Whilst there is no dedicated ‘self-sponsorship’ Skilled Worker route, those who are seeking to set up a UK company, or have an existing UK company, may be able to sponsor themselves under the existing Skilled Worker route.

And here is how.

Step 1 – satisfy the mandatory requirements under the Skilled Worker route

There is no point in embarking on this route unless the role you plan to undertake in the UK will actually satisfy the Skilled Worker visa requirements. We therefore always advocate looking at this first before you start setting up a company in the UK. The Skilled Worker visa requirements include, having a genuine job vacancy, at the appropriate skill level, which will pay a salary in line with the general salary thresholds and the going rate for the UK role. In addition, you must be able to demonstrate a competent level of English language, and show that you have sufficient funds to support yourself without recourse to public funds.

You can find a complete breakdown of the mandatory requirements under the Immigration Rules, here. Please note that, as has been widely publicised, the basic salary threshold for new Skilled Worker visas is due to increase to £38,700 on 4 April 2024.

Step 2 – establish a UK company

Now that you’ve established that your role will meet the Skilled Worker visa requirements, you will have to set up a UK entity. If you already have a UK based company, you can skip straight to Step 3.

A non-UK national/resident individual can set up and become a director of a UK company. There is no minimum or maximum investment required and you can be a 100% shareholder of the company.  However, there are certain criteria that must be met in order to satisfy the legal requirements under the Company Act 2006. Meeting the criteria and completing the set up process correctly at the outset is vital, particularly with the upcoming changes to UK company law and the Companies House reforms. We have a very knowledgeable Corporate Services team at Michelmores who will be on hand to assist you with this part of the process. Amongst many things, they can prepare and file all of the necessary formal documents at Companies House to form a UK company and provide you with ongoing company secretarial support to ensure your company complies with its statutory obligations on a yearly basis. Registration of a UK company may be done electronically or by paper application and there is a same-day application facility if needed. Companies House charges a company incorporation fee of £10 for standard or £30 for same-day electronic application. Note that with the introduction of the Economic Crime and Corporate Transparency Act, Companies House fees are due to increase from 1 May 2024. Please contact the Corporate Services team at Michelmores if you need assistance with the formation of a UK company or provision of a company secretarial and/or registered office address service for your company.

In addition to the formal set up process, it is also advisable that you have an organisation chart, showing where your role will fit in, a business plan if your business is in the early stages of growth, a functional UK website, a company email address and, of course, sufficient funds to pay your proposed salary amongst other things.

There is also likely to be regulations specific to your home country in relation to setting up an overseas entity and we would strongly advise that you seek local legal advice to ensure you remain compliant with local laws. We have good connections with exceptionally talented lawyers around the world and we can put you in touch with the appropriate people to guide you through your local legal considerations.

Step 3 – apply for a sponsor licence

Once you have established a UK entity, or if you have an existing company, the next step is to apply for a Skilled Worker sponsor licence.

To successfully apply for a sponsor licence, the Home Office will require evidence that:

• Your business is genuine and operating lawfully in the UK

To satisfy this requirement, the Home Office requires at least four documents (one mandatory and at least three optional documents) from a list set out under Appendix A of the sponsor guidance. The exact documents required will depend on the industry in which your business operates. Where the business has been trading in the UK for less than 18 months (and therefore qualifies as a ‘start-up’) the following documents will generally be required:

In addition, the Home Office will normally expect you to have registered with HM Revenues and Custom to pay PAYE and National Insurance Contributions. You must register before the first payday but you cannot register more than two months before you start paying people. It can take up to 15 working days to get your employer PAYE reference number.

• Why does your business want a Sponsor Licence?

It is recommended that you also detail the specific reasons why you require the licence to sponsor you. In scenarios where your company is already set up, this may include reasons why you are no longer able to perform your duties remotely and you are required to undertake your business activity in the UK for the benefit of the organisation.

• Opening a UK bank account

Firstly, it is possible to open a UK bank account as a non-UK resident, however, the requirements vary depending on the bank and the individual opening the account. Only some banks offer accounts to overseas nationals. Other banks will require you to have a UK address or to be tax resident in the UK. Additionally, some banks may require you to attend in person in order to open a bank account whereas others do not. Further, some of the documents that the bank require, can be difficult to obtain whilst outside of the UK.

Therefore, we strongly encourage you to seek professional financial advice to assist with this process. We have many contacts in this area that we can recommend to you.

