Economic recovery finally starts to take hold
- Credit: Archant
The economic recovery has finally taken hold with a clear increase in business confidence, according to Bank of England representative Alex Golledge, who I spoke to this week.
This comes in the same week that the Prime Minister said he wanted to “get out of the way of small business success” and that “we need to be a country that celebrates enterprise and backs risk takers”.
When you think that we are now emerging from the longest downturn ever recorded following the financial crisis of 2008 it is really good to hear some positive news. Mr Golledge said we are very unlikely to see a base rate rise for a while as the Bank of England wishes to continue to support this recovery. So we are feeling very positive at the Chamber for 2014 and hope you are too!
If unemployment has fallen to seven per cent as the government says it has, this can only be a good thing particularly as this is ahead of the predicted schedule.
I am sceptical about these figures as to whether this is full-time employment based on a 35 hour week or part time/zero hour contracts.
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I hear that businesses are recruiting not just for the sake of creating jobs and a big challenge here in St Albans is convincing graduates to come and work in the district instead of London.
One thing employers must think about is what new minimum wage fines mean for their business.
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One of our Chamber members, Chris Cook from SA Law, discusses the implications of new minimum wages fine.
“Coalition business secretary Vince Cable said last week a new maximum fine will be introduced from the first of this month for those firms that continue to pay less than the national minimum wage.
“Last year David Cameron announced that fines on employers failing to pay the national minimum wage would increase from £5,000 to £20,000. Many perceived this to be a token gesture, as they believed that the maximum fine of £20,000 would be the limit of what could be imposed on offending employers.
“However the legislation that is due to come into effect from this month will introduce a fine that can be levied on an employer in respect of each underpaid employee.
“This makes the new legislation considerably stronger and should serve as a stark warning to all employers that the national minimum wage legislation cannot be ignored.
“HM Revenue and Customs has revealed figures that show more than 26,000 workers paid less than the national minimum wage have received £4 million between them following HMRC investigations – 708 employers have been fined with charges of up to £5,000 after 1,693 complaints were made in 2012/13. An average of £300 back pay was given to each affected worker.
“Many of the cases involved illegal use of interns, unpaid extra hours and workers being forced to buy company clothes as uniform.”
Mr Cook added: “Several national retailers have fallen foul of the rules and bearing in mind the significantly increased scope of the sanctions for non-compliance, these types of decision are likely to become commonplace and indeed dwarfed by the size of potential future penalties.
“Mr Cable stated it will now be made easier for offending employers to be named and shamed a timely reminder to make sure that practices and procedures are carefully reviewed to ensure proper use of interns; that employees do not have to work excessive additional hours without pay; and workers are not forced to buy their own company equipment.”
If you wish to discuss any employment law issues with Chris Cook, partner at SA Law please contact him directly 01727 798000.
We welcome the following new businesses to the Chamber: An Idea Was Born, Ideal Weight, Nathalie Bennett and Hardy Planning & Design. We look forward to working with them in the future and helping them raise their business profiles in the area.