Connect with us

Business

CORONAVIRUS: FURLOUGHED WORKERS AND WHAT IT MEANS FOR BUSINESS

CORONAVIRUS

by Tina Chander, Wright Hassall

 

c

All businesses with a PAYE scheme in place on 28 February 2020, regardless of size or sector, will be able to benefit from the scheme with the government reimbursing employers up to 80% of their employees’ wages, to a maximum of £2,500 per month, plus employer’s NICs and auto-enrolment pension contributions.

Employees on agency contracts and flexible or zero hours contracts can also benefit from the scheme. In addition, the scheme also covers employees who were made redundant since 28 February 2020, if they are rehired by their employer.

 

Furloughed workers: what does that mean?

Businesses have to ‘designate affected employees as furloughed workers and notify your employees of this change’. However, employers still have to heed employment law which means that, having designated those employees whose jobs were at risk, they will need to agree with those employees that they will be ‘furloughed’.

Given the extraordinary situation prevailing at the moment and given the alternative to being furloughed, it is likely that most employees will agree to the terms.

For those workers who do not agree, they will either have to take unpaid leave for an indeterminate period or employers are likely to have to go down the redundancy route. It should be noted that furloughed workers are designated by the employer – an employee cannot ‘self-designate’.

 

Eligibility

Employees hired on or after 1 March 2020 are excluded from the scheme, presumably to stop people ‘gaming’ the system by hiring family members after the scheme was announced and then furloughing them.

However, those businesses that have made people redundant since 28 February 2020, can re-employ them and then furlough them. To qualify for payment under the Job Retention Scheme, an employee must be furloughed for a minimum of three weeks in order to prevent employers putting staff on a furlough ‘rota’ i.e., one week on furlough, one week off.

 

Who can be furloughed?

Normal employment law still applies so employers must not discriminate when deciding who to furlough. Employees returning to work after a period of sickness absence, or self-isolation, can be furloughed, however they cannot be furloughed whilst they remain on a period of sickness absence or self-isolation.

Furlough will only take effect when this period comes to an end. Employees who are “shielding” however, will be eligible to be furloughed. Employees on maternity leave can be furloughed if they agree to return to work early or change to shared parental leave, alternatively they will remain on Statutory Maternity Pay where this is applicable and will not be furloughed until their return.

When agreeing changes and moving to furlough status, it is important to remember that normal employment law processes apply. Employers must be careful not to discriminate against any employees when deciding who to offer furlough to.

 

Furloughed workers remain employed but must not work

Assuming the designated employee has agreed to be furloughed, they cannot undertake any work for their employer at all. If the employee continues to work, even reduced hours, they are not eligible for the scheme. The good news for furloughed staff is that they can volunteer or undertake training providing neither activity generates income for their employer. Whether or not people can take advantage of this while confined to their house is, of course, another matter altogether.

 

How it will work?

While furloughed, the government will pay related employment costs including pension contributions and NICs (but not commission or bonuses) in addition to wages. All furloughed workers will remain employed by their employer for the duration of the scheme.

Employers can make up the missing 20% of their employees’ salaries but that is their choice (or ability to pay). There is no legal obligation for the employers to top up the salary to 100%, but any contractual clauses regarding withholding pay and deductions should be taken into account when this decision is being made.

For those employees who are furloughed, their employment status will change but their employment record remains continuous.

Employers need to give HMRC a list of furloughed employees. Employers pay their workers as usual, via PAYE, and then apply for funding, every three weeks (not weekly) to cover 80% of their wages (up to £2,500 of gross pay).

You will receive a grant from HMRC to cover the lower of 80% of an employee’s regular wage or £2,500 per month, plus the associated Employer NICs and minimum automatic enrolment employer pension contributions on that subsidised wage. Fees, commission and bonuses should not be included.

For workers whose pay varies, the 80% is based on the higher of:

  • the earnings in the same pay period in the previous year; or
  • the average earnings in the previous 12 months (or less, if they’ve worked for less).

If employees paid the minimum wage are furloughed, the fact that 80% of their earnings will bring their wages below the NMW does not contravene the legislation as people are only entitled to the NMW if they are working. They can, however, claim the NMW if undertaking training.

The HMRC system through which payments can be made should be up and running by the end of April. The scheme is expected to run for three months, subject to review.

