This chapter introduces and explains the legal requirements that a training department needs to consider in order to protect itself, its partners and its customers. It looks into the various legal facets to be considered, including import and export restrictions and regulations, trademarks, indemnity and liability, intellectual property and data protection.

CONTRACTS VERSUS STANDARD TERMS AND CONDITIONS

When dealing with customers, training partners or suppliers, it is important to validate and protect the supply or purchase of the required goods and services. Normally, this takes the form of a contract, which provides legal protection for both supplier and purchaser.

A written agreement should be provided when supplying training, which includes standard terms and conditions. Purchasing sends their version, which will require consideration before acceptance. The complexity of the agreement will be dictated by whether the training group is part of a large corporation or small enterprise.

In some instances, both supplier and purchaser may request acceptance or modification of their terms and conditions. The process can appear complicated and time-consuming, which is why qualified legal representation should be engaged. From the training perspective, the key contribution to be made to this process is the development of standard terms and conditions. This allows the legal team to recommend their inclusion in a contract or sanction their use independently.

This raises the question as to when to use a contract versus terms and conditions. The training department needs to establish what the contracting policy is. A simple contracting policy may be more appropriate when selling scheduled public training, where standard terms and conditions can be used. If the training sold is more complex, perhaps involving customisation of content and multi-modalities, then a more detailed contracting policy needs to be enforced.

What is a contract?

In effect, a contract is an agreement between the training department to sell and the customer to buy training services on certain terms and conditions. Typically, a contract is drawn up when the training provision is complex in nature, requires additional terms and conditions and is of a large value.

What are standard terms and conditions?

These represent the training department’s standard trading position relating to the sale of its training offerings and services via a formal written document. Typically, it includes price, payment and delivery terms, including protection for its intellectual property.

Using standard terms and conditions is a recognised way of contracting for several reasons:

• It minimises the time and expense of writing specific terms for each individual transaction.
• It enables more favourable terms to be established for the training department and negates lengthy negotiations for standard and repeatable offerings.
• It provides consistency regarding the training unit’s policies and procedures, which in turn creates efficiencies.
• It provides standardisation of the training department’s contracting procedures, allowing contracts to be handled and concluded by training operations and administrative staff.

As an example, Table 17.1 highlights the main sections that form a typical training organisation’s standard terms and conditions.

Table 17.1 Sample description of standard terms and conditions

INDEMNITY AND LIABILITY

Whenever a company is involved in providing a service to others, it has a professional responsibility to provide a duty of care. The nature of that care is what differentiates indemnity from liability.

When providing training to customers, it is reasonable for them to consider instructors as being expert in their field and able to rely upon their professional knowledge and guidance. The duty of care responsibility is to ensure that any advice provided is accurate and complete. Any mistakes in the provision of this advice is protected by professional indemnity insurance.

Legal liability is primarily associated with personal injury or property damage as a result of attending or being involved with the training business. It is normal practice to cover this with public liability insurance.

Including a limited liability or indemnity clause in the contract or training terms and conditions may save a training department and its company from significant financial risk. However, the presence of a limited liability or indemnity clause does not always make it enforceable, so it is important to seek guidance from the legal department or an independent lawyer before finalising.

IMPORT/EXPORT REGULATIONS AND RESTRICTIONS

When establishing a presence in markets outside the country of operation, always seek advice when involved in exporting or importing training services, including regulations and intellectual property issues.

Countries tend to execute these in different ways, although the complexity can be simplified if they are trading under the World Trade Organization’s (WTO) General Agreement on Trade in Services (GATS).

For those training groups operating within the EU, the EU Services Directive removes many of the barriers to service businesses being established in a member state. This allows training provision to be more easily established throughout the EU. In a similar fashion, the North American Free Trade Agreement (NAFTA) supports American, Canadian and Mexican service business-related interactions.

Many of the same basic rules apply for services as for trade in goods, and reference to the relevant agreement or country-specific regulation should always be undertaken. Below is a generic list of key points and issues that should be considered when trading in training services.

