March 2020 - MLP Law

Making a Will during times of crisis

Can I make a Will during the coronavirus (Covid-19) outbreak?

Yes, you can. During this difficult time, we’ve found that many of our clients have been contacting us to make a new Will, change an existing Will or update their Lasting Power of Attorney. 

What if I’m self-isolating and can’t / don’t want a face to face meeting?

There are other options available.

At MLP, we’ve already adopted measures to offer alternative arrangements for our Will writing service such as video-conferencing and telephone-based where we’ll provide advice before sending final Wills via email or post.

Doesn’t a solicitor need to witness the Will in front of you?

No. You need two witnesses for your Will to be validly executed. You should sign and date your Will in the presence of both witnesses, who should both see you sign.

Your witnesses can be any two persons who are over the age of 18 and neither witness nor his/her spouse or civil partner can be named as a beneficiary under your Will.

At this moment in time, many of our clients fall in to the “at risk” category meaning they are following the advice to social distance themselves and self-isolate from other people. Following the guidance given by the government and other such organisation such as STEP.org, having family members/other people you are isolating with witness your signature is the best alternative.

What if I’m in hospital or in a nursing home and don’t have any other people who can witness the Will?

In this situation, the guidance is to look to those people, such as hospital staff or nursing home staff, who can witness your signature safely.

If you are in a situation where there are no other people who can witness your signature, there is an option where a solicitor, at your discretion, can sign off the Will after going through the document with you through a window.  

As there is information that the virus could survive on paper for up to 12 hours, this alternative method would need to be carefully considered so as not to spread the virus from person to person.

Why can’t a Will be witnessed via video-conferencing or skype?

There is currently no law that says witnessing a signature via video-conferring or skype Will count as “being in your presence”.  Although electronic signatures on contracts or deeds done through video or skype are legally valid, witnessing a Will is the exception.

What about mental capacity?

The law says that anyone making a Will must be able to understand all the information relevant to their decisions, including any reasonably foreseeable consequences.

Without a solicitor having the means to have a face to face meeting, questions could be raised as to the mental capacity of the person making the Will.  It is at the discretion of the solicitor drafting the Will to determine if extra measures need to be taken in order to prove the mental capacity of a person.

So what’s the best way for me to make a Will?

STEP.org advices that whilst video or skype meetings are the best way forward at this particular time, it is for the solicitor dealing with the drafting of the Will to asses on a case by case basis and to liaise with family members and relevant persons such as hospital staff and nursing home staff in order to try and facilitate the most appropriate arrangements.

How can MLP help me?

If you’re thinking about making/changing/updating your Will or executing a Lasting Power of Attorney, please get in touch with our Wills, Trust and Probate team who would be happy to have a chat with you to discuss the best way to do this, whilst following all the guidance and protocol on staying safe during the coronavirus.

Please contact either Jane Hunter on 0161 926 1542 Janeh@mlplaw.co.uk or Samantha Kennedy on 0161 926 1515 SamanthaK@mlplaw.co.uk.

Furlough Leave – Update

Following our recent blog on the Coronavirus Job Retention Scheme that was announced by the Chancellor on Friday 20 March 2020, Luke Evans, a backbench MP, has provided this update in relation to the the Scheme. 

It is not an official government update but is the most recent information we have obtained for the time being…..

  • the aim is to get the scheme up and running before the end of April.
  • the 80% is based on the higher of (i) the earnings in the same pay period in the previous year; or (ii) the average earnings in the previous 12 months (or less, if they’ve worked for less)
  • employees taken on after 1 March 2020 are excluded from the scheme.  So the rumour was true!  Presumably that’s an anti-fraud measure to stop employers hiring their spouses, mums, dads and siblings after the scheme was announced.
  • businesses can re-employ people who have been made redundant since 1st March, and then furlough them.
  • to qualify for the payment, an employee must be furloughed for a minimum of three weeks.  They can then come off furlough.  This means that employers cannot rotate staff weekly between furlough and non-furlough.
  • employees on furlough leave can do volunteering or training, providing it does not generate any money for their employer.

If you have any questions as an employer or an employee in relation to the new updates and how they will affect you, then please contact our Employment Team on 0161 926 9969employment@mlplaw.co.uk or follow our employment law-specific Twitter account @HRHeroUK. 

