Pensions and furloughing

Since the Government published details about its Coronavirus Job Retention Scheme, there have been many questions asked about what it means for pensions.

While we don’t yet have the complete picture  about furloughing and its impact on pension contributions,  we are expecting guidance on it from the Government, HMRC and the Pensions Regulator. In the meantime this is what we do know:

The Government will only pay the Auto Enrolment minimum employer pension contribution ie 3% on the 80% or £2.5k per month if lower of the employee’s regular monthly wage (no commission, fees or bonus). If the employer pays more then the Government’s furloughing scheme only covers 3%, it won’t pay any extra.

• The Government‘s scheme will not cover the employees’ auto-enrolment pension contributions at all. 

• For members who are part of a pensions salary sacrifice scheme, the 80% pay is based on the employee’s reduced salary and the Government’s scheme will only cover 3% of the salary sacrificed amount. The information that has to be provided to HMRC is all based on what goes through PAYE and so there is no allowance for salary sacrifice. 

• The 3% itself is based on 3% of earnings above the lower qualifying earnings threshold (£512 per month up to 5 April and £520 after that). This is the case regardless as to the definition of pensionable earnings used by the employer for auto-enrolment and regardless of which quality test is used for auto-enrolment 

Our view is that the legal position currently is that the employer must top up any difference in contribution rates if it is furloughing. If the employer is not prepared to do so then this amounts to a listed change as it is a change to its pension contribution structure. This then requires the employer, if it has 50 or more employees, to consult for 60 days before changing its pension contribution structure. This is just a consultation - individual consents are not required. 

The Pensions Regulator has the power to issue a £50k fine if the employer fails to satisfy its statutory 60 day pension consultation obligations.  It is also separately a change to an employee’s terms and conditions and so the employee could claim constructive dismissal if they do not agree to the change ie there is the potential for a breach of contract claim. 

However we understand that the Pensions Regulator is looking at relaxing the 60 day consultation obligation as this doesn’t work well with the idea of furloughing and the flexibility that this aims to bring employers. We understand that some Guidance is expected relatively soon from the Pensions Regulator. 

Separately employers should not be encouraging their employees in any way to opt out of auto-enrolment and it is a statutory offence to do so. An employee must pay the minimum auto-enrolment contribution of 5% on qualifying earnings unless the employer pays this. There is no flexibility on this in the auto-enrolment legislation. 

Also we understand that the Government is to issue Guidance on how to calculate the contributions before employers can apply for the furloughing grant. We expect this to specify whether the difference the employer has to make up is on the new furloughed amount or the higher pre-furloughed amount.  HMRC are actively looking at this at the moment.

The Government’s announcements on furloughing do not specifically mention Defined Benefit schemes. It is unclear what impact furloughing will have – is Defined Benefit accrual to be maintained? If so, the 3% employer contribution rate is not likely to be sufficient. We have to just wait for further guidance for this to be clarified.     It may not be an immediate priority for the Government as the public sector and  local authorities, for example, are not immediately going to go down the route of furloughing employees.   

By Penny Cogher and Larisa Gordan from Irwin Mitchell

#MY19HERO | Bringing out The Best in People

Stephanie Young of #saydesignUK wanted to highlight how businesses have adapted during this time of Covid-19. Many of her clients where reframing their business talents, contacts and working practices, to not only survive this time of turmoil, but also support and give back to the NHS and communities. There are many positive stories out there.

• Like the Brighton furniture manufacture now making facemasks for the NHS.
• The independent cleaner turning her business into a team of carers.
• The yoga teacher going online and giving free classes.
• People with more spare time baking and delivering free bread and cakes.
• The community support groups that have emerged.

We hear a lot about the negative things taking place, but there are so many positives arising every day. Stories of hope and change in business and the community are so important to share. Not only to promote them but also to educate and encourage others to think outside the box and do the same.

My Heroes a facebook group has been set up as a platform to share this hope.

#MY19HERO | The Best in People
https://www.facebook.com/groups/my19hero

So you are invited to tell your story, or to invite others that have a story to tell:

• How has your business transformed i.e. Manufacturing, social care, going online?
• Have you started up a new business?
• Have you created a new community service?
• Are you now supporting the NHS or the venerable?
• Are you making donations through your products and services?
• How has your service grown in these troubling times?

