Redundancies expected to rise this year – what you need to know

The latest official figures show that redundancies are on the rise this year. Expected redundancies are up from 22,525 in June to 23,975 in July, based on the number of HR1 forms filed to HMRC. While this data lags behind real-world figures because of the way it is collated, many big companies have already announced redundancies.

The biggest so far includes Wilko. Its collapse has put around 12,500 jobs at risk. But it is far from alone in making layoffs. Deloitte is expected to lose around 800 of its UK staff, while even behemoths like Google, Amazon, Yahoo and Meta have made redundancies this year. As early as February, the Retail Gazette highlighted that 15,000 jobs in retail had been cut by the time this story was published.

Employees can do little to avoid the cull, but the least you can do is understand what you can expect from your employer. If you’re an employer, then you also need to understand your legal obligations.

Responsibilities of an employer

Let’s start with the employer’s responsibilities. To make a person or people redundant, their job or jobs must no longer exist. If this isn’t the case, it won’t be considered a genuine redundancy. Then you must choose who to make redundant.

This must be carefully considered, especially if you are making compulsory redundancies, as the people you choose must be chosen fairly. For example, under the Government’s fair selection criteria, you can consider:

• skills, qualifications and aptitude,
• standard of work and/or performance,
• attendance,
• disciplinary record.

Source: Gov.uk

You can use the ‘last in, first out’ approach legally too, providing it doesn’t unfairly impact one group over another. However, you cannot choose people based on:

• pregnancy, including all reasons relating to maternity,
• family, including parental leave, paternity leave (birth and adoption), adoption leave or time off for dependants,
• acting as an employee representative,
• acting as a trade union representative,
• joining or not joining a trade union,
• being a part-time or fixed-term employee,
• age, disability, gender reassignment, marriage and civil partnership, race, religion or belief, sex and sexual orientation,
• pay and working hours, including the Working Time Regulations, annual leave and the National Minimum Wage.

Source: Gov.uk

For voluntary redundancies, you must be clear about how you are going to choose people, and ensure they understand you may not give them redundancy just because they applied for it. Another way to reduce staff numbers voluntarily is to offer people incentives to take early retirement. This must be offered across the entire workforce to comply with legislation. But you can’t force someone to retire early.

At all times, good communication between employers and employees is paramount, so everyone knows where they stand, and trust is maintained.

What employees need to know

Employees want to know they are being treated properly, and there are different rules employers must follow depending on how many redundancies they’re making. If it is less than 20, there are no hard and fast rules, but you should still be fully consulted on plans and kept informed of what is about to happen.

If more than 20 people will be made redundant within the same ‘establishment’ as the Government puts it, within a 90-day period, then the company must go through a ‘collective consultation’. Staff or union representatives should be informed initially if they are in your workplace, or the company must speak directly to the staff.

The consultation period must last for at least 30 days if 20-99 people are being made redundant, or 45 days if it is 100 or more. Once this is done, then you will be given notice of your redundancy. At the very least this should include:

• the reasons for redundancies,
• the numbers and categories of employees involved,
• the numbers of employees in each category,
• how you plan to select employees for redundancy,
• how you’ll carry out redundancies,
• how you’ll work out redundancy payments.

Source: Gov.uk

How is redundancy pay worked out?

How much redundancy pay you will get depends on a variety of factors, but there are rules around the minimum statutory redundancy pay that should be offered. For example, anyone not under an employment contract, those with the company less than two years, and those who have taken early retirement won’t get statutory redundancy pay. Your employer may still pay you, but it is not compulsory.

Any employee receiving redundancy pay should be told exactly how it has been worked out in a written statement. The statutory redundancy pay rules allow for amounts equivalent to:

• 5 weeks’ pay for each full year of employment after your 41^st birthday,
• one weeks’ pay for each full year of employment after your 22^nd birthday,
• half a weeks’ pay for each full year of your employment up to your 22^nd

Source: Gov.uk

The length of service is capped at 20 years under these rules, and the amount you will receive is based on the average of the amount you earned in the previous 12 weeks prior to you being made redundant. Even so, weekly pay is capped at £643 per week, and the total statutory redundancy payout is capped at £19,290. But remember, your employer can decide to pay you more, or you may be able to negotiate more.

This payment should be made when you are made redundant, but if not, or your employer doesn’t agree with the amount, you have up to three months to claim the payment due from an employment tribunal. So, even though this might be an emotional time, keep your eye on the calendar to make sure you don’t miss out. The good news is that even if you miss this deadline, the tribunal would have up to six months to decide whether you should receive the money.

We can help you

If your business needs to make redundancies, or you’re an employee about to be made redundant, please get in touch with us and we will help to either make sure you are complying with all of the relevant regulations, or receiving what you expect.

New UK Internal Market Scheme launches

A new UK Internal Market Scheme (UKIMS) has been launched to replace the old UK Trader Scheme, which will enable any registered traders to move ‘not at risk’ of entering the EU goods into Northern Ireland. The legislation, which came into force on September 30, is needed following the UK’s exit from the European Union.

The good news is that from October 2024, these ‘not at risk’ items will also be free to move without any unnecessary paperwork, checks or duties, only the existing commercial information will be needed from then onwards.

What are the changes and what do they mean?

