The impact of COVID-19 on financial services firms – key regulatory and employment issues

Ian Mason: Well, hello everyone and welcome to this Gowling WLG seminar on the impact of COVID-19 on financial services firms, key regulatory and employment issues. I am Ian Mason, I am a partner in Gowling WLG and work in the financial services regulatory team and with me today are:

Sushil Kuner: Hi everyone, my name is Sushil Kuner. I am a principal associate in Gowling WLG's financial services and regulatory team. I spent eight years at the FCA prior to being at Gowlings. Four years in supervision division and then four years in the enforcement division.

Simon Stephen: Hello. I am Simon Stephen. I am a director in the employment team. I have been at Gowling on and off for about 15 years and I have spent four and a half years in-house at a global investment bank working in employee relations.

Ian: Thank you. So, just to explain the format of this webinar. There are various key questions arising from COVID-19 for firms which we are going to be discussing with Sushil and Simon and we also invite you to send in your questions in the Q&A box and within the time available we will try to answer a few of those towards the end of the webinar, otherwise we will be looking at them subsequently.

Now is clearly a challenging time for all firms and no less so for financial services firms and firms regulated by the FCA must continue to comply with the FCA rules while at the same time, dealing with major issues resulting from COVID-19, such as home working, financial pressures on your customers, volatile markets and significant economic disruption and that is what we will hear from Sushil. The FCA and the other regulatory authorities have published first communications – an update setting out what their expectations are of firms in the current situation.

It is really important for firms and their senior management to be on top of these communications and we hope this webinar will help you with that. You will not be surprised to hear also that there are some particular employment issues for regulated firms arising from the current situation and Simon will highlight these.

So, first of all - Sushil, the government has indicated that financial services is a critical sector in the response to COVID-19 and that children with parents who fulfil certain key roles can still go to school if they cannot be kept safely at home. Who are the key workers in financial services industry?

Sushil: Yeah, so these are individuals essentially fulfil a role which is necessary for the firm to continue to provide essential daily financial services to consumers or to ensure the continuing functions of markets. Now, while the FCA has placed the onus on firms to determine which of their workforce are key financial workers, they have provided some guidance to help firms identify these individuals.

Now essentially, firms should first identify the activities the services or operations which, if interrupted would likely lead to disruption of essential services to the real economy or financial stability. Firms should then identify the individuals who are essential to the continued provision of services, even where these are not financial services firms. So here we are thinking of critical outsource providers for example.

Now the FCA has recommended that the CEO SMF one function or in the absence of a CEO, the most relevant member of the senior management team, should be accountable for ensuring an adequate process to identify key financial workers.

Types of roles which may be considered as providing essential services include individuals essential in the overall management of the firm, for example senior managers under the senior managers regime, individuals essential in the running of online services and processing, individuals essential in the running of branches and providing essential customer services and here we can think of claims handlers in call centres, workers responsible for client money and client assets and those maintaining access to cash and other payment services.

Also captured are employees in risk management, compliance, audit functions which are necessary to ensure the firm continues to meet its clients' needs as well as its obligations under the regulatory system and finally any individual that sort of provides essential support to allow the functioning of those aforementioned roles such as finance and IT staff would potentially be captured as well.

Ian: Thanks Sushil. So Simon are there particular employment issues that firms need to be thinking about in relation to this aspect.

Simon: Thanks Ian. Well the short answer is yes, there are many and the main reason for that is that the usual equality rules and the usual employment law regulations will all still continue to apply during this unprecedented time we are all facing. So that means that we have to make sure that decisions made, particularly around things like who are key workers, and who are we going to ask to come into the office, are all made clear and objective and can be easily justified.

Now we will probably all have experience of people who want to lobby for key status key employee status so that they can keep their kids in school while they carry on work and I do have some sympathy of that, with three children of my own, but you need to be consistent in that approach, particularly given the fact that many people with childcare issues or problems that may be caused by having to work from home may then feel particularly at risk or impacted by it.

