Businesses in every industry have to comply with certain government legislation. Some regulations deal with the formation and running of any public business, as well as businesses that employ staff, and certain industries, from construction to gambling, have specific legislation in place to ensure good, safe, and honest business practices.
While legislation is established to protect people and businesses themselves, it can place a burden on businesses, and certainly requires that they have some degree of expertise in this specific area.
Industry-Specific Legislation
As well as general legislation that affects businesses in all industries, there are regulations specific to certain industries. Construction has extensive health and safety regulations, including those that deal with working at height, for example. UK iGaming legislation is so strict that many businesses in the industry have chosen to move abroad to avoid some of the potentially prohibitive requirements, such as Gamstop registration (source: gamblingsitesnotongamstopuk.com).
Such casinos are still licensed in other jurisdictions and offer many of the same bonuses as UK-licensed casinos, including generous bonuses and extensive game selections, but because they don’t have to gather or verify Know Your Customer (KYC) details, they offer smoother and faster registration processes.
General Legislation
All businesses, depending on their legal structure, must meet certain legislation to be able to operate legally. Some examples of common requirements include:
- Health and Safety – Businesses must ensure, within reason, the safety of their employees, business users, and visitors by meeting health and safety regulations. Risk assessments may need to be completed, and depending on the activities of the business, certain mitigating practices may need to be employed to ensure safety.
- Employment and Human Resources – If a business employs any member of staff, it must meet certain human resource requirements. This includes working hours, minimum pay, and working conditions requirements.
- Environmental – Waste management, pollution control, and climate change mitigation are some of the environmental regulations that businesses might need to meet. In some cases, preemptive businesses that meet these requirements may receive compensation or grants for doing so, and to help to continue meeting these requirements.
- Taxes – Businesses, like individuals, are subject to taxation. At the most basic, this means paying tax on profits. Other taxes include VAT, PAYE, and National Insurance. A failure to report or pay the appropriate taxes can lead to hefty fines and may even land company officers in legal trouble.
Expertise Requirements
Legislation is unavoidable, and, for the most part, it is established to protect businesses as well as their customers and third parties. However, they can place a lot of strain on businesses, especially small and new businesses that have limited staff numbers. Regulatory compliance is so important, however, that businesses either need to employ full-time staff to deal with some elements or outsource their requirements to third-party experts.
Finance
The cost of employing full-time compliance officers is just one way legislation can cost businesses money. In most cases, it is necessary to pay for the license itself. Health and safety licenses can cost hundreds of pounds or more, depending on the size and scope of a project. Furthermore, there are annual renewal costs, too. On the other hand, some licenses attract certain grants and other financial compensation. This is especially true for climate change, sustainability, and other environmental legislation, although the remuneration won’t always necessarily cover the associated costs.
Non-Compliance Consequences
Where there is legislation, there is punitive action that can be handed out to companies or individuals that are in breach of that legislation. This action can range from financial fines to prison sentences for company officers, although the latter is rare and usually reserved for cases where people have lost their lives or where officers have acted fraudulently to cover up failed legislation.
Reputation
Most legislation is designed to protect either the business itself, its stakeholders, customers, or third parties. Some customers ensure that the businesses they deal with meet legislative requirements before they consider doing business with them. It helps build trust.
This, in itself, might be a legislative requirement for partner businesses, and dealing with organizations that do not meet specific regulations may also be considered a breach of legislation. Even where it isn’t a regulatory requirement, it might be considered a critical part of insurance or some other financial instrument. If a company outsources building work to a third party and it turns out that the company does not meet health and safety regulations, an insurance company may refuse to pay out in the event of an accident or incident caused by the outsourced company.
For those customers that perform extensive due diligence, any reported regulation failings may also crop up, leading to a loss of reputation and potentially lost business for the company, too.
