• LIVE – Experts answer your on-trade questions

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Got a question? Perhaps one of our advisory board members can answer it

Have you got a question about your on-trade business that you can’t find an answer for even though you’ve searched online and listened to Boris’s daily updates? Perhaps The Morning Advertiser can help.

28 May, 12.16 – Distancing time limit

Charlie Gilkes of Inception groups asks:

How long will physical distancing restrictions be in play?

Kate Nicholls, CEO of UKHospitality, says:

There is no detail on that at present.

Under the Government’s roadmap, as we move up the phases to reopen more of the economy there is also the potential to move down the risk alert levels that were published at the same time, but no dates are attached to this.

The details for this can be found by clicking here or visiting https://bit.ly/2yFOQfb. 

We are currently in level 4 in terms of alert level but moving into level three and at that time we will reopen more of the economy – that is phase 2 of the roadmap from 1 June and phase 3 (pubs and hospitality) from 4 July.

During that reopening, it is unlikely that the risk level will change but clearly cases are going down and the new test-and-trace strategy to keep them low and avoid a second spike is about to be introduced. I would anticipate the Government would not want to see a lessening of those controls unless they could be certain cases remained low.

You will note from the slides that a lessening of social distancing restrictions is envisaged as we move to risk level 2. Risk level 1 and no controls is only envisaged when there is a vaccine or effective treatment.

We need to keep the pressure on the Government and ensure that they provide a clear commitment to review the guidelines and the social distancing controls on a regular basis – fortnightly or three-weekly – that they publish the scientific evidence underpinning the controls and the remit against which measures will be assessed and criteria for adjustment.

7 May, 15.53 – Reopening with social distancing rules 

Paul Houghton of Mississippi’s Bar & Grill in the Wirral asks:

We are a small licensed premises that if two-metre social distances became a requirement in order for us to open, it would without doubt not be financially viable for us.

However, one side of our premises opens up on to a pedestrianised precinct that is privately owned by the landowner and not the council.

What, if anything, would we need to do (other than obtain the permission of the land owner of the precinct) in order to be able to put tables outside and allow customers to drink at these outside tables and chairs with say an appropriate barrier/fencing to clearly provide a boundary to this outside drinking/eating area?

Lisa Sharkey, of licensed solicitors Poppleston Allen says: 

Many operators are asking similar questions about outside areas.

The simple answer at the moment is that we all must await the Government’s amendment of the current rules regarding licensed premises.

At present, as you know, you can’t use any area outside to provide a sit-down service, even if this area isn’t part of your land. The Coronavirus (Business Restrictions) Regulations will need to be amended to allow you to do that and, obviously, when they are amended or repealed, we will see what replaces them.

Certainly, the emphasis seems to be on businesses being able to use their outside areas rather than internally at first, so you are clearly thinking along the right lines.

With regard to your licence itself, and ignoring any sweeping relaxation the Government may or may not allow licensed premises to act outside their existing permissions (unlikely), you would need to ensure you have permission for off-sales, without any conditions restricting off sales to, for example, sealed containers. Basically, check your licence for any relevant conditions and speak to the licensing authority if necessary.

You would also have to check there are no local by-laws prohibiting outside drinking, etc. and possibly look into planning permission for any permanent barrier, depending on height and dimensions. The Government may, of course, make further announcements on this over the weekend.

22 April, 12.27 – Help with the furlough scheme

Richard Hartley, chief product officer, S4Labour (Catton Hospitality) gives his advice about the current policy on how to furlough staff:

The Government has updated its advice on holiday for furloughed workers. It has confirmed that holiday continues to accrue while furloughed in line with each employee’s contract. This can be varied if agreed with the employee but not below the statutory 5.6 weeks.

It has also been confirmed that holiday can be taken while on furlough, although this would need to be paid at the employee’s normal rate of pay meaning employers will have to pay the top up over the grant amount.

Employers can request and restrict when their employees take holiday, meaning there will be a careful balance between short-term cash flow and the longer-term issue of a burdening holiday accrual.

The Government has stated it is keeping its policy on holiday under review during these unprecedented times. S4labour will release the ability to put employees on holiday while furloughed and calculate the top up amounts within the next week. 

You can email Richard for further help at richard@s4labour.co.uk.

21 April, 09.41 – Demand for Crossrail cash

Martin Whelan asks:

I have just received my rates bill from Islington Council (north London), for 2020 and I’m being billed for Crossrail business rate supplement even though my pub is shut.

Am I, as a lessee, liable for this under, current guidelines, set by the Government.