Please join, share and post. Sharing our stories we can encourage others, learn and recognise the #MY19HERO.

More than £2M already paid to hard-hit businesses in Adur & Worthing 

Sums totalling more than £2m have been paid to 176 businesses struggling during the coronavirus crisis in just two days, Adur & Worthing Councils announced today (April 8)

Staff at the Councils are working through hundreds of request forms to send hard-pressed businesses lifeline grants from the government.

The small businesses, retailers, restaurant owners and leisure operators have successfully completed an online form established by the Councils to register for the government cash. 

The Councils are encouraging eligible businesses to continue to come forward and complete the easy-to-use online form believing there are still many more businesses who could qualify for help.

Small businesses qualifying (those that receive Small Business Rate Relief or Rural Rate) will receive a grant of £10,000 while operators in the retail, hospitality and leisure sectors will receive grants on a sliding scale of up to £25,000 providing their rateable value does not exceed £51,000.

In total the government has allocated £26M for support to these businesses in Worthing and £17M in Adur.

Around 2,500 qualifying businesses across Adur and Worthing have also been sent a letter from the Councils to their business address as a prompt to register for a grant.

A spokesman for Adur & Worthing Councils said:“We thank everyone for following the guidelines as they complete the forms and want to reassure all eligible businesses that we are working through the submissions as quickly as possible.”

Businesses qualifying will need to give details of their operation so it is important the rate payer accesses the form only when they have all information to hand. 

Details needed include their business rates account number, property reference number, VAT registration number, full bank details, and billing address.

Businesses that have been verified will be sent a confirmatory email with further details of payments while those who haven't met the government's criteria will also receive an email confirmation.

To register businesses should go to https://www.adur-worthing.gov.uk/coronavirus/business-support/#register-for-sbgf-rhlgf-grant-fund

Economy Watch - ‘We are facing a potential £8 billion hit to our economy’

Coast to Capital Cheif Executive, Jonathan Sharrock  has written a blog which will focus on the huge impact which COVID-19 is having on businesses centered around Gatwick Airport and the aviation based economy which is just one aspect to our complex and diverse economy.

Following the news that Gatwick Airport has consolidated its operations and limited runway opening hours, airport handlers have warned that they are close to collapse putting 25,000 jobs across the country at risk.  Many of these will be based around Gatwick.  We estimate that the aviation sector in our region could face an up to £8 billion hit across the coming year.

Stories from the supply chain

Please keep sending through your stories from the supply chain to our news focused email address news@coast2capital.org.uk or tweet us @coast2capital and tag #c2cEconomyWatch.

We want to hear from you directly so do record a short video and send this to us via email for our new ‘Economy Watch’ blog section of our website. - Launching Soon!

We are hearing that the massive reduction in aviation demand by passengers and subsequent hit to the aviation related economy around Gatwick Airport is now filtering out to the wider economy.  

For example, a successful manufacturer of testing equipment, which exports 80% of their goods globally is finding it impossible to send their products over to Asia. Other exporting companies have told us that air freight rates have increased by up to 80%.  The situation is clearly having a significant impact on businesses across the region who export goods via piggy backing on to passenger flights.

The impact on Manor Royal Business District

Pre-COVID-19 the Gatwick Diamond, the cluster of towns in East Surrey and West Sussex surrounding Gatwick airport, had a combined economy of £24 billion and 368,000 jobs. It represents a symbiotic economic relationship between the airport and the local area that has grown and developed over 70 years.

Manor Royal Business District, our area’s largest business park and situated very close to Gatwick, is home to more than 500 businesses employing 30,000 people, including blue-chip global brands. Its 240 hectares include headquarters for Virgin Atlantic, CGG, Thales, Varian Medical Systems, Elekta, Vent-Axia, and Doosan Babcock Energy. 

Executive Director of the Manor Royal BID reports that that the impact on the park is mixed with some companies very, very busy (e.g. logistics), some ticking along (e.g. med-tech) and others very much struggling and worried about survival for whom the available grants and support either help a bit or not at all.  For example companies that depend on gatherings and assembly (e.g. those involved in the events industry) but that are not technically classified as retail, leisure or hospitality. For them no relief from rates and no cashflow. 