It is important to remember that, whilst the requirement to open a UK bank account is mandatory, it is not a requirement that your company be actively trading, or have generated any revenue, at the date of the application. If your company is not yet trading or has yet to generate income, we would suggest that the following evidence is provided to the Home Office to satisfy them that you are a ‘genuine’ organisation:

• Your business is capable of carrying out its sponsor duties

As a UK sponsor licence holder, your business will need to comply with certain duties, including record keeping, reporting and compliance with UK immigration laws.

Therefore, as part of the application process you will need to demonstrate that you have in place:

• • a HR policy and procedure (we can assist with drafting this);
  • recruitment systems and compliant right to work practices (we can provide you with the necessary training for doing this);
  • a system of record keeping; and
  • the required Key Personnel (see below).

• Appointing the Key Personnel

As part of the application process, you will need to appoint three Key Personnel, including:

• • An Authorising Officer (AO) – this individual is ultimately responsible for the licence and oversight of all migrant employees the business employs;
  • A Key Contact – who will act as the main liaison between the company and the Home Office; and
  • At least one Level 1 User – they will have unfettered access to the Sponsor Management System (SMS) and will, under the AO’s direction, undertake all the main functions required (e.g. reporting migrant activity, assigning Certificates of Sponsorship (CoS) and lodging any business changes). We can act as an additional Level 1 User to assist you with your compliance obligations.

In deciding who should fulfil these roles, it important to keep some key mandatory criteria in mind, such as Key Personnel roles can be filled by the same or different people and, importantly, each must be resident in the UK at the date of the application and throughout the period they fulfil the role. Also, the Level 1 User must be British or settled in the UK. There are various other requirements, which we will advise you on as part of the process.

Given the position here, it is essential that you have at least one trusted person, who is either British or settled in the UK, who you are willing to appoint as a paid director, employee or office holder of your UK business.

Step 4 – apply for your Skilled Worker visa

Once your sponsor licence has been approved, and you have assigned a Defined CoS to yourself, you will be ready to submit your Skilled Worker visa application.

You can apply for a Skilled Worker visa up to three months before you are due to start work in the UK. A decision on the application should be received in around 15 working days, and there are priority services available at an additional cost to expedite the process to around five working days.

You can elect to apply for the Skilled Worker visa to last for up to five years. After five years on a Skilled Worker visa, you may be able to apply to settle in the UK. It is currently possible for your partner and children to join you in the UK if you have a Skilled Worker visa (some limited exceptions exist).

If you would like to discuss the self-sponsorship process in more detail, please do get in touch with the Immigration team here.

To coincide with International Women’s Day (8 March), Michelmores’ angel investor network, MAINstream, is thrilled to be hosting its debut Bristol pitch event, followed by a Q&A with an experienced panel of investors, advisors and founders. The aim of the event is to secure investment for the four brilliant companies that are pitching and to recruit more female angel investors, to help accelerate the growth and diversity of angel investing in the South West.

The Firm launched MAINstream, the UKBAA registered network, in 2019. It now has over 65 member investors, seeking opportunities to actively invest in, and provide ongoing support to, innovative start-ups and exciting disruptive ventures – many who have themselves started, scaled, and exited successful businesses.

On Tuesday 27 February, Partners Chloe Vernon-Shore and Harry Trick will be hosting a MAINstream special in the Wiper and True Tap Room in Bristol. The event will give female founders the opportunity to pitch to a full room, and, hopefully, reach and recruit more female investors for the benefit of future female founders.

Chloe is an experienced Partner in Michelmores’ Commercial team, advising a wide range of clients on a spectrum of commercial issues that affect their businesses. Harry is a Partner in the Firm’s Corporate team and acts for scale-up companies on all stages of their equity fundraising journey through to exit, as well as regularly advising those who invest in them – including angel investors, venture capital funds, family offices and private equity.

Chloe comments: “True equity in investment is something that I feel very strongly about. Being an angel investor means investing in an early-stage business before institutional investors are likely to be interested. This means that there can be a lot of risk but also incredible rewards, with some investors realising 10, 20 sometimes 100 times on their investment.

“Women identify market gaps that men might not see (for example a female urinal to combat crazy lavatory queues) for the benefit of other women. It is great to be playing a small part in achieving that equity, and just before International Women’s Day.”

MAINstream regularly holds pitch events throughout the year where high-growth, early-stage companies are invited to present their businesses to the network. Upcoming events can be found here.

The Firm is proud that its female partnership stands at around 50 per cent, which highlights a positive step towards gender parity at Michelmores, as the Firm remains committed to promoting and sustaining the inclusive culture for which it is known.

For more information about MAINstream, visit our website. RSVP to the event here.

Michelmores has advised purpose led investment manager Triple Point on a long-term agreement to fund the development of TBC Partners’ energy storage assets.

