Report: Legal Framework, Business Structures, and Dispute Solutions

This report provides a comprehensive analysis of the legal framework relevant to businesses, particularly focusing on the English legal system. It examines key principles, the process of enacting laws, and primary and secondary sources of legal information. The report delves into the crucial distinction between employed and self-employed individuals, referencing the Pimlico Plumbers case to illustrate the factors determining employment status, and applies these principles to a hypothetical scenario involving a meal delivery business, Kango. Furthermore, it explores various types of business organizations, including joint ventures, limited liability companies, corporations, sole proprietorships, and partnerships, outlining their legal requirements and benefits. The report also discusses the concept of legal personality and the duties of company directors. Finally, it addresses dispute resolution, offering suitable legal solutions for business conflicts, providing valuable insights for business owners and legal professionals alike.

The Legal Framework
and
Legal Solutions

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
TASK 2............................................................................................................................................6
TASK 3 ...........................................................................................................................................1
LO3 Detail description about various kind of organisation...................................................1
TASK 4............................................................................................................................................3
LO4 Suggesting the suitable legal solution to resolve areas of dispute.................................3
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Legal framework comprises of rules, procedures and other similar steps which are
necessary for the purpose of maintaining law and order. It includes policies, laws and rules
which are implemented for creating a balance in the society (Price, 2012). On the other hand,
legal solution provide prompt action for the settlement of differences risen or may arise between
two parties. This report includes nature and main principles of English Legal system,
determination of status of self-employed which can have impact on the business. Along with this,
various types of business organizations that can be formed and what legal solutions are available
that can be applied to number of disputes.
TASK 1
In the given case, Kango has been established by Jay and Alex in the year 2016, engaged
in the business of delivering meals. The source of income is by charging restaurants a
commission fee and separate fee from the customers. In order to resolve all the matters and have
better knowledge about legal implications that might occur in the business, Kango has demanded
a draft about main principles and related matters.
English legal system is a very old legal system which comprise number of laws and rules
applicable on individual as well as business. UK follows the doctrine of judicial precedents
which states that, a case having same facts and issues with that of a prior case, then it will be
decided on the basis of previous case law (Baker, 2019). Furthermore, parliament is sovereign
which means that, the highest authority to enact a law is with the Parliament and no one can
challenge its authority or the laws that have been implemented by it. This doctrine is useful as
Parliament analyse the outcomes of the every bill that is presented before it. It passes those bills
only which are for the betterment of the society. However, on coming to the effectiveness of
English legal system which is a set of many rules and laws, it can be said that, the system needs
updates as there are many provisions which are outdated resulting in loopholes. This cause
problem for effective implementation of laws and rules.
Apart from this, there is a standard procedure for transforming a bill into an act which is
applicable throughout UK. These governs the rights of individual by protecting them and
providing justice in case of contravention. The process for passing a bill is as follows:

First reading: In this step, a bill is put before the parliament for discussion and having
votes on it. Presence of both the house of Parliament is compulsory.
Second reading: At this stage, required amendments can be made depending on the
needs.
Committee stage: After going through second reading, the bill is submitted to an
independent committee for examination and to give recommendation wherever needed (Passing
of bil, 2019).
Report stage: This stage is about sending a report by the committee to House of
Commons to have a discussion whether to amend the bill or not.
Third reading: The draft bill is reviewed and no further amendments can be made at this
stage. However, amendments can be made with the approval of both the houses.
Royal assent: This is the last stage in which the assent of the Queen is received for the
implementation of the law in UK.

There are sources which can be used to know whether a new law which might be
applicable on the business has came into force or not. This will also disclose the amendments