So it is just important to make sure that all these things are taken into account and that people do not feel that certain areas are being treated more favourably than others and things like that.

It is also very important to make sure that given the key employee status is designed to enable us to help people going to work to get both the childcare issues that if we are asking people to come into work, the contingency planning is built in as how you are going to manage this. Things like splitting shifts and rotating staff all need to be taken into account to make sure that whilst we are keeping it to a minimum and we are doing what we need to do.

I think the final point not really an employment issue but linked, is the fact that in doing this when they are thinking about key employees, thinking about all these issues. There is going to be a lot of personal data being processed or being maintained so normal data protection principles have to still continue to apply.

Ian: Thanks Simon. So, Sushil are all financial services employees expected to travel to the office and work from the office?

Sushil: No, so the FCA has made clear that it strongly supports the UK government's efforts to protect the public by ensuring that only those workers who cannot work from home continue to travel to and from work. Again, the CEO or other appropriate designated senior manager should be allocated responsibility for identifying which of their employees are unable to perform their jobs from home and will have to travel to the office for business continuity site. The FCA has indicated though that it expects the total number of roles requiring an ongoing physical presence to be far smaller than the number of workers need to ensure all of the firm's business activities continue to function on a 'business as usual' basis.

Examples of employees not being expected to work in the office include financial advisers, staff who can safely and securely trade shares in financial instruments from home, business support staff and where they can triage issues from home and claims management companies.

Firms should, however, be mindful of their regulatory obligations where employees are working from home. So the FCA has made clear that it expects firms to take all reasonable steps and meet their regulatory obligations during this time, for example, entering orders and transactions promptly into relevant systems, using recorded lines when trading and giving staff access to the compliance support they need.

In particular, where employees would ordinarily be subject to routine oversight and monitoring the firms in the workplace, firms should ensure that they continue to be monitored when working remotely.

Ian: Thank you. So, Simon are there any particular issues here for people to think about with people coming in, either coming in or working from home, for you?

Simon: Yes, there are again many issues and again it links back to the fact that the usual employment law rules still apply. If you are requiring people to come into the office, there almost needs to be some form of risk assessment matters done, taking into account people's personal circumstances.

Particularly to identify anybody who may be at high risk. Obviously if anyone who has been required to shield following our government's advice, then they will not be coming into the office, but for other people, there may be grey areas just to make sure you are fully up to date with that information.

So that is things like taking into account anybody who is pregnant or has any underlying health issues and even age to some extent.

All of these issues come with a health warning about discrimination. We have seen potential risk areas where people saying that anyone with certain conditions come into the office and things like this, everything needs to be looked at on its own individual basis.

It is also important to keep it under review, the people that you require to work in. As Sushil has said, you have got to make sure that you have the right work-stream still functioning and you need people to carry those out in the office, but carrying out who you are actually asking to do that and keeping that under review is really important as circumstances may or may not change and it is a big part of the communications to staff to enable them to actually follow the phrase 'speak up culture' to speak up if circumstances change, to be sure they can be taken into account.

It is also important to remember about health and safety obligations and not just the regulatory obligations. This includes those who were asking to come into the office, making sure that they are protected as far as possible from the risk of being infected or coming into contact with those who are infected and it is also a health and safety duty to other people not to be infected by others who may be coming in.

So there is a number of different ways that that can be done. We have been advising a lot of clients on things like temperature checks and health assessments, all these steps need to be doing before allowing people into the office and to have contact with co-workers and colleagues.

These are all perfectly sensible and perfectly right things to do but again you need to make sure that things are done properly and maintaining the approach to equality laws and in line with data protection.

Things like temperature checks or health assessments, they contain personal data of particular sensitivity, they have a particular grade of protection under the data protection principles so everything must be done fairly and to the extent possible, in line with your own privacy notice.

The ICO have, however, helpfully said that they will relax expectations during this time but it is still something that cannot be forgotten and must be maintained.

