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What is a Deed of Variation and when might you need one?

A Deed of Variation is a document that changes the distribution of a deceased person’s estate. It allows a beneficiary to alter what they are entitled to receive under the terms of the deceased’s Will or under the intestacy provisions. A Deed of Variation allows the beneficiary to choose who they would like to redirect the estate to. The recipient does not need to be named in the Will or entitled to benefit from the estate under the intestacy provisions.

A Deed of Variation differs from a Deed of Disclaimer by which a beneficiary gives up their entitlement to the deceased’s estate and the disclaimed part of the estate is then governed by the Will or intestacy provisions.

The variation is treated as a gift by the original beneficiary to the recipient unless the original beneficiary has made an election for Inheritance Tax and/or Capital Gains Tax purposes. The effect of a deed of variation with an election for Inheritance Tax and/or Capital Gains Tax purposes is that the recipient is deemed to have inherited directly from the deceased, rather than as a gift from the original beneficiary.

A Deed of Variation must:

  • Be made within two years of the deceased’s date of death
  • Be made in writing
  • Be signed by all individuals whose entitlement is adversely affected
  • Clearly indicate the inheritances that are being varied and how they are being altered
  • Contain a Stamp Duty exemption certificate if it alters the destination of stocks, shares or marketable securities
  • Contain a statement that the signatories intend the variation to have effect for Inheritance Tax and/or Capital Gains Tax
  • Not be made for consideration or money’s worth

Why should I make a Deed of Variation?

  • Inheritance Tax (IHT) savings

Each individual has an IHT allowance of £325,000. Anything about this amount at the date of death is taxable at 40%. A Deed of Variation can significantly reduce the amount of IHT payable by the estate.

One way in which a variation can do this is by ensuring that 10% of the deceased’s net estate passes to charity. This means that the estate would then benefit from the reduced IHT rate of 36%.

A Deed of Variation can also be used to take advantage of other reliefs such as business property relief and agricultural property relief.

A copy of the variation must be sent to HMRC if it alters the amount of IHT payable.

  • Change of circumstances since Will was written

An individual may not need or wish to receive their inheritance or the Will may not include children or grandchildren that have been born after the Will was made. A Deed of Variation can be used to provide for those that have been left out of the Will or to equal out the distribution of the estate e.g. one person has received a smaller share than others (note if the variation alters the distribution of another individuals share of the estate they must also be party to the deed).

  • Intestacy

If an individual has died without making a Will their estate will be governed by the strict rules of intestacy. A Deed of Variation can be used to redirect the deceased’s estate to those that would not have been entitled to it under the intestacy rules.

We would advise seeking legal advice if you are looking to make a Deed of Variation to ensure that the document meets the necessary requirements.

If you would like to speak to a member of our specialist Wills, Trusts and Probate team about making a Deed of Variation, please do not hesitate to contact us on probate@steeleslaw.co.uk or by calling  01379 652141.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

HR Survey for Businesses: How the pandemic has affected HR professionals 

Our Employment Law Team recently launched an HR survey to understand how the pandemic has affected HR professionals in businesses throughout the UK.

The HR survey was completed by individuals in B2B and B2C companies throughout industries such as Education, Hospitality, Banking, Tourism, Finance and Social Media.

We asked businesses:

  • Have they continued to operate throughout lockdown?
  • Did they have a plan in place or did they have to react quickly?
  • Have they taken advantage of the furlough scheme?
  • What are the key challenges they still face?

Steeles Law Employment HR Survey Infographic. Our team will use this information to both inform the service they provide to our Employment and Commercial clients but to also ensure that we are providing useful guidance on our website for the questions you currently have!

HR Survey for businesses. What challenges do you think you may face returning to work?

 

Current articles

We’ve currently got lots of useful resources on our website so if you have questions on employment law, how to plan a safe return to work in your offices, how to deal with redundancy and returning employees and discrimination to name but a few, take a look at the full list below:

3 August 2020 – Dealing with redundancy

29 July 2020 – Covid-19: Returning Employees and Discrimination – problems to be aware of

28 July 2020 – Returning to work: employee rights and coronavirus

6 July 2020 – Discrimination in the workplace: Q&A

29 May 2020 -Furlough Leave Update

Further Employment news for businesses.

Steeles Law has both a very experienced Employment Law Team and a Business Consultancy and Restructuring Team of which both are highly experienced in business re-organisation and the difficulties associated with the short-term challenges to business. These teams are focused on helping businesses which are struggling in the current climate as we return to work and come out of lockdown. If we can assist in any way with the challenges that your business is facing, or you would like to discuss the finding of our Employment HR Survey with a member of the team, please do not hesitate to contact the team via email info@steeleslaw.co.uk or by calling 01603 598000.

Dealing with redundancy

The coronavirus pandemic has had an impact on many businesses, with the prospect of having to make redundancies unavoidable for many.