• Undertake thorough research and have a clear understanding of local culture before entering new markets.
• International services can be provided from within the country of origin, such as by using the internet to deliver a virtual training course, or in the customer’s country, by sending an instructor. The important point here is that there is a difference between the two, which can have important legal and tax consequences if not clearly understood.
• Lack of a physical product has important implications for contracts, for example inability to use Incoterms (international commercial terms), which are a series of pre-defined commercial rules published by the International Chamber of Commerce (ICC). They are widely used in international commercial transactions and procurement processes.
• When trading in goods, the focus is on the responsibility for delivery as defined by the Incoterms regarding what is being supplied, which is normally easy to describe. However, when supplying training services it is more challenging to explain what is being delivered. This is where a service level agreement should be included in the contract, which helps to outline the agreed outcomes.
• Protecting intellectual property is a key issue (see later section in this chapter).
• Similar issues to exporting also apply to the importing of services, and therefore these are important to understand and address before completing a transaction.
• When trading internationally, different business cultures, legal environments and languages can increase the risk of confusion. It is therefore important to have a clear contract in place.
• Payment issues, such as choice of currency and protection against the risk of non-payment, need to be clearly defined.
• Delivering training services internationally is normally defined in one of four ways, depending upon the location of the supplier and the customer:
  1. Cross-border trade: both supplier and customer are in their own countries, while the service crosses the border. For example, training can be provided by phone and/or over the internet in the case of VILT.
  2. Consumption overseas: the customer visits the supplier’s country, where the supplier provides the service. For example, a student attends a course in another country.
  3. Setting up overseas: the supplier establishes a presence in the customer’s country. For example, opening and operating a training room at an overseas office.
  4. Movement of individuals: individuals who will provide the service travel to the customer’s country. For example, an instructor might travel overseas to teach a course at a customer’s premises.

These methods of service delivery are defined in the WTO’s GATS.

In 2010, the EU Services Directive removed many barriers from trading in services within the EU, effectively bringing member states closer to open trading.

The way services are supplied has important implications for which country’s laws and taxes apply, especially when trading outside an established trading agreement, so it is important that appropriate government guidance is sought when considering trading as an importer or exporter. Some useful links are provided in Table 17.2.

Table 17.2 Useful import and export links

CONTENT AND TRADEMARK INTELLECTUAL PROPERTY

Within the training world, intellectual property (IP) is an important part of what is offered, which differentiates it from grey market competition. As a consequence, most training providers will want to establish and protect a good reputation and brand name to ensure continued customer growth, which therefore requires courseware content to be protected.

When IP rights are granted, they cover trademarks, copyright, patents and industrial design. For most training providers, IP will predominately be based around content and hence come under the copyright designation. With IP laws varying from country to country, the basic principles are recognised internationally, and copyright filed in one country can offer legal protection in other countries under a collection of treaties administered by the World Intellectual Property Organization (WIPO),¹ which is an agency of the United Nations. As with any business activity, it is good practice to check which countries the training will be provided in, and whether WIPO jurisdiction applies. IP protection should also be included in employee contracts in case instructors or courseware developers move to training competitors.

When sharing content for the purposes of gaining feedback from potential suppliers or training partners, it is good practice to issue non-disclosure agreements (NDAs).

Copyright protects the form in which the content is recorded, and includes discussion forum posts, unless it is placed in the public domain or licenced environments such as Creative Commons.

Creative Commons

Creative Commons is a not-for-profit organisation offering copyright licences under six main categories. Licences allow digital content to be referenced, used or modified for commercial and non-commercial benefit to encourage controlled reuse and expansion.

From a training vendor perspective, this can encourage training partners to value add with their own material, which can enhance the content and reduce investment in additional modules. This effectively allows the partner to decide what additional training needs to be added, based on local requirements and industry specialisations.

The six categories of licences offered are:

• Attribution: allows distribution, remixing, tweaking and addition, even for commercial use, as long as the creator of the original work is credited.
• Attribution-NoDerivs: allows commercial and non-commercial redistribution, as long as the work is passed along unchanged and intact, crediting the creator.
• Attribution-NonCommercial-ShareAlike: allows remixing, tweaking and addition for non-commercial purposes, with the creator being credited and new creations licenced under identical terms.
• Attribution-ShareAlike: allows remixing, tweaking and addition for commercial and non-commercial purposes, with the creator being credited and new creations licenced under identical terms.
• Attribution-NonCommercial: allows remixing, tweaking and addition for non-commercial purposes, crediting the creator. Derivative works do not have to be licenced under the same terms.
• Attribution-NonCommercial-NoDerivs: allows work to be downloaded and shared as long as the creator is credited and the work is not used for commercial purposes.

