(b) is a fit and proper person to act as an insolvency practitioner
only in relation to companies, but the person’s authorisation is
not so limited; or

(c) is a fit and proper person to act as an insolvency practitioner
5only in relation to individuals, but the person’s authorisation is
not so limited.

(3) Condition 3 is that it is appropriate for the person’s authorisation to act
as an insolvency practitioner to be suspended for a period or until one
or more requirements are complied with.

(4) 10Condition 4 is that it is appropriate to impose other restrictions on the
person acting as an insolvency practitioner.

(5) Condition 5 is that loss has been suffered as a result of the failure
mentioned in condition 1 by one or more creditors of a company,
individual or insolvent partnership in relation to which the person is
15acting or has acted as an insolvency practitioner.

(6) In this section “relevant recognised professional body” has the same
meaning as in section 391O.

391R Direct sanctions direction instead of order

(1) The Secretary of State may give a direction (a “direct sanctions
20direction”) in relation to a person acting as an insolvency practitioner to
the relevant recognised professional body (instead of applying, or
continuing with an application, for a direct sanctions order against the
person) if the Secretary of State is satisfied that—

(a) condition 1 and at least one of conditions 2, 3, 4 and 5 are met in
25relation to the person (see section 391Q), and

(b) it is in the public interest for the direction to be given.

(2) But the Secretary of State may not give a direct sanctions direction in
relation to a person without that person’s consent.

(3) A direct sanctions direction may require the relevant recognised
30professional body to take all necessary steps to secure that—

(a) the person is no longer authorised (whether fully or partially) to
act as an insolvency practitioner;

(b) the person is no longer fully authorised to act as an insolvency
practitioner but remains partially authorised to act as such
35either in relation to companies or individuals, as specified in the
direction;

(c) the person’s authorisation to act as an insolvency practitioner is
suspended for the period specified in the direction or until such
time as the requirements so specified are complied with;

(d) 40the person must comply with such other requirements as may
be specified in the direction while acting as an insolvency
practitioner;

(e) the person makes such contribution as may be specified in the
direction to one or more creditors of a company, individual or
45insolvent partnership in relation to which the person is acting or
has acted as an insolvency practitioner.

(4) A direct sanctions direction must not be given in relation to a person
whose authorisation to act as an insolvency practitioner was granted by

the Department of Enterprise, Trade and Investment in Northern
Ireland (see section 390A(2)(b)).

(5) A direct sanctions direction must not specify a contribution as
mentioned in subsection (3)(e) which is more than the remuneration
5that the person has received or will receive in respect of acting as an
insolvency practitioner in the case.

(6) In this section “relevant recognised professional body” has the same
meaning as in section 391O.”

139 Power for Secretary of State to obtain information

10After section 391R of the Insolvency Act 1986 (inserted by section 138) insert—

“General

391S Power for Secretary of State to obtain information

(1) A person mentioned in subsection (2) must give the Secretary of State
such information as the Secretary of State may by notice in writing
require for the exercise of the Secretary of State’s functions under this
15Part.

(2) Those persons are—

(a) a recognised professional body;

(b) any individual who is or has been authorised under section
390A to act as an insolvency practitioner;

(c) 20any person who is connected to such an individual.

(3) A person is connected to an individual who is or has been authorised
to act as an insolvency practitioner if, at any time during the
authorisation—

(a) the person was an employee of the individual;

(b) 25the person acted on behalf of the individual in any other way;

(c) the person employed the individual;

(d) the person was a fellow employee of the individual’s employer;

(e) in a case where the individual was employed by a firm,
partnership or company, the person was a member of the firm
30or partnership or (as the case may be) a director of the company.

(4) In imposing a requirement under subsection (1) the Secretary of State
may specify—

(a) the time period within which the information in question is to
be given, and

(b) 35the manner in which it is to be verified.”