The Guardian recently reported tens of thousands of people are facing redundancy as a result of the Coronavirus pandemic. The government has supported many businesses and employees with the introduction and extended furlough scheme to encourage businesses that have been affected by the pandemic to maintain their workforce, as the scheme begins to be phased out over the forthcoming months many companies are now facing the tough decision to make employees redundant.

Redundancy occurs when employers need to reduce their workforce because a job or jobs are no longer needed. For a redundancy to be genuine, you must demonstrate that the employee’s job will no longer exist, this might be because your business is:

  • changing what it does, for example other employees are doing the work you carried out
  • doing things in a different way, for example new systems implemented within the workforce
  • changing location or closing down
  • the business is being transferred to another employer

Employment Solicitor, James Conley, answers common questions raised surrounding dealing with the redundancy process, what an employee is entitled to and how a Solicitor can help an employee facing the prospect of redundancy.

Q1. What steps are involved in dealing with the redundancy process and when should an employee speak to a solicitor about redundancy?

The process will depend on how many redundancies are proposed but, generally speaking, whenever a company considers making redundancies there should always be a period of consultation. During this consultation period the employee will have the chance to challenge the redundancy proposals as well as their selection for redundancy and it is at this point that it would be most beneficial to speak to a solicitor.

Q2. What would be considered an unfair redundancy?

There are two scenarios where a redundancy situation can arise fairly – Your workplace is closing or moving, or your employer is ceasing trading altogether; or your employer has a reduced need for employees to carry out a particular kind of work.

If your redundancy does not come about through either of those scenarios, or if your employer fails to follow a fair redundancy procedure, then the dismissal will be unfair.

Q3. How much notice of redundancy is an employee entitled to?

Again, this can vary depending how many staff are being made redundant at once. However, in all cases where you are made redundant you should be given your contractual notice period before the dismissal takes affect.

Q4. How much redundancy pay are employees entitled to?

If you have worked for your employer for two years or more, you will usually be entitled to a statutory redundancy payment (SRP). The amount of your SRP will be calculated using a set formula that considers your age, length of service and weekly pay, subject to an upper limit.

You receive one and a half weeks’ pay for each complete year of service in which you are aged 41 or over, one week’s pay for each complete year of service in which you are aged 22-40, and half a week’s pay for each complete year of service in which you are aged under 22.

The weekly gross pay is capped at £538 and the length of service is capped at 20 years. The maximum amount of statutory redundancy pay is £16,140.

Q5. Can an employee challenge their employer if they feel they have been unfairly chosen for redundancy?

Yes, and you should. If you feel that the criteria you have been assessed against are discriminatory or unfair, or if you been given a score well below what you were expecting, you should challenge your employer to explain them. A solicitor can help you write to your employer or advise you on whether your selection for redundancy was objectively fair.

Contact us

If you would have further questions regarding any of the points raised in our Dealing with redundancy Q&A, or you wish to speak to a member of the Employment team, please do not hesitate to call 01603 598000 or email employment@steeleslaw.co.uk. Appointments are available at our Diss, Norwich and London offices or at your offices by appointment.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

Covid-19: Returning Employees and Discrimination – problems to be aware of

As the limitations of shielding are lifted and more and more employees are encouraged back to the workplace employers are having to address the competing challenges of providing a safe workplace, complying with government guidance as it changes after 1 August 2020 whilst ensuring so far as possible that there is no breach of existing discrimination legislation.

These challenges raise a plethora of issues for an employer to grapple with.  The government guidance on Covid-19 is often opaque and contradictory.  In an employment context the guidance does not have statutory effect when a tribunal is considering discrimination, the Equality Act 2010 (and associated EHRC code of practice, which is statutory) is still paramount.

Returning employees

Clinically Extremely Vulnerable

It is important to identify two different categories of vulnerable employees:

  1. The clinically extremely vulnerable; and
  2. The clinically vulnerable.

The former being those identified on a list prepared by the government (Covid19 Returning Employee and Discrimination Supplementary Information) but includes organ transplant recipients, people with certain cancers, those with severe respiratory conditions and women who are pregnant and have significant heart disease).

The COVID-19 Secure guidelines originally noted that the “clinically extremely vulnerable” had been “strongly advised not to work outside the home”. However, they were silent on what happened when these staff could not work from home. After the government announced the end of the shielding period, the guidelines were amended and now state that the clinically extremely vulnerable “have been strongly advised not to work outside the home during the pandemic peak and only return to work when community infection rates are low.

On 8 July 2020, the Shielding guidance was amended to provide that, from 1 August; the clinically extremely vulnerable should keep two metres away from people outside of their household or bubble wherever possible. The previous wording that qualified this, providing that they could keep one metre away from others with protective measures in place, was removed. However, no specific amendments were made to the Work and employment section of the Shielding guidance, which does not refer to physical distancing on return to work.

