Don’t let automation be a legal minefield for you.

Developments in smart technology and automation have made vast leaps in recent years and they are set to contribute $15 trillion to the global economy by 2030. Advanced systems increase production efficiencies enormously whilst slashing lead times, creating goods and making services far quicker. They also let staff focus on adding value where they may not have had time to before, in sectors such as customer relations.

However, you must remember that any new IT has far-reaching legal implications for people and processes. So, if you’re looking to take advantage of robot tech you must understand the responsibilities and liabilities it brings.

While the “Factory of the Future” offers much greater capacity, improved data collection and fewer errors, businesses must lay proper foundations by nailing vital considerations from the start.

Who Owns The Clever Data?

IP in AI is a burning issue, but what is AI? Most frequently applied to robotics and automation, artificial intelligence (‘AI’) is simulated human intelligence in machines that are programmed to think like real people. Its soaring use has huge data protection implications. A crucial, complex question is who’s responsible for the protection of users and the stored details of individuals – the AI supplier or their client? Automated systems often capture and store information about employees, suppliers, customers (e.g., by cameras, microphones or sensors). However, much of it is likely to be personal data.

If your a tech user (or cient) it’s critical you understand what information is being captured. You must put in place meaningful protections to remain compliant with data protection law, which you should make yourself aware of. You need to ensure that personal data captured by automation isn’t passed back to its supplier without the permission of everyone involved. Strict legislation on ‘data protection principles’ demands that personal information be held securely and used fairly, lawfully and transparently. These GDPR laws come with eye-watering fines for breaches that run into the tens of millions. It means that responsibility for compliance must be agreed upfront and known by all parties. And the law’s relationship with AI is set to become an even hotter topic. The government recently published its proposed approach to regulating technology, with a full white paper expected later this year. Among six core compliance principles is a requirement for legal accountability for all AI tools to rest with a nominated person or company.


Licensing is another key complex concern. It boils down to whether a user fully owns a system or just has the right to use it. While the robot might be yours, the ‘AI- powering software’ is usually provided by a vendor under licence. This allows you to run it, but only on specified terms, with the supplier retaining overall ownership. The question of who owns the tech is critical. Many customers think they do, then fall foul of an IP infringement claim when they sell it on or offer it as a service.

There is an understandable conflict here. You will want to pay for a unique breakthrough that will give you massive competitive advantage, not one that might also be offered to your competitors. And you certainly don’t want them to have a version that has been refined and improved following your early adoption.

Meanwhile, the vendor naturally wants to market its innovation as widely as possible. They’re justifiably unwilling to devise bespoke one-offs they can only sell once. If they did, the price would be through the roof, while a multi-use application would be affordable. And systems that are widely employed can bring a host of advantages to an entire sector much quicker, boosting outcomes for all.

So, there must be upfront agreement on whether software will be developed, priced and supplied as a custom platform. If not, what constitutes the core software and what bespoke tweaks the customer has the exclusivity on must be defined.

Ensure you understand the legal basis by which you’re using all tech and how this is dealt with in every contract. Take the time to read the small print, ensure you know the terms exactly, how they will impact your business and for what it’s responsible.

Health and Safety

Health & Safety is a great concern. Putting robots among your people brings risks and understandable staff fears.

Human operators unfamiliar with the systems and their safety procedures and mechanical errors can trigger prohibited, dangerous behaviour, which may cause death or serious injury if not managed properly. Rushed or careless set-up and power surges can also cause accidents and lethal electric shocks. Recent changes to UK sentencing guidelines have pegged penalties for serious health and safety breaches at more than £10m in some cases. You must be guided by your H&S advisers on safe, compliant installation and operation of all robotic systems and document that you have done. Beyond that, ensure that all staff and visitors know the safety policies and procedures in place.

If you have any concerns about automation or don’t understand it fully, you must get support and advice quickly – whether it’s legal guidance, technical support or both. Working with specialists before problems emerge is far better, cheaper and less stressful than enlisting them to sort out disputes and disasters.

Automation’s fast-accelerating rise offers businesses of all types possibly limitless opportunities. However, everyone must know the dangers and duties it brings and how to protect themselves.

James Crayton

Head of Commercial, Walker Morris.

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