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Would you hire your employees again?

Generally when an employee hands you their notice, they will normal fall into one of two categories, the first one being the ‘we will be said to see you leave ‘ or  ‘thank goodness for that’. Whichever category it may be, let’s suppose that one day you receive a call from a fellow business owner considering taking on your former employee?

If this individual managed to fall into your first category, great, you are so pleased that they have found themselves a new position. But wait, what about if the individual in question fell straight into the second category the moment they resigned? Yikes, what do you tell their new employer?

What if that new employer asked, if you was given the opportunity would you hire the individual under interrogation again?

If we are being brutal, you probably shudder at the mention of their name and under no circumstances would you hire them again. You was not happy with their work, and certainly wouldn’t wish this on another employer.

So surely, this the part where you speak your mind, and explain what you experienced; after all you would want somebody in a similar situation to look out for you, wouldn’t you? Wrong. 

The law states that no former employees have the right to any reference from you. With the exception of an agreed reference included in a settlement agreement, then you can’t refuse to give a reference in future.

Where you are to give a reference, it is important that reasonable preparation is given, to ensure that it’s fair, accurate and not misleading. This same rule applies for references given verbally, so be especially careful when giving references over the telephone.

While you feel that it is fair and reasonable from your perspective to say that you wouldn’t employ this individual again, it’s far safer to keep it quiet and not mention this to their new employer.

There are three main points to remember when giving references:

  1. References must only ever be based on fact;
  2. You must be able to back up with clear evidence; and
  3. You should never provide any negative opinions about an individual.

Why? Well, if  your former employee found out then you could potentially have a case against you.

Here are our tips to ensure you don’t find yourself in the same situation as above:

  • Always ask for the reference request to be in writing, this way you can consider what you wish to say carefully;
  • It is easy to slip up when giving verbal references, and what you say could also be misinterpreted;
  • Remember that if you really don’t have anything good to say, you can refuse to give references – but it’s always best to make this a standard practice to avoid any allegations of discrimination;
  • Be sure to provide basic references only e.g. the employee’s employment, length of service, job title and duties;
  • Watch out for former employees that threatened you with a claim or brought one. It is important not to refuse a reference as this could be deemed victimisation.

So, remember while there is nothing wrong with you giving a verbal reference or giving your honest opinion, but  it’s always safer to keep it to yourself.  If you need any guidance with references, contact us on 01909 512 120 or email info@loftusstowe.com

This one’s pretty interesting!

A company in Indian, has appointed a dog as their HR representative and I’m sure you’ll be interested to read about this!

We all know that to be part of a HR team, it’s expected that you are approachable, mild mannered and a pretty good listener. So, surely it makes sense that the Indian Company, OPN Advertising in Chennai, has hired Goofy, a Lhasapso?

Seven years ago, Goofy found his way into the offices and has never left. The Head of Strategy, states that his presence brings calm to the workplace, stating “he’s an inspiration, he doesn’t bark or bite. Seeing him or cuddling him brings a surge of ideas.”

It gets better, Goofy spends his time split between the companies ‘Thinking Room’ and living at different employee’s homes.

Starting to feel jealous that you don’t have a furry friend at work? Let us know what you think!

Acas: Disability Discrimination Guide

As a way to try and tackle and prevent disability discrimination in the workplace, Acas have published a guide. It’s completely free and is called Disability Discrimination: Key Points for The Workplace, for a quick link you can find it here.

The guide helps employers to understand exactly what is meant by the term disability, how it can happen and how to prevent and manage complaints. This is a reaction from Acas, due to their helpline receiving around 12,000 calls in the past year, all relating to disability discrimination.

Many employers understand that disability is a complex area when it comes to employment law and disabled people who seek work have found that misconceptions of their capability to work, were stopping them being hired.

Don’t forget, you can find a copy of the guide here. For support or guidance with any HR matter, contact us on 01909 512 120 or email phillipa@loftusstowe.com

Employment Law – Free Event

Auto-enrolment is here, are you ready? Do you know how it is going to affect your business, do you know the fines you will have to pay if you get it wrong, or ignore it all together?

Not only this, there are many employment law changes coming into place for example the new living wage and new regulations on pay gaps between men and women – all of these changes mean you will need to change your contracts, handbooks, policies and even the way you recruit!

There’s a lot going on over the next few months, if you don’t know how these changes will affect your business, there’s a free event being held at The Turbine, Worksop by NMJN Accountants which includes two experts who will be speaking throughout the morning.

If you wish to attend, you can book by contacting Michelle on 01909 512 112.

Changes Affecting Business

‘Mandatory online filing of CIS returns and verifications’

HMRC has advised that over 85% of contractors and their authorised agents are already submitting their CIS returns online.

With effect from April 2016, however, all taxpayers will have to use the online system.

After this date, HMRC will not accept paper returns.

Online amendments, online messaging and alerts will be introduced to make it a fully automated service.

For those contractors and agents who have not already done so, you will need to register online before the April 2016 deadline.

Are you leaving auto-enrolment preparations too late?

The Pensions Regulator (TPR) is becoming concerned that some employers haven’t begun organised their auto-enrolment yet, and are possibly leaving their preparations too late to comply with their duties on time. This is after half a million small and micro employers are still to act this year, to meet their duty deadline.