Triple Point and TBC Partners, a joint-family office focused on impact and energy transition, have agreed a debt facility of £5 million to support TBC Partner’s development of Battery Energy Storage System (BESS) assets.

The debt facility will provide funding to support a portfolio of three BESS projects across the UK, which will contribute to balancing the electrical grid and bringing new renewable energy projects online. Once energised, the TBC Partners BESS Portfolio will store enough energy to power approximately 2,485,000 homes for a two-hour period, significantly bridging the issue of intermittent power supply.

The Michelmores team advising on the deal was led by Partner Karen Williams and Senior Associate Danielle Collett-Bruce, both from the Firm’s Banking team, alongside Partner from the Firm’s Commercial team, Ian Holyoak, as well as Partner Alex Watson and Solicitor Gruff Cartwright from the Firm’s Corporate team.

Danielle Collett-Bruce comments on the deal: “We are pleased to have advised Triple Point on this deal, which will support the drive towards balancing intermittent renewable energy generation on the grid. We are delighted to have played a role in this key project.”

Jessica Fisher, Investment Manager at Triple Point, adds: “We are delighted to have finalised our deal with TBC Partners at the start of this year, a significant step in scaling renewable energy integration throughout the UK. We appreciate the support from the Michelmores team in supporting this deal. Their collaborative and responsive approach has been appreciated. We look forward to working with them in future collaborations, aiming for more impactful deals ahead.”

This deal is very much in line with Michelmores’ own environmental principles as we to strive to address the use of renewable energy sources across the UK and work towards a fully decarbonised society. Michelmores has a strong legacy of helping clients to become more sustainable whilst also trying to reduce the impact that our own business has on the environment through initiatives such as Planet Mark.

Read more about the Michelmores’ Banking team on our website.

Background

The UK government has made it a priority to counter the use of corporate structures for fraud and money laundering with the introduction of The Economic Crime and Corporate Transparency Act (ECCTA), which received Royal Assent on 26 October 2023. Companies House (the UK’s Registrar of Companies) faces huge changes due to this legislation. Louise Smyth (Chief Executive of Companies House) even said “this is one of the most significant moments for Companies House in our long history”.

The details of the ECCTA and the upcoming changes were generally covered in our previous articles “How will Companies house Reforms affect Private Companies and their Directors?” and “The Economic Crime and Corporate Transparency Act (ECCTA) and the Companies House Reforms“.

The focus of this article is specifically around the changes to a small, but crucial piece of information – the registered office address (ROA) of a company and the new requirement for a company to register their email address at Companies House.

Current Legal Requirements

Every UK company, even those who carry out business from abroad, must have a ROA in the UK. This address must be a reliable address which official bodies (such as Companies House or HMRC) may serve correspondence, notices and reminders to the company. The ROA is shown on the public register, available for everyone to see. Unless a company has a Single Alternative Inspection Location (SAIL) address, it must keep its records and statutory registers available at the ROA. Any member of the public may request in writing to inspect these records (subject to a ‘proper purpose’ under the Companies Act 2006) at the company’s ROA or SAIL address.

The ROA must be a physical location in the country of incorporation. For example, a Scottish company must have a ROA in Scotland. The address used must also be displayed clearly on all letters, invoices and websites of the company as well as those of the company’s offices. Failure to comply with these requirements constitutes an offence committed both by the company and every officer of the company (including shadow directors) who is in default.

New Rules regarding the Registered Office Address and Email Address of a Company

The first set of changes introduced by the ECCTA will come into effect from 4 March 2024 (subject to secondary legislation being passed). There will be new rules for a company’s ROA which means that a company must, at all times, have an ‘appropriate address’ as their ROA.  An appropriate address is one where:

• any documents sent to the ROA should be expected to come to the attention of a person acting on behalf of the company; or
• any documents sent to that address can be recorded by an acknowledgement of delivery.

These changes mean you will not be able to use a PO Box as your ROA in the future.  Additionally, if your company is using an address of a service provider (such as accountants, law firms or company formation agents), now is a good time to review or assess your arrangements with them to ensure that your company has continuing authority to use such address and that there is an appropriate system in place for you to receive and acknowledge communications sent to the company in an efficient manner.

Another change concerns the introduction of a requirement for all companies to register an email address at Companies House, which will also come into effect from 4 March 2024 (subject to secondary legislation being passed). Before the ECCTA, there was no need to register an email address of a company at Companies House. Section 29 of the ECCTA will ensure that all companies must (at the point of providing registration documents) provide ‘a statement of the intended registered email address of the company, which must be an appropriate email address within the meaning given in section 88a(2)’. Section 88a(2) of the ECCTA provides that an email address is ‘appropriate’ if, in the ordinary course of events, any email sent ‘would be expected to come to the attention of a person acting on behalf of the company’.