May I take this opportunity to thank you for all of the lobbying you’re doing and it’s great to have someone voicing concerns on behalf of tenants/lessees.

Kate Nicholls, CEO of UKHospitality, says:

We have confirmed with the Greater London Authority that no instalments for Crossrail BRS should be have been collected in April and that the bills will not become due until March 2021.

I understand that some bills have been incorrectly showing the business rate supplement is due but pubs are now exempt from both charges along with other eligible retail/leisure/hospitality businesses for the whole of 2020/21.

20 April, 11.57 – VAT charges on coronavirus grants

Simon Olley of the Mackland Arms, Rainham, Kent, asks:

Now that we have received our grant, I assume that it is taxable, meaning that I declare it as an income and pay VAT on it, bearing in mind the items I am using it for I am obviously claiming VAT back?

Robert Hayton, head of UK business rates at the real estate adviser Altus Group, says:

Our understanding is that grant funding will need to be shown as other income in UK accounts and will, therefore, be subject to corporation tax to the extent that the relevant business receiving the benefit generates taxable profits in the same financial year.

Further, we are also led to believe that grant funding provided by Government is outside the scope of VAT so there should be no need to apply VAT to its receipt.

However, this is something that should be confirmed by your professional tax advisers. 

17 April, 12.19 – Rateable value too high yet wage is so low

Pat Logue of the Sheephaven Bay, Camden Town, north London, asks:

I am a single operator who is tied to Ei. My rateable value is £62,000 so I qualify for no grants and only rates relief this year.

I come under the title of self-employed but my profits for last year were £60,000, after deductions, and being a front-of-house owner-operator, my wages or profits equate to £10 per hour for a 70 to 80-hour week.

So on the self-employed aspect, I am screwed. And on the rates grants, I am screwed. My staff are being furloughed at the moment and receiving enough money to survive but, on the other hand I receive nothing and have a family to support.

How long can i do this? I don’t know but know if my business goes under, it’s going to impact on the 10 staff who I employ. Surely there has to be a level playing field for all?

The British Beer & Pub Association says:

We are continuing to urge the Government to extend the threshold for their grant scheme so the 10,000 pubs with rateable values above £51,000 can take advantage of them.

It is important to note that local authorities do have some discretion on the grants, so for those who are more marginally above the threshold, like yourself, we’d still encourage them to apply for a grant with their local authority.

9 April, 15.36 – Holiday for furloughed staff

Julie Yeo of Yeo group asks:

Our employment solicitor has issued general guidelines to all his clients this week, due to the Easter bank holiday, stating that you can put staff on holiday (subject to notice, etc.) while they are furloughed and continue to claim their 80% wages. You would, of course, have to top it up by 20% to make their full holiday entitlement.

If so, that makes the accruing holiday while on furlough much less of an issue, and we should all get on with compulsory holidays, pro rata, during the furlough period.

Do your experts agree?

Richard Hartley of S4Labour (Catton Hospitality) says:

Julie’s interpretation is in line with the advice from the Chartered Institute of Personnel and Development (CIPD), although they state this has not yet been confirmed by the Government.

We need to push for Government to make its stance on holiday clear because both of these issues keep arising.

The best advice for Julie at the moment would be to hold off for as long as she is able and hope that the Government makes its position clear.

If she is worried about holiday accrual, and the cost of this/business interruption becoming an issue, she should put staff on holiday while furloughed. She would have to top up their salaries so employees receive ‘full pay’. This might include a ‘tronc top up’ if this is part of their normal holiday pay despite it not being part of their furlough pay.

This has the benefit of ‘clearing down’ holiday at a lower cost than if employees were to take it when they return.

7 April, 11.40 – Grant for club that rents only part of a premises

Michael Foster of Fairlop Leisure, asks:

Hi, I run a bar and catering services on the site of a sports complex, and as a community social club for the local area, which we have been trading since October 2000.

The site is owned by a registered charity, to whom we are contracted to pay a rental fee.

We would like to apply for a Government coronavirus grant but we do not pay business rates as we rent part of the premises.

We have welcomed the Coronavirus Job Retention Scheme and will be applying when available but this only helps our employees and not the business that, without a grant to help with ongoing fixed costs, may not survive.

I feel that although the Government help is well-intentioned, it does not help small businesses like ours that are in danger of slipping through the safety net that it was designed for.

I would very much appreciate your thoughts on this situation.

Charles Littlewood, deputy chief executive of the Association of Conservative Clubs says:

We do not consider that the rental situation for the club should affect its ability to receive this grant. The grant does not specify that the business has to own the property land to receive the grant and many leisure industry businesses are conducted on a rental basis.