Clinically Vulnerable

The social distancing guidance identifies the clinically vulnerable to be:

  • Individuals aged 70 and over (regardless of medical conditions).
  • Individuals under the age of 70 with a specified underlying health condition (which includes anyone instructed to get a flu jab each year on medical grounds).
  • Pregnant women.

The guidelines suggest that clinically vulnerable employees “should be helped to work from home, either in their current role or in an alternative role”. Where it is not possible for them to work from home, they should be offered the option of the safest available on-site roles, enabling them to maintain social distancing guidelines (i.e. two metres away from others where possible or, where this is not possible, one metre with risk mitigation). Otherwise an employer should “carefully assess whether this involves an acceptable level of risk”, taking into account specific duties for those with characteristics protected under the Equality Act 2010.

Discrimination

The discrimination concerns that arise from implementing these provisions are that an employer may either:

  1. fails to make adequate provisions bearing in mind an employee’s protected characteristic; or
  2. In making the provisions the employer (often inadvertently) disadvantages one group of employees over another and indirectly discriminates against them.

The first of these is probably easier to deal with and is where the most likely challenge will come.   A large number of the clinically extremely vulnerable and the clinically vulnerable will have disabilities falling within the definition of the Equality Act 2020 but not all.

When following the government’s guidance, above and assessing the ‘acceptable level of risk’ adjustments will have to be made to accommodate so far as reasonable the disadvantage to which a disabled employee is put by the measures.

The bad news for an employer is that there is no ‘one size fits all’ approach that can be adopted; each case will need to be assessed individually, most likely with the assessment of a medical practitioner or occupational health, providing they have the necessary specialist knowledge.

It would equally be wrong to adopt a policy that treats all disabled persons in the same way; many disabled employees will be at no greater risk from Covid-19 than other non-disabled employees.

It is clear from the government guidance that the over 70’s are considered clinically vulnerable but to apply a blanket policy to the over 70s is potentially age discrimination.  The guidance clearly allows the employer to take a view on risk and allow employees over 70 to take on an acceptable level of risk.  Importantly, age discrimination can be ‘justified’ if it represents a proportionate means of achieving a legitimate aim.  A blanket policy which, for example, says we will not allow the over 70’s to return to work (or we will not employ the over 70’s) will be unlikely to be justified.  This contrasts with a policy which assesses each case on its merits and then puts in place the prohibition.

The EHRC has issued specific Covid-19 related guidance in which the following are highlighted as examples of direct discrimination:

  1. ‘a manager asking a female employee working from home to check in with him more than a male employee, because of an assumption that the woman is more likely to be distracted by her children
  2. an employer deciding it will no longer recruit candidates from any ethnic minority to front-line roles after finding out some ethnic minorities are disproportionately impacted by coronavirus (COVID-19)
  3. employees over 60 not being informed that the physical workplace is reopening, as you do not want them to return because of the potential risk – the employer should consider less discriminatory ways of protecting older employees’.

The last two of these examples might be well meaning but are misguided and unlikely to be defensible in the courts.

Pregnant Employees

Employers have additional duties to protect the health and safety of new and expectant mothers in the workplace. In summary, the law requires employers:

  1. To assess the workplace risks posed to new or expectant mothers or their babies.
  2. To alter the employee’s working conditions or hours of work to avoid any significant risk (regulation 16(2), Management of Health and Safety at Work Regulations 1999 (SI 1999/3242) (MHSW Regulations)).
  3. Where it is not reasonable to alter working conditions or hours, or would not avoid the risk, to offer suitable alternative work on terms that are not “substantially less favourable” (regulation 16(3), MHSW Regulations and section 67, Employment Rights Act 1996 (ERA 1996)).
  4. Where suitable alternative work is not available, or the employee reasonably refuses it, to suspend the employee on full pay (regulation 16(3), MHSW Regulations and section 67, ERA 1996).

As pregnant women have been identified as clinically vulnerable in the social distancing guidance, where the nature of the employee’s role means that they cannot work from home and there is no suitable alternative work available that they could do from home, the employer should consider suspending the employee on full pay in accordance with regulation 16(3) of the MHSW Regulations.

It goes without saying that a policy that prohibits the employment of pregnant candidates (even if this is well meaning to exclude them from harm) would be unlawful sex discrimination.

Contact us

To find out how Steeles Law Employment team can support you and your business, please do not hesitate to call 01603 598000 or email employment@steeleslaw.co.uk. Appointments are available at our Diss, Norwich and London offices or at your offices by appointment.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

 

 

 

Returning to work: employee rights and coronavirus

As many businesses begin to re-open and employees start to return to work, many workers still have concerns about how safe their workplace is during the pandemic.