Coronavirus Job Retention Scheme

Ever since the Coronavirus Job Retention Scheme was announced by the Chancellor of the Exchequer, Rishi Sunak, on 20 March 2020 employers have been calling for guidance of how the scheme will work in practice.

Further guidance has now been published by the Government and can be read in full by clicking here. The guidance is not entirely comprehensive and employers are bound to have further questions about specific scenarios affecting their businesses, but some of the key points are set out below:

  • the scheme applies to any employer who, as at 28 February 2020, had a PAYE payroll scheme in place ;
  • only employees on their employers PAYE scheme as at 28 February 2020 are eligible for the scheme. Anybody who was on the payroll on this date but was subsequently made redundant can be rehired and put on the job retention scheme;
  • employees must be furloughed in minimum blocks of three weeks. The guidance does not prohibit the rotation of furlough leave amongst employees, as long as each period of furlough leave lasts at least three weeks;
  • employers can reclaim up to 80% of wage costs up to a cap of £2,500 per month, PLUS the associated employer NICs and minimum auto-enrolment pension contributions on that wage;
  • fees, commissions, and bonuses should not be included in the employer’s claim;
  • employers are not obliged to top up the employee’s wage to 100%;
  • for employees with variable pay, the employer can claim for the higher of (i) the same month’s earning from the previous year; or (ii) average monthly earnings from the 2019-20 tax year. If the employee has been employed for less than a year, you can claim for an average of their monthly earnings since they started work;
  • employees on the national minimum wage are only entitled to 80% of their wage, even if this puts them below the national minimum wage rate for the hours they would have worked. The national minimum wage only applies hours actually worked (although employees should not perform any work for their employers during furlough leave);
  • employees must not carry out any work for their employer during furlough leave, otherwise they will become ineligible for the scheme. However, employees can undertake training and do volunteer work, provided they do not provide services to or make any money for their employer (with such training to be paid at at least the national minimum wage rate);
     
  • employees affected by the job retentions scheme are still protected by existing discrimination laws, which means employers need to carefully consider the grounds upon which they select employees for furlough;
  • employees on sick pay or self-isolating cannot be furloughed, but can be furloughed afterwards;
     
  • employees on maternity (or similar) leave continue to receive statutory maternity pay (or other statutory payments as applicable) payments.  The guidance does not prohibit women on maternity leave agreeing to return to work early and then being furloughed; and
  • employers can only claim once every three weeks, i.e. they cannot get weekly reimbursement.  Claims can be backdated to 1 March 2020.

The Employment Team at MLP Law can help you with any issues raised in the update. Just contact us on 0161 926 9969, employment@mlplaw.co.uk or on our employment law-specific Twitter account @HRHeroUK.

MLP Law Launches “MLP Flex: In-House”



MLP Law is launching a new service to provide corporate clients with access to the very best legal support and direction on an “in-house” basis. “MLP Flex: In-House” has been developed in response to the changing way in which businesses, their boards and their owners engage with legal services.  
 
Our aim is to work closely with businesses, get to know them and fully understand their long-term objectives, whilst supporting the needs of the business with “in-house” adaptable, flexible, legal services.  Ultimately, the work we then do is firmly in the context of and aligned with that particular client’s medium to long-term strategic objectives.
 
Stephen Attree, Owner of MLP Law says “This new service offers additional in-house legal support for short term, interim periods or longer term support, with the backing and resources of a full service law firm. MLP Flex: In-House goes beyond the “job” or transaction as a piece of work and allows us to align ourselves even more closely with a client’s ongoing needs and ultimate indicators of success.
It covers a variety of different services that a business may need including the provision of experienced city lawyers to handle complex projects, legal directors advising main boards or attending executive meetings and interim lawyers for specific compliance and regulatory needs”.
 
Leading this new and developing service alongside Stephen Attree is Karen Delamore. Karen has spent 16 years in a senior in-house position with a global company with over 35,000 employees and has particular corporate and commercial expertise including equipment leasing and asset finance.
 
If you would like to learn more about how MLP Flex: In-House can help your business, please contact Stephen or Karen direct on either stephena@mlplaw.co.uk or karend@mlplaw.co.uk or call 0161 926 9969.
 
MLP Law Ltd
 

Workers to be allowed to carry over 4 weeks of annual leave for 2 years

The government has announced it is allowing workers to carry over up to four weeks (not 5.6 weeks) annual leave into the next two leave years.
 
