LAW011-1 Business Law: Analyzing Employee Rights and Legal Issues

This case study delves into various aspects of UK business law, examining employee rights and employer obligations. It analyzes scenarios involving lost property and police responsibility, the enforceability of confidentiality clauses in employment contracts, and the implications of the Salomon v. Salomon & Co. Ltd. case on corporate structure. The study addresses issues such as whether the police are entitled to a reward for recovering lost property, the legality of restricting employees from sharing company trade secrets, and the concept of separate legal entity in corporate law. The analysis includes relevant legal rules, application of those rules to the specific scenarios, and conclusions regarding the rights and responsibilities of the parties involved. Desklib offers similar solved assignments and resources for students.

For Business
Managers
(LAW011-1)
( Distinction
Criteria )

Contents
INTRODUCTION...........................................................................................................................1
TASK...............................................................................................................................................1
Part 1.......................................................................................................................................1
PART 2...................................................................................................................................4
Issue.......................................................................................................................................4
Rule........................................................................................................................................4
PART 3............................................................................................................................................6
CONCLUSION................................................................................................................................7
References:.......................................................................................................................................8

INTRODUCTION
The legal system in the United Kingdom is incredibly complicated and one-of-a-kind. It gives
both the employer as well as the employee a wide range of protection measures. The UK's
legislation is divided into two parts: public and private law. Company law, contract law and
employment law are all examples of private law. The Company Act of 2006 protects the rights of
employees while also ensuring their safety and security. A contract is a legally binding
agreement between two parties (Ettredge, Guo and Li, 2018). Contract law's three fundamental
regulations include offer, acceptance and consideration. The Employment Law, 2008 protects
both employers and employees by providing legal protection against dismissal, pay, and
holidays, among other things, in order to protect employers' interests while also maintaining both
parties' relationships. This report include various elements of business law as well as the
privileges of the workers and employers in an organisation.
TASK
Part 1
Mike returns home from vacation to discover that his house has been broken into. He then
instantly notifies the authorities about the altercation and is very discouraged to see his late dad's
present, the Watch, missing from the house's missing items. He then begs the police to reward
him with £100 if he can find his watch. The police were also able to restore the majority of the
lost items, including the loosing watch. Mike then declined to pay another £100.
Issue
 Whether police is entitled to receive the promised money?
 What are the legislative provisions in this context.
Rule
The scenario of the government of United Kingdom and police in relation to the recovery
of lost property is complicated and unimportant. Presently, the police have no obligation for
recouping and distributing lost property items. Even though sensible precautions must be taken
to make sure the recovery of lost property.
In the early 18th century, lost property was not a common issue in the United Kingdom. As
the transportation of items or products increased, more items were misplaced, resulting in the
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establishment of the first public offices known as Lost Property Offices (LPO). These
workplaces will indeed assist in locating and trying to claim lost and found items by advertising
them in newspapers (Hossain, Bari, Mahmud and Khan, 2021). After some time, the
Metropolitan Police Department established a "Central Repository for Lost Things" in 1869. Its
main aim was to eliminate the crime of stealing property from people's homes or places and to
reduce criminal activity. It is essential for the police officers to focus on the reduction of the
activities which may leads to the loss of property of anyone.
Police officers from across United Kingdom were in charge of lowering the violence of
stolen items. The law becomes more complicated when deciding whether to keep the lost items
for oneself or come back it to the owner. The following is the most reasonable approach to
dealing with such a complicated situation:
To begin, whoever finds the lost items must report this to the appropriate authorities, who
can assist in reclaiming its true ownership.
Second, if anybody tries to find a lost item in general populace, he must not start taking it
but should instead notify the police.
Finally, one can notify the lost property through advertising in newspapers, television, and
social media.
There is also a 'return to finder' policy in place to assist in returning stolen property to the
previous purchaser. The time period for trying to return such objects ranges from a month to a
year, during which a person can file a claim for his or her lost property or item. The individual
who obtains or provides the lost property bears no legal liability under this service.
Application
The strategy of going back lost property to its finder has aided in the retention of the items
to their original owner. There has been a period of approximately 7 to 14 days for the return of
lost items, provided that they return to their original owner without any complications. There are
also some items which can be kept by the recipient of lost items for an extended period of time.
These items include the discovery of food items that can rot or spoil if stored for an extended
period of time. As a result, it is not always necessary for the receiver to possess the lost
property's belongings. Because of the new powers granted to the police, it is no longer necessary
to recover lost property because it can be kept by whoever receives such property. There is no
legal requirement to return the item of lost property.
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Conclusion
As a result, the police are not entitled to the promised amount from Mike because it was
his responsibility to find the lost property while under the authority of police, who will provide
assistance to ordinary folk in the absence of crime, including the recovery of unclaimed property
(Tipu, U.F., 2020). The role of police in the case of lost property is somewhat uncertain and
untrustworthy in terms of taking effective measures because it is dependent on the situation
regarding the finding or retrieval of lost good or service or property.
Describing Property
 To confirm the acknowledgement and end up making the documentation reliable, the
found property items must be described as clearly and thoroughly as possible. For
example, 'a camera' discovered was insufficient evidence to reunite it with its owner.