Therefore, companies will need to confirm their appropriate email address on their annual confirmation statement together with a statement that their future activities will be lawful; this will apply to all confirmation statements with a statement date from 5 March 2024. When incorporating new companies, a company’s email address will need to be supplied and a confirmation that the company is being formed for a lawful purpose will also be required.

It is important to note that providing a registered email address will become as important as providing a ROA. A breach of these requirements will result in an offence being committed by both the company as well as every officer of the company who is in default.  Companies House will take action against companies that do not have an appropriate ROA or email address.

How To Change or Update a Company’s Registered Office Address

Below are the simple steps needed to change a company’s ROA:

1. Review your company’s articles of association to check for the procedure needed to change the ROA.

2. The company’s board of directors must approve this change. Any changes to ROA must be actioned within 14 days of the board’s approval.

3. File the form AD01 with Companies House either:

3.1. electronically via Webfiling; or

3.2. in paper form via post.

4. The ROA change will be effective from the date the notice is registered and accepted by Companies House.

Conclusion

In summary the above changes, albeit small, are critical. Transparency is a key theme to the wider changes in legislation. The ECCTA will go some way to protecting our economy against unlawful or fraudulent activities via corporate structures. Most companies will be able to adapt to these changes very easily but for some, company law changes can be quite daunting. Michelmores has a dedicated Corporate Services team led by experts in the field of Company Law Compliance and Corporate Governance who will be happy to speak with you if you want to know more about the changes introduced by the ECCTA and how this will affect your business. Our Corporate Services include the provision of company secretarial, registered office address and email address services to companies which are fully compliant with the ECCTA rules. Please contact any member of the Corporate Services team or email cosec@michelmores.com.

Andrew Oldland KC, a Partner in the Firm’s Commercial & Regulatory Disputes team, has been appointed the Chairman of a UK/Vietnamese working group advising the Vietnamese government on establishing an International  Centre (IFC).

The UK Foreign & Common Office (FCO) approached TheCityUK to access the expertise of its members to support the Vietnamese government in this initiative. The UK Government values its long-term partnership with Vietnam and Financein recognition of the diplomatic relations between the two countries, responded to the request of the Vietnamese government requesting assistance in the IFC’s establishment.

TheCityUK is the industry-led body representing UK-based financial and related professional services.

In March 2023 an ad hoc Working Group was established by TheCityUK to produce an initial scoping report. Given his experience in advising the Astana International Financial Centre (AIFC) in Kazakhstan, ARO KC was invited to chair the Working Group. Since 2017, ARO KC has been a member of the Legal Advisory Council to the AIFC, reviewing legislation and providing strategic legal advice, as well as leading the team which drafted many of the financial regulations for the AIFC.

Other members of TheCityUK’s Working Group include HSBC, Standard Chartered, Dragon Capital, Prudential, KPMG, Clifford Chance, Freshfields, ACCA, London Stock Exchange, CISI and Simmon & Simmons.

The Scoping Report was launched in June 2023, following which funding was provided by the FCO for further phases, including the formal establishment of Working Group under a Memorandum of Understanding between TheCityUK and the Ministry of Planning & Investment of the Vietnamese government.

In November 2023, ARO KC, together with senior figures from TheCityUK, led a delegation to Hanoi and Ho Chi Minh City, during which the Memorandum of Understanding (MoU) was signed, a number of high-level meetings with relevant ministries and the State Bank of Vietnam took place, and the Working Group held the first of a series of meetings scheduled for the next 12 months.

The Working Group is aiming to produce a set of recommendations for the IFC project by September 2024.

As a Partner in Michelmores’ Commercial & Regulatory Disputes team, ARO KC specialises in contentious regulatory work, focusing on international financial regulation and white collar crime.

He is barrister, King’s Counsel and a part-time judge sitting in both civil and commercial and criminal cases, having joined Michelmores from the independent bar in 2011 and acting as the Firm’s Senior Partner between 2017 and 2021.

For more information or to contact Andrew Oldland KC, visit our website.

Michelmores is pleased to announce that it has advised the UK’s largest independent processing dairy, Freshways, on the acquisition of Milk & More’s doorstep delivery service from Muller.

Since its beginnings in 1990 as a small wholesaler, Freshways has grown into one of the largest independent and family-run dairy suppliers in the UK. All of the milk Freshways processes comes from cows farmed in the UK. Milk & More is one of the market leaders for home grocery deliveries with about 1,100 employees and 31 depots. It was first purchased by Muller in 2016.