A recent HR survey carried out by Steeles Law highlighted the biggest concern for employers and employees was around implementing new health and safety measures in the workplace to ensure it was a safe place for workers to return to. While government guidance still recommends that employees should be encouraged to work from home if they can, employers have a responsibility to maintain a safe workplace.

Employment Chartered Legal Executive, Denise Traube, answers common questions raised by employees and their employment rights if they refuse to return to work because they believe their needs have not been met.

Q1. What are the current restrictions for businesses opening during the pandemic and what guidelines are in place to protect employees?

The restrictions for businesses opening are different for every industry.  On 10 July 2020, the government loosened restrictions again but has suggested new ‘COVID-19 secure’ guidelines, further information and links to guidance for businesses can be found on the government website: https://www.gov.uk/government/publications/further-businesses-and-premises-to-close/further-businesses-and-premises-to-close-guidance.

An employer should follow 5 practical steps to protect employees returning to work, these are

  1. carrying out a Covid-19 risk assessment,
  2. develop cleaning, handwashing, and hygiene procedures,
  3. help people work from home,
  4. maintain 2m social distancing where possible,
  5. where people cannot be 2m apart, manage transmission risk.

Q2. Is an employee entitled to refuse to return to work during the coronavirus pandemic if they feel their workplace is not safe?

If an employee has a genuine concern about the safety of the workplace, this should be raised with the employer and the employer should take all reasonable steps to review the employee’s concerns and address any health and safety issues that it brings up.

Under the Health and Safety at Work Regulations, workers are protected if there is a genuine belief that the workplace is not safe. It is recommended by ACAS that businesses work with their staff to try and reach an agreement with them about returning to work. Employers should be careful about trying to force an employee back to work if they have genuine concerns as they may expose themselves to risks of claims.

Q3. Is an employee entitled to sick pay if they are isolating due to them or a member of their household showing coronavirus symptoms?  

An employee is entitled to statutory sick pay while they are isolating.  However, an employee may be entitled to company sick pay if they have a contractual entitlement to it.

If an employee cannot work, they should liaise with their employer as soon as possible with the reason for absence and how long they are likely to be off for.

Q4. If any employee has to take time off to look after a dependant, what rights to leave do they have? 

Under the Employment Rights Act 1996, employees have the right to take a reasonable amount of unpaid time off work to take necessary action to deal with particular situations affecting their dependants.  These situations include the illness of a dependant, the breakdown of arrangements of care and an unexpected incident which involves the child’s school.

Government guidance recommends employees liaise with their employers as soon as possible, with details of how much time you may need so it can be agreed.

Q5. What can an employee do if they feel they are being put at risk or treated unfairly by their employer during the coronavirus pandemic?

An employee should raise any health and safety risks or feelings of unfair treatment with their employer.  This can be done by raising a grievance and speaking to their HR department.  The employer should have procedures they must follow in order to deal with the grievance or concerns raised.

Contact us

If you would have further questions regarding any of the points raised in our Q&A, or you wish to speak to a member of the Employment team, please do not hesitate to call 01603 598000 or email employment@steeleslaw.co.uk. Appointments are available at our Diss, Norwich and London offices or at your offices by appointment.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

Norfolk Day 2020: A spotlight on all we love about Norfolk and our Charity Heroes.

In its 3rd year, Norfolk Day is a chance to celebrate all things we love about Norfolk and will be held on Monday 27th July. New to this year’s Norfolk Day celebrations, organisers want to honour the numerous people who go above and beyond to help communities in our county.

Community engagement is important to us all at Steeles Law, staff work hard to strengthen ties within the Norfolk community and regularly engage with local charities. As part of our 50th Anniversary, the Directors launched a CSR campaign to undertake at least 50 Acts of Kindness for our local community. Although some of the fundraising and volunteering events that were planned have been affected by Covid-19 restrictions, charities that have been supported include:

• Macmillan Coffee Mornings
The Benjamin Foundation Charity Sleep Out
The Big C Biscuit Donation
• Mince Pie Drops in Norwich and Diss
Hadrian’s Wall Challenge
• The Legal Walk
The Neonatal unit at NNUH
• Scotty’s Little Soldiers

As we look forward to celebrating all we love about Norfolk and, with the chance to highlight the important work our Norfolk charities do across the region we spoke to staff members about the charities they have supported, their charity heroes, how it has impacted on their wellbeing and what they love about living in Norfolk.

Fiona Walker: Community Sports Foundation.

‘I had completed the Community Sports Foundation Coastal Challenge three times before taking on the Hadrian’s Wall challenge last year. Supporting these challenges has had such a positive impact on my state of mind. The sense of achievement is incredible and has left me feeling much more able to look forward with a sense of purpose. This aside, I have made the most wonderful friends both working for the charity and taking part in the challenges – the comradery is truly unbeatable.