More to come

We continue to receive data that suggests that our area is amongst the worst hit parts of England for job losses (outside London) and we are assessing the impact of COVID-19 to focus our Local Industrial Strategy on our recovery from the crisis.

For future blogs I will also focus on the economy of Brighton and the South Coast and other key sectors including our agriculture sector and glasshouse economy.  Also on the impact on SMEs and how our new Backing Business Grant support is starting to help these businesses. 

The team and Board is thinking hard about the following and we will report further when things start to become clearer:

• The potential challenges that will be faced on the return to work.  What is the impact of blanket restrictions on working people?  What measures do we need to put in place to support a quick return to work in our region?
• The investment and support will be needed to support recovery.  Is this infrastructure? Or help for people to retrain? Or sector interventions? How to protect business confidence?

SME Emergency Response Clinics launched

The COVID19 outbreak poses substantial challenges to businesses across the Coast to Capital area and the dedicated Coast to Capital Growth Hub team is committed to supporting businesses in Greater Brighton, West Sussex, East Surrey and Croydon by providing practical support and signposting to reliable information to help address the challenges of these exceptional times.

Our Growth Hub have brought together our team of Growth Champions who can help you to develop business resilience and answer any questions you may have.

They will running FREE one hour bookable sessions for 1-2-1 conversations with one of our selected group of business experts. The sessions will be running online from 8.00am to 8.00pm and therefore there will be up to 10 available appointments each day. Each day will have a theme and we hope to address topics of most relevance to the challenges being faced by businesses in our area.

The sessions will be confidential and can be offered as either video or audio calls to suit you. If you require support in another area please complete this online form and one of the team will respond.

Click here to book your 1-2-1 slot now 

Coronavirus Business Support Guide

The Martlet Partnership have created a guide to help businesses during this crisis. 

Navigating the Crisis 
The Coronavirus (COVID-19) pandemic and associated shutdown has significantly affected many businesses. We know you may be suffering in terms of cash flow and face enormous uncertainty about the future for your business. We will do all we can to help you.

In this newsletter we have brought together what you need to know about the Government help available for small businesses. HMRC is automatically deferring the next VAT and Income Tax bills, and it will agree extra time for you to pay Corporation Tax and PAYE, but those terms need to be negotiated individually.

Unfortunately, it takes time to set up new systems to provide cash injections directly into businesses, but there are Government grants on their way to the Self employed and employers to cover 80% of profits or wages. We explain who will qualify for these grants.

A large number of businesses will have their Business Rates bill for 2020/21 wiped out, and smaller businesses will be eligible for cash grants of £10,000 or £25,000 from their local authority. Don’t be caught out by scammers, as all the Government grant money will come through either HMRC or the local authority you pay business rates to. Those organisations will not use email, text messages or phone calls to contact you so don’t click on links in any unsolicited communications.

If you are renting your home or business premises and are having difficulty in paying your rent, you should speak to your landlord. The law has been changed to require the landlord to give you at least three months notice to leave the property. All current court proceedings concerning evictions have been paused.

If you are worried that your business has more outgoings than sales and is heading for bust, any of these measures may be able to help you. The Government has temporarily changed the rules on wrongful trading to allow companies to pay staff and suppliers even if the directors fear this could mean the company is made insolvent. Your creditors will not be able to force your business into administration or liquidation for a temporary period during the pandemic.

Click here to view full Coronavirus Business Support Guide

For more information on The Martlet Partnership visit their website here or email. 

Have you got a Crisis Communication strategy?

Did you get the message?

As the impact of the global coronavirus outbreak continues to change our lives as we know it. People across the globe are adopting new ways of working to help authorities stem the worldwide spread of COVID-19. New ways of working create new challenges as well as new opportunities and collaborations. Organisations will find that 'not' having a communication strategy will impact employee’s productivity and reduce their engagement

Lack of direct communication with your most important assets could make them feel isolated, disengaged and 'out of the loop' from decision makers. Effective communication is critical as companies adjust to navigate this global issue. Common questions people ask when going through major operational changes:

• How quickly can we notify our global workforce of change?
• How do we inform multiple individuals and stakeholders about this? 
• How do we know if important messages have been received and actioned? 
• How can we reduce the rumours and misinformation that may cause further disruption?         