 

Business

GOING GLOBAL: 7 TIPS TO GET STARTED

The idea of selling your products or services to new markets across the globe is an attractive prospect for any business, large or small. But while reaching new customers and unlocking the potential for further growth can seem exciting initially, adapting your business to foreign markets is no small feat. Factors such as cost, communication and cultural differences can all affect your business’ success when going global. This guide will explore some of the key considerations to make when you’re thinking of expanding your business overseas.

 

Evaluate Your Finances

One of the main questions to ask when looking to go global is whether or not your business can afford to do so. Crossing borders can be a complicated and expensive process which can take away time and resources from other opportunities at home. Growth for businesses abroad is often a slow process; establishing products and services in other countries takes time, so you will need to factor this into your planning. Thorough analysis of domestic and international markets should always be undertaken before making the decision to expand your business overseas.

 

Location, Location, Location

Choosing the right location is crucial to the success of your business expansion. International business network Going Global Live says that taking your business to the right countries initially can save you money on excessive marketing and advertising, putting you face-to-face with your target market from the outset. You should weigh up the pros and cons of potential locations, such as the likelihood of being able to fill your new HQ with prime, homegrown talent, as well as access to desired markets aided by foreign investment bodies. It is also important to consider the relevant laws and regulations laid out by national and regional governments.

 

Ensure You Have the Right Infrastructure

Making sure your business has the right infrastructure to handle expansion abroad will put you in a good place going forward. Implementing a clear management strategy, both locally and centrally, will set your business up for a smooth and successful launch overseas. Having up-to-date IT and communications systems at the centre of your business will allow you to share information and data securely. When it comes to shipping, choosing the best – and most efficient – transport and storage providers will give you the peace of mind that your products are safe in transit. Companies such as S Jones are ideal for businesses looking for more information on storage solutions for shipping overseas.

 

Build a Strong Team

Appointing a strong team to oversee your expansion is crucial to your company’s success in new markets. Hiring people with a good knowledge of your target market, as well as a focus on your business’ interests, is key when establishing your overseas HQ. Working with local partners can help you to communicate your business’ unique selling point in a meaningful way. Having an experienced partner or mentor that you can trust to oversee the expansion will allow you to stay focused on the bigger picture and ensure that your attention isn’t taken away from your core customer base.

 

Have Faith

Once you’ve made the move to globalise your business, be sure to have faith in your ideas and don’t be deterred by slow progress. Dr Shai Vyakarnam of the Cranfield School of Management says that while there is a fine balance between faith and stubbornness, you’ll need “incredible levels of self-belief and faith in your idea” to succeed, and that you “only need to be able to turn a few key people in your favour and the others will follow”. Making well-informed decisions quickly will allow you to stay on track and will nullify the threat of any lingering self-doubt. While progress may be slow at first, be sure to remain patient and be prepared to build personal relationships to gain the trust of your new partners and customer base.

 

Consider the Impact of New Ideas

When implementing new ideas for your business as whole, consider how they will be received by your new international customers, as well as by your existing customer base at home. What might be seen as a positive idea in your home country could be perceived as offensive or alienating by your customers abroad. Factors such as differing time zones, languages and cultural appropriateness should always be taken into consideration when making key decisions to eliminate the risk of alienating foreign customers and damaging your reputation overseas.

 

Be Adaptable

While it is important to have faith in your business and be patient initially, you should also be willing to make changes as things develop. Acting on the advice of experts is key to navigating new markets successfully. It may be that your products and services require innovation to meet demand, or that cultural differences lead you to make changes to your marketing strategy. Being adaptable will give you the best chance of meeting consumer demand on a global scale.

When trying to expand your business to an entirely new customer base, try to bear in mind some of the above points. As long as you remain patient and open-minded, then you should have little difficulty in marketing your business globally.

 

Sources

Continue Reading

Banking

REDUCING FRICTION ONLINE HAS BECOME BUSINESS CRITICAL

Andrew Shikiar, Executive Director at the FIDO Alliance

 

The global pandemic has pushed the importance of remote access and authentication right up the agenda for many businesses. All those occasions where people would normally show up in person to open a bank account or pick-up some high street essentials were simply not possible for large parts of the year. Even as restrictions have eased across the country, these kinds of face-to-face transactions remain an unappealing prospect or a last-resort to many.