It has been an honour to help raise funds and be a part of what Emma Fletcher and her team at CSF have achieved in helping thousands of people every year to achieve their goals through sport, supporting some of the most disadvantaged, disabled and talented people across Norfolk.’

Fiona Walker | Norfolk Day 2020 | Norfolk Charity Hero

5 reasons I love Norfolk:

1. Swallowtail Butterflies
2. North Norfolk Coastal Path
3. Winbirri Vineyard’s Bacchus
4. Beautiful Beach Walks
5. The Broads Windmills

 

 

 

Alistair Ponder: Nelson’s Journey.

‘I have been a trustee at Nelson’s Journey for 3 years. Nelson’s Journey has a strong reputation within the local community, and having had friends and family who have had first-hand experience of the challenges that bereaved children face I was only too happy to get on-board to support Nelson’s Journey.

Nelson’s Journey supports over 1,000 Norfolk children on a average year. Covid-19 has had a devastating affect on many charities with funding gaps and many fundraising events having to be cancelled, using #NorfolkDay as a platform to highlight these local hero’s will go some way to remind people that these charities need our help now more than ever.’

Simon Wright, Chief Executive of Nelson’s Journey, said: “Thank you to Alistair and Steeles Law for raising awareness of Nelson’s Journey’s work with bereaved children in Norfolk. Alistair’s skills and expertise bring tremendous benefits to the charity’s governance, which is so important, particularly in challenging times such as these.

“Bereaved children and young people have faced particular challenges since the Covid-19 outbreak, with restrictions on funerals and cancelled memorial events as well as the loss of usual support networks such as schools, clubs and limited contact with family and friends. As a charity, we’ve had to work creatively, using different tools to support young people with the restrictions on place for our work – but in doing so we’re learning lots of other ways of working effectively so that we can continue to bring back smiles to Norfolk’s bereaved children.”

Alistair Ponder | Norfolk Day 2020 | Norfolk Charity Hero

5 reasons I love Norfolk:

1. Big skies
2. The Norfolk Broads
3. Best beaches
4. Quieter than the big smoke
5. Great place for children

 

 

 

 

 

 

Suzanne Cuthbert: Scotty’s Little Soldiers

‘I was raised in the British Forces and have always found a way to support charities related to the services. One of my best friend’s cousins was killed in Afghanistan in 2009; he left behind a beautiful wife Nikki and 2 very young children. There was no support for them, so Nikki set up Scotty’s Little Soldiers and the journey started. They are based in Kings Lynn and were one of the charities Prince Harry and Meghan Markle donated to after their wedding.

They now have numerous holiday homes around the country that families can escape to in these tragic circumstances and they support over 500 children bringing them light, love and hope in the trauma of losing a parent in our British forces. The children are invited to parties, regularly contacted; receive gifts for their birthdays and a special gift on the anniversary of their parent’s death to remind them they are not alone.

Along with two of my best girlfriends I am completing a sponsored walk ‘Yayas Walk to New York’ to raise further funds for the charity. In September 2019, we went to New York we had planned to return this year but obviously world events has meant that is not possible, so we came up with the fundraising idea to ‘virtually walk’ there instead!.

We have set ourselves the target to walk the 3477 miles within the year. As we are all busy working mums, and with other day to day commitments it can be hard to squeeze in the 3.3 miles that is needed to stay on target each day. However, at the end of a busy day it is a chance to reflect and spend some much needed time away from the pressures of working life.

We started 1st July 2020 and I’ve just hit my 70th mile. To date we have raised £1,944.00.’

If you would like to support this fundraiser, please visit Suzanne’s fundraising page.

Suzanne Cubitt | Norfolk Day 2020 | Norfolk Charity Hero

5 reasons I love Norfolk:

1. The beautiful coastline
2. Cromer crab
3. Copys Cloud Cheese made by the wonderful Mrs Temple
4. Black Shuck Gin
5. Blakeney Point to see the seals

 

 

 

 

 

 

During Norfolk Day we will be sharing our colleagues ‘5 reasons I love Norfolk’ from our company twitter account (@steeleslaw) please connect with us and join in the conversation using the hashtag #NorfolkDay and let us know about your Charity Heroes.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

The Problem of Late Payment, Long Payment Terms and What Your Business Can do About it

As a small or medium business, you have probably come up against the significant issue of being paid late by your customers. You have probably also been forced to accept very long payment terms by larger businesses because of the imbalance of power in contract negotiations.

Long payment terms and late payments have a serious knock-on effect on your cash flow. You become unable to invest in new equipment and staff, you may have to increase overdrafts or take on new bank loans and, for some businesses, it may mean salary cuts, redundancies and insolvency. In short, the future growth of your business is directly affected by long payment terms and late payments.