140 Compliance orders

After section 391S of the Insolvency Act 1986 (inserted by section 139) insert—

“391T Compliance orders

(1) If at any time it appears to the Secretary of State that—

(a) 40a recognised professional body has failed to comply with a
requirement imposed on it by or by virtue of this Part, or

(b) any other person has failed to comply with a requirement
imposed on the person by virtue of section 391S,

the Secretary of State may make an application to the court.

(2) If, on an application under this section, the court decides that the body
5or other person has failed to comply with the requirement in question,
it may order the body or person to take such steps as the court considers
will secure that the requirement is complied with.

(3) In this section, “the court” means the High Court or, in Scotland, the
Court of Session.”

10Power to establish single regulator of insolvency practitioners

141 Power to establish single regulator of insolvency practitioners

(1) The Secretary of State may by regulations designate a body for the purposes
of—

(a) authorising persons to act as insolvency practitioners, and

(b) 15regulating persons acting as such.

(2) The designated body may be either—

(a) a body corporate established by the regulations, or

(b) a body (whether a body corporate or an unincorporated association)
already in existence when the regulations are made (an “existing
20body”).

(3) The regulations may, in particular, confer the following functions on the
designated body—

(a) establishing criteria for determining whether a person is a fit and
proper person to act as an insolvency practitioner;

(b) 25establishing the requirements as to education, practical training and
experience which a person must meet in order to act as an insolvency
practitioner;

(c) establishing and maintaining a system for providing full authorisation
or partial authorisation to persons who meet those criteria and
30requirements;

(d) imposing technical standards for persons so authorised and enforcing
compliance with those standards;

(e) imposing professional and ethical standards for persons so authorised
and enforcing compliance with those standards;

(f) 35monitoring the performance and conduct of persons so authorised;

(g) investigating complaints made against, and other matters concerning
the performance or conduct of, persons so authorised.

(4) The regulations may require the designated body, in discharging regulatory
functions, so far as is reasonably practicable, to act in a way—

(a) 40which is compatible with the regulatory objectives, and

(b) which the body considers most appropriate for the purpose of meeting
those objectives.

(5) Provision made under subsection (3)(d) or (3)(e) for the enforcement of the
standards concerned may include provision enabling the designated body to

impose a financial penalty on a person who is or has been authorised to act as
an insolvency practitioner.

(6) The regulations may, in particular, include provision for the purpose of
treating a person authorised to act as an insolvency practitioner by virtue of
5being a member of a professional body recognised under section 391 of the
Insolvency Act 1986 immediately before the regulations come into force as
authorised to act as an insolvency practitioner by the body designated by the
regulations after that time.

(7) Expressions used in this section which are defined for the purposes of Part 13
10of the Insolvency Act 1986 have the same meaning in this section as in that Part.

(8) Section 142 makes further provision about regulations under this section which
designate an existing body.

(9) Schedule 11 makes supplementary provision in relation to the designation of a
body by regulations under this section.

142 15Regulations under section 141: designation of existing body

(1) The Secretary of State may make regulations under section 141 designating an
existing body only if it appears to the Secretary of State that—

(a) the body is able and willing to exercise the functions that would be
conferred by the regulations, and

(b) 20the body has arrangements in place relating to the exercise of those
functions which are such as to be likely to ensure that the conditions in
subsection (2) are met.

(2) The conditions are—

(a) that the functions in question will be exercised effectively, and

(b) 25where the regulations are to contain any requirements or other
provisions prescribed under subsection (3), that those functions will be
exercised in accordance with any such requirements or provisions.

(3) Regulations which designate an existing body may contain such requirements
or other provisions relating to the exercise of the functions by the designated
30body as appear to the Secretary of State to be appropriate.

143 Regulations under section 141: timing and supplementary

(1) Section 141 and, accordingly, section 142 and subsections (3) and (4) below
expire at the end of the relevant period unless the power conferred by
subsection (1) of section 141 is exercised before the end of that period.

(2) 35The “relevant period” is the period of 7 years beginning with the day on which
section 141 comes into force.

(3) Regulations under section 141 are subject to affirmative resolution procedure.