Before the report is considered, that information should be obtained. Color, size, shape,
and any names, marks, or other distinguishing features. Include the manufacturer's
number, serial number, and/or other unique identifiers (Levine, D.S., 2020).
 Police should not make presumptions about the property which may not be correct and
may complicate the identification process. For example, rather than presuming a gold
item of jewellery, it is better to describe that item as "made of yellow metal and
containing a single white stone" instead of as a gold and diamond bejewelled ring.
 The recommendation of this Power is that the audience be urged to retrieve the property
from the start, and that the police service will not take and record property that is found
except in limited circumstances where retention by the finder is prohibited.
Exceptions of the above are:
 Where the finder of the lost product is a paid or unpaid servant of the Police service;
 Where the lost property was found on premises of police, in vehicle of police, in a
vehicle hired for police or otherwise used by police;
 Where the property is suspected of being of value for the evidence or could be used to
support the commission of offences;
 Where the property is a product which requires special action;
 Where it would be illegal or not lawful for the finder to retrieve the property;
 It would be unwise to retrieve the property where in the opinion of an approved person;
or
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 The Cash of any amount and products capable of containing data – for example mobile
phones or computers.
PART 2
It has been observed from the given above situation that Cristine is an employee of
organisation “Super Fizzy Ltd” which manufactures beverages. She learned the formula of
popular beverage during her employment named as “Super cola” an fizzy drink.
Issue
 Is Cristine is bound with the contractual clause?
 If yes, what will be that clause?
Rule
The UK contract law is uncodified which imposes various rights & liabilities over the
parties. Under the employment contract, terms and conditions are laid down which is biding
upon the parties. There are several clause artefacts into employment contract as to make parties
to agree upon terms and conditions of organisation (Dahal, 2018). Rights and responsibilities of
parties are enforced in contract law of UK which is vast and complex. It is obliged by the parties
to comply with clauses. In case party fails to do so, it will be held liable for breach of contract.
One of the essential clauses is confidentiality clause which restricts parties to share
important information from the outsiders. It is made for legitimate purpose and employees are
prevent form causing commercial loss to organisation. This is made to maintain confidentiality
of information which is secretive in nature and involving commercial benefit. The contracted
parties are not bounded to disclose crucial information, techniques, process and any other related
sources which provides special benefit to organisation. In order to secure intellectual property
rights of organisation the clause is made within contract involving trade secret. The major
amendment has made by the public Disclosure Act of 1998 in employment rights act of 1956 that
declare confidential information void if exclude worker from the use of protected disclosure.
However, trade secret and confidentiality clause are complementarity to each other which are
introduced for securing rights of owner (Leng, Ozkan, A., Ozkan, and Trzeciakiewicz, 2021). To
promote new innovation and technology is the main reason behind inserting confidential clause
which contributes in economy growth. Under Trade Secret Regulation Act of 2018, valuable
information, techniques, methods and process are secured by trade secret.
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In the economy of UK, the major regime has taken place which grants special rights to
information holders from infringement of their legal IP rights. IT protect the company from use
of obtaining and disclosing information unlawfully with an intention to cause loss or injury to
information holder. The trade secret directive is been introduced to provide statutory protection
to owner of trade secret. In accordance to Article 39 of TRIPS Agreement, the trade secret
involve information which has commercial value in market & essential steps is been taken as to
secure important information from outsiders. The solution for infringement of owner rights are
also provided.
Application
The cristine agreed with the terms of contract which she made in respect to trade secret as
she is legally bounded with all clauses that is mentioned in report within employment contract.
The “super Fizzy Ltd” is renowned organisation and famous for super cola drink. The
organisation itself has own trade secret over manufacturing process which entitle to add
confidential clause in its agreement as to restrict employees from disclosing information as to
gain competitive benefit in market (Machiridza, and Thondhlana, 2022). The organisation is able
to compete with other competitors of beverages by offering unique taste as to attain success.
On the employees, limitation is imposed by confidential clause from use, manufacturing
and unauthorised use of methods which is achieved from the employment course. The protection
of trade secrets and other information that is vital to an employer is ensured by this clause.
However, there are three steps in identifying the trade secret's sensitive information, which
include:
 The information is vital in the development of business strategy and reasonable steps are
taken as to ensure secrecy.
 The receiver of such information has duty to keep secrets
 The liability is created with the use of such information over the unauthorised user.
The Super Fizzy Ltd. is entitled to remedies for the unlawful use of confidential information,
including restitution, an injunction, damages, and other restitution at the court's discretion.
Conclusion
It can be stated that, the confidentiality clause binds Cristine, and she must uphold the
company's privacy by not disclosing any information about the production process to third
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parties because it has a financial value and could have an impact on an organization's
profitability.
PART 3
The Salomon v. Salomon &Co. Ltd. case is a major decision that changes the corporate
world. According to the Companies Act of 1862, Mr. Salomon sold his entertainment business in
this case. The company's members were Mr. Salomon, his wife, and their kids. He had got the
debenture and fully paid-up share. The company eventually entered insolvency because it was
unable to pay its creditors. The liquidator tried to hold Salomon accountable for his actions, but
the court intervened and said that the firm is separate from its owners and that he will not be held
accountable for the loss done to the creditors.