You can also think of practical steps to help people to alleviate any concerns and the FCA have raised this as well about allowing or giving people passes, hall passes as they are known in the states I have learned this week. Where people can give to the authorities if they are challenged. We are hearing stories of our clients having employees stopped in the street to ask where they are going and even ringing the doorbells in offices asking why they are still open.

So doing practical things to help people out may well alleviate their concerns as well.

It is also really important to listen out for people's objections. If we designate someone a keyworker, they might think that is great because they have their childcare covered but if we ask them to come into the office, they may have very personal reasons why not, particularly along health and safety. They are entitled to raise these and so they must be listened to and dealt with as you would normally really in managing all these employee relations issues.

If you have people working at home, this is of course, fine and you may find that in years to come we all work from home a lot more often than we do. I have certainly seen a lot more of the insides of my colleague's houses than I have ever done in the past years and have met a lot of children and pets on the way.

But again, remembering the health and safety obligations still exist and even more heightened ones to some extent. So risk assessments - making sure people have safe places to work are all going to be very key. We can, I think expect that the FCA will start picking up on things like this in due course, expecting there to be part of the whole risk management process, how have we looked after staff, what steps did we put in place. And this I think is also particularly person to mental health issues, which again is something that the FCA has picked up on recently under the senior manager's regime, ensuring that the steps are in place to ensure the workforce is mentally well.

Working from home, particularly from those who are not used to it - not just those who are maybe more junior, who cannot work from home for supervision reasons and even those from more senior, more experienced who just do not like doing it, because they have not really done it.

All these things can have a big impact, particularly as this goes on for the foreseeable future. So there are many steps to make sure that people are looked after, checked in, zoom calls, live webinars, all things like this just to make sure people feel engaged.

Ian: Thanks Simon. Now, another hot topic has really been around the FCA conduct and culture and in particular non-financial misconduct and obviously with people working from home, they may have more time on their hands and there may be some greater temptation, so I was just wondering how that would apply in an employment context with so many people working from home now?

Simon: Yeah definitely, and I think it is something that needs to be thought of, because as you say, there is potential in time for non-financial misconduct issues to become more of a risk and as you say, particularly the longer it goes on and I think the important thing here is that the FCA conduct rules will still apply as will all the other internal policies and other relevant issues.

For those who are new to the senior management regime, you will still of course have a period of time in which to train individuals whether or not that will be extended we will have to wait and see but I think it is important to work on the basis that we still have to make sure that individuals are aware of the conduct rules and the expectations on them in terms of their behaviour. Of course there are other internal policies you may be able to flex to give some freedom for people to allow for circumstances but you cannot flex any of the expectations from the FCA and under the conduct rules.

Particular issues I think which need to borne in mind for those who are home working and it is always difficult this - it is a bit of a balance - it is how much do you go into it without being big brother if you like. But things like instant messaging from an employee relations point of view, they were always a good source of business when I worked in employee relations. They were futile ground for harassment claims and many other types of issues but this is particularly so of people left to their own devices. If you are in an office environment, it is very different but if you are sat at home and you are messaging people those boundaries can slip so it is very important to keep reminding people as to those boundaries.

Particularly so as we embrace more different ways of engaging with each other. People may set out team WhatsApp chats to update and do things like that. In the financial services WhatsApp is frowned upon for many reasons - not least because it is a means of communicating that is not tracked/is not logged and cannot be used as a record, so you have got to make sure that all of these things are dealt with.

Again you have got to keep this approach reviewed constantly as things have been going on. As time goes on and this carries on.

A bit later, and I have already mentioned the thing about the mental wellbeing, but again I think it is a big part of conduct risk and a big part of making sure that people feel that they are in a good space and they are supported and it also links up with the speak-up culture which is something I will come onto later on.

