Two sides to every story
From Shipshape | Uploaded 24th March 2017
Recent events should remind us of the need to recognise that things move on and there is a constant need to adapt. On 9 January 2007 Steve Jobs announced that the first iPhone would be released later that year – can that really be only ten years ago?
Advances in technology have made science fiction become reality, changing the way we interact with the world around us and the way we do business. While society’s attitudes are still playing catch-up, ‘millennials’ (defined as those born roughly between 1980 and 2000) and their expectations are fast-becoming the dominant force in workplace culture and an increasingly important market segment.
By clinging on to some out-dated views businesses can suddenly look rather out of touch. Of course ‘modern’ will mean different things to different people and industries. As a ‘people’ business, recruiting, managing and retaining our best people is a key priority for Shipleys. We have traditionally recruited graduate trainee chartered accountants from reputable universities, but with more and more school leavers choosing not to go to university could we be missing out on very capable and enthusiastic school leavers or others who have valuable work experience and are clear about their career path? It’s also vital that, as employers, we all re-examine our attitude to our staff. Are we genuinely offering everyone a meaningful career and ensuring that opportunities are open to all?
9 to 5
Social attitudes and Government often combine to drive change. An example is the Government’s introduction of rules on flexible working – essentially the ability for a worker to request a change to their hours or place of work. Surveys have shown that employers who offer flexible working have greater employee engagement and a happier and more productive workforce, often resulting in a more profitable business.
Some of the flexible working ‘practices’ would have been treated with disbelief by many employers not that long ago. At a meeting we hosted recently it was clear that some business owners find it hard to let go of long-held perspectives. The general consensus was that it comes down to whether we trust our employees. If you’ve got the right people, yet you have trouble trusting them, then perhaps you need to consider your own outlook. How modern are you exactly?
The Government is bringing in another change for businesses, intended to benefit employees and small companies, in the form of the apprenticeship levy. From April 2017, larger companies will be obliged to pay a levy. But it will also be an opportunity for smaller businesses to get a contribution from the fund to hire and train their staff. See our article on the apprenticeship levy here. And don’t forget about your obligations to provide a pension for just about all of your employees. We are now on the final run in and every company will be affected by the end of the year. See the article on pensions auto-enrolment on page 4 of Shipshape.
Moving on up
Getting the right balance between fairness, flexibility and achieving your company’s goals, is tricky but crucial. When the ‘gig economy’ (where workers are given short term contracts or freelance work) is used fairly, flexible contracts can be mutually beneficial. The business benefits by not having to pay National Insurance or pension contributions. There are also no employment regulations such as minimum wage, holiday or sick pay. In return, workers get to be their own boss, and may have more control over when, where and how often they work. But recent disputes involving Uber, Deliveroo and Hermes and the use of zero-hour contracts were swiftly followed by the introduction of the Modern Slavery Act – demonstrating the Government’s concern that a balance is kept.
The new world also provides plenty of opportunity for individuals to manage their finances more in line with their social attitudes. We’ve noticed that many of our clients are becoming increasingly concerned about the social impact of the companies they invest in. Aimed at encouraging investment in ‘social enterprises’ the Government has introduced Social Investment Tax Relief. Money Matters on the back page of Shipshape looks at the scheme in more detail.
Money for nothing?
As we go to press, the Chancellor’s Budget on 8 March is set to be the last Spring Budget, at least for the time being. In the last Shipshape we noted that tax payments are being speeded up and it now seems that tax revenues in January were higher than expected (though the cynic may say that this was to be expected as individuals had accelerated dividend payments to avoid the tax increase on them!). Mr Hammond may have scope for some crowd pleasers after all. Following the announcement, there will be our usual analysis and comment on our website.
Finally, this issue of Shipshape is full of tips to help you make the most of your planning opportunities in time for the tax year-end on April 5. There are details on your last chance to protect your pension pot following the drop in the lifetime allowance in April 2014, and we also talk about the new Tax-Free Childcare scheme.