Issue
 Whether Salomon was responsible for the company's debt?
 What are the exception and legal consequences of the rule established in this case?
Rule
The scope and depth of UK corporation law are enormous. It outlines the steps and
approaches for incorporating the business. The Company Act of 2006 gives the company
necessary components. In order to make operations and activities within an organisation easier, it
provides a broad spectrum of protection to both employers and employees. The business is
regarded as a separate legal entity from its owners (Morikawa, 2019). The company is legally
recognised and was founded under the Act of 2006. The company is created through a legal
framework and functions as an artificial person with a common seal, the ability to sue, and the
ability to be sued in its own name. The court determined that the firm is a legal entity that was
created artificially and is recognised by statute. The firm has obligations to its members as well
as rights, like any other independent individual. The law establishing different legal entities
recognises the company as a separate organisation of people.
Application
According to UK corporate law, the corporation is a totally separate legal entity from its
stockholders. Due to the fact that it is incorporated by statute law, which grants it unique rights,
it can operate as a separate legal body and exercise those powers. He was merely an agent of the
main firm in the Salomon v. Salomon case. The Court went on to say that he had not committed
any fraud and had granted the liquidator payment precedence over creditors. The court concluded
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in Lee v. Lee's Air Farming Ltd., 1960 UKPC33, that a corporation is never the same as its
shareholders and directors and that its members have limited liability.
Exception of General Rule
Piercing the Corporate Veil: It is an exception to the rule that each legal entity should exist
separately. The owners and directors of the corporation are not protected in this case by the
court. When a corporate personality fails to uphold the distinct identities of its companies while
attempting to conceal wrongdoing, The court concluded in the case of Gilford Motor Business
v. Horne [1933] Ch 935 that a company is created to engage in a variety of activities, and that a
breach of their legal obligations forbids any of the members to act in the capacity of the
company's owner (Niteesh, and Sai, 2022).
Evasion Principle: It circulates as a result of avoiding the need to control future risk in order to
fulfil the goal of incorporation. The court determined that the evasion concept is an exception to
the general rule established in the Salomon v. Salomon case in the case of Prest v. Petrodel
Resources Ltd., 2013 ER 795. The corporate personality is disregarded when the owner acts on
behalf of the business.
Conclusion
As a result, the owner's actions are never the same as those of the business and have their
own corporate identity. Legal personality, which is always distinct from its members, including
shareholders and directors, is a crucial aspect of a corporation.
CONCLUSION
It has been concluded from the above report that company law is detail document which
defines roles and responsibilities of each member of organisation as legal system of UK is
unique ad developed over times. Within organisation the rights and duties of member are secure
by legislative framework. Between the parties the contractual agreement is biding upon them &
obliged to comply with it. Company takes use of trade secret as to secure vital information which
has commercial value and used for gaining advantage over competitors. Moreover, company is
legal personality which is distinct from its member as evolved by landmark cases which creates
history in UK legislative system.
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References:
Books and Journals
Dahal, R., 2018. Salomon v Salomon: Its Impact on Modern Laws on Corporations. Available at
SSRN 3169431.
Ettredge, M., Guo, F. and Li, Y., 2018. Trade secrets and cyber security breaches. Journal of
Accounting and Public Policy, 37(6), pp.564-585.
Hossain, M.J., Bari, M.A., Mahmud, M.T. and Khan, M.M., 2021, October. Web and Mobile
Application Based Missing Query Platform (Lost and Found BD). In 2021 IEEE 12th
Annual Information Technology, Electronics and Mobile Communication Conference
(IEMCON) (pp. 0074-0079). IEEE.
Leng, J., Ozkan, A., Ozkan, N. and Trzeciakiewicz, A., 2021. CEO overconfidence and the
probability of corporate failure: evidence from the United Kingdom. The European
Journal of Finance, 27(12), pp.1210-1234.
Levine, D.S., 2020. Covid-19 trade secrets and information access: an overview. Available at
SSRN 3838892.
Machiridza, L.H. and Thondhlana, T.P., 2022. Lost and Found Property: Evaluating Efforts to
Resurrect and Resuscitate ‘Institutionalised Garbage’in Post‐Colonial Zimbabwean
Museums. Curator: The Museum Journal.
Morikawa, M., 2019. Innovation in the service sector and the role of patents and trade secrets:
Evidence from Japanese firms. Journal of the Japanese and International Economies, 51,
pp.43-51.
Niteesh, S. and Sai, V., 2022. Participation of Shareholders in Corporate Governance. Issue 1
Int'l JL Mgmt. & Human., 5, p.1377.
Tipu, U.F., 2020. Assignment on Peace Treaty, Lost Property, Foundling, Rules for Apostate,
Spoils of War in Muslim Personal Law. Lost Property, Foundling, Rules for Apostate,
Spoils of War in Muslim Personal Law (July 15, 2020).
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