Across the country, huge numbers of businesses have significant numbers of employees working from home. In many cases, it’s virtually the entire workforce.
From what we’re hearing, it’s working out reasonably well. Working from home isn’t ideal, but people are finding ways of being productive and keeping in touch.
One aspect of working from home, though, is proving more problematic. In most businesses, there are requirements for signatures to be placed on certain documents—and from what we’re told, getting those signatures can be challenging.
It’s certainly possible to temporarily ease the requirements for signatures. Holiday approvals, expense claims—business doesn’t grind to a halt if those have a temporarily-looser signing regime applied to them.
But other documents are much more important. Purchase orders, say. And contracts.
Can electronic or digital signatures help?
One option that businesses might like to consider is to use electronic or digital signatures instead.
There’s a difference between the two—which we explain below—but the good news is that both the government and the Law Commission have decreed that electronic and digital signatures are lawful and valid.
A broad definition
Electronic and digital signatures can take many forms. According to the Law Commission, for example, all of these are perfectly valid forms of electronic or digital signatures:
- Typing a name or initials at the bottom of an electronic document such as an email.
- A scanned handwritten signature that is incorporated into an electronic document.
- Clicking an ‘I accept’ or ‘I agree’ button on a website.
- Using a web‑based e‑signing platform such as Adobe Sign or DocuSign to generate either an electronic representation of a handwritten signature or a digital signature using public key cryptography backed by a digital certificate verifying the signatory’s identity, and linking the signatory to their public key.
From this, we can immediately see several things. First, that some forms of electronic and digital signatures are easier to generate than others. Second, that some forms of electronic and digital signatures are more open to fraud and potential abuse than others. And third, that some forms of electronic and digital signatures may be more acceptable to counterparties than others.
Four-step plan
Normally, a move to electronic and digital signatures might be a carefully thought-through transition, taking place over many months.
The businesses that we’re speaking with want to know what they can do now. The answer: several things.
First, it makes sense to review the business’s policies on which individuals have the authority to legally commit the organization to a particular obligation. The idea should be to think about reducing the number of such individuals, so as to both reduce the risk of fraud, and simplify the signature process.
Second, as mentioned earlier, think carefully about the need for documents —particularly internal ones—to be signed at all, at least on a temporary basis. In the short-term, would typed initials suffice?
Third—and in line with a reduced number of individuals possessing signing authority—think about subscribing to a digital signature platform. Such a platform is likely to be more secure than (say) inserting scanned signatures into documents.
And fourth, review documents such as standard terms and conditions, so as to make it clear where electronic and digital signatures are permissible, and which particular forms of electronic and digital signatures are preferable or acceptable.
Looking ahead
In summary, while obtaining signatures on documents might be painful at the moment, businesses can find ways of easing the pain—and can do so, what’s more, without materially increasing their risk of being exposed to fraud.
And—as with several other aspects of everyone’s day-to-day working life—changed document-signing practices could be something positive to emerge from this lockdown. For without the impetus of the lockdown, transitioning to secure digital signatures might have been years away.
After all, take video-conferencing: undeniably, many of us are fast becoming experts on Zoom, Skype, and Microsoft Teams!
Stay safe, and keep well.