(4) If a draft of a statutory instrument containing regulations under section 141
would, apart from this subsection, be treated for the purposes of the Standing
40Orders of either House of Parliament as a hybrid instrument, it is to proceed in
that House as if it were not a hybrid instrument

Part 11 Employment

Whistleblowing

144 Protected disclosures: reporting requirements

(1) 5The Employment Rights Act 1996 is amended as follows.

(2) In Part 4A (protected disclosures), after section 43F insert—

“43FA Prescribed persons: duty to report on disclosures of information

(1) The Secretary of State may make regulations requiring a person
prescribed for the purposes of section 43F to produce an annual report
10on disclosures of information made to the person by workers.

(2) The regulations must set out the matters that are to be covered in a
report, but must not require a report to provide detail that would
enable either of the following to be identified—

(a) a worker who has made a disclosure;

(b) 15an employer or other person in respect of whom a disclosure
has been made.

(3) The regulations must make provision about the publication of a report,
and such provision may include (but is not limited to) any of the
following requirements—

(a) 20to send the report to the Secretary of State for laying before
Parliament;

(b) to include the report in another report or in information
required to be published by the prescribed person;

(c) to publish the report on a website.

(4) 25The regulations may make provision about the time period within
which a report must be produced and published.

(5) Regulations under subsections (2) to (4) may make different provision
for different prescribed persons.”

(3) In section 236 (orders and regulations)—

(a) 30in subsection (3), before “43K(4)” insert “43FA (but see subsection
(3A)),”;

(b) after subsection (3) insert—

“(3A) Subsection (3) does not apply to regulations under section 43FA
that contain only the provision mentioned in section 43FA(2),
35(3) or (4).”

Employment tribunals: failure to pay sums

145 Financial penalty for failure to pay sums ordered by employment tribunal etc

(1) The Employment Tribunals Act 1996 is amended as provided in subsections (2)
to (6).

(2) After section 37 insert—

“ Part 2A Financial penalties for failure to pay sums ordered to be paid or
settlement sums

37A 5Sums to which financial penalty can relate

(1) This section has effect for the purposes of this Part.

(2) “Financial award” means a sum of money ordered by an employment
tribunal, or on a relevant appeal, to be paid by an employer on a claim
involving the employer and a worker, other than a financial penalty
10under section 12A.

(3) “Settlement sum” means a sum payable by an employer to a worker
under the terms of a settlement in respect of which a certificate has been
issued under section 19A(1).

(4) “Relevant sum” means—

(a) 15a financial award, or

(b) a settlement sum.

(5) In subsection (2) “relevant appeal”, in relation to a financial award,
means an appeal against—

(a) the decision on the claim to which it relates,

(b) 20the making of the financial award,

(c) the amount of the award, or

(d) any decision made on an appeal within paragraphs (a) to (c) or
this paragraph.

(6) Sections 37B to 37D apply for the purposes of calculating the unpaid
25amount on any day of a relevant sum.

37B Financial award: unpaid amount

(1) In the case of a financial award, the unpaid amount on any day means
the amount outstanding immediately before that day in respect of—

(a) the initial amount of the financial award (see subsection (2)),
30and

(b) subject to subsection (4), interest payable in respect of the
financial award by virtue of section 14.

(2) The initial amount of a financial award is—

(a) in a case to which section 16 applies, the monetary award within
35the meaning of that section (see section 17(3)), and

(b) in any other case, the sum of money ordered to be paid,

adjusted in accordance with subsection (3).

(3) The initial amount of a financial award—

(a) includes (or, if it is the only amount the employer has been
40ordered to pay, comprises) any amount the employer has been
ordered by an employment tribunal to pay in respect of
employment tribunal fees;

(b) does not include—

(i) any other amount payable by virtue of section 13 or 13A;

(ii) any amount payable by virtue of section 34;

(iii) any other amount payable in respect of costs or
expenses.

