Public responsibility for the growing business

As a small business owner you may well find it a struggle to keep up with your day-to-day responsibilities and the last thing you want is a mass of red tape and regulation to navigate. However, if you run a business you operate in the public domain and so there are inevitably some public responsibilities that you must fulfil, ranging from environmental requirements to compliance with data protection legislation. These are some of the key responsibilities facing small business owners.

Data Protection legislation

The Data Protection Act has been the source of some controversy since its inception. Businesses and other organisations are collecting ever more personal information about their customers and employees, and the Act aims to regulate the way in which this information is used. Therefore, you are required to comply with the Act if you keep details of any identifiable individual.

The Act stipulates that you may only use this type of information if at least one of six conditions applies. These conditions are very broad, and compliance is actually possible in almost every case; one of the conditions is simply having a “legitimate interest” in using the information. Find out more at

Once you are confident that you may legitimately use this information, you must ensure that you comply with the eight data protection principles. These require that the information is:

  • Fairly and lawfully processed
  • Processed for a specified purpose, and not reprocessed for any other purpose in the future
  • Adequate, relevant and not excessive
  • Accurate and up to date
  • Not kept for any longer than is necessary for the fulfilment of the specified purpose
  • Processed in line with the rights of the individual concerned
  • Kept secure (this will involve technological and organisational measures)
  • Not transferred outside the European Economic Area without adequate additional protection.

In certain circumstances you may be required to notify the Information Commissioner of your activities. This generally involves businesses that process information for purposes other than human resources or marketing. Notification involves a £35 annual fee.

Environmental best practice

The impact of our actions on the environment is now well understood. While governments negotiate programmes to mitigate these effects, it increasingly falls on individual businesses and citizens to ensure that they are accountable for their own environmental impact. For businesses there are a variety of statutory responsibilities that must be fulfilled.

Amongst the most wide-ranging regulations are those concerning waste. Businesses must ensure that all waste is properly secured and stored, and that it is only disposed of by an authorised organisation (this is likely to be your local authority). When transferring your waste, you must get a Waste Transfer Notice (WTN) signed by both parties. It is now possible to get ‘season ticket’ WTNs in order to avoid having to fill out a new WTN for every transfer. If you are storing or transporting hazardous waste you must also register with the Environment Agency before removing any such waste from your premises. The Agency will be able to advise on your specific statutory responsibilities.

Regulations governing the handling of packaging also apply to a wide variety of businesses. If your business has a turnover of more than £2 million, and annually handles more than 50 tonnes of packaging, you will be required to register with the Environment Agency. You will also have a responsibility to put in place measures that mitigate the impact of this packaging; particularly, you will be required to recover and recycle a set amount. This amount will vary depending on the nature of your business, so you should seek specific advice from the Environment Agency.

The law on sales

There is a variety of laws governing the sale and provision of goods and services, and it is vitally important that you are fully compliant.

Most of the regulations concerning the sale of goods are, as with data protection rules, simply common sense. For example, goods must fit the description given of them, and they must be fit for the purpose specified. Crucially, this includes information given on the shop floor; if a customer says they want a printer that prints envelopes and a member of staff says that it will, the goods provided must be able to perform this task.

It is also important to remember that, when selling products, responsibility for dealing with complaints rests with you, the supplier. It is not acceptable to suggest that a customer must take their complaint to the manufacturer.

If you are providing services, rather than selling goods, similar rules apply. Even if no written document exists, you enter into a legally binding contract when you agree to provide a service. Clearly, the service must conform to the terms of this contract. So, if you said that you would complete some work by a set date, you have a legal responsibility to do so. Furthermore, the Supply of Goods and Services Act states that you must do the work to a “reasonable” standard and at a “reasonable” price if you did not agree these specifics in advance. This is generally taken to mean that you will conform to industry standards.

Public liability insurance

Finally, it is important to remember that mistakes do sometimes happen. No matter how efficiently you run your business, there are occasions on which things may not go to plan. In the worst case scenario this could lead to a member of the public sustaining an injury or damage to their property.

Public liability insurance is not a legal requirement (unless you run a horse-riding establishment!), but it is seen as a business necessity. In the first instance, a claim against you by a member of the public can be financially crippling; it is not uncommon for uninsured businesses to be bankrupted by this type of claim. Perhaps even more pertinent, however, is the fact that many businesses will refuse to deal with you unless you have sufficient insurance. You will require proof of public liability cover in order to secure contracts, and it is therefore a necessary and important investment.

Simply Business allows you to compare real quotes from top UK insurers. You can also read the policy documents before you make a purchase - crucial if you are to make the right choice.

Many small business owners do not consider their public responsibilities but it is vitally important that you are aware of your obligations, and that you take suitable action to comply with them.

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