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Glossary

Approved Person

This is someone within a firm who will be performing a controlled function. To perform a controlled function, that person must be approved to do so and comply with the FSA’s Statements of Principle and Code of Practice for Approved Persons. When assessing an application from someone wanting to be an approved person, the FSA needs to be satisfied whether they are fit and proper to perform a controlled function. For more information see the Fit and Proper Test for Approved Persons section of the FSA Handbook.

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Asylum and Immigration Act 1996

Making it illegal for employers to employ anyone without permission to work in the UK.

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Care Standards Act 2000

Designed to protect the public from unqualified or dangerous workers, placing the responsibility on employers to check candidates.

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Caution

A caution is a formal warning about future conduct given by a senior police officer, usually in a police station, after a person has committed an offence.  It is used as an alternative to a charge and possible prosecution.

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Children

The Criminal Justice Court Service Act (CJCSA) defines a child as someone who is under 18 (under 16 if the child is employed).

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Conduct on Employment Agencies and Employment Business Regulations

Regulations requiring agencies to screen candidates adequately, give employers information on why candidates might be unsuitable. Establishes fee limits on employers who give temporary workers permanent jobs.

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Controlled functions

The controlled functions are those jobs or responsibilities within a business that have a particular regulatory significance. Some examples are overseeing the firm’s systems and controls and being responsible for compliance with FSA rules. There are 27 controlled functions and different functions are relevant to different businesses, depending on the particular regulated activities they do. The controlled functions are divided into two main groups:

Significant influence functions: These relate to managing and overseeing the business. In the FSA Handbook these are referred to as governing functions, required functions, systems & controls functions and significant management functions.

Customer Functions: These relate to dealing directly with customers and their property. Individuals holding a position of significant influence in a firm need to be approved by the FSA (these individuals are called approved persons).

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Corporate Governance

Provides the structures through which the objectives of the firm are set, and the means of attaining those objectives and monitoring performance. It involves the development of systems and processes for ensuring proper accountability, probity and openness in the conduct of an organisation’s business.

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Criminal Justice and Court Services Act

Making it illegal for people on the PoCA or PoVA lists to seek or be given employment in jobs involving close contact with children or vulnerable adults.

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Criminal Records Bureau (CRB)

Government organisation providing checks -disclosures- into individuals’ criminal records

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Data controllers and data subjects

Employers who process personal data about staff, and those to which this data relates.

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Data Protection Act 1998 (DP Act)

Protects personal data and allows data to be disclosed only in accordance with data protection principles.

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Employment Practices DP Code

A code of practice issued by the Information Commission to help employers meet the requirements of the Data Protection (DP) Act.

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Enforced Subject Access

Under current legislation, individuals can exercise their right to apply for access to information held on them including criminal record information under the ’subject access’ provisions of the Data Protection Act 1998.  Currently, some employers seek to obtain this information about employees and potential employees by compelling them to exercise their rights under the Data Protection Act.  This process is known as ’Enforced Subject Access’ and is undesirable because details of all convictions are revealed.  Most employers are not entitled to ask for this information under the Rehabilitation of Offenders Act (ROA) 1974.

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Enhanced Disclosure

A type of criminal record check available from the CRB to applicants for posts involving regular care, training, supervising or being in sole charge of young people, for certain statutory licensing purposes and judicial appointments.

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Ex-Offender

A person who has been convicted of a criminal offence and whose crime is now “spent” under the Rehabilitation of Offenders Act (ROA) 1974.

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Excepted Professions

Positions of trust set out in the Exceptions Order to the Rehabilitation of Offenders Act (ROA) 1974, where an employer is entitled to ask a candidate to reveal details of all convictions, whether spent or not.

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Exceptions Order

The Exceptions Order to the Rehabilitation of Offenders Act (ROA) 1974 sets out those occupations and positions exempt from the provisions of the ROA. These are generally positions of trust, where there is a valid need to see a person’s full criminal history in order to assess their suitability for a position.  This information is intended as general guidance only. It must not be regarded as a definitive interpretation of the Act. Anyone requesting further guidance should seek legal advice.

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Exempted Question

An exempted question is a valid request for a person to reveal their full criminal history (including spent convictions) and is made possible by virtue of the Exceptions Order to the Rehabilitation of Offenders Act (ROA) 1974.