There is a culture of late payment and long payment terms in the United Kingdom. Why this has come about is unclear but it is a stark difference to our European neighbours, where they see prompt payment as a badge of honour and good business. For this reason, the Government recently opened a consultation into this area to see if changes to legislation needed to be enacted. Unfortunately, the results were mixed and it is unlikely we will see any changes to current payments legislation. However, there are some things we can learn from that consultation and some things that businesses need to be reminded of in order to protect their business interests. The overwhelming majority of SMEs simply chase the debtor, repeatedly asking for payment, but there is much more that you can do.

We set out below some key steps you can take if your business is currently suffering from late payments and long payment terms:

1. Current UK Legislation

Current legislation already gives maximum 30-day payment terms for transactions with public bodies. It also gives maximum 60-day payment terms for all other business-to-business contracts unless they agree longer terms between themselves and those new terms are not “grossly unfair” to the supplier. Unfortunately, what “grossly unfair” actually means is unclear and has been the subject of much debate. Also, from 1 September 2019, any business that bids for a Government contract above £5 million will be expected to pay 95% of their invoices within 60 days across their whole business.

2. Research and Investigate Your Customer

Before you start supplying the customer you might want to consider doing your research on them and taking a view on the risk of them paying you late. If they are an essential customer for you, then this may not make a difference to your decision, but it always pays to do your due diligence:

  • a. Running a credit check against them might raise any red flags about their solvency before you even start supplying them.
  • b. Check the Payment Practice Reports at https://www.gov.uk/check-when-businesses-pay-invoices. This is a register of large businesses and tells you their record of paying invoices on time. This register has increased Board level responsibility for late payment and has started to improve the situation.
  • c. Check the business accounts at Companies House.
  • d. Talk to others in your industry for any awareness or knowledge on the particular business and their payment practices.

3. Contact the Small Business Commissioner and Trade Sector Bodies

It is bewildering how few businesses know that the Small Business Commissioner can help. Since the role was introduced in 2017, the Commissioner has recovered more than £3.5 million in late payments for SMEs. You are able to contact the Commissioner, report the late payer and the Commissioner may, in certain circumstances, help you to recover the debt that you are owed. Find out more at https://www.smallbusinesscommissioner.gov.uk/deal-with-an-unpaid-invoice/get-advice/. You should also contact organisations in your trade sector which can help to resolve your issues, especially if you are in the Construction industry, or if you supply to a supermarket or to a Government body (the Small Business Commissioner cannot help you in those areas).

4. Calculate Statutory Interest on the Debt and Re-Invoice the Late Payer

The majority of SMEs are hesitant to enforce their legal rights with debtors for fear of losing business and damaging relationships. However, does not enforcing your legal rights contribute to the underlying late payment culture? That is a question for another time. However, you don’t need to sue the debtor to enforce your rights – interest on late payments is a statutory right and you should make this known at the earliest opportunity. Currently, the interest rate is set at 8% above the Bank of England base rate, which would make the current late payment interest 8.1% per annum. Calculate the interest at that rate, then re-invoice the late payer with the additional amount. This might make them aware that you are serious about enforcing your rights.

5. Invoice Financing and Supply Chain Finance

It might not be right for some businesses, so you should consult expert advice, but Invoice Financing and Supply Chain Finance can help with short term liquidity and solidifying the supply chain. Invoice Financing involves assigning the amount of money owed to you to a finance company, who then advances you 80% (usually) of the debt. From 31 December 2018, contract terms which forbid the assignment of amounts owed to businesses can no longer be enforced, which means that invoice financing could be available to you. Supply Chain Finance is more complex and is usually arranged when you have a very large and reputable customer; it enables you to obtain early payment or financing from a bank against the invoices you have issued to the large customer.

6. Legal Action

You can, of course, take legal action which would likely involve sending a letter before claim followed by issuing legal proceedings if the debtor does not pay. Legal action can be costly and risky but sometimes it may be your only remaining course of action. It does not need to be stressful, however, and we can help you to navigate through the process.

For more information on how the Steeles Law Corporate and Commercial team and Debt Recovery teams can support you and your business, please call 01603 598000 or email info@steeleslaw.co.uk and a member of the team will be happy to assist. Appointments are available in Norwich, Diss and London offices.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

The Gig Economy and the Changing Nature of the Workforce – Lessons for Employers

An upcoming Supreme Court hearing which is taking place remotely on 21 and 22 July 2020 will again consider the nature of Uber’s business model and the classification of their drivers. Are they “workers”? Or are they, as Uber puts it, self-employed “partners”? If they are workers, they should be entitled to holiday pay and at least the national minimum wage, which Uber does not give them, and each driver could be entitled to an average of £12,000 in compensation.

As the Gig Economy continues to increase in popularity, cases such as this highlight the speed at which the nature of the workforce is changing and whether current employment law can keep up with those changes. It also puts into focus the importance of carefully considering the status of the people that work for you.