which can affect the business. These are divided into primary and secondary which are as
follows:
Primary sources includes case laws and judgements which of previous case study and
legislation which govern rights of individuals living in UK. Secondary sources comprises legal
encyclopaedias, textbooks, law commission and most importantly, parliamentary and non-
parliamentary publications which are considered great sources of legal information.
TASK 2
In this case scenario, Kango's workers are having doubt regarding their status in the firm.
According to them, the administrative control, code of conduct and other points have put the
self-employed personnel into dilemma and now they are demanding that they should be treated
as the employees of Kango. Therefore, Pimlico Plumber case has been described stating the
details where a self-employed will be considered as employee.
In the case of Pimlico Plumber, Gary Smith was a self-employed worker engaged himself
with Pimlico for 6 long years. Gary filed a suit against the company in Employment Tribunal
stating that, he and other should get the status of employees in the company. However, the court
passed a judgement refusing the contention made by Gary. Aggrieved from the judgement of the
tribunal, Gary approached Supreme Court which passed the judgement in favour of Gary Smith.
This judgement was based on when Smith Suffered from a heart attack, he was asked to reduce
his hours due to ill health which was denied by Pimlico also, the van which was provided for the
work, was take by the company. Furthermore, he was dismissed in an unfair manner also faced
situations of discrimination. Furthermore, he was denied sick pay and holiday pay.
In addition to this, Supreme court paid attention on the fact that, every self-employed
person was made to wear the uniform of the company and to use the van carrying brand name of
Pimlico only. Along with this, every self-employed had to carry identity card and abide by
administrative instructions of Pimlico. All of these made that, Gary and other self-employed
should be treated as employee only and they should not be deprived of their employment rights.
By applying this to the case of Kango, it put administrative control on its self-employed people
which is a major point to witness of the Gig economy (Pimlico Plumber case, 2019.).
If Kango appointed employees only then the working environment and other rights
should be according to Employment Act and Equality Act. Also, they were paid salary instead of
wages and were made to act according to instruction of Kango only. Furthermore, they had no

right to switch their company for better opportunity. Along with this, they had leaves and
flexible working hours which has been mentioned in the laws and rules. Thus, in case of
employment, the factor of independence is not there. Every employee is required to work as per
the instructions and directions of management of company. Also, entity hold right to dismiss
them from the work provided there should be a fair reason for dismissal.
Difference between employed and self-employed
Employed Self-employed
Higher tax according to rate provided for
individual salaried employee.
Less tax on the income earned by the person.
There is regularity of income. Income is irregular.
Opportunities for professional development. There is no such opportunities in being self-
employed.
No flexibility in work. Higher flexibility as self-employed has the
absolute control.

TASK 3
LO3 Detail description about various kind of organisation.
Business are of different types and it is important for any of the investor that how they
want to incorporate there organisation. While incorporating organisation it is important that
legal methods and procedure must be followed so that business activities can be started. Limited
company are those business organisation where number of rights are given to the organisation so
that they can conduct business in smoother manner. Here liability are always limited which helps
to influence investor to invest more amount of money. Some of the limited organisation are listed
below: Joint Venture: It is the business organisation where several organisation come together
to increase there productivity and sale so that more amount of profit can be earned. The
motive behind commencing joint venture is increase the market share. This types of
organisation can be formed for small period of time or even for long period of time too.
Whenever Joint venture are formed it is necessary that legal process must be followed in
which contract deed is required where venturing company should mention the work
which they are going to are commencing joint venture (Cameron, 2017). Then, roles and
responsibilities must be decided of each member. Once all this work is completed all the
documents are required to be submitted in the Companies House. Limited Liability Company: This types of companies are helpful investor because the
motive behind incorporating LLCs is to give flexibility to invest as they will feel safe if
there liability will be secured and safe. The legal method to for limited liability is the
firstly name of the organisation is to be selected and then it says that address should be
mentioned so that everyone can know the place from which business activity will be
carried on. Also, there is the requirement of Memorandum of Association and Article of
Association. Employee Identification number is must to operate business.
 Corporation: In this business organisation, it is found that capital is required in huge
amount. Shareholder, board of directors, company secretary are the one who takes the
responsibilities to manage every single work so that organisational goal can be
accomplished easily (Miller and Jentz, 2017). There is the legal process and method to
form corporation and that is categorised below:

◦ It is necessary to selected the appropriate name and address of the company.
◦ When incorporating organisation, it is important that Memorandum of Association
and Article of Association is also required.
◦ Selection should be done that who will be the first director and first shareholder of a
company to take most of the legal decision before incorporation.
◦ Standard Industrial Classification code is required to be obtained so that it can be
easily found that organisation is involved in which sector.
Sole Proprietorship: This form of business activities are performed at very small level
where single investor is available in it. The main benefit of this form of business is that there is
no interference of any of the party and even legal requirement are also less. There is no
requirement for incorporating sole proprietorship legal as government have given them the
flexibility in it.
Partnership: This sort of business is performed by more then one number of person if
they comes together to work on similar form of project. Several benefits in taxation are being
provided due to which partnership loves to invest in this form of business. If partnership firm is
required to formed then it is important that legal contract should be prepared which is known as
partnership deed and then it is needed to be submit in Companies House.
Legal Personality
It is defined as the situation where rights are given to the organisation and due to which
they becomes capable to sue and be sued. It is the concept which is applied to business
organisation.
Salomon v Salomon Ltd.
This is the case which tells that business and its member are different from each other.
The liabilities will be limited and member will pay only up to the amount of investment (Orlov,
V., 2016). This case was entertained in the court and judges decided that Salomon will not be
liable to pay any debt because company and its member are different from each other.
Duties of Director's
 Duty of director is to manage daily affairs.
 Required to conduct general meeting every year. As per the guidelines of Companies law.
Here, KANGO must try to commence there business under limited liabilities Company
through which they can be benefited. It will help them to secure there liability up to the amount
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of investment. Also, various benefits will be provided to the organisation under LLCs. (Picciotto
and Mayne, 2016)
TASK 4
LO4 Suggesting the suitable legal solution to resolve areas of dispute.
Case Scenario: The dispute is all between KANGO and there IT suppliers and both of
them want to solve there issue by legal ways but not taking the help of court proceeding.
Alternative disputes resolution:
This is the process of settling the disputes between the parties without any litigation, all the
disputes under alternative disputes resolutions are solved in a private forum or are solved out of
the court. This focuses on providing long lasting solutions of the disputes. It is the most effective
process of solving the disputes without consuming much time and cost .
Conciliation: Here a conciliator is hired , Who privately meets both the parties to resolve
the disputes between them and does not involve any legal binding . The decisions of conciliator
are not forced on both the parties they are free to agree or disagree on account of it. In this the
conciliator works on the common ground to resolve the conflict.
Mediation: This is a method which helps the individuals in reaching towards a mutual
decision so that disputes can be resolved effectively. This method also increases the
understanding of individuals about the litigation (Schulman, Moscow and Lesser, 2017). Apart
from that mediator is the person who have no right to make biasses in their work as they helps
the parties to communicate or settle disputes by themselves. this method of solving disputes and
conflicts are more beneficial as it helps the parties in resolving family or neighbour issues.
Arbitration: In this method an another party is involved which is termed as Arbitrator.
arbitrator is the one who have rights to provide helps to both parties through resolving their
issues or conflicts. final decision is also taken by Arbitrator as these parties allows them to take
final decisions if they are agrees on it. There number of arbitrator should always be in odd
number and their decision should not be biased. After declaring the result arbitration prepare the
deed which is needed to be signed by disputed parties. It is expensive process as compared to
other process.
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In this particular case, it can be said that KANGO and there IT supplier must take the
help of arbitration method whether they will get the option to sign the contract that will help to
make sure that similar form of case will not happen again.
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CONCLUSION
It has been summarised from the above report that legal system of Uk is effective and
always helps the organisations in achieving their desired goals. mainly four sources of laws in
UK that should be adhere by each organisation so as to gaining effective outcomes in future. It is
also concluded that Dispute resolution is an effective way that facilitates organisation in order to
achieving their desired goals and objectives.
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REFERENCES
Books & Journals:
Price, D.P.T., 2012. Legal framework governing deceased organ donation in the UK. British
journal of anaesthesia. 108(suppl_1). pp.i68-i72.
Baker, J., 2019. Introduction to English Legal History. Oxford University Press.
Cameron, P., 2017. International energy investment law: the pursuit of stability. OUP
Catalogue.
Miller, R. L. and Jentz, G. A., 2017. Business law today: The essentials. Cengage learning.
Orlov, V., 2016. Introduction to business law in Russia. Routledge.
Picciotto, S. and Mayne, R. eds., 2016. Regulating international business: beyond liberalization.
Springer.
Schulman, S. H., Moscow, C. and Lesser, M. R., 2017. Michigan Corporation Law & Practice.
Wolters Kluwer.
Online:
Passing of bill. 2019. [Online]. Available through:
<https://www.parliament.uk/about/how/laws/passage-bill/>.
Pimlico Plumber case. 2019. [Online]. Available through:
<https://www.supremecourt.uk/cases/uksc-2017-0053.html>.
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