(4) 5Interest in respect of the financial award included under subsection
(1)(b) in the calculation of the unpaid amount does not include interest
(if any) in respect of any amount excluded from the initial amount
under subsection (3).

(5) An amount in respect of a financial award is not to be regarded as
10outstanding—

(a) when the employer or worker could appeal against—

(i) the decision on the claim to which it relates,

(ii) the making of the financial award,

(iii) the amount of the award, or

(iv) 15any decision made on an appeal within sub-paragraphs
(i) to (iii) or this sub-paragraph,

but has not done so, or

(b) when the employer or worker has made such an appeal but the
appeal has not been withdrawn or finally determined.

37C 20Settlement sum: unpaid amount

(1) In the case of a settlement sum, the unpaid amount on any day means
the amount outstanding immediately before that day in respect of—

(a) the settlement sum, and

(b) interest (if any) calculated in accordance with the settlement
25(within the meaning of section 19A).

(2) Subject to section 37D(2) and (3), an amount in respect of a settlement
sum is not to be regarded as outstanding if the settlement sum is not
recoverable under section 19A(3).

37D Unpaid amount of relevant sum: further provision

(1) 30Subsections (2) and (3) apply where—

(a) a relevant sum is to be paid by instalments,

(b) any instalment is not paid on or before the day on which it is
due to be paid, and

(c) a warning notice (see section 37E) is given in consequence of the
35failure to pay that instalment (“the unpaid instalment”).

(2) For the purposes of calculating the unpaid amount for—

(a) that warning notice, and

(b) any penalty notice given in respect of that warning notice,

any remaining instalments (whether or not yet due) are to be treated as
40having been due on the same day as the unpaid instalment.

(3) Accordingly, the amount outstanding in respect of the financial award
or settlement sum is to be taken to be—

(a) the aggregate of—

(i) the unpaid instalment, and

(ii) 45any remaining instalments,

including, in the case of a settlement sum, any amount which is
not recoverable under section 19A(3) by reason only of not
being due,

(b) interest on those amounts calculated in accordance with section
537B(1)(b) or 37C(1)(b) (and subsection (2)).

(4) Subsections (2) and (3) are not to be taken to affect the time at which any
remaining instalment is due to be paid by the employer.

(5) Where a payment by an employer is made, or purported to be made, in
respect of a relevant sum, an enforcement officer may determine
10whether, and to what extent, the payment is to be treated as being—

(a) in respect of that relevant sum or instead in respect of some
other amount owed by the employer;

(b) in respect of the initial amount or interest on it, in the case of a
payment treated as being in respect of the relevant sum.

37E 15Warning notice

(1) This section applies where an enforcement officer considers that an
employer who is required to pay a relevant sum has failed—

(a) in the case of a relevant sum which is to be paid by instalments,
to pay an instalment on or before the day on which it is due to
20be paid, or

(b) in any other case, to pay the relevant sum in full on or before the
day on which it is due to be paid.

(2) The officer may give the employer a notice (a “warning notice”) stating
the officer’s intention to impose a financial penalty in respect of the
25relevant sum unless before a date specified in the warning notice (“the
specified date”) the employer has paid in full the amount so specified
(“the specified amount”).

This is subject to subsection (3).

This is subject to subsection (3).

(3) 30Where a penalty notice has previously been given in respect of the
relevant sum, the officer may not give a warning notice until—

(a) 3 months have elapsed since the end of the relevant period
(within the meaning of section 37H) relating to the last penalty
notice given in respect of the relevant sum, and

(b) 35if the relevant sum is to be paid by instalments, the last
instalment has become due for payment.

(4) The specified date must be after the end of the period of 28 days
beginning with the day on which the warning notice is given.

(5) The specified amount must be the unpaid amount of the relevant sum
40on the day on which the warning notice is given.