Not surprisingly, this has led to unprecedented demand for online and remote services. This brings with it a host of challenges and opportunities, and we have seen many examples of companies brilliantly adapting and reacting to this new way of life. But one issue that businesses and individuals have been grappling with for years – that of frictionless transactions and authentication – has now been put under a brighter spotlight as it is increasingly critical to get right.

 

Friction impacts the bottom line

The core challenge facing businesses is how to strike the right balance between giving customers the best possible experience of online service, and the necessary regulatory and security implications that directly affect – and often contradict – that ideal user experience.

We’ve all likely experienced the very real kinds of friction I’m talking about – it’s the account you gave up on registering for, or the purchase you abandoned because the process was just too frustrating.

Friction like this has direct bottom line impacts through the loss of sales and/or disaffected customers –  and it is substantially more pronounced in the current climate. People have less money to spend, they are spending a greater proportion of this reduced pot online, and businesses are competing for their livelihoods to claim their share. Providing a frictionless experience can be the difference between success and failure.

 

Banking and retail lose out

Nowhere is this problem more keenly felt than in the retail and banking industries. Countless transactions simply don’t happen each year due to issues with passwords or mobile One Time Passwords (OTPs) at the point of signing-up or checking-out.

Data from Statista shows that 69.57% of digital shopping carts and baskets are abandoned and the purchase not completed. And Mastercard’s analysis estimates that up to 20% of mobile e-commerce transactions are abandoned or otherwise fail (e.g., from undelivered SMS OTPs) mid-way.

In addition, independent web usability research institute Baynard found that one out of five consumers abandoned their online shopping carts citing the checkout process as “too long and complicated”. That means 20% of customers taking their custom elsewhere, likely to a competitor, because the process presented too much friction.

 

Passwords are a major part of the problem

Organisations have struggled to strike that balance between frictionless yet secure online log-ins in large part because of historical dependence on passwords – which simply aren’t fit for purpose in today’s online economy. Passwords were designed to be simple but, as we can all likely attest, they have become incredibly cumbersome and difficult to manage.

The demands placed on consumers to remember and keep track of the array of different passwords they need, and the different requirements of password complexity which varies from provider to provider, is proving to be untenable.

Not only are passwords a major cause of consumers giving up on purchases or preventing them from signing up for new services, but they also fail in delivering on their primary objective: to protect accounts and sensitive data. All too often the password has proven to be a single point of failure, and one that is all too easy for hackers and fraudsters to get hold of – a trend accelerated by the coronavirus pandemic.

 

Reducing friction

There has been a move toward developing and adopting open standards that enable any online service provider to authenticate users in a way that is both highly secure and almost completely frictionless – with all major platform and cloud service providers coalescing around a common approach.

It’s clear from the way consumers have embraced using their fingerprints and FaceID to unlock their devices that simple, natural gestures work – and that they are often preferred over using a password. By adopting the latest authentication standards, organisations can enable their customers to use these same easy gestures on their every-day devices to prove their identity and approve even the most sensitive of transactions.

The standards also improve security by moving away from the traditional model where your password or similar piece of ‘secret’ information is stored on a server, to one where credentials are stored on an individual’s device. This means they cannot be phished or divulged through other means of social engineering, while also inherently stopping the large-scale breaches that impact millions or billions of users in one go.

Due to these developments, the kind of poor user experience that leads to abandoned shopping carts and lost customers during the sign-up process is completely avoidable. There is now nothing stopping banks, retailers, and a range of other businesses from offering a superior, and low-friction user experience while also maintaining the safety and integrity of the networked economy.

 

Continue Reading

Magazine

Trending

Business14 hours ago

GOING GLOBAL: 7 TIPS TO GET STARTED

The idea of selling your products or services to new markets across the globe is an attractive prospect for any...

News14 hours ago

KASHFLOW AND YAPILY PARTNER TO SUPPORT SMES WITH DIGITAL BOOKKEEPING AND CASH FLOW MANAGEMENT

KashFlow continues its mission to provide SMEs and accountancy firms with software that keeps bookkeeping easy to understand and even...

Top 1014 hours ago

WHY HIGH NET WORTHS SHOULD BE LOOKING AT ANGEL INVESTING IN A NEGATIVE INTEREST RATE ENVIRONMENT

By Oliver Woolley, Envestors   As England gets through its second lockdown, Bank of England policymakers report the UK we...