Trademarks

As with content, trademarks also form part of IP rights. Trademarks should be registered in the training group’s local country and individually in other countries where protection is required. To aid simplification, there are European and international application systems available.

European Union trademark protection is available by applying via the European Union Intellectual Property Office (EUIPO), based in Alicante, Spain. International trademark protection is covered by the ‘Madrid Protocol’, which is overseen by WIPO, based in Geneva, Switzerland. An international application has to be based on an existing trademark application or registration in one of the member countries. Once issued, the international trademark can be included and protects all training related documents, correspondence and promotions.

DATA PROTECTION

The right to privacy is a highly developed area of law in Europe, with the European Court of Human Rights applying a very broad interpretation in terms of its execution. Primarily, there are seven governing principles:²

1. Notice–data subjects: should be given notice when their data is being collected.
2. Purpose–data: should only be used for the purpose stated and not for any other purposes.
3. Consent–data: should not be disclosed without the data subject’s consent.
4. Security–collected data: should be kept secure from any potential abuses.
5. Disclosure–data subjects: should be informed as to who is collecting their data.
6. Access–data subjects: should be allowed to access their data and make corrections to any inaccurate data.
7. Accountability–data subjects: should have a method available to them to hold data collectors accountable for not following the above principles.

In the EU, the General Data Protection Regulation (GDPR)³ is used to regulate the processing of personal data, whereas in the USA there is no single law that matches that of the EU.

The USA does have a number of sectors that have acts of law protecting data, such as Video Privacy, Cable Television Protection and Competition, and Fair Credit Protection. But none as such apply to protecting data from a technical training perspective.

As many training organisations are part of multinational companies, it is prudent to adopt the seven EU principles. When considering the application of this fundamental level of privacy and protection, this helps in standardising across the company and simplifying the systems required to support the data captured.

CUSTOMER REFERENCES: IMPLICATIONS

Establishing a customer reference programme can have significant benefits (see Chapter 5); however, from a legal perspective, it is crucial to ensure that the training group and the customer follow the appropriate legal protocol.

The training group must always obtain written permission from target customers before publishing their names or brand. It is also vital that customers are given the opportunity to review any materials before proceeding, to ensure that information is not being disclosed that they consider as proprietary.

The golden rule is always to respect the customer’s requests and publicity policies. This will protect the training group and its company from potential liabilities associated with disclosing customer information without permission.

SUMMARY

When a training group deals with customers, training partners or suppliers, validating and protecting the supply or purchase of required goods and services is crucial. This is normally undertaken in the form of a legally binding document.

Depending on the nature of the requirement, the document can be either a detailed contract or standard terms and conditions. Both include indemnity and liability sections. Whenever a company is involved in providing a service to others, it has a professional responsibility to provide a duty of care so that when advice is provided it is accurate and complete. This is covered by professional indemnity insurance. Legal liability is associated with personal injury or property damage, as a result of attending or being involved with the training business.

When operating in markets outside the country of origin, importing and exporting regulations and IP issues need to be considered and adhered to as well. These are covered by the World Trade Organization’s (WTO) General Agreement on Trade in Services (GATS), and the EU Services Directive.

Intellectual property (IP) is an important part of what training departments offer and differentiates it from grey market competition; consequently, the content needs protecting. When IP rights are granted, they cover trademarks, copyright, patents and industrial design. The World Intellectual Property Organisation (WIPO), which is part of the United Nations, offers legal protection across all member countries.

Copyright protects the form in which the content is recorded and includes discussion forum posts, unless it is placed in the public domain or other licenced environments such as Creative Commons. Trademarks should be registered in the training group’s local country and individually in other countries where protection is required.

The right to privacy is a highly developed area of law in Europe. In the EU, the General Data Protection Regulation (GDPR) is used to regulate the processing of personal data, whereas in the USA there is no single law that matches that of the EU.

Customer reference programmes can have significant marketing benefits; however, written permission from target customers must be obtained before publishing their names or brand.

1 WIPO is the global forum for intellectual property services (www.wipo.int/about-ip/en/), policy, information and cooperation. It is a self-funding agency of the United Nations (www.un.org/en/), with 191 member states.

2 Provided by Wikipedia Foundation under Creative Commons Attribution-ShareAlike License.

3 The General Data Protection Regulation standardises data protection law across all 27 EU member states and imposes strict new rules on controlling and processing personally identifiable information (PII). It also extends the protection of personal data and data protection rights by giving control back to EU residents.