So I think, yes there is definitely heightened risk here because I think the reality is, is the longer we stay at home, it is easier for standards to slip. I think is the frank reality. We may have all started video conferences last week, still with maybe not suit and ties but maybe nothing a bit smarter than we do now. I know for one that I have put something on with a collar on for the first time in ten days for this call, so standards do slip so we need to bear that in mind and keep reminding because the FCA will still expect processes to be in place, to both monitor and to prevent misconduct from occurring.

Ian: Absolutely right. So, Sushil looking more generally at the situation and taking a step back, one of the things the FCA has stressed is, about treating customers fairly and responsibilities of firms to customers during the crisis. So what should firms be thinking about and what are responsibilities of firms to customers during the crisis?

Sushil: Yeah, so the regulators have all made clear that they expect financial services firms to continue operating effectively whilst meeting their regulatory obligations and in particular, treating customers who have been impacted by COVID-19 fairly. Now the potential risks of COVID-19 are quite wide-ranging and despite government intervention, may include certain businesses becomes insolvent due to worsening trading conditions and unemployment levels rising.

Now, even where governmental assistance is available, customers may still be under a lot of financial pressure. For example, in relation to furloughed employees, where there is a substantial gap between the amount they would be paid under the government's employment retention scheme and the amount they would have received by way of their normal salary. The FCA has issued specific guidance for creditors, both mortgage lenders and unsecured creditors, insurers and banks on key factors they need to consider when ensuring the fair treatment of customers during this pandemic.

In particular, the FCA has made clear the importance for customers to be able to access cash in the current environment and has welcomed proactive actions by some firms, for example enabling customers to access savings accounts and waiving any fees for doing so and increasing ATM withdrawal limits.

Where bank branches are closed, the FCA would expect sufficient measures to be in place to enable regular customers to be able to access cash and bank loans which may be available under the government's current initiatives.

In respect of mortgage customers, where they are experiencing or reasonably expect to experience payment difficulties as a result of the impact of COVID-19, the FCA has made clear that a firm should grant a customer a payment holiday for three months unless it can demonstrate it is reasonable and in the customer's best interest to do so otherwise.

Where a payment holiday is offered, firms should be clear to customers about the implications of the payment holiday, including the consequences on the total amount payable under the mortgage contract, the term and the amount of contractual monthly instalments.

Firms should also not commence or continue repossession proceedings against consumers during this time, given the unprecedented uncertainty and government advice on social distancing and self-isolation.

Similarly, for unsecured creditors, only yesterday the FCA announced proposals for temporary measures to help consumers of certain consumer credit products, including offering a temporary payment freeze on loans and credit cards where consumers faced difficulties with their finances as a result of Corona Virus, again for up to three months ensuring that customers who have been hit financially on COVID-19 and already have an arranged overdraft on their main personal account, up to £500 will be charged at zero interest, for up to three months and requiring firms to make sure that all overdraft customers are no worse off on price when compared to the prices they were charged before the recent overdraft changes came into force.

And finally ensuring customers are using any of those temporary measures should not have their credit rating impacted because of those.

The FCA also expects firms to demonstrate greater flexibility for customers in persistent credit card debt.

Under FCA rules, after 36 months of somebody being in persistent debt, provider must offer options to help repay the debt more quickly if customers do not respond within a set period of time, the card must be suspended. However the FCA has made clear that given the challenges facing many customers at the present time, customers should be given more time and until 1 October 2020 to respond to firm's communications. This means that firms should not be obliged to suspend the cards of non-responders before then.

And then finally, for insurers, the FCA has stated that it expects firms to consider very carefully the needs of their customers and to show flexibility in their treatment of them. For example, some customers may now be working from home on a regular basis and keeping work assets at home, while others will be travelling by car for work purposes. As such, the FCA expects insurers to act fairly in these temporary circumstances, ensuring that consumers working from home will be covered by their home insurance and motorists will be covered for essential travel by the non-commercial motor insurance policies.