TPR have already issued letters to these employers alerting them that their auto-enrolment duties are soon to start and reminding them that failure to prepare and comply on time, risks avoidable compliance action from them. However it’s still thought that a considerable amount of employers will leave it too late, or not take any action at all.

If you haven’t started planning for auto-enrolment yet, you should aim to start around 12 months before your staging date. If you need assistance with auto-enrolment, contact us on 01909 512 120 or email phillipa@loftusstowe.com

Subsidised commuting – what are the tax advantages?

For some of your employees a large dent on their earnings will be a result of getting to and from work by transport.

Did you know there’s several ways you can help them and your business by offering a tax efficient perk, as part of their pay package?

1st way, a simple loan – your employees can reduce their public transport costs by purchasing a season ticket.

But, the trouble is these can be expensive and it means them finding money to pay the ticket as a lump sum, resulting in most employees lending money.

As you are probably well aware, any credit card or overdraft will add interest, which in turn will then reduce the season ticket saving.

Our tip, is to avoid interest charges, by lending an employee up to £10,000 interest free.

Now I can see you thinking, why on earth would you possibly do this? Well, to you this is a tax and NI-free perk, but why? You can recoup the loan from their salary.

2nd way, subsidised bus routes.

What if some of your employees face a long walk from the nearest bus stop into the office or factory?

You might be able to make use of a quirky but useful tax break, all you have to do is pay a bus operator to increase the frequency of the service, or add a stop closer to you.

The tax and NI-free benefit to you is that in return for the subsidy, the bus company can offer free, or reduced rate tickets for your staff.

Then, you can recoup some if not all of the cost of subsidising a bus route by having employees give up some of their salary in exchange for the bus season ticket.

Or if the bus subsidy looks too costly, how about joining forces with other business owners near by?

Where none of the above work, how about an alternative tax break.

You could, again with other business owners if necessary, hire/buy a minibus to pick up employees from various points en route to or from work.

To recover some of the costs you could hire out the minibus when it is not being used, such as at the weekends and evenings.

As you would normally expect, your company’s costs associated with any of the above are tax deductible from its business profits.

Have you heard about the extending Sunday trading hours?

Through the Enterprise Bill, from autumn time, local authorities and city mayors in both England and Wales, are going to be given the authority to extend Sunday trading hours, allowing them to choose which larger shops will stay open for longer than the current trading hours which states six hours.

For shoppers, this may seem like a positive, extra trading hours means that businesses and high streets are able to stay open longer – giving them the change to compete as people’s shopping habits change.

But what about employees? If you are a shop worker, you will be given the choice to opt out of Sunday working by giving your employer a month’s notice. It’s key to ensure that shop workers are happy with the changes and only the ones who are happy to work those extra hours, are doing them.

Let us know what you think about the extending Sunday trading hours, do you think it’s a positive move? Or, along with religious groups, Conservative MPs and trade unions, do you think this could have a negative effect of the employee’s family lives?

Buy to Let – Property Portfolios

  • Posted On February 24, 2016
  • Categorized In News
  • Written By

Individual landlords will see their tax bills increase significantly from 2017/18, due to the restriction of interest and finance costs as deductions from residential property income.

There are tactics to discuss with the landlord for avoiding paying tax on more than 100% of net income. The choices are available can be:

  • Reduce the property related borrowings from existing resources;
  • Sell part of the property portfolio; or
  • Change the business structure to invest in commercial buildings or furnished holiday lettings, neither of which are subject to the restriction of interest deductions.

Where the properties are already held within a company there will be no interest restriction.

If there are properties carrying low gains those could be transferred gradually, perhaps covering the capital gains with the taxpayer’s annual exemption each year.

Entrepreneurs’ relief, business asset roll-over relief and hold-over relief for gifts can’t be used for gains made within a property letting business, as letting is not regarded as a “trading business”.

However, incorporation relief may be available if the entire property lettings business is transferred to the company in one go.

There will also be charges such as stamp duty to pay on the transfer.

Landlords may soon be incorporating companies to protect their property portfolio.

Invoice Financing Ban Removed

  • Posted On February 22, 2016
  • Categorized In News
  • Written By

Some businesses can be notorious and take a long time to pay invoices – these are usually big companies.

Smaller companies therefore have trouble with cash flow, leaving them to suffer in silence because they may not want to kick a fuss for fear of losing a major client.

One remedy to this is through invoice financing – transferring rights to receive money owed to a bank or finance company in exchange for most of the value of the invoice upfront.

Some bigger companies however can choose to ban smaller companies from using this as an option of debt recovery when entering into trade agreements.

The good news is with effect from early 2016, the government has outlawed bans on clauses in terms and conditions which state companies cannot assign their outstanding invoices to banks or finance companies.

The government’s proposal to make ineffective bans on invoice assignment by debtors won’t apply where:

  • the invoices relate to a business-to-consumer contract (rather than business-to-business)
  • they relate to financial services contracts
  • the contracts relate to interests in land. This is because there are already significant laws in place concerning these types of transactions
  • assigning the debt might breach the debtor’s commercial confidentiality
  • the transaction is between businesses not under English contract law, or if it is, neither business operates within the UK.

It possibly is about time to review existing contracts – we can assist you with this.

You can also call us on 01909512120 or email paul@loftusstowe.com

Femi Ogunshakin Managing Director
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