Disqualification from being charity trustee etc.
Section 6 – Disqualification: senior management functions
37.Originally, the disqualification criteria set out at paragraph 20 of these notes applied only to charity trustees. Charity trustees are the persons who have the general control and management of the administration of a charity. For example, in a charitable company, this will usually be the company directors, while in a charitable trust this will usually be the trustees.
38.This section of the Act inserts a new section 69B into the 2005 Act which extends the disqualification rules to individuals holding office or employment with senior management functions. A senior management function is—
a management function for which the person is not accountable to anyone or is accountable only directly to charity trustees (for example, the chief executive), or
a function which involves control over money for which the person is not accountable to anyone other than another person with senior management functions but which do not relate to money (for example, a chief financial officer who is accountable in line management terms to the chief executive).
39.If a person is disqualified from acting as a charity trustee in relation to a charity (i.e. they are disqualified under section 69 and do not have a relevant waiver), they are also disqualified from having senior management functions in that charity. This disqualification applies only to the extent that trustee disqualification applies. For example, if an individual who would otherwise have been disqualified under section 69 had been granted a waiver to act as a charity trustee of any ex-offenders’ charity, that would automatically flow through and they would not be disqualified from holding senior management functions in such charities without the need to seek a further waiver.
40.By the same principle, if the disqualification arises by virtue of new section 69(2)(db) or 69(2A) (as to which, see paragraphs 31 and 33 of these notes), the disqualification from holding senior management functions only applies to the extent that the person is disqualified in England and Wales. This means that where the order in England and Wales is one which does not apply to acting as an employee at all (i.e. section 181A(5)(a) of the Charities Act 2011 is used) or the jobs or types of job which it applies are limited (i.e. section 181A(5)(b) of that Act is used), that will flow through.
41.In addition, as with the provision relating to charity trustees, it will be possible for a person to apply to OSCR for a waiver. As with the rules in relation to charity trustees, a waiver in respect of senior management functions will be able to be granted in respect of all charities, in respect of a particular type of charity, or in respect of a specific named charity only. It will also be possible to limit the waiver to specific senior management jobs or senior management functions of a particular nature.
42.If a waiver is not granted, it will be possible to seek a review (and, if desired, subsequent appeal) of that decision in exactly the same way as applies in relation to waivers for charity trustees: the consequential modification made to section 71 of the 2005 Act provides for this, while the change made to section 72 ensures that the person who sought the waiver will be notified of the decision in relation to it.
43.It is an offence under the 2005 Act to act as a charity trustee when disqualified from doing so. This rule in section 70(1) of the 2005 Act is extended by the Act so that it is similarly an offence for a person to hold office or employment with senior management functions when disqualified from doing so. As with charity trustees, the penalty on conviction is—
on summary conviction, imprisonment for a period of up to 6 months or a fine up to level 5 on the standard scale (£5,000 as at August 2023, as specified by section 225 of the Criminal Procedure (Scotland) Act 1995) or both,
on conviction on indictment, imprisonment for a period of up to 2 years or an unlimited fine or both.
44.In addition, where a person acts as a charity trustee despite being disqualified from doing so, section 70(2) of the 2005 Act makes provision to ensure that the acts carried out by the charity during the period of that person’s appointment are not invalidated by reason of the disqualification. This rule is also now extended by the Act to cover a person who carried out senior management functions despite being disqualified from doing so.