Those customer segments who have been particularly impacted, include those with travel insurance policies that have had their package holidays or flights cancelled or who are likely to have or want future travel cancelled. These firms should clearly communicate any policy exclusions that result from Corona Virus to their existing customers and of course, where there are no such exclusions, to honour those policies.

Ian: Thanks Sushil. So, we have been talking about firms, employees working from home but obviously given the economic downturn, a lot of firms may not have work for people - at least not as much - so, Simon what is the position on that?

Simon: Yes, thank you Ian. Well this is obviously a very pertinent topic right now. There are a number of different mechanisms available for firms to deal with not having work for staff.

Much will initially depend on the existing contractual relationship between a company and its staff. There are mechanisms such as lay-off and reduced working, so short-time working which can all be used, providing that they are allowed for in the contract of employment.

There is also been the well-publicised government job retention scheme which has introduced a new concept of furlough into - well not quite into English law as yet, it just exists in the form of government guidelines but this is a brand new concept and a brand new type of leave.

It is a topic of a webinar in itself, but in an overview, what this allows is that where you do not have work for somebody or where your business has been severely impacted by COVID-19 it is possible for you to put someone on furlough leave during which they undertake no work at all and that is really important to stress, that in order for this scheme to work they cannot do any work, so they cannot just log-on to quickly check something or take calls etc. it really is a strict no-work rule that if this person does it, if you put someone on furlough leave, it is for a minimum of three weeks but you can then claim back from HMRC a grant of up to 80% of their salary or £2,500 whichever one is the greater. So there are these government mechanisms as well to enable you to deal with the fact that you do not have work for people.

What we are seeing in a number of different sectors in the financial services is, starting to look at furloughs for covering backroom staff or administrative staff, where really because of the nature of what is being done, there is not that work for them and I think just one additional thing to add to the ability to furlough leave, is that whilst I say it is not possible to do any work at all, there are explicit exceptions that people can do training.

So people can do training that they need to do to self-develop, for example. So you can still require people to do their mandatory training, which is obviously important to cover all the necessary compliance obligations but it also means you can continue to roll out conduct training as you do.

So even if you have got someone on furlough leave, you can still comply with your obligations and your own procedures.

Ian: Thank you. Thank you very much for that Simon. So, Sushil, one of the issues given the economic environment is that firms may be receiving cash payments more slowly and that is obviously going to affect liquidity and their financial resilience. So, what are the FCA's expectations on the financial resilience of firms?

Sushil: Yeah, so the FCA wants firms to continue operating and hopes that capital and liquidity buffers can protect firms in times of stress. So the FCA has indicated that it intends to provide flexibility to firms where it can, but has warned firms that they should be planning ahead and ensuring the sound management of their financial resources.

While the most systemically important firms will be having active discussions with the PRA and the FCA during this time, solo regulated firms who are concerned that they will not be able to meet their capital requirements or debts as they fall due, should contact the FCA firm contact centre with their plans for the immediate period ahead.

Ian: Yeah, so I think the message there is to keep things under review for firms really. So we've covered a fair amount of ground here, but Sushil are there are any other issues which firms/financial firms need to be aware of at the moment?

Sushil: Yeah, there are quite a few and it really does depend on what sector you are operating in.

But key points, I think it is worth mentioning that firms should be considering the impact of COVID-19 on the effect of running of the board and ensure that sufficient contingency arrangements are in place to ensure continuity of the board decision-making. Now it is not inconceivable in the current environment that board members or designated senior managers may be personally impacted by COVID-19 and examples of contingency plans may include holding board meetings by electronic means where the constitutions so provides and acting by way of written resolution.

Cyber resilience is also another key consideration. The European Central Bank has recently warned banks to prepare for an increase in cyber-attacks as cyber criminals seek to take advantage of the substantial chaos caused by COVID-19. Firms should ensure that potential mass staff shortages do not impact on their cyber resilience and ability to withstand malicious attacks.

