Key Takeaways

  • An anti bribery and corruption clause in employment or commercial contracts helps organizations comply with global laws like the FCPA and UK Bribery Act.
  • Businesses should adopt proactive steps, including employee training, internal reporting, whistleblower protections, and board-level oversight.
  • Clauses should cover definitions of bribery, obligations of employees and contractors, audit rights, and termination rights in case of breaches.
  • Including the ICC model anti-corruption clause helps manage third-party risks and demonstrates a commitment to ethical business conduct.
  • Organizations benefit from integrating clauses into a broader compliance framework that also aligns with institutional policies and international standards.

An anti-bribery clause employment contract is the result of governments wishing to take a tougher stance against bribery and corruption. Anti-bribery legislation is continuously being passed and prosecution is ongoing against corporations and individuals who break these laws.

The Foreign Corrupt Practices Act of 1977, the Bribery Act of 2010, and the Criminal Code Act of 1995 brought dramatic change to the global anti-bribery and corruption scene. International organizations are especially vulnerable to these laws and need to work hard to avoid prosecution. It's wise to institute corporate compliance programs, as well as anti-corruption clauses in your contracts.

Steps to Combat Corruption

Here are the steps every corporation should take to combat corruption.

  1. Review current compliance codes, policies, and programs and make improvements where necessary. Focus on external and internal compliance reporting mechanisms to ensure employees are well aware. It's important to have a strong compliance program, coupled with ongoing employee training and a thorough understanding of whistle-blowing obligations.
  2. Cultivate a culture, from the managerial level, that emphasizes compliance and ethical conduct. Make sure corporate compliance programs have oversight from the board level. It's important to consult with experienced legal advisers who specialize in matters pertaining to compliance and can develop action plans in the event a violation occurs.
  3. Be sure the organization's response to a bribery or corruption complaints is well-documented. Maintain privilege over material whenever appropriate, whether that's through in-house counsel or outside lawyers.
  4. Review and update compliance policies, especially regarding provisions for anonymous reporting, hotlines, and whistleblower policies.

Global Anti-Bribery Laws and Their Impact

Major legislation worldwide has shaped the way businesses implement anti bribery and corruption clauses. For example, the Foreign Corrupt Practices Act (FCPA) in the U.S. prohibits offering anything of value to foreign officials to secure business advantage. Similarly, the UK Bribery Act 2010 goes further by criminalizing both offering and accepting bribes, even in private commercial transactions. Australia’s Criminal Code Act 1995 also imposes strict penalties on corporations and individuals.These laws apply extraterritorially, meaning companies can face liability for misconduct abroad. Therefore, a strong contract clause is not just best practice—it is essential for compliance in global business operations.

Programs That Comply with Anti-bribery Laws

In order to counteract corruption, organizations should consider the following:

  • Programs that encourage employees to make internal reports, rather than going to the press
  • Incentives for employees who resort to internal reporting in an ongoing investigation
  • An action plan that immediately responds to whistleblower tips, ensuring a speedy resolution to an investigation
  • Regular training on internal reporting policies so employees are well-informed

Elements of an Effective Anti-Bribery Program

A robust compliance program should work hand-in-hand with an anti bribery and corruption clause. Key elements include:

  • Clear definitions: Specify what constitutes bribery, facilitation payments, kickbacks, or undue advantages.
  • Employee responsibilities: Require employees to promptly report suspected violations.
  • Training requirements: Ensure regular, documented training sessions on anti-bribery policies.
  • Record-keeping obligations: Maintain transparent financial records to prevent hidden payments.
  • Audit rights: Grant employers the ability to audit third parties or contractors for compliance.

When these elements are reinforced contractually, organizations create a consistent framework across internal operations and external partnerships.

What to Include in Anti-Bribery Contracts

Corporate compliance contracts that are well-executed may provide some comfort to organizations. It's helpful to know they're taking proper steps to avoid corrupt practices inside.

Things become a bit more difficult when bringing in outside contractors or retaining third parties. It's not as easy to dictate how those third parties will conduct internal components of their business. This is where organizations become vulnerable to prosecution, even though they adhered to strict due diligence and performed risk assessments.

To fight this vulnerability, the International Chamber of Commerce (ICC) created an anti-corruption clause that needs to be included in contracts where third parties will commit to comply with ICC rules that combat corruption. Such a requirement will help preserve trust between both parties and prevent corruption in the negotiation and performance of the contracts.

Employment Contract Applications

In the employment context, an anti bribery and corruption clause should explicitly bind employees to uphold ethical standards. Common provisions include:

  • A representation and warranty that employees will not engage in bribery or corrupt acts.
  • An obligation to comply with company policies, as well as national and international anti-corruption laws.
  • A requirement to report gifts, hospitality, or entertainment above a certain threshold.
  • The employer’s right to take disciplinary measures, up to and including dismissal, for violations.

By integrating these clauses into employment contracts, companies protect themselves from liability while making expectations clear to staff at every level.

ICC Anti-corruption Clause

The ICC anti-corruption clause applies to any contract that incorporates it either by referencing it or writing it out in full. The purpose of the model clause (or a similar one) is to provide all parties with a contractual provision that can reassure them of their counterpart's integrity. The clause also assigns certain rights to each party, should corrupt practices be discovered.

An anti-corruption clause allows all parties to claim they have not and will not give or receive bribes or conduct other corrupt practices. If any party breaches the clause, suspending or terminating the contract is possible. Damages may even be claimed.

The ICC suggests all organizations include an anti-corruption clause in every significant contract. This will not only comply with best practices but also decrease the likelihood of prosecution over bribery and corruption laws. Whether the courts will enforce such clauses, strictly interpret them, or allow them as a defense against a bribery prosecution remains to be seen.

As for a response to such an allegation, whether or not an anti-bribery clause should be deemed invalid should not diminish the importance of its intent, especially when combined with robust internal policies.

An anti-corruption clause signals that unethical practices will not be tolerated. Including such a clause in your contracts is an important first step that will allow your business to reflect a strong internal culture to every party it works with.

Institutional and Organizational Policies

In addition to ICC guidance, many institutions adopt internal anti bribery and corruption policies that reinforce contractual clauses. For instance, universities and multinational corporations often maintain policies that:

  • Extend compliance expectations beyond employees to cover agents, consultants, and joint venture partners.
  • Prohibit both giving and receiving anything of value intended to improperly influence decisions.
  • Require due diligence reviews before engaging third parties.
  • Outline procedures for internal investigations and reporting suspected violations.

These policies demonstrate that clauses are not standalone provisions—they are part of a wider compliance culture that must be maintained through training, leadership commitment, and transparent enforcement mechanisms.

Frequently Asked Questions

  1. What is an anti bribery and corruption clause?
    It’s a contractual provision that prohibits employees or third parties from offering, giving, or receiving bribes, and requires compliance with anti-bribery laws.
  2. Why should employment contracts include this clause?
    Including it helps clarify employee responsibilities, reduce corporate liability, and show regulators that the company takes compliance seriously.
  3. What laws make these clauses necessary?
    Key laws include the U.S. Foreign Corrupt Practices Act, the UK Bribery Act 2010, and other national criminal codes with global reach.
  4. Can an employer terminate a contract if the clause is breached?
    Yes. Most clauses allow suspension or termination of employment or business relationships if bribery or corruption is discovered.
  5. How do these clauses work with company policies?
    They complement internal compliance programs and institutional policies, ensuring that both contractual and organizational standards are aligned.

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