of General Data Protection
Regulations (GDPR) for protection of data provided to the company by
employees or any other individuals. The company must take precautions to
ensure that the data is protected and to avoid any legal proceedings.
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M2 Differentiate and analyze the potential impacts of regulations, legislation and
standards.
Laws are the system of rules and statute enacted by government of any country or
community. Regulations are the detailed instructions about how enacted laws shall be
carried out and enforced. Standards are the specifications provided for products,
services and systems (Focus, 2018). The compliance of applicable laws, regulations
and standards affects the efficiency and goodwill of an organization. If the business of
an organization is carried on without compliance of applicable laws. then it shall result in
inefficient and unfair decisions. This will impact the growth of business. The compliance
of laws and regulations is important for gaining trust of customers and other persons
who associate with business as clients or stakeholders. The non-compliance of laws
shall lead to legal consequences and liabilities. Therefore, every organization must
follow the laws, regulations, and standards applicable.
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