The new legislation – The Working Time (Coronavirus) (Amendment) Regulations 2020  – will amend regulation 13 of the Working Time Regulations, to allow workers to carry over the 4 weeks of annual leave that they are entitled to under EU rules, into the next two leave years.  This will apply where it is not reasonably practicable for them to take some, or all, of the holiday they are entitled to due to the coronavirus pandemic. 
 
It should be noted that the balance of 1.6 weeks’ statutory leave – which employers are obliged to give under UK law – will not be affected (although it can be carried over for up to a year by agreement under existing law).
 
The change is aimed at allowing businesses under particular pressure from the impacts of COVID-19 the flexibility to better manage their workforce, while protecting workers’ right to paid holiday.

Coronavirus Job Retention Scheme Q & A

We are frequently being asked questions about the new Coronavirus Job Retention Scheme that was announced by the Chancellor on Friday 20 March 2020. Here are some key questions and answers based on our early interpretation of the Scheme.

At the time of writing there is still a lot of missing detail on how the Scheme will operate in practice and once we have received this information we will update this note.

Please also bear in mind that employers can continue to have employees attend the workplace where work cannot be done from home and can ensure employees can remain 2 meters apart.

What is the Coronavirus Job Retention Scheme?

It is a scheme which allows employers to continue their employees’ employment, and for the employees to continue to receive at least 80% of their salary (capped at £2,500 per month), during circumstances in which the employee would normally be laid off or made redundant (whether temporarily or permanently) due to a lack of work.

Who does the scheme apply to?

It is available to all employers, whether they are sole traders, partnerships, PLCs, private limited companies, charities or LLPs.

Can I force my employees to take leave under the scheme?

Leave under the scheme is being referred to as “furlough leave”, which is based on an American term referring to circumstances in which employees are sent home due to a lack of work.

Our view is that, if an employee’s contract contains a right for the employer to impose lay off or short time working, then this will also apply to furlough leave.

If there is no such clause in the contract, the employee’s consent will be required. In practice, many employees are likely to consent to furlough leave (and a guaranteed 80% of their pay) rather than face the potential alternatives, such as redundancy.

How can I get my employees consent when we are in lockdown?

It is preferable to obtain an employee’s consent to being on Furlough Leave in writing, although this can be done by an employee replying to an email, in addition to the more common method of having employee’s sign and date consent letters. Ultimately, if there is a record of the terms of the Furlough Leave being communicated to the employee and the employee does not respond/object, consent to the change can be implied.

It is not yet clear from the information which has been published whether it is possible to furlough employees for part of their working hours and have them work the rest.

Do I have to top up my furloughed employees’ 80% wages to 100%?

There appears to be no obligation on employers to do this, although some employers may choose to do so.

To minimise the small risk of unlawful deductions from wages claims, employers should get written confirmation of their employees’ agreement to go on furlough leave.

If my employees refuse to go on furlough leave and I am unable under the contract to impose it, can I make them redundant?

Employers will be using the Coronavirus Job Retention Scheme where they are unable to provide their employees with work. If the alternative of furlough leave is not accepted by employees, the option of making compulsory permanent redundancies remains for employers.

How does the process work? How is the 80% of salary claimed?

The Government confirmed that a new portal will shortly be set up.

From what we can tell from the detail so far, the process is likely to be as follows:

  1. Identifying employees to place on furlough leave, and the reasons why this is required;
  2. Obtain the employees’ consent to furlough leave and reduction to 80% pay;
  3. Send the employee home;
  4. Register with the Government’s online portal to recover the 80% pay paid out to the employee.

What does 80% of pay include?

Again, this is not entirely clear but it is expected that it will include pension and NI contributions up to the cap of £2,500 per month.

Is the scheme open to abuse by employers and employees?

Many commentators have already spoken of the potential for this scheme to be abused. The Government will no doubt be alive to this risk and we expect to see stringent anti-fraud measures being introduced, with severe penalties and public naming and shaming likely to form part of such measures.

Potential Grievances

There may be tension with some workers who are/are not furloughed, which may result in grievances. These should be responded to in accordance with your usual grievance procedures, although due to the current importance of working from home where possible, parties may agree to undertake the process by way of written submissions or using technology to avoid having to meet in person.