There have also been reports of significant rise in the number of phishing emails, in which cyber criminals take advantages of fears over COVID-19. Again, firms should ensure that they are taking all reasonable steps to shield their customers from such practices.

Firms should also be ensuring that their online services are able to cope with increased demand from consumers who may now be utilising more online services for everyday financial needs and the FCA has also this week issued further guidance for firms providing services to retail investors, including how to conduct identity checks remotely as part of their obligations under the Anti-Money Laundering regime.

While the FCA expects firms to honour their core regulatory obligations, they are showing some flexibility to firms in the current pandemic wherever possible.

Finally it is also worth noting that COVID-19 has had an unprecedented impact on financial markets causing billions to be wiped off stock markets worldwide and it is crucial for the orderly and proper functioning of markets that all financial market participants adhere to their regulatory obligations when deploying their business continuity measures.

In particular, issuers should disclose as soon as possible, any relevant significant information concerning the impacts of COVID-19 on their fundamentals, prospects or financial situation in accordance with their transparency obligations under the market abuse regime.

The v has offered two month's temporary relief for listed companies to complete audited financial statements. While this will alleviate some pressure on firms, it also increases the likelihood of insider dealing. Combine this with COVID related market volatility and suspicious transaction may well be more difficult to detect.

The market abuse regime continues to be in full force and the FCA is likely to be paying particular attention to this area so firms should really be ensuring their systems and controls are robust enough to detect suspicious transactions during this time.

Ian: Thank you Sushil. So, coming back to employment issues, Simon now is obviously bonus-time for a lot of financial services firms. How is the current situation going to affect remuneration and bonuses and those sort of issues?

Simon: I think the answer is, significantly. But, as we know the financial services, there is strict governance and regulation of remuneration and not least as well, for certain of the bigger institutions, there is a gleeful press waiting to produce negative news about what is being paid.

We have already seen the regulators putting out expectations that big bonuses will not be paid out to senior staff and also the impact on dividends to shareholders and specific guidance for the insurance markets as well. But there is that the expectation for regulators that the current situation will be borne in mind in bonus decisions, not least to imbalance the fact that whilst people in front office may still be ploughing on, because the financial markets still are, there are a number of other people who will be losing jobs or indeed not being able to work, putting on furlough. All these kind of things which would potentially normally have an impact on bonus decisions. So there will be, I think, enhanced groups nee of the amount of bonuses that are paid.

Particularly now, looking at bonuses that are to be paid that have not yet been paid, this current situation will have to be factored into that.

There is of course a particularly difficult question about bonuses that have been awarded but not yet paid, looking at unpicking any of those obligations. You will have to look back at your own existing policies and schemes in place, but it may well be possible to suspend those bonuses or indeed, claw back some of them.

Where a bonus has actually already been paid is going to be very difficult to do so, not least from a contractual or legal point of view but it is the kind of things that need to be looked at, always within the realm of the schemes, the kind of there in place. It is difficult to give any specific guidance because a lot of it is based on the actual existing schemes that are in place, but I think it is fair to say there will be this enhanced scrutiny about why people have been paid what they have been paid and for what it is they are being paid.

Not least from an external regulation point of view, but it is also going to be a consistent theme from an employer relations point of view. People who do not get paid what they were expecting because of the COVID-19 may well be that pool of people who raise concerns or raise grievances etc. about their bonuses.

So there is two angles to look at. Making sure that the regulators are happy about an appropriate process being put in place and making sure the internal employee relations are maintained as well.

I think it is also fair to say, that there is an expectation on future considerations for next year's bonus. If we are into a new bonus year, how will this impact on the bonus next year so I think it is a good opportunity now to start thinking about those future considerations and the future impact on what will happen next year. Because by the time we get to this time next year, we may well be out of the current situation that we are, some memories may be short and people may well be expecting us to be back to normal, so again, start thinking about this future consideration.

Coming back to the initial point made about the employment law and regulations still will apply to the usual practices on discretions, using discretionary powers correctly and using them appropriately and also making sure that they are in the realms of the equality law, is still going to be important.