(6) A warning notice must identify the relevant sum and state—

(a) how the specified amount has been calculated;

(b) the grounds on which it is proposed to impose a penalty;

(c) the amount of the financial penalty that would be imposed if no
45payment were made in respect of the relevant sum before the
specified date;

(d) that the employer may before the specified date make
representations about the proposal to impose a penalty,
including representations—

(i) about payments which the employer makes in respect of
5the relevant sum after the warning notice is given;

(ii) about the employer’s ability to pay both a financial
penalty and the relevant sum;

(e) how any such representations may be made.

(7) The statement under subsection (6)(e) must include provision for
10allowing representations to be made by post (whether or not it also
allows them to be made in any other way).

(8) If the employer pays the specified amount before the specified date, the
relevant sum is to be treated for the purposes of this Part as having been
paid in full.

(9) 15Subsection (8) is not to be taken to affect the liability of the employer to
pay any increase in the unpaid amount between the date of the warning
notice and the date of payment.

37F Penalty notice

(1) This section applies where an enforcement officer—

(a) 20has given a warning notice to an employer, and

(b) is satisfied that the employer has failed to pay the specified
amount in full before the specified date.

(2) The officer may give the employer a notice (a “penalty notice”)
requiring the employer to pay a financial penalty to the Secretary of
25State.

(3) A penalty notice must identify the relevant sum and state—

(a) the grounds on which the penalty notice is given;

(b) the unpaid amount of the relevant sum on the specified date
and how it has been calculated;

(c) 30the amount of the financial penalty (see subsections (4) to (6));

(d) how the penalty must be paid;

(e) the period within which the penalty must be paid;

(f) how the employer may pay a reduced penalty instead of the
financial penalty;

(g) 35the amount of the reduced penalty (see subsection (8));

(h) how the employer may appeal against the penalty notice;

(i) the consequences of non-payment.

(4) Subject to subsections (5) and (6), the amount of the financial penalty is
50% of the unpaid amount of the relevant sum on the specified date.

(5) 40If the unpaid amount on the specified date is less than £200, the amount
of the penalty is £100.

(6) If the unpaid amount on the specified date is more than £10,000, the
amount of the financial penalty is £5,000.

(7) The period specified under subsection (3)(e) must be a period of not less
than 28 days beginning with the day on which the penalty notice is
given.

(8) The amount of the reduced penalty is 50% of the amount of the financial
5penalty.

(9) Subsection (10) applies if, within the period of 14 days beginning with
the day on which the penalty notice is given, the employer—

(a) pays the unpaid amount of the relevant sum on the specified
date (as stated in the notice under subsection (3)(b)), and

(b) 10pays the reduced penalty to the Secretary of State.

(10) The employer is to be treated—

(a) for the purposes of this Part, as having paid the relevant sum in
full, and

(b) by paying the reduced penalty, as having paid the whole of the
15financial penalty.

(11) Subsection (10)(a) is not to be taken to affect the liability of the employer
to pay any increase in the unpaid amount of the relevant sum between
the specified date and the date of payment.

37G Appeal against penalty notice

(1) 20An employer to whom a penalty notice is given may, before the end of
the period specified under section 37F(3)(e) (period within which
penalty must be paid), appeal against—

(a) the penalty notice; or

(b) the amount of the financial penalty.

(2) 25An appeal under subsection (1) lies to an employment tribunal.

(3) An appeal under subsection (1) may be made on one or more of the
following grounds—

(a) that the grounds stated in the penalty notice under section
37F(3)(a) were incorrect;

(b) 30that it was unreasonable for the enforcement officer to have
given the notice;

(c) that the calculation of an amount stated in the penalty notice
was incorrect.

(4) On an appeal under subsection (1), an employment tribunal may—

(a) 35allow the appeal and cancel the penalty notice;

(b) in the case of an appeal made on the ground that the calculation
of an amount stated in the penalty notice was incorrect, allow
the appeal and substitute the correct amount for the amount
stated in the penalty notice;

(c) 40dismiss the appeal.

(5) Where an employer has made an appeal under subsection (1), the
penalty notice is not enforceable until the appeal has been withdrawn
or finally determined.