Discrimination

Employers should be mindful to avoid discriminatory reasoning in their decision-making process regarding who is/who is not furloughed i.e. choosing to furlough all full time employees, which may disproportionately affect men and therefore be indirectly discriminatory where it cannot be objectively justified.

Coronavirus: Workers will receive statutory sick pay from first day off work

Boris Johnson has today announced that workers in the UK will be able to get statutory sick pay (SSP) from the first day off work, not the fourth, to help contain coronavirus. In practice, this means that those receiving SSP could get an extra £40.00 a week.   

Generally, an employee will have to have been off work due to illness or injury for 3 days before being eligible for SSP on their fourth day of absence. They will also have to be earning at least £118 per week. However, in an attempt to help contain coronavirus and to prevent people with coronavirus from feeling forced to stay in work due to financial pressures, Mr Johnson has announced that people earning enough to be eligible for SSP can now receive it from day 1.

The change has been introduced using emergency legislation. This is legislation that allows bills to be brought forward and fast-tracked through Parliament when they are in response to a specific situation, rather than having to go through the usual stages of approving a bill which can take up to 3 months.    

Officials believe that up to a fifth of the workforce could be off sick during the peak of an epidemic and given that England’s chief medical officer has today said that it was “likely” that coronavirus will become an epidemic in the UK, these numbers could soon become reality. It is therefore important that both employees and employers know what their entitlements and obligations are when it comes to sick pay.

Although this is a significant step by the prime minister, today’s change will not mark the end of debate over sick pay. As coronavirus cases continue to soar, the estimated 2 million workers who are not entitled to SSP will no doubt want their issues to be addressed as without some sort of financial relief, they may have to face the dilemma of either receiving no pay or having to go to work putting their colleagues at risk.

We will continue to update you as matters unfold. If you have any questions as an employer or an employee in relation to our article, then please contact our Employment Team on 0161 926 1508, or follow our employment law-specific Twitter account @HRHeroUK.

Entrepreneurs’ Relief following the 2020 Budget

Changes to Entrepreneurs’ Relief made by the Chancellor in the Budget could have a  significant impact on entrepreneurs, owner managed businesses (OMBs) and small to medium sized enterprises (SMEs), for those looking to dispose of all or part of their business or shares.

Key Fact:  the cutting of the lifetime limit for relief of £10m to £1m with effect from the Budget Day (11 March 2020)

The measure will have effect for Entrepreneurs’ Relief qualifying disposals made on or after 11 March 2020.  This will include sales under conditional contracts which have exchanged, but where the conditions precedent to completion have yet to be satisfied.  The rules also provide that the lifetime limit must take into account the value of Entrepreneurs’ Relief claimed previously in respect of qualifying gains.

‘Anti-avoidance’ rules will also be introduced that apply to forestalling arrangements entered into before Budget Day. 

  1. Unconditional Contracts

This will apply where an unconditional contract for the sale of an asset has been entered into prior to 11 March, but the contract is completed after that date, the disposal will be treated as taking place when the contract actually completes.  So the £1m lifetime cap will apply in such cases unless:

  • The parties to the contract demonstrate that they did not enter into the contract for the purpose of gaining a tax advantage by exploiting the timing rules of section 28 of the Taxation of Chargeable Gains Act 1992; and
  • Where the parties to the contract are connected, that the contract was entered into for wholly commercial reasons (with no purpose of exploiting CGT timing rules)

In each case, the seller of the asset must make a claim for Entrepreneurs’ Relief including a declaration that no purpose of the disposal was to exploit the CGT rules.

  • Share for Share Exchanges

Section 169Q Elections allow an individual who is exchanging shares which qualify for Entrepreneurs’ Relief for shares which do not in circumstances where they would otherwise be able to defer a CGT charge on the old shares to elect to trigger a disposal and effectively ‘bank’ the relief on the disposal of their old shares.

The changes provide that where shares have been exchanged for those in another company on or after 6 April 2019, but before 11 March 2020 and either both companies are owned or controlled by substantially the same persons or the controlling shareholders of Company A hold a greater percentage of shares in Company B after the exchange than they did in Company A before the exchange and on 11 March 2020, the personal company test, the trading company and the employee/officer test are met in respect of Company B.

So if an election is made after Budget Day, this will apply as though the individual’s disposal happened on the date the election was made, rather than the date of the transaction, so the lower £1m limit applies.

For help and advice on Entrepreneurs Relief, please speak to our Corporate and Commercial team at on 0161 926 9969 or email corporate@mlplaw.co.uk.     