The deal will see Freshways acquire all 31 of Milk & More’s sites, plus its sophisticated back-office e-commerce operation, with all 1,100 staff transferring over to Freshways Group.

The Michelmores team advising on the deal was led by Partner from the Firm’s Corporate team, Alexandra Watson, alongside Partners Adam Corbin, Paul Beanlands, Chloe Howard-Smith, Tom Torkar, Noel Beale and Ian Holyoak.

Adam Corbin, Freshways Client Partner comments: “We are pleased to have advised Freshways on this milestone transaction, in line with their strategic growth plans. Freshways is now entering an exciting marketplace aimed at buyer’s convenience, which is growing alongside other delivery brands around the UK.”

Freshways Director, Bali Nijjar said: “We committed to this transaction with a very short timescale, safe in the knowledge that Adam, Alex, and the Michelmores Team would make sure we achieved our objectives. Having a Team of lawyers who know us and know our business makes a real difference in transactions like this, and Michelmores have really invested in our relationship to ensure they deliver that.”

Michelmores’ consumer and commercial specialists help UK and international brands to break into new markets, connect with customers and close deals. From food and drink to luxury goods, brands with big ambitions and sustainable visions trust our extensive legal expertise. Read more on our website.

Michelmores is pleased to have welcomed Employment specialist Robert Forsyth as a Partner in its Employment team. Robert joins from Shoosmiths.

Having been a Legal 500 listed lawyer, Robert guides clients on all aspects of employment law, both contentious and non-contentious, and has particular experience in the banking, manufacturing, retail, hospitality and leisure sectors.

Robert has specialised in employment law for over 18 years, delivering pragmatic solutions to complex issues. He also has a strong tech sector focus and a particular expertise and interest in the effect of Artificial Intelligence on workforces and the role of HR teams.

Having spent six months working in Palo Alto advising U.S. Tech clients on U.K. employment law and co-ordinating cross border employment advice, as well as 3 months on secondment at the Qatar Financial Centre Regulatory Authority in Doha advising and training the General Counsel and HR teams on employment laws, Robert’s experience means that he is well placed to advise companies on global employment issues.

James Baker, Partner and Head of Michelmores’ Employment team, comments on Robert’s appointment: “Robert’s arrival at Michelmores will add further strength to our Employment team and we’re really pleased to welcome a lawyer of his calibre to the Firm.”

Robert Forsyth adds: “I am delighted to have joined the excellent employment team at Michelmores as our London office continues to expand rapidly and look forward to working with colleagues to support our clients.”

Michelmores supports employers across all sectors, as they face their greatest challenges – especially in cases involving media scrutiny in highly unionised and litigious environments, where legislative uncertainty and organisational change compound pressures.

With a focus on lasting relationships and innovative solutions, the Firm works as an expert extension to in-house HR functions, providing reassurance and guidance in difficult, time-sensitive cases involving issues such as complex discrimination claims and whistleblowing investigations.

For more information, visit our website.

Michelmores is pleased to have appointed four new lawyers into its South West offices as it continues to strengthen its growing national Corporate team.

The new hires include Partner Adam Kean, Associate Ben Adams, Solicitor Harry Jones and Paralegal Philippa Kean, continuing the expansion of the Firm’s Corporate capability across its Bristol and Cheltenham offices.

These appointments build on last year’s arrivals to the Firm’s Corporate team, which included Cathy Bryant as a Partner.

Adam, former Head of Corporate at BPE Solicitors, brings with him extensive experience in M&A and corporate finance with specialisms in private equity and venture capital investments and clean energy.

Adam Kean comments: “I am excited to have joined the highly regarded Corporate team at Michelmores and I look forward to working alongside a team of experts and to continuing the exciting and impressive growth of the Corporate team.”

Henry Taylor, Partner in the Corporate team at Michelmores, adds:

“We are very pleased to welcome Adam, Ben, Harry and Philippa into the Corporate team here at Michelmores. Each new recruit brings with them a wealth of experience and their expertise in corporate matters will play a pivotal role in our continued growth and in enabling us consistently to meet and exceed the needs of our clients.

“As our exciting new hires in the South West show, we continue to strengthen our first-rate corporate offering to the Bristol and Cheltenham markets, based on our integrated approach that has worked so well for us in London and Exeter.”

Michelmores’ award-winning Corporate team of 25 specialist lawyers advises clients across the UK, US, EMEA and beyond – on capital markets, mergers and acquisitions, management buyouts, impact investing, energy projects, microfinance initiatives and more.

Read more on our website.