The Uber Case

The Court of Appeal has already ruled that Uber’s drivers are workers and not self-employed. The factors taken into account were, among others:

  1. While they had the app switched on they were ready and able to accept work.
  2. They had a positive obligation to be available to accept passengers while the app was switched on.
  3. The degree of control that Uber exerted over them and the ratings system used to assess performance.

As workers, they are entitled to basic employment rights including holiday pay and national minimum wage. Simply labelling them as self-employed “partners” did not necessarily mean that that was their status in law.

However, cases such as this always turn on the specific facts of the case – some specific drivers in a specific tech company. The fact is that many people are self-employed in the Gig Economy and they enjoy the freedom and flexibility it brings. However, the inconsistency with the court decisions on the classification of “workers”, and also the different treatment under tax law, is a weakness in the current framework for classifying people who provide services, especially as the nature of the workforce is changing and will continue to change as the trend towards independent contracting and remote-working gathers pace.

Practical Lessons for Employers

If you have self-employed independent contractors working in your business, they will need to fall outside of the definition of “worker” or “employee” pursuant to section 230(1) and (3) of the Employment Rights Act 1996. An “employee” should be fairly easy to classify but a “worker” has a very fuzzy distinction due to the inconsistent case law. If those people you had originally considered to be self-employed turn out to be workers, then there could be large claims for unpaid statutory holiday by your entire workforce. Alternatively, they could be entitled to carry that untaken holiday over indefinitely and be paid in lieu on termination (according to the European Court of Justice’s decision in King v Sash Window Workshop Ltd (C-214/16) EU:C:2017:914).

It is therefore of paramount importance that you keep a watchful eye over your workforce’s status to avoid paying the price of misclassifying them. Perhaps the Supreme Court in the Uber case will take this opportunity to clarify the case-law in this area. Practitioners in this space are keenly anticipating the remote hearing later this month.

Contact us

To find out how Steeles Law Employment team can support you and your business, please do not hesitate to call 01603 598000 or email employment@steeleslaw.co.uk. Appointments are available at our Diss, Norwich and London offices or at your offices by appointment.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

Relationship breakdown in a pandemic – Q&A

Throughout the coronavirus pandemic, many couples may have had time to consider the future of their relationship.

It was reported in June that since the lockdown Law firms have seen a 40% rise in divorce enquiries in the UK. ‘In my opinion, couples rarely rush to divorce. Often, they have had a period of many months or even years of trying to mend a failing marriage sometimes with the assistance of family counselling or marriage guidance’ comments Sally Harris, Family Law solicitor. ‘It is difficult to tell whether the coronavirus and subsequent lockdown has been solely responsible for the increase in relationship breakdowns but the pandemic has undoubtedly left cracks in family relationships and certainly given families time to revaluate what is important for their future plus additional financial stress leading to a rise in matrimonial conflict.’

In our relationship breakdown Q&A, Sally Harris reviews common questions raised on the divorce and civil partnership dissolution process and reviews whether the coronavirus pandemic has had an affect on family life and how a solicitor can offer support and guidance to separating couples.

Q1. Can couples still apply for a divorce or civil partnership dissolution during the pandemic?

A Divorce and Civil Partnership Dissolution can still be applied for in exactly the same way during the pandemic as previously. The process is the same either online or by sending a hard copy application to the Court together with the Court fee.  The only difference is that the Court are taking longer to issue and send the paperwork out to the other party than prior to the pandemic.

During the pandemic we have changed the way we offer appointment slightly. While we are still contactable in the usual way, via telephone or email and we now routinely offer Zoom or Skype video calls and pre-booked appointments at our Diss office.

Q2. What steps will a solicitor take you through when applying for a divorce or civil partnership dissolution?

Our family team are members of Resolution and are committed to supporting families in as amicable way as possible, working in the best interests of the whole family.

A solicitor will discuss with you how you are best to dissolve your marriage or civil partnership and draft the petition and accompanying paperwork for you.  This will all be agreed with you and usually your spouse or civil partner before it is sent to the Court to be issued.  The solicitor will then take all the necessary steps to obtain the Decree Nisi and Decree Absolute to finalise divorce/dissolution for you.

Q3. Has the coronavirus pandemic impacted the timescales for divorce and dissolving civil partnerships?

Although the steps that you have to take are exactly the same the pandemic has extended the timescales.  The Court have less staff and backlogs have occurred.  There has also been additional pressure on Judge’s time and therefore it is now taking longer from start to the conclusion of a divorce/dissolution than at the beginning of the year.

Q4. Why is it important to seek expert advice during the divorce and civil partnership dissolution process, rather than taking a DIY approach?

With proper advice the divorce/civil partnership will make its way through the Court process as swiftly as is possible, a solicitor will be able to advise you on any arising risk and the best steps to take to protect yourself..  Many DIY approaches are rejected by the Court where errors have been made, or not fully understanding of the value of joint assets which will affect what you could be entitled to in the settlement, and this can prolong the process considerably.