So it is important to make sure that any payments that are being made, or indeed any payments that are not being paid or any payments that are being sought to claw-back or suspend, however it is dealt with, it is important to ensure that these decisions are and continue to be fair and objective and consistent in order to be able to justify them for when the inevitable claims do come. And these claims obviously include breach of contract, total discrimination and indeed even whistle-blowing claims.

Ian: Thank you Simon. I think you mentioned whistle-blowing earlier on in our discussion. Why is that a potential risk now or even more of a risk perhaps during the current time?

Simon: I think there are two things. First of all, looking back to Sushil's point about making sure that the right services are still up and running.

It is of course important to make sure that your whistle-blowing processes and programmes are still up and running and monitored and are still maintained. There was a high profile issue about a whistle-blowing hotline not being maintained in the press and whistle-blowing is and will continue to be a big focus of interest in financial services and for the regulators so I think the practical point is, make sure that your whistle-blowing processes still carry on and are still valid. But I think in reality as well, COVID-19 is a very public issue, it is creating a lot of issues around health and safety.

There is a lot of nervousness around people, there is a lot of confusion about what is happening and these are all the kind of environments if you like which lead to misunderstandings, lead to people feeling aggrieved or unsettled and I think that is, again, fertile ground for people raising concerns that the way that they are being dealt with, or things that they are seeing, may not have been done quite as they should have done. So it is important to make sure that doing this process while people are working at home, or more separated from colleagues, that you still maintain that culture of a speak-up environment and

I think as well from a pure legal point of view, the law behind whistle-blowing is all around people making public interest disclosures. I think the fact that anything linked to COVID-19 is going to be in the public domain is going to make it potentially more likely that such claims do in fact have legs and could well be held to be more in the public interest.

Ian: Thank you very much Simon. I think we can now turn to the Q&A's actually.

One question I would like to - which has been posted to us and thank you for the question, is this. So the FCA's five conduct questions last year said that firms must be alert to the risk of poor staff behaviour where staff are anxious about their jobs. Staff must be trained on the conduct rules by 9 December. Do we agree that that deadline of 9 December is unlikely to be extended given that good conduct is a big FCA priority and that even furloughed staff can be trained online. Sushil do you have any thoughts on that?

Sushil: Yeah, I mean I would agree in the sense that conduct is the biggest FCA priority obviously and the fact that I think it is even more imperative in the current circumstances that firms are ensuring that their employees are still maintaining good levels of conduct and for that reason I would - there is no crystal ball in terms of whether this is one of the deadlines that might be extended by the FCA - but I would suggest that at the very least, the FCA would expect firms to have taken reasonable steps in making sure that their employees are trained on what conduct looks like in the context of their business models and know what their duties and obligations are, especially whilst working from home.

I am not quite sure in relation to the impact on furloughed employees and that is probably one for Simon.

Simon: Yeah, sure. I think I covered this in my answer earlier about when you do not have work. But there is nothing to stop you from training people from furlough and as I mentioned, there is a particular exemption to the non-working principal which allows people to do training so I do not think there were any barriers that the regulators will see to prevent people from being appropriately trained.

Ian: Yes. I think it will also depend, to some extent, on how long we are in this situation because obviously if there are still people able to return to work significantly before 9 December, so there is a good time for face-to-face training, as well as online training, that will help but obviously if this period goes on for a long time, of course online training is still possible but nevertheless face-to-face training is always very good and very effective as well so think it is a great question and we will have to say the situation goes on for.

So, thank you very much for attending this webinar. I think we are coming to a close now. We will be producing a recording of what we have said today, we will also include some links to relevant client alerts that we have published. Our contract details are in the webinar invitation and on the Gowling WLG website and you are welcome to contact us if you would like a chat or if you are wrestling with any tricky issues, so thank you very much for attending the webinar and the webinar has now ended.