What Are the Legal Consequences of a Data Protection Breach at Your UK Company?

Data protection breaches can harm any organisation, resulting in financial losses and damaging your company’s reputation. Our data protection laws are regulated by the General Data Protection Regulation (GDPR) and the Data Protection Act 2018. These laws set out specific obligations for companies that process personal data. Failure to comply with these obligations can result in severe legal consequences. This article will discuss the legal implications of a data protection breach, so your company is aware of the potential fines and sanctions that can result.

What Is the GDPR?

The General Data Protection Regulation applies to all UK organisations that process the personal data of EU citizens. Personal data refers to any information that can identify a living person, such as their name, address, date of birth or email address.

The UK GDPR sets out several specific obligations for companies and organisations that process personal data.  These obligations include the following:

1. Obtaining valid consent – Companies must obtain valid consent from data subjects before collecting and processing their personal data. Permission must be freely given, specific, informed and unambiguous; 
2. Data minimisation – Companies should only collect and process personal data that is necessary for a specific purpose.  They should not collect more data than necessary;
3. Data accuracy – Companies must ensure that personal data is accurate and kept up-to-date;
4. Data retention – Companies must not keep personal data for longer than necessary; and
5. Data security – Companies must implement appropriate technical and organisational measures to protect personal information from unauthorised access, disclosure or destruction.

Failure to comply with these obligations can result in severe legal consequences.  Let us explore some of these potential legal consequences below.

Fines

The Information Commissioner’s Office (ICO) can fine UK organisations up to £17.5m for breaches of the GDPR. The ICO is the regulatory authority responsible for enforcing data protection laws and is not shy about enforcing hefty financial penalties for non-compliance.

The fine amount will depend on the severity of the breach, the number of individuals affected, and the level of cooperation with the regulatory authority.

Sanctions

In addition to fines, the ICO can impose sanctions on companies that breach data protection laws.  These sanctions can include the following:

1. Reprimands – The ICO can reprimand companies that breach data protection laws.  A reprimand is a formal warning that highlights the breach and the steps that need to be taken to prevent it from happening again;
2. Enforcement notices – An enforcement notice requires the company to take specific steps to remedy the breach and prevent it from happening again; and
3. Suspension of data processing – The ICO can suspend a company’s data processing activities if it believes there is a risk to individuals’ rights and freedoms.

Reputational Damage

In addition to the legal consequences of a data protection breach, companies may also suffer reputational damage. A data protection breach can erode consumer trust in your company, leading to a loss of custom or revenue.

Reputational damage can be particularly severe for organisations that handle sensitive personal data, such as healthcare providers, financial institutions or government agencies. These bodies are expected to take extra precautions to protect personal data, and a breach can be seen as a sign of incompetence or negligence.

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How Can My Organisation Guard Against Data Protection Breaches?

It is in your company’s best interests to try and prevent data protection breaches from occurring.  

This includes implementing appropriate technical and organisational measures to protect sensitive data, including the following:

1. conducting regular risk assessments to identify and mitigate personal data protection risks;
2. implementing appropriate security measures, such as encryption, firewalls and access controls;
3. providing training to employees on data protection and cybersecurity best practices;
4. conducting regular security audits to identify and address vulnerabilities; and
5. developing and implementing a data breach response plan, including procedures for notifying affected individuals and the regulatory authority.

Key Takeaways

In conclusion, the legal consequences of a data protection breach at your UK organisation can be severe. To combat this, you must ensure that all data processing complies with the GDPR and take appropriate measures to protect personal data from unauthorised access, disclosure or destruction.

Taking data protection seriously can not only avoid legal consequences but also protect your reputation and maintain the trust of your customers. By implementing appropriate security measures and developing a data breach response plan with an expert lawyer, your company can reduce the risk of data protection breaches and mitigate the impact if a breach does occur.

If you need to ensure good protection against data protection breaches, our experienced Data, Privacy and IT lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.  

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