A survey of 350 FTSE companies by solicitors CMS Cameron McKenna has shown an alarming lack of understanding of and preparation for the Human Rights Act, which comes into force on October 2.

Although the act was passed by Parliament two years ago, nearly a quarter of respondents had little or no knowledge of how it would affect their business. And while many businesses were aware that they would have to prepare for the act, only a minority had taken action. This is despite 69% of respondents feeling it would lead to a rise in litigation.

Most respondents felt the act would impact on employee relations, but only 19% of organisations had actually reviewed their existing employment procedures.

The monitoring of internet and email usage was also seen as being affected by the act, but again, only about a fifth of companies had done anything to amend their policies in line with the act.

Half of respondents were not confident that their managers would adapt their decision-making as a result of the act.

General reaction to the act was mixed, with 16% calling it a necessary inconvenience and 64% deciding it was too early to say.

The survey was conducted among chief executives, managing directors, finance directors, human resources directors and in-house lawyers.