We have seen that some borough councils are now accepting online applications for the the Retail and Hospitality Grant Scheme. Clubs with a building that has a rateable value of up to £15,000 may be eligible for a grant of £10,000 and clubs with rateable value of over £15,000 and less than £51,000 may be eligible for a grant of £25,000.

Although the council will eventually contact eligible businesses directly, it’s important to be proactive to ensure timely delivery. Unfortunately, there is no telling how long it will take to receive the grant at this stage.

We highly recommend that you visit your local council’s coronavirus business support website page to see if the online application form has been added. If it is not there and the council is not saying that it will be added soon, you may wish to email your local rates team with your information. This is the information that we believe is required:

  • Club name
  • Club address
  • Business rates account number
  • VAT registration number, if applicable
  • Company number, if applicable
  • Name of responsible person
  • Capacity of persons
  • Contact number
  • Bank details
  • Recent bank statement
  • Record of any state aid in the past three years
  • Date and amount of your last rates payment

3 April, 15.54 – Two furlough payouts

Richard asks:

My Sunday bar staff work part time of between four and six hours each. They have full-time jobs during the week on Monday to Friday.

A) If they are on furlough from their main job, can I put them on furlough as well? Will the Government pay out twice for two employers?

B) Do I pay them 100% of their wages or 80% of their wages?

C) If a person is on sick leave from their main work, can they be furloughed for part-time work?

Charlotte Jackson, associate solicitor at Gannons Solictors, says:

A) The guidance received at the moment is where an employee has two jobs, they can be furloughed for each job and each shall be treated separately. The cap also applies to each employer.

B) You can do either, however, if you are paying them less than 100% you will need written agreement from them. We have prepared a furlough agreement that can be used for such purposes. Visit https://www.gannons.co.uk/expertise/employment-law-solicitors/furlough-agreement/ for details.

C) This is a difficult question to answer without more facts, if they are on sick leave from one role? Why would they not also be on sick leave from the other role? The guidance is that the two jobs would be treated separately, they can continue working at one role and be furloughed from the other.

Please note that the above response is a general overview without knowledge of the specific circumstances in this case. Further, there is no law governing these temporary measures at this stage and the guidance is frequently changing and updating. If you would like more specific advice to your circumstances, please do get in touch with us and we can take some formal instructions.

3 April, 15.45 – Does holiday accrue under furlough?

Julie Yeo, of Yeo Group, asks:

Like other employers, and on the advice of an employment solicitor, we added a clause to our furlough letter – Variance to contract re: CJRS – stating that holiday would not accrue while you are furloughed.

ACAS and other sites state the opposite – and a couple of employees picked up on it.

We will suffer dreadfully if we remain closed for six months or more and when we reopen (if we survive), all our staff have a full year’s paid holiday entitlement to take in the remaining six months.

We would end up having to use expensive agency/relief staff to be able to operate, as well as paying the holiday.

(In fact, it has just occurred to me that we might be better of making some staff redundant now rather than have them accrue holiday that we have to pay in the future – something we have been determined not to do as we value all our colleagues we have trained and share our ethos).

The guidelines have now been amended to allow paid holiday to be carried over into 2021.

This makes sense for front-line staff who are being denied holiday now and during the crisis, but how does it make sense applying it to staff who have just had a long period of being furloughed?

Charlotte Jackson, associate solicitor at Gannons Solictors, gives her advice:

The starting point is that holiday does accrue while on furlough as the employee is still employed.

As you noted there is the carry-over provisions, however, there is no guidance on requiring staff to use holiday days during furlough periods under the scheme, however, under the Working Time Regulations, employers can require staff to take days as long as they give them twice the amount of notice as the holiday period, eg, if you require them to take two weeks off you will need to give four weeks’ notice.

This is all subject to your holiday policy under their employment contract, which could change this position. 

Please note that the above response is a general overview without knowledge of the specific circumstances in this case. Further, there is no law governing these temporary measures at this stage and the guidance is frequently changing and updating. If you would like more specific advice to your circumstances, please do get in touch with us and we can take some formal instructions.

1 April, 14.56 – Unfair situation on site with higher rateable value 

Helen Wood asks:

I have been in this business for more than 18 years. We have always had a good profitable business until the past year. A lot of new businesses opened up plus the unsettled state due to Brexit made us a little more hand-to-mouth trading, more than we have ever been.

We are now in a tricky situation we have a rateable value of £70,000 so there’s no grant available for us, Barclays say we have a business loan with them and our P&L shows a small loss for last year because of major investment in the business, funded by ourselves, so we do not meet lending criteria.