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Financial Services Market Act 2000

Saw the establishment of the Financial Services Authority (FSA), which requires individuals in controlled functions to be checked out for honesty and competence.

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National Minimum Standards

A set of standards developed by the Department of Health regulating the care sector, requiring employers to have written recruitment procedures and to carry out intensive checks into certain regulated employees.

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Operational Risk

The risk of loss resulting from inadequate or failed processes, people or systems or from external events (Basel II).

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Personal Data

Any data relating to a living individual from which that individual can be identified, or from which, together with other information in the possession of, or likely to come into the possession of the data controller, that individual can be identified.

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Police Act 1997

Set up the CRB, giving employers access to individual criminal records.

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Pre-employment screening

As defined by the Employment Practices Code, means actively making enquiries to third parties about an applicant’s background and circumstances.

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Pre-employment vetting

See Vetting.

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Psychometric Testing

Read the latest research on psychometric testing

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Registered person

Applications for both standard and enhanced disclosures must be countersigned by a ’registered person’ listed in a register maintained by the CRB as such. A registered person is a corporate or unincorporated body; a person appointed to an office by virtue of any enactment; or an individual who employs others in the course of a business.

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Rehabilitation of Offenders Act (ROA) 1974 and ROA (Exceptions) Order 1975

Governing when a conviction can be considered spent and outlining job exceptions to the definition of spent.

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Risk assessment

Procedure to compare an applicant’s skills, experience and conviction circumstances against risk criteria identified for the job.

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Risk Assessment Framework

The FSA’s ARROW (Advanced Risk Response Operating frameWork) risk assessment framework has been developed to help the FSA meet its statutory objectives. It involves assigning firms to one of four supervision categories, based on the risk they pose to the FSA’s objectives, as perceived by the FSA. As a result of the ARROW process, the FSA will develop a risk mitigation programme for the firm that will use a selection of regulatory tools intended to reduce the risks that have been flagged as requiring action.

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Sarbanes-Oxley Act (2002)

It evolved from the need to address corporate failures with a focus on preventing corporate fraud (e.g. Enron/Worldcom). The Act makes reporting on internal controls mandatory for SEC registrants at the end of the fiscal year and has introduced the requirement to implement an approved control framework (e.g. COSO).

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Sensitive data

Data such as information about criminal records, the handling of which is governed by the DP Act.

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Spent Conviction

The Rehabilitation of Offenders Act (ROA) 1974 sets out to make life easier for many people who have been convicted of a criminal offence and who have since lived on the right side of the law. A person convicted of all but the most serious criminal offences and who receives a sentence less than 2.5 years in prison, benefits from the Act if they are not convicted again during a specified period.  This is called the rehabilitation period. In general terms, the more severe a penalty is, the longer the rehabilitation period. Once a rehabilitation period has expired and no further offending has taken place, a conviction is considered to be ’spent’. Once a conviction has been spent, the convicted person does not have to reveal it or admit its existence in most circumstances, including, for example, when applying for a job. In most circumstances, an employer cannot refuse to employ someone, or dismiss them, on the basis of a spent conviction. There are some exceptions to the general principle that spent convictions do not have to be declared. When assessing the suitability of a person for a position of trust, an employer is entitled to ask a candidate to reveal details of all convictions, whether spent or not. This is, in part, to ensure that children and other vulnerable groups are adequately protected from those in positions of authority over them.  These positions of trust, or excepted professions, are set out in the ROA Exceptions Order.

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Standard disclosure

A type of criminal record check available from the CRB for posts which are exceptions to the ROA, including those involved regularly with children, young people, the elderly, sick or handicapped, administration of the law and other sensitive areas.

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Verification

As defined in the Employment Practices Code is the process of checking the details supplied by applicants are accurate and complete, including the taking up of references

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Vetting

Is a process by which an employer undertakes background checks to assess a person’s suitability.  The aim of vetting is three-fold:  1) to confirm the applicant’s identification, 2) to look at whether any association the applicant has gives rise to a conflict of interest and 3) whether there are any vulnerable aspects of the applicant’s life that would make them unsuitable for a particular employment post.

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