Non-disclosure agreements (‘NDAs’) or confidentiality clauses are often legitimately used in a genuine attempt to protect the interests and reputation of a business, as well as its trade secrets/confidential information. In an employment context, NDAs/confidentiality clauses are commonly contained in an employment contract, entered into at the outset of an employment relationship, to protect the confidential information of the employer (such as trade secrets, client information, financial statistics etc.), to which the employee will have access during their employment. However, it’s the use of NDAs at the end of the employment relationship – often included in a settlement agreement or COT3 agreement to settle a dispute – that is more controversial and has been the subject of increased scrutiny over recent years. While NDAs in a settlement agreement can be mutually beneficial to both parties, by allowing them to draw a line under an issue and move on without litigation, various concerns have been raised about them being improperly used to silence employees and intimidate them from reporting concerns externally.

Initially an issue highlighted by the #MeToo campaign, the inappropriate use of NDAs – particularly in cases of sexual harassment – has been the subject of a number of inquiries and reports. Indeed, in 2019, in its response to a consultation on appropriate measures to prevent the misuse of NDAs in situations of workplace harassment or discrimination, the Government committed to introducing legislation to govern the use of NDAs/confidentiality clauses in settlement agreements. However, a timeframe for such legislation still remains unclear.

For organisations negotiating settlement agreements, it is best practice to consider at the outset whether a confidentiality clause is actually needed and you should discuss this with your legal adviser.[1] The ACAS guidance states that confidentiality clauses should not be used as a matter of routine, and it’s certainly sensible to consider on a case by case basis whether an NDA is required. This should include identifying the specific reasons why an NDA may be needed and weighing up the benefits to the employer vs the impact on the employee in question, as well as the impact on the wider culture of the organisation.  This is particularly the case for allegations of sexual harassment. It’s relevant to note that The Higher Education (Freedom of Speech) Act 2023 received Royal Assent on 11 May 2023, and when it comes into force (on a date to be specified in regulations), it will prevent English higher education providers from entering into NDAs with staff, students, visiting speakers etc. in relation to sexual abuse/harassment/misconduct and other types of bullying or harassment. Other organisations and sectors also seem to be taking note and are moving away from blanket NDAs in settlement agreements. For example, since 2015, the Department for Work and Pensions has not used NDAs in its settlement agreements and, in 2019, a city worker making accusations of sexual harassment and victimisation settled her claim for circa £270,000, without being required to enter into confidentiality provisions.

If and when an organisation decides an NDA is appropriate, careful thought should be given to how wide such a clause should be. For example, in some cases, the NDA may need to cover the settlement sum only, rather than the entire agreement. In terms of the breadth and content of the confidentiality obligations, businesses will usually wish to engage lawyers to assist with the drafting. It is worth noting that there are certain clauses in a settlement agreement which will be void and unenforceable if included. For example, an NDA cannot be used to: prevent an employee making a protected disclosure; stop an employer making necessary legal and regulatory disclosures; or prevent an employee reporting criminal offences or becoming involved in criminal investigations. Further, if an NDA is used in a settlement agreement, an employer should use plain English to set out the confidentiality obligations and should not put pressure on an employee to sign it, nor impose arbitrary or oppressive time limits on getting it signed.

In terms of wider considerations, organisations may want to consider introducing an approval process for confidentiality clauses – for example, prescribing that the use and terms of an NDA must be signed off by a director not involved in the matter. From a wider cultural perspective, businesses should consider monitoring their usage of NDAs on an organisation-wide basis to gain a better understanding of when, why and how often they are used, as well as helping identify particular areas of concern or patterns of behaviour.

As with most things, being proactive in managing risks and behaviours is better than having to be reactive in dealing with the fallout later down the line. Fostering an open and transparent culture, which takes allegations seriously and investigates fairly and transparently, can help prevent disputes (and ultimately, settlement agreements) arising. Again, having (genuine) zero tolerance policies in place for bullying and harassment, and providing relevant training on those policies, should reduce the risk of such behaviour, which should in turn have a knock-on impact on the use of settlement agreements and NDAs.

Ultimately, careful consideration as to the inclusion, and scope, of NDAs should take place at the outset of any settlement negotiations. They should only be used to protect information which genuinely requires protection: not as a way to cover up inappropriate behaviour. Given that many now deem NDAs as unethical and unacceptable in harassment and discrimination cases, businesses would be well advised to give proper thought to their approach to NDAs and what practices best reflect their company’s ethos.

For advice on the use of NDAs/confidentiality agreements, please contact Rachael Lloyd or another member of our Employment Team, who have a wealth of experience in this area and would be happy to help.