They are looking into whether we can have an overdraft with them, so they can make more money out of us, I believe. Where is the help? We can’t pay the staff, can’t pay all our bills, please can you let the Government know there is no help.

Tell me how a leasehold business recently opened can get a grant of £25,000 and pay no rent for three months, compared to us who have worked solidly for 18 years, bought the freehold of the business, invested well and looked after our workforce of 25-plus staff, yet we are being left to possibly fail?

Please advise us. Barclays is not forthcoming. Our insurance won’t cover us. Can’t the Government make them help with interruption of business that would keep us going? Some one needs to fight for us.

Two experts from the #UnitedWeStand advisory board have offered advice.

The British Beer & Pub Association says:

We continue to raise with Government the difficulties that some pubs are having with accessing the finance and loans that that have been established but, if you haven’t already done so, you should consider seeking a 12-month interest-free loan from the Coronavirus Business Interruption Loan Scheme (CBILS) via the British Business Bank.

In order to improve your cash flow, you should also consider contacting HMRC to defer any tax payments that are due. While VAT payments are automatically deferred, they will be able to make arrangements for other taxes. HMRC has opened a dedicated helpline for businesses and the self-employed to answer queries or concerns regarding tax payments and finding solutions, its business support helpline is available on 0800 024 1222.

On the question of staff costs, if you are able to furlough your employees while there is no work available for them, you will be able to get a refund for 80% of their monthly salaries, up to £2,500 per employee from the Government’s Coronavirus Job Retention Scheme.

The process for submitting a refund is expected to be in place by the end of April if not sooner. More details of the scheme can be found on our website here. And if you are operating as a limited company, you will have the option of being able to furlough yourselves, and claim a refund for any salary paid via PAYE.

Alternatively, if you are a sole trader or partnership the Government has established the Self-employment Income Support Scheme, through which you can claim a cash grant worth 80% of your average monthly trading profit over the past three years.

Kate Nicholls, CEO of UKHospitality, says:

We are looking into securing a extension of grants to cover circumstances like Helen’s as well as exploring what support can be given through the furlough scheme.

The Government brought forward, on Monday, new requirements to get bank lending flowing through emergency loans and it would be worthwhile contacting them again or approaching another lender through the British Business Bank because the criteria may have changed since Helen had her first discussion.

Finally, the furlough money to pay staff will come.

1 April, 12.09 – Grant for Marston’s business

Tracy Arthur of the New Star, Poole, Dorset, asks:

I have a franchise with Marston’s that I am currently running with my business partner Dawn. I believe that small businesses in hospitality are entitled to a grant if your rateable value is under £50,000. Is it correct this is only payable to the business ratepayer?

Under the franchise we have with Marston’s, we don’t pay the business rates or utilities, Marston’s pays it. We get 20% of the turnover. We employ the staff so the 20% is to cover this and myself and Dawn’s salaries. Are we as the franchises entitled to this grant or would it go to Marston’s?

I can't seem to get any answers from anywhere, the accountants believe it should to come to us the franchisee. Can you help me with this? And how do we go about addressing this with the council?

We are currently not entitled to the universal credit scheme as we have partners that work. So I'm trying to address all the options we have. 

Robert Hayton, head of UK business rates at the real estate adviser Altus Group, says:

The criteria for grant funding is that the recipient will be the person who, according to the council’s records, was the ratepayer for the property on 11 March 2020.

As Marston’s is currently paying the rates, it is likely to be considered to be the appropriate recipient of any grant funding, subject to EU state aid rules that will limit their claim to €800,000 (about £707,000) across all its estate. 

Sometimes a local council will send the business rates bill to the owner rather than the occupier, despite the fact the occupier should be shown as the ratepayer. This is often an administrative convenience because a third-party agreement, such as that which you say exists in your case, means the rates paid by the occupier will be reimbursed by the owner.

Whether, in your case, you should properly be the ratepayer will depend on the precise facts of your occupation status and the agreement you have with the owner. You may need to take legal advice on this.

If you should be the ratepayer then the administrative convenience will mean that you currently fall outside the strictly worded rules on who can claim a grant.

One option is to speak to the council and see if it will exercise discretion in the circumstances.

The alternative is to retrospectively change the rates bill into your name so that on 11 March 2020 (the qualification date) you are shown as the ratepayer.

However, even if you do this you need to be prepared for a potential rejection. The guidance note given to councils is quite badly worded such that it could be read to mean that retrospective changes are ignored. That would clearly, in my view, be beyond the implicit intention of Government to support businesses that, in fact, was the ratepayer on 11 March 2020.

