Reclaiming business expenses should be a straightforward exercise. The expense is either business related or not. However, those working at senior and executive levels can sometimes find that there are blurry lines between work and personal life. When does a trip to see the Managing Director on their holiday yacht relate to business or pleasure?

This very issue was one of the topics under consideration by the High Court in the case between Nathalie Dauriac and her ex-business partner John Caudwell (founder of Phones4u). During the proceedings the High Court heard arguments from Caudwell that Dauriac stole up to £30k from his business through a series of fraudulent business expenses. Caudwell has alleged that his investigations unravelled numerous unjustifiable expenses, which related to personal holidays and gifts for Dauriac’s family members.

Dauriac has defended the allegations arguing that the claims against her are untrue and engineered in an attempt to avoid paying out the £10 million share value which she alleges is owed to her. Many other accusations have been raised during the course of the case, including an allegation that Caudwell placed a discriminatory condition on the initial offer of employment.

Whilst we await the outcome of the High Court hearing there are a few nuggets to take away from the case:

  • Always have in place a clear expense policy, setting out what is deemed as acceptable business expenses.
  • Carry out regular audits of business expenses. Avoid waiting until a working relationship sours to review expense claims, as this may appear that you are attempting to engineer a reason to bring the employment relationship to an end.
  • Don’t make it a precondition of an offer of employment or promotion that a person should place their plans to have children on hold. An instruction or even suggestion of this nature is likely to be regarded as discriminatory and in breach of the Equality Act 2010.

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