This article is for general information only and does not, and is not intended to, amount to legal advice and should not be relied upon as such. If you have any questions relating to your particular circumstances, you should seek independent legal advice.

[1] Solicitors and firms regulated by the Solicitors Regulation Authority (SRA) and Law Society are subject to specific regulatory requirements regarding the use of NDAs, which is outside the scope of this article.

The government has published its updated National Planning Policy Framework (NPPF). The purpose of the updates is to address obstacles to development in the planning system, with an emphasis on growth and regeneration. In this article, we set out the key changes for the planning industry with reference to the latest version of the NPPF published on 20 December 2023.

The revised NPPF provides clarification for local planning authorities (LPAs) seeking to argue for divergence from objectively assessed housing need in specific circumstances. Importantly, authorities with an up-to-date local plan will no longer need to continually show a deliverable five-year housing land supply.

In a U-turn move, the government’s changes to the NPPF allow LPAs to set local plans with fewer homes when they can demonstrate to the Planning Inspectorate that such targets would damage the character of an existing area or require building on the green belt. Therefore, local councils will no longer be forced to set aside greenfield land and other land of environmental importance or aesthetic significance to meet their future housing needs. In addition, councils are given an exemption from building new homes on prime agricultural land.

The government insists that these changes do not allow LPAs to evade their responsibilities in addressing housing shortages, as LPAs must provide rigorous evidence of any divergence from targets. The Planning Inspectorate will not accept any departure from targets if the reasoning is not strongly rooted in environmental or aesthetic concerns.

By contrast, the document sets out the government’s aim to prioritise brownfield and higher-density development in inner-city areas. The NPPF also ensures greater promotion of small sites for community-led development for housing and self-build, custom build housing and upward extensions including mansard roof extensions on suitable properties.

The new NPPF contains revised guidance on the legal duty to cooperate, which requires cooperation between local planning authorities and other public bodies to maximise the effectiveness of policies for strategic matters in local plans. This is due to be replaced by the ‘alignment policy’, details of which remain subject to further consultation. In addition, the NPPF retains the controversial policy obligation for councils in the largest urban areas to increase their homes requirement by 35%. The NPPF requires local authorities in urban areas to ensure the uplift occurs within their own area, unless there are voluntary cross boundary redistribution agreements in place.

The government’s update also covers changes to the Housing Delivery Test based on LPA’s previous 3 years of delivery, with enforcement consequences continuing and a new action plan for improvement where LPAs are hitting below percentages of target requirement. The new NPPF confirms that the statistical model based on population growth remains the basis of assessment. These updates are set to incentivise LPAs to deliver.

The government highlights the need for LPAs to have up to date plans in place. In a statement on 19 December, the Secretary of State for Levelling Up, Housing and Communities Michael Gove announced new measures to hold LPAs to account for delays and failure to rollout increased homes, with robust league tables revealing the real performance of LPAs, showing the speed and level of approvals against targets. Further, Gove announced measures to restrict planning committees’ ability to block developments that have been approved in principle by officers.

In his speech, Gove also referred to changes brought about by the Levelling Up and Regeneration Act which will allow statutory consultees such as Natural England and Historic England to charge for pre-application advice to incentivise timely responses.

With severe under resourcing of LPAs being a major cause of underperformance, Gove pointed to extra funding announced in the Autumn statement and the upcoming raised planning fees and indexing arrangement which should add extra resource to LPAs.

Finally, the government’s development of proposed National Development Management Policies (NDMPs) remains subject to further consultation. NDMPs are set to standardise development management rules across a series of policy areas to avoid duplication in council’s local plans. Gove states that NDMPs will provide guidance to LPAs formulate local plans and criteria to apply on determining planning applications.

The long-awaited updates to the NPPF provide much-needed clarity to LPAs who have paused or delayed their local plan process due to a lack of certainty over planning policy over the past year. Gove has stated that plans already implemented, that include policies in anticipation of the NPPF, will be given “significant weight” by the Department for Levelling Up, Housing and Communities (DLUHC).

While the government claims that updates to the NPPF have been put in place to address chronic housing shortages in the UK, some industry sources claim that the revised NPPF will have the opposite effect. We can help clients navigate these changes to NPPF when approaching planning matters.

Michelmores has advised Kew Green Hotels on the acquisition of two prominent new hotels, located in Manchester and Leicester. Under a franchise agreement with IHG Hotels & Resorts, both properties will be transformed into voco branded hotels by mid-2024.

Kew Green Hotels is an international hotel management company offering a range of services with a wide portfolio of properties around the world. Formed in 2001, the company now has over 55 hotels in their portfolio.

