SMEs still unclear how to implement auto-enrolment
Many SMEs believe ‘auto-enrolment’ will be good for their staff and that workers should save for the future, yet many are still unclear what they need to do, when they need to do it, and how much it will cost, according to the Federation for Small Businesses (FSB).
Three in four business owners (76%) said auto-enrolment pensions put too much pressure on businesses like theirs. Around 45% of businesses that have not yet complied are unclear what they need to do and one in four (26%) do not know their staging date.
When asked how they accommodated the cost of setting up a workplace pension, 70% of businesses that had already done so said they absorbed the expense into general operating costs or accepted lower profits. However, a fifth (21%) said they had frozen or reduced wages in order to cover the cost of auto-enrolment.
FSB National Chairman John Allan said: “Our message for small employers is auto-enrolment is coming and will affect your business – and the sooner you get to grips with what you need to do, the better off you will be.”
If the person you care for is employing a personal assistant they'll be affected by auto enrolment. Find out more at https://t.co/REoL3VTx0e— Carers UK (@CarersUK) January 19, 2016
The advantages of employees choosing their own hours
Allowing employees to choose their working hours improves performance, according to a report from economics expert IZA World of Labor.
In recent years, firms have been increasingly replacing the traditional nine-to-five, five-days-a-week fixed working time model with arrangements that provide workers with more discretion over individual working hours and work locations. The most common practices allowing more autonomy are flextime, self-managed working timeand working from home.
While managers often raise concerns that working-time autonomy might encourage workers to reduce their efforts, the research contradicts this. In addition, working-time autonomy is also likely to increase an employer’s desirability to employees, as indicated by sharply declining turnover rates once such a policy is implemented.
Are you doing flexitime right? Avoid these errors https://t.co/8zFQxeKy5d— Wiley CPAexcel (@WileyCPAexcel) January 19, 2016
TTIP agreement could spell unfair competition for SMEs
The Transatlantic Trade and Investment Partnership (TTIP) is likely to force SMEs into unfair competition with the US and could cost Europe 680,000 jobs, according to 2015 Entrepreneur of the Year Titus Sharpe.
The TTIP is a proposed free trade agreement between the US and the EU. Some business leaders have expressed concerns that it is in effect an agreement that means the regulations to be followed are generally adopting the lowest standard either in Europe or the US. In most cases, the US has lower standards of controls and regulations that in the EU.
ReesRussell partner Jonathan Russell explained: “This means that US suppliers might be able to undercut EU suppliers, which opens up more of the EU market to the US businesses. This suits large corporations who are only interested in their profit across the world and therefore have little care which jurisdiction it is created in.”
National Living Wage will make staff more motivated
More than 70% of workers have said they will feel more positive as a result of the introduction of the new National Living Wage, announced by the Chancellor at the Summer Budget.
The findings are part of a new government survey, which also shows that 59% of respondents will feel more motivated at work as a result of the increase in their pay packets.
From 1 April 2016 employers in the UK must ensure that all staff aged over 25 earning the minimum rate of £6.70 per hour will see a 50p increase.
The government is continuing to raise awareness to businesses to make sure they are ready to pay the new wage on 1 April 2016. As part of this, it has published a four-step guide for businesses on the living wage website, asking firms to:
- Check you know who is eligible in your organisation.
- Take the appropriate payroll action.
- Let your staff know about their new pay rate.
- Check your staff under 25 are earning at least the right rate of National Minimum Wage.
HMRC will have responsibility for enforcing the new National Living Wage in addition to the National Minimum Wage from April 2016 and will take firm action where an employer fails to pay the correct wage.
Chancellor George Osborne said: “The new National Living Wage is an essential part of building the higher wage, lower welfare, lower tax society that Britain needs and it’s great to see that over a million people will see their living standards boosted when this comes into force on 1 April.
“Britain deserves a pay rise and this one-nation government is making sure it gets one, helping more people have the security of a higher wage to provide for themselves and their families.”
Barking and Dagenham reports fewest SMEs in the capital
The borough of Barking and Dagenham has the fewest SMEs of any London borough for the second year running, it has been reported.
The Office for National Statistics (ONS) has compiled a list of how many businesses with fewer than 50 employees are registered in each borough and Barking and Dagenham had only 4,535. Westminster topped the list with 42,850. The second-lowest borough was Bexley with 6,965.
However, the borough saw 715 new SMEs registered in 2015 (a 15.8% increase), which places it third for growth in the capital.