The Charity Commission requires charities to report actual or alleged serious incidents.

Serious incident reports (SIRs) should be a prompt and open report to the Charity Commission which details what happened and the approach in which the charity is taking to deal with the serious incident.

What is a serious incident?

Serious incidences are defined in the Charity Commission SIR guidance as “an adverse event, whether actual or alleged, which results in or risks significant:

  • harm to your charity’s beneficiaries, staff, volunteers or others who come into contact with your charity through its work (who are collectively referred to throughout this guidance as people who come into contact with your charity through its work);
  • loss of your charity’s money or assets;
  • damage to your charity’s property; or
  • harm to your charity’s work or reputation.

“Significant” is taken to mean significant in the context of your charity, so it will depend on your charity’s size, staff, operations, finances and/or reputation.

The trustees of a charity hold ultimate responsibility for ensuring that the charity makes a SIR when applicable, therefore it is in the trustees’ discretion and judgment as to whether they consider an actual or alleged incident a serious incident with significant risk, as described above.

Does coronavirus trigger a serious incident “significant” enough to file SIR?

The Charity Commission released guidance on 7th April 2020 (found here), which confirmed that charity trustees should continue to report serious incidents using the main SIR guidelines (found here).

More recently, on 3 June 2020, the Charity Commission issued supplementary guidance (found here), with an accompanying examples table, to help trustees in deciding whether they need to report an incident related to the pandemic.  This supplementary guidance clarifies, for example, that it is the impact of any pandemic-related reduction of services or operations on the charity that is key in determining whether a SIR should be reported.

In practice, although there are some differences from the main guidance – for example, the usual thresholds for reporting a financial loss do not apply where the losses are related to the coronavirus crisis – the Charity Commission continues to expect trustees to exercise their own judgement as to what is ‘significant’ for a charity, with the effect that the pandemic may give rise to reportable incidents for many organisations.

We have set out below some example scenarios (some are taken from the latest Charity Commission guidance) under which a charity may choose to file a coronavirus-related SIR:

Serious incident to report: Harm to people who come into contact with your charity through its work

Example scenario: There is an outbreak of coronavirus, including suspected cases (rather than a single (suspected) case) amongst staff, volunteers, trustees and/or beneficiaries which lead to the charity being unable to continue its normal operations.

Serious incident to report: other significant financial loss

Example scenario:

A charity has lost significant income due to the lockdown (e.g suspended operations or cancellation of fundraising events) which leads to one of the following specific impacts:

  • inability to deliver vital services to at risk beneficiaries;
  • immediate insolvency or permanent  closure; and/or

high likelihood of insolvency or permanent closure in the next 12 months

Serious incident to report: Incidents involving partners

Example scenario :
(a) A delivery partner of the charity has ceased to operate due to coronavirus which prevents the charity from providing services and assistance to its beneficiaries.
(b)The charity’s subsidiary trading company goes into liquidation due to reduced trading caused by coronavirus, and the liquidation has a material impact on the financial sustainability and future of the charity.

Serious incident to report: Other significant incidents

Example scenario:

  • The charity’s services are severely disrupted from coronavirus such as lack of staff (due to quarantine and illness), unreliable supply of essential products such as food for a food bank, which materially impacts on the charity’s ability to provide services for its beneficiaries, and which poses uncertainty on the sustainability of the charity’s service provision.
  • The charity is investigated by the Police for an alleged breach of the government lockdown measures.
  •  The charity experiences any fraud linked to the pandemic which the charity failed to identify as suspicious.
  • A member of staff alleges they have suffered significant harm due to their working conditions (e.g. lack of social distancing measures or personal protective equipment) during the pandemic.

When to file an SIR

The Charity Commission recommends that both actual and alleged incidents are filed promptly. This means reporting as soon as possible after the incident happens or after the charity becomes aware of the incident.

If you need any further advice please speak to your usual Bates Wells contact or more generally, please contact Abbie Rumbold (a.rumbol[email protected]) or Jennifer Chong ([email protected]).