There are three main changes under the UKIMS rules compared with the old scheme. The first is that all companies established in the UK will be able to use the scheme, instead of only those companies with a physical premises in Northern Ireland.

The second is that the turnover threshold below which companies involved in processing can move goods has risen from £500,000 up to £2m, making the scheme more widely available. The third is that even if a business is above this £2m threshold, they will still be eligible to move goods under the scheme if they are for use in healthcare, construction, animal feed or not-for-profit sectors.

All traders operating under the old scheme should have received information on how to become authorised for the new scheme. There are some additional pieces of information that need to be supplied for HMRC to complete the enrolment of these traders into the new scheme. You can get more information and guidance on what these are by clicking here.

Let us help you

If you need or want to move goods into Northern Ireland, then please get in touch with us and we will work with you to ensure you have all the relevant permissions under the new scheme.

Back to work means it’s time for business development

For most people the summer holidays will be firmly in the rearview mirror by now and they will be starting to focus on the year ahead. One way to make sure next year will be one to remember is by putting some effort into business development now, so you can start 2024 in good shape.

The EY Item Club said earlier this summer that it expects the UK economy to grow by just 0.8% in 2024, so the sooner you start working on how you can connect more effectively with your customers, whether your business is B2B or B2C, the more chance you have of boosting your profits.

Autumn is a great time for business development, as the months ahead of Christmas are key for many businesses because they plan their budgets and allocate finances to projects the following year. Getting in front of the right people now could give you a better chance of securing a piece of the pie.

Where’s the best place to start?

Most businesses will be doing some form of business development on a regular basis – and if yours isn’t, then this is something to address. Becoming complacent and relying on your current client base to keep your business afloat is a risky strategy.

If you’re new to this, then one of the best places to start is by identifying what your customer looks like. Literally. This may sound extreme, but considering who your customer is, what they are interested in and what they are going to want to spend their money on is the ideal way to target the people or businesses you want to work with.

For example, is your business selling primarily to people or other businesses locally? Could you expand your reach online? Are your customers UK-based, or can you sell your products or services globally? Once you know the answers to these initial questions, you can begin to establish who your customers are.

Where do I find them?

The next step is talking to them. This could be through advertising locally, or perhaps you could harness the power of social media to spread the word about your business. For example, LinkedIn is a great place to do some networking whether your business is B2B or B2C, or both.

Other social media sites, such as X, formerly known as Twitter, Instagram, Facebook, TikTok, Threads and so on, can be just as useful. But you will need to create regular content for them to be effective. This can take time, although there are now some useful AI tools that can do some of the heavy lifting for you. For image creation, you could check out Midjourney, or if you already use Hootsuite to manage your social media channels, then check out its AI content creator OwlyWriter AI.

AI tools aren’t perfect, but they can help take away some of the difficulties that come from starting with a blank page and give you some content to work with. You can even use AI tools to run ads for you now, just be sure you keep a keen eye on how well they are working. This is your brand we are talking about here.

I don’t like social media, what else can I do?

If you’re not a fan of social media, there are plenty of other ways to meet and greet potential new partners and customers. Check out any local trade fairs that are happening and see what it costs to go as a delegate or to exhibit. The latter will usually cost more, so do your research carefully to see who will be there so you know your efforts and money won’t be wasted.

Other business development can be done through business associations, such as the local Chamber of Commerce, or through networking at more social events, such as during a round of golf or at a tennis club.

Once you get into the swing of your business development, use a customer relationship management (CRM) system to keep on top of those conversations and important contacts. This will help you track and action anything you need to so those opportunities don’t get left to wither on the vine. Different CRMs have various pros and cons, so again do your research carefully.

Contact us

If you are considering spending money on your business development, then get in touch with us first and we will help to make sure you are getting the right tools for the job.

Don’t miss the October 5 deadline to register for self-assessment

Anyone who has become self-employed, was in a business partnership, earned more than £100,000 or had to pay the High-Income Benefit Charge this year has until October 5 to speak to HMRC to register for self-assessment.

Millions of people each year need to do a self-assessment, and this includes anyone earning money outside of their PAYE job, including commission or tips, or you earn income from renting out a property.

What if I need to claim tax relief?

If you need to claim tax relief on anything, such as items you pay for out of your own pocket which are solely used for your PAYE employment, then you would also need to sign up for self-assessment. You may be due a tax rebate too if you have been made redundant, as you may not have been paid as much as expected across the whole year.

Other tax reliefs might come from Gift Aid donations you have made to charity, or reclaiming the additional tax relief on your pension contributions if you are a 40% or 45% taxpayer.

You can also claim tax relief on maintenance payments if you have to make them to your ex-spouse or civil partner, although this would only apply if one of you was born before April 6, 1935.

Check if you need to make a self-assessment payment by visiting the Gov.uk website.

Can I be fined if I miss this deadline?

If you fail to notify HMRC before the October 5 deadline, then you could face a penalty. If you fail to register and file your return before January 31 of the year following the tax year when the amount was due, you could face another.

The best thing to do is act now and check if you need to file a self-assessment. If so, then get your skates on and register before October 5. If you can’t, then do it as soon as you can afterwards and check if any penalties will apply.

We can help you meet your obligations

If you think you may have a self-assessment liability for 2023/24, then please get in touch and we will make sure you get everything you need in place.