Top tips to consider when starting a divorce or civil partnership dissolution

  • Wherever possible remain amicable and take a co-operative approach to the process.  This can save a huge amount of time as well as costs and emotional effort if parties are able to work together.
  • Ensure you take legal advice – do not take advice from family or friends, as their situations and/or financials will be very different.
  • Don’t be afraid to ask your solicitor questions, no question is stupid and it’s important that you understand the advice you are being given.
  • Don’t panic. Focus on the bigger picture and what is most important to you for an amicable resolution?
  • Prepare yourself financially for your new life. Set budgets and get a good understanding of your financial situation.
  • Be prepared. Be armed with as much information as possible prior to meeting your solicitor.
  • What about the children? A court will always look to put the children’s best interest first, make sure you are working with extended family to ensure your children’s needs are being met.

If you would have further questions regarding any of the points raised in our Q&A, or you wish to speak to a member of the Family Law team regarding your relationship breakdown please call 01603 598000 or email family@steeleslaw.co.uk  and a member of the team will be happy to contact you.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.

Summer Statement 2020

Yesterday the chancellor announced his summer statement to kick start the UK economy. Key points within the summer statement include: A VAT cut for hospitality, a cut in stamp duty until 31 March 2021, an ‘eat out to help out’ scheme with discounts on eating out and a job retention bonus when bringing employees back from furlough.

It is no surprise that coronavirus has had a detrimental effect to the economy, with significant losses to businesses and job prospects. We are optimistic that these schemes will give the economy the kickstart it needs and have reviewed the key points of the summer statement and what this will mean for our clients.

Hospitality industry:

To encourage consumers to support local restaurants and cafes and give the hospitality industry the additional boost it desperately needs, the Chancellor has introduced an ‘eat out to help out discount’ scheme throughout August.  In addition, VAT has been cut with immediate effect until January 2021 from 20% to 5%. This scheme will help the consumers who have been financially affected by the pandemic start to visit restaurants again and we are confident that this will give the hospitality sector the boost it needs as we continue to navigate a difficult period, particularly during the summer season which would ordinarily be their busiest time.

UK property market:

While many estate agents report an upturn in the property market, the market was initially hit hard in the early stages of lockdown. As the market reopened, we saw a surge in buying and selling enquiries. This is due to many having the ability to save money in lockdown due to lack of spending if they had not been financially affected. Others found themselves at home more in a house that no longer works for them and their family, particularly bearing in mind the prolonged period of remote working for many.

Estate agents quickly adapted as the lockdown restrictions allowed them to reopen and many now report that the housing market is as strong as it has ever been. In order to encourage the housing chains to move again, the Chancellor has announced a stamp duty holiday until 31st March 2021, meaning that first time buyers will have their stamp duty increased from £125,000 to £500,000. Those buying homes for more than £5000,000 will still have to pay stamp duty but it will be lower as a result of these short-term changes.

“After a short period of closure, it is great to see the residential property market open again. We have seen all areas of the property process adapt to social distancing well, with virtual house viewings and socially distanced conveyancing meetings. I am confident the changes announced to stamp duty in the summer statement will only further strengthen the housing market”, said Michael Fahy, Director and Head of Property.

Furlough and Kickstart Scheme

As the furlough scheme starts to be phased out from August with flexible working, the scheme will ultimately come to end in October this year. “Leaving the furlough scheme open forever gives people false hope that it will always be possible to return to the jobs they had before,” says the Chancellor. However, he has announced a job retention bonus which will pay businesses £1,000 to retain furloughed staff.  There will be terms that need to be met in order to claim the bonus and staff should not be brought back ‘for the sake of it – they need to be doing decent work’. Employers will need to continuously employ workers through to January 2021.

A ‘kickstart’ scheme was also announced to financially support businesses recruiting those aged 16-24 who may otherwise struggle to find employment in the current climate. A £2,000 incentive is also available for businesses looking to recruit apprentices.

“The Job Retention Scheme has been a lifeline for many as we continue to navigate our businesses though this unprecedented situation. Now is the time for businesses to look to the future and decide the shape of their workforce as we begin to bring our businesses back to work in line with social distance guidelines. The new bonuses and ‘kickstart scheme’ will give employers the confidence to bring employees back and look to grow their workforce as they start to rebuild their businesses” said Oliver Brabbins, Managing Director and Head of Employment Law.

If the Chancellor’s summer statement has inspired you to get a foot on the property ladder and you would like to talk to us about conveyancing, or you would like to speak to our employment team about how the furlough scheme could work for you and your business, please call our team on 01603 598000 or email info@steeleslaw.co.uk and a member of the team will be pleased to contact you directly.

*The information provided in this article is designed to provide useful information on the subject, not to provide specific legal advice.