31 March, 08.44 – Steven Davidson of Mr Ants Bar, Hexham, Northumberland, asks: I seem to be getting mixed advice about furloughed workers. My bar closed on Friday 20 March as required by the Government. I paid my four staff their wages owed for that previous week on 23 March and cancelled all my standing orders/direct debits except for my insurance. I have no money in my bank account apart from the money to pay my insurance on 6 April. I can’t pay my staff their weekly wages and I feel terrible about that. 

I have applied for an overdraft facility, and awaiting to see when these grants will appear. My four staff members want their jobs when this mess is all over.

I have own savings but my accountant has advised me not to pay them in the coming weeks from my own money in case I don't get anything back or my employees don’t come back.

Kate Nicholls, CEO of UKHospitality, says:

Firstly, the good news is that the cash grants should be coming through imminently – the money is with the local authorities to distribute, so providing your rateable value is less than £51,000, you should receive it. Please check with your local authority website as some are relying upon you notifying them that you are still the ratepayer.

In terms of your staff, you must move now to put them on furlough so that you can recover the money that they are owed for the forthcoming month, and you are also likely to be able to backdate the claim to cover wages paid since the business closed. Unless you put them on furlough – even if you are not paying them anything at the present moment – you will not be able to claim for the money nor will you be able to retain their jobs.

It will be difficult for many companies to manage through the next four-week period before the money for furloughed workers can come through. If you cannot manage to pay your staff on a weekly basis before the furlough money is received, talk to your staff and see if they would be willing to be furloughed and paid monthly in April – they will still be paid and receive the money but just in April, not each week. You can also furlough them on a fortnightly pay period or half pay.

During April, you will be able to submit a claim to recover earnings and wage costs. This may be backdated to 1 March depending on when your business was closed or jobs were put at risk because of Covid-19. This could be the date you closed or could be earlier, depending on your circumstances. You will then be able to recover 80% of all staff salaries, employer NICs and employer pension auto enrolment.

The only other alternative if you want to pay your staff weekly in advance of the payout is to approach your bank for a loan under the Government’s Coronavirus Business Interuption Loan Scheme (CBILS).

30 March, 17.48 – Jeanette Reid, HR and finance director at the Queens Arms, Corton Denham, Somerset, asks: I applied for a Government-backed loan through my bank and have been told I do not qualify because I do not pass ‘the stress test’, ie, I have no income coming in for likely three months or more and wouldn’t be able to make repayments – how can this be right?

I thought this business interruption loans were going to be made available to people like us, we are freehold and we have a 35% mortgage on the property. We do not qualify for any grants because our business rates are over £51,000, we have got a business rates holiday and a mortgage holiday but cash flow is crucial and we have very little once I have paid my team and key suppliers this month. 

Kate Nicholls, CEO of UKHospitality, says:

I suggest Jeanette checks whether her bank is covered by the British Business Bank and, therefore, offers the Government’s Coronavirus Business Interruption Loan Scheme (CBILS). This is exactly for her circumstance and offers a Government-backed interest-free loan to businesses that would not otherwise be able to access finance.

The scheme launched last Monday (23 March) and banks have only this week been receiving instructions about how to handle applications and the criteria to use so it is possible that her bank were not using the most up-to-date information. Try again and keep asking as the criteria were relaxed again at the end of last week.

30 March, 16.15 – What do I need to do to safely shut down my soft drink dispense equipment?

Phil Goldspink, director of customer operations at Britvic, says:

  • For a shut down of less than eight weeks, mains power should be left on but CO2 and water supply off. However, mains power should be turned off if shut down is more than eight weeks
  • Remove all dispense nozzles and diffusers before cleaning and drying thoroughly
  • Clean all valves before refitting nozzles and diffusers. Do not leave in soak
  • Flush all drip trays with clean water
  • The system can be left in this clean state for up to eight weeks. The dispense heads can be turned off in the normal way via key switch or the transformer

30 March, 15.24 – Dan Tornbom asks: Can I kindly ask a clarifying question in regard to the furlough. I changed employment after nearly four years on the 9 March to start with my new employer on the 11 March. Would you know if employees in my situation will be covered?

Charlotte Jackson, associate solicitor at Gannons Solictors, gives her advice:

One of the qualifying factors for furlough is that the employee has been on the payroll on 28 February 2020. However, I could not confirm whether he will qualify without knowing the specific facts of the case.

30 March, 15.04 – Mark Harrison asks: We have a pub with rooms  I have two questions – we generally turnover