‘You’ve got mail’ 

Many organisations will solely rely on mass emails to share critical communications. Although it’s a widely adopted tool and a universal platform, it has limitations: 

• Emails are often delivered to junk or other folders where they may be missed by the recipients
• Information can be lost amongst all other incoming messages 
• The onus is on the recipient to assess the relevance of the email 
• Emailing multiple people can be cumbersome and slow 
• Recipients can choose to ignore communications regardless of the importance 
• Not knowing if your message has been read or understood 
• Monitoring multiple responses can be difficult 

Multi-channel communication 

Mass notification systems that have the capability to share information through multiple channels are a necessity to organisations going through change. Systems that allow you send several communications via different means at the same time, help ensure no one is left in the dark. Instantly sharing operational changes, safe working advice or vital safety alerts at a push of a button. 

What are the benefits? 

• Utilise multiple channels to deliver you messages 
• Provide clear and consistent messaging from one central place 
• Instantly share up-to date advice or change in company procedures or vital operational updates 
• Deliver messages to 1 or 10000 recipients immediately 
• Use geographical locations to send messages to specific individuals or groups 
• Schedule regular and automatic communications   
• Share media, documents and policies
• Invite users to the official company collaboration channels such as, slack, Trello or Asana.

Respond with confidence

Mass notification platforms allow employees to respond to a specific question or report issues directly to their senior management. This allows companies to make decisions based on actual responses and real time data. Robust systems will let you know if a message has been delivered, confirm if the recipients have read and acknowledged your message. 

Giving senior management the confidence that their workforce is fully informed, and if required they have the flexibility to send follow up communications automatically through pre-defined or instant individual messages.  

While the global impact of the ongoing COVID-19 pandemic is still unclear, organisations can try control the impact to employees and operations by adopting new ways of communicating. Keeping all their people in the loop and informed of relevant information and critical developments. Giving their workforce a means to respond and report problems directly, allowing their management to make informed and faster decisions.

Locate Global

Locate Global's Multi-Channel Communication module allows you to disseminate vital communications instantly to all your stakeholders from one central place.

• Delivery and read confirmations 
• Quick deployment and onboarding 
• Easy to use interface 
• Scalable infrastructure 
• Fully auditable and detailed management reports 

For information please contact enquiries@priavosecurity.com

Indigo Restaurant will be delivering Easter Weekend right to your door

We have been thinking about you and we are missing just doing what we love to do which is produce and serve lovely food.
 
And Easter is a time of celebration which as you know we like to do !!
 
So as you cannot come to us we will come to you! simples! or is it simnels??!!

To start the Easter Weekend we have seafood and blues to your door on Good Friday, with some fantastic music from some very talented musicians available online for your listening pleasure while you enjoy lunch!

And the Easter Bunny will be dropping by with delightful afternoon tea and fizz for you on Easter Sunday.

As presently we are unfortunately not able to be sociable you may think it would be nice to send this as a gift to a friend or relative in the area to remind them that you are thinking about them and cheer them up!
 
…..then you can eat and listen to the music “together” 

And what is more 15% of each guests order will go to Love Your Hospital which is the dedicated charity for Western Sussex Hospitals NHS Foundation Trust and raises funds for St Richard’s, Worthing and Southlands Hospitals.

For more information visit  www.indigorestaurant.info 

Davison High School need equipment to make Visors for Worthing Hospital  

The Davison DT Team have made Visors to give to Worthing Hospital, but have now run out of materials. Worthing Hospital have asked if they can make some more Visors as they are running low. 

Davison are looking for: 

• 1mm transparent acetate
• HIPs or Polycarbonate plastic min size 300x300mm 
• Elastic 1 / 1.5cm
• Expanded foam  

Please email louisepoland@icloud.com if you can help

Monk Marketing Covid-19 Catalogue

Now available:

• Face Masks
• N95 (FFp2) Face Masks
• Antibacterial Wipes
• Hand Sanitiser
• Digital Thermometers 
• Contactless Thermometers 
• Latex Gloves
• Nitrile Gloves 

All these items can be supplied on a 3 week lead time. 

For further information please contact Mike on 01273 286133 or 07885 490266 or email mike@monkmarketing.com

Click here to view full Covid-19 Catalogue