Dad’s the word

Small businesses should start preparing for changes in paternity laws, say legal experts.

This follows new legislation set to allow a father up to six months leave while the mother returns to work.

Angela Armar, employment solicitor at Davenport Lyons, says: ‘With maternity leave you need at least 15 weeks’ notice, but for paternity leave the father only has to give eight weeks’ notice, so there’s less time to make contingency plans.

‘Small businesses should review their policies now and make sure they have a good back-up system in place. They should also express that while eight weeks’ notice is the minimum requirement, they would encourage employees to let them know as soon as possible if they intend to take time off.

Armar expects the new laws to lead to more employment tribunals: 'Employers need to be very careful how they deal with employees and not be flippant because it’s the father who’s asking for leave instead of the mother.’

Under the new laws, a mother will be able to transfer the last three weeks’ of her maternity leave to the father, who can then take an additional three months’ unpaid leave.

David Price, head of employee relations at Peninsula, is concerned that the new system could be open to abuse. He says: ‘A number of our clients are concerned with the practicality of how it’s going to be transferred. It’s a self-certification system, so the male employee will not have to provide proof that he is a father to be.

‘Employers need to have clear rules and expectations. Small businesses are worried at the moment, as they’ve never had to factor in the possibility of male employees taking time off before.’

The law will come into force this April, but will only affect employees expecting a child after April 2011.

8 Feb 2010 | 10:53 am UTC

Insolvency drop ‘calm before the storm’

Fewer companies went bust in the last quarter of 2009 than in the third quarter.

Some 4,566 compulsory liquidations and creditors’ voluntary liquidations occurred in the last three months of 2009, a decrease of 1.7 per cent on the previous quarter and 1.1 per cent less than the same period a year ago.

Brian Johnson, insolvency partner at chartered accountants HW Fisher & Co chartered, says the drop in insolvencies reflects an unwillingness on the part of creditors to crack down on businesses that miss payments.

He adds: ‘While the banks are not extending credit, they also aren’t calling in debts. Likewise, the Inland Revenue has started to exert some pressure on companies that are stalling on their PAYE/NI and VAT bills, but they appear to be reluctant to adopt an overly aggressive stance.

‘The feeling among insolvency practitioners is that [this is] the quiet before the storm and the number of new cases will rise dramatically after the election.’

The total amount of company insolvencies was 19,077 in 2009, compared to 15,535 in 2008, according to figures from government body The Insolvency Service.

5 Feb 2010 | 11:53 am UTC

'You're hired'

Businesses are set to increase their staff levels by hiring more apprentices.

Some 60 per cent of employers intend to recruit apprentices this year, with 72 per cent who have already done so believing have helped their businesses during the recession.

Simon Swords, owner of Atlas Computing Systems, says: ‘As a small business, we have built the success of our company on recruiting apprentices. When we started out we simply couldn’t afford to hire someone with a lot of experience. Our apprentices have also brought a flexibility to the job that people who have been in the industry for a long time don’t always have.’

Pat McFadden, business minister, says: ‘For so many businesses to be planning to recruit in 2010 is good news for the whole economy. In 1997 apprenticeships had dwindled as a route for people to gain new skills, [while] today we have 239,900 starting apprenticeships and businesses of all sizes are reaping the rewards of having a highly skilled workforce.’

Of the 1,000 business owners surveyed, 88 per cent say drive and enthusiasm are the most important traits in an apprentice, according to the survey from the National Apprenticeship Service.

4 Feb 2010 | 12:48 pm UTC

‘Government not paying up,’ claims FSB

The government is still paying small businesses late despite making commitments to settle invoices within ten days, claims a survey from the Federation of Small Businesses (FSB).

Local government is likely to pay one in four invoices late, and central government and government agencies to make one in three payments late, finds the research.

John Wright, national chairman of the Federation of Small Businesses, says: ‘It is shocking that after the government put the Prompt Payment Code in place so many businesses are still being paid late. The public sector needs to take the lead in more than words alone and set an example that paying late isn't acceptable, as this problem persists in the private sector.’

Of the 10,000 respondents surveyed, 30 per cent say EU institutions are likely to make late payments, 29 per cent the NHS and 25 per cent local authorities.

A spokesperson for the Department of Business says the findings are at odds with the government’s own data. 'Around £21 billion of payments were made by central government within ten days in December, with 19 out of 20 invoices now paid within ten days. While local authorities are not covered by the government’s Prompt Payment Code, the majority have committed to paying their accounts promptly as part of the recession plans they have adopted,’ says the spokesperson.

2 Feb 2010 | 11:39 am UTC

‘Retirement age should be kept at 65’

Government proposals to remove employers’ rights to retire workers at 65 have been criticised by a small business support group.

Phil Orford, chief executive of the Forum of Private Business (FPB), says: ‘In the absence of a default retirement age, the only viable option available to an employer is a capability dismissal based on the declining competence of the worker. We believe this would be an undignified and humiliating end to a career for most staff.’

Stuart Mitchell, managing director of Machine Building Systems, says: ‘There are quite enough obligations placed on employers without adding an enormous burden such as this.’


Charlie Mullins, owner of Pimlico Plumbers, supports the abolition of the retirement age. ‘Older people should be encouraged to continue working as long as they are capable. If they can’t afford to retire, why should they be forced to struggle when they still have the ability and drive to get to work and make a meaningful contribution?’

Under current employment law, both men and women can be made to retire at 65 unless the employer wishes to keep them on.

2 Feb 2010 | 11:23 am UTC