This latest acquisition reflects Kew Green’s ambitious growth strategy to deliver outstanding hotel services and exceptional returns for hotel owners and partners. The newly acquired properties both feature decor inspired by the history of New York’s Brooklyn neighbourhood.

The Hotel Brooklyn, located in the heart of Manchester, boasts 189 stylish bedrooms, the chic Runyon’s Bar & Restaurant, and versatile event spaces. Blending edgy decor and unique design, the hotel caters to both business and leisure guests.

Leicester’s Hotel Brooklyn is an urban sanctuary in the city’s heart, featuring 191 contemporary bedrooms, The Lair restaurant and bar plus flexible meeting spaces. This hotel is recognised for its commitment to accessibility and inclusivity, making it an ideal destination for all travellers.

The Michelmores team advising on the deal was led by Senior Associate Lucy Tucker, from the Firm’s Transactional Real Estate team, alongside Jess Hopkins (real estate), Anna Wood (construction) and Harriet Grimes (planning).

Lucy Tucker comments:

“It was a pleasure to partner with Kew Green and bring the deal to a successful close with our expert advice and ability to assist in executing these strategic transactions. Kew Green’s decision to acquire the two hotels reflects its ambitious growth strategy and we are proud to have been a part of that, helping to advise the Kew Green group on the legal aspects of the acquisition.”

Real Estate forms a core part of our work at Michelmores. The Firm advises organisations and individuals doing business in the real estate sector, to help them stay at the forefront of progress and innovation.

The Firm’s in-depth understanding of the issues and practicalities involved around transactional real estate issues enables us to undertake complex work for a diverse client base that includes developers, entrepreneurs, landowners, listed companies, government bodies and major institutions.

For more information, visit our website.

Introduction

In this case, the court considered whether one of two directors of a company could apply to appoint an administrator without the agreement of the other director and a validly passed board resolution.

The court found that in order for a director to bring an application for an administration order, they would need authority from a valid board resolution, passed by a majority of the board of directors.

Background

Abigal Boura (the “Applicant“) was one of two directors and shareholders of LYHFL Limited (the “Company“).

The Applicant considered that the Company was in financial distress. Accordingly, the Applicant decided that the Company ought to be placed into administration. The Applicant did not obtain approval of the other director. Nor did the Applicant obtain approval through a board resolution.

Despite this, the Applicant applied to the court for an administration order (the “Application“). Her application was made under paragraph 12(1)(b) of schedule B1 of the Insolvency Act 1986. This provision allows “the directors of the company” to apply for an administration order.

Issues

Leigh Harmer (the “Respondent“) was the other director of the Company. He disagreed with the Applicant that the Company should be placed into administration. He opposed the Application, on two grounds.

• That the Applicant as one of the directors alone did not fall within the scope of paragraph 12(1)(b). As the Applicant had acted alone, she was not, and did not represent, “the directors of the company”. Accordingly, she was not entitled to apply for an administration order.
• That the Company was not insolvent – it could pay its debts as they fell due.

The Judge only considered the first ground on the basis that if the Respondent succeeded on that ground, then the Application would be disposed of.

The issue was whether the Applicant, as one of two directors, had standing to apply for an administration order without the agreement of the board of directors and without a valid board resolution.

Decision

The Judge reviewed case law on the meaning of “the directors of the company” and made the following observations.

First, a unanimous decision of the directors was not required. However, a majority was needed.

Second, a formal decision of the directors was required. Before a decision to place a company into administration, a valid board resolution compliant with the company’s constitution was needed.

Third, there was authority that where a company only has one director, that single director could apply to the court in urgent circumstances for an administration order, even where the articles of association required more than one director to be quorate. However, in the present case, that authority could be distinguished as the Company had two directors.

Accordingly, as the Applicant was only one out of the two directors (and so did not have the requisite majority) and a valid board resolution had not been passed, the Applicant did not have standing to bring the Application. Therefore, the Judge refused to make an administration order in respect of the Company.

Conclusion

This case illustrates the importance of taking all necessary steps to ensure that the applicant is actually able to initiate the appointment of administrators. In particular, consideration should be given as to whether a director has the requisite authority in accordance with the company’s Articles. It is key to check the company’s constitution to identify any limits on director decision making and also ensure a sufficient proportion of the board are in agreement as the court has no power to initiate an appointment in the absence of such agreement.

Taking the appropriate steps to ensure that board decisions are validly made, and documenting them appropriately, are vital as they court will assess this when making a decision on an application for an administration order or when considering the validity of an appointment made using the out of court process.

Advice should always be sought before making an appointment, in order to determine whether all relevant requirements have been met, or alternatively what additional steps can and should be taken.