MLP Law – Business as usual

Whilst we’ve been busy advising and helping our clients through the current uncertainty we are sending a quick update to let you know that we are very much open for business and will remain so. 

Flexible, agile working has been at the heart of the way we operate as a team for a number of years.  Our investment in leading technology and infrastructure means we are and always were well placed for remote and distance working.

We’ve put our distance working into effect which means our offices are effectively closed for the foreseeable future.  However, all our colleagues are accessible and contactable as usual and will be working extremely hard throughout this period to minimise any possible disruption.  This means advice, work, meetings will be carrying on, as necessary so we can help all our clients however they need us at this point in their and our journey. 

All our usual lines of communication are open.

If you need a shoulder, virtual pat on the back, support or advice, we’re here for you – however you need us, telephone email or video (face to virtual face).

Stay safe and best wishes,

From Stephen Attree and the MLP Law Family

Advice for Employers during the Coronavirus Outbreak

Coronavirus: New SSP Regs re self-isolation
 

The Statutory Sick Pay (General) (Coronavirus Amendment) Regulations 2020 are now in force.
 
They provide that SSP will be available to anyone isolating themselves from other people in such a manner as to prevent infection or contamination with coronavirus, in accordance with government guidance.
 
Currently, the anticipated Regulations providing that SSP will be payable from day 1 (not day 4), and allowing employers to reclaim the cost from the government, have not yet been published.
 

Lay offs and Short-time Working

Due to the negative impact of the cornovirus outbreak upon the financial markets and the economy, many businesses are considering what options are available to them in reacting to a potential downturn or recession, particularly in the short-term.  One such option could be to implement lay offs or short-time working.  In short, laying off employees means that the employer provides employees with no work (and no pay) for a period while retaining them as employees; short-time working means providing employees with less work, (and less pay) for a period while retaining them as employees.  The reduction in work associated with short time means giving employees less than half the normal amount of work.
 
Unlike dismissal, it is a temporary solution to the problem of no or less work.  An employer will be looking to save money when it lays people off or puts them on short-time working, by not paying them or by paying them less for a certain period.
 
During this period, employers are required to give affected employees guarantee payments but this is a minimal amount.  It is 5 days’ worth of payments in any rolling 3 month period, capped at £29 per day (£30 from 6 April).  Annual leave entitlements for this period also continue to accrue.
 
In essence, an employer only has the right to implement these changes if it is expressly provided for in the contract of employment.  This means that imposing such working conditions (with the consequent reduction/stoppage in pay), without having the contractual right to do so, allows an employee to resign in response to the breach of contract and claim constructive dismissal or a make a claim for an unlawful deduction of wages.  It is open to employees, however, to accept the breach and the change to their contractual terms.  In reality, many employees may do this in order to avoid being without a job in uncertain times or in the hope that it prevents a more drastic compulsory redundancy situation in the future.
 
Importantly, employers should note that after lay offs or short time working have been running for a certain amount of time – 4 consecutive weeks or 6 weeks in a rolling 13 week period – an employee is entitled to resign and treat themselves as having been made redundant.  The employee would then be entitled to the appropriate redundancy payment and notice.  There are complicated rules around these automatic statutory redundancy payments, so please contact us if this becomes an issue.


Other Short-Term Measures
 

Employers can consider:

  • Staggering lunch or working hours, to minimise the number of people congregating in the workplace (and in the local area), at any one time.
  • Reducing the number of meetings or changing the format (ie by telephone or Skype) to reduce face to face contact.
  • Facilitating working from home, in accordance with government guidelines.
  • Requesting that staff do not  travel abroad for the foreseeable future, to avoid staff absences due to disrupted travel plans and the potential need to self-isolate.
  • Requiring staff to take annual leave when business is quiet – this ensures staff are paid during quiet times but also that they are available if and when matters improve.  Employers can dictate when employees take annual leave and must give employees appropriate notice – twice the length of the leave being imposed.  This means that an employee being asked to take a week’s holiday must be notified of this 2 weeks before the required holiday is due to be taken.
  • More regular cleaning of the workplace

 If you want to discuss any of these issues or other concerns that you have, please contact the MLP Employment Team on 0161 926 1508, employment@mlplaw.co.uk or follow our employment law-specific Twitter account @HRHeroUK.