News14 hours ago

VIVA WALLET SUPPORTS E-COMMERCE GROWTH THROUGH ITS MARKETPLACE SOLUTION

Viva Wallet’s PSD2-compliant payment solution for online marketplaces removes the requirement for them to become licensed providers of regulated payment services. Viva Wallet is able to handle the streamlined processing of customer transactions through a PSD2-compliant escrow account...

Banking14 hours ago

REDUCING FRICTION ONLINE HAS BECOME BUSINESS CRITICAL

Andrew Shikiar, Executive Director at the FIDO Alliance   The global pandemic has pushed the importance of remote access and authentication...

Wealth Management1 day ago

QUICK FIXES TO LOWER YOUR CAR INSURANCE

Car insurance is something we all have to pay for, no matter how much we despise it. However, it’s not...

Uncategorized1 day ago

ALL-SEASON TYRES AND HOW TECHNOLOGY IS CHANGING THE FUTURE OF TRANSPORT

Avid vehicle enthusiasts will likely know that summer and winter tyres are developed from different rubber compounds which work at...

Business1 day ago

EQUIPPING YOUR TEAM WITH THE SKILLS TO MANAGE THE CHANGING LANDSCAPE

By David Wharram, CEO of Coast Digital   For businesses to emerge from the COVID-19 pandemic stronger than ever, companies...

Banking2 days ago

BANKING ON THE FUTURE: WHY PAYMENTS TRANSFORMATION IS THE KEY TO SUCCESS

Simon Wilson, Co-Head, Payments at Icon Solutions   Standardisation, regulation and technological innovation means payments are well on the way...

Finance2 days ago

DIGITAL FINANCE: UNLOCKING NEW CAPITAL IN DISRUPTED MARKETS

Krishnan Raghunathan, Head of Finance & Accounting Services at WNS, explores how a digitally transformed finance department can give enterprises...

Technology2 days ago

DATA DILEMMAS IMPACTING ESGS

Mario Mantrisi, Chief Strategy and Knowledge Officer, Kneip   It’s been well documented over the past few months that the...

Technology5 days ago

SIX PILLARS FOR A SUCCESSFUL CLOUD

by Giuseppe Paternò, IT Infrastructure Architect, Security Expert, and Cloud Solution Guru   COVID-19 pandemic is pushing many companies to...

News5 days ago

MARQETA CONTINUES EUROPEAN GROWTH, SIGNING THREE NEW DIGITAL BANKING CUSTOMERS

Marqeta is supporting the development and launch of three new digital banks across the UK and Europe   Marqeta, the...

Technology5 days ago

TECHNOLOGY IS OUR FIRST DEFENCE AGAINST MONEY LAUNDERING

Jesse Chenard, CEO of MonetaGo Fraud is an age-old problem that has plagued every industry since businesses began trading. It...

News5 days ago

STOCARD BUILDS ON SUCCESS AS IT EXPANDS STOCARD PAY TO FOUR MORE EUROPEAN COUNTRIES

Stocard, the leading European mobile wallet with over 50 million users, launches its payment functionality, Stocard Pay, in Germany, France,...

Business5 days ago

3 KEY DIGITAL MARKETING TRENDS FOR 2021

– Emma Digital marketing is an industry where the trends are changing on a daily basis, meaning those in the...

News5 days ago

SBER ANNOUNCES PARTICIPATION IN A PRIVATE EQUITY FUND

Sber in cooperation with a leading Middle East sovereign wealth fund announces its commitment as a cornerstone investor into an...

Wealth Management1 week ago

HOW INSURERS CAN KEEP UP WITH A NEW WAVE OF MILLENNIAL PET OWNERS

Chris Blatchly, Chief Digital Officer & Consulting Leader for Insurance, Cognizant   In the midst of COVID-19, puppies and kittens...

Banking1 week ago

ADVANTAGES OF OFFSHORE BANKS: WHAT THEY HAVE TO OFFER MILLENIALS

Contrary to popular belief, offshore banking isn’t just for the super-rich, nor is it illegal. In reality, and with professional...

Business1 week ago

A GUIDE TO LLC TAXES FOR SMALL BUSINESSES

By Tricia Joyce   Starting a small business can be an exciting, if sometimes stressful, journey. While finally being able...

Trending