Friday, 3 July 2009

Don't abuse expenses to boost your salary

Shropshire bosses should review their expenses policies in order to stop staff getting away with false claims.

John Mehtam, our Employment Law Specialist, said the MPs expenses scandal had uncovered a raft of issues that could not be ignored.

“We’ve all seen the continuing press coverage and the uproar over the MPs’ claims, and it’s an important lesson for companies to learn. Now is the perfect time to review your expenses policies, and ensure staff are not using your expenses system as a way to boost their salaries. Some people seem to assume they have a right to expenses on top of their wages, but in fact they are there to reimburse staff and not as an additional extra to reward them.”

John said companies should check the expenses staff were claiming were actually correct – particularly travelling expenses.

“But of course you’ll probably have much more pressing things to do than check every single expenses claim – and that’s what expenses cheats are relying on. There is no reason though why you can’t introduce spot checks. Select a couple of claims at random and look through them in detail – this should be enough to put employees off who may be considering submitting inflated claims.

“If you do find someone has made a false or embellished claim, challenge them – if they’ve clearly broken the rules, you can start disciplinary proceedings, and of course, it’s actually also a criminal offence.”

John said companies should also insist on receipts – for every expense they claim, staff should need to prove it. “Take heed of the scandal that’s hit Westminster, and don’t allow your own company to suffer at the hands of employees who are prepared to take a chance.”

Think carefully before you sign

Shropshire couples should think very carefully before they sign a prenuptial agreement as it will now have a huge impact on the rest of their lives.

Graham Davies, our Senior Partner, said previously prenuptial agreements had been taken into consideration by the courts, but could not be enforced. But now, in a landmark decision senior judges have given their clearest signal yet that courts in England and Wales should take prenuptials as binding documents, bringing them into line with the rest of Europe.

“The law previously said that prenuptial contracts were not enforceable, but the judges said the legislation was patronising and outdated,” said Graham. “So in the case of a wealthy heiress, they ruled that the prenuptial contract she and her husband had signed should be decisive in their divorce case.

“In future, the courts will now regard these contracts as binding, unless there is a reason not to. This means couples should give more consideration to the agreement before they sign it, as it could be a key factor if they ever decide to divorce and need to divide their assets.”

Graham said the judges had decided that ignoring prenuptial contracts seemed to be “increasingly unrealistic” and “reflected the laws and morals of earlier generations”. “By bringing England into line with the rest of Europe, the judges have put a stop to divorcing couples from overseas coming here to finalise their arrangements and avoiding their prenuptial agreements.

“The outdated law meant it was open season for couples who wanted to disregard the contracts they had previously signed – now England is on a level playing field. Any couples considering a prenuptial agreement would be wise to think things through very carefully – the consequences of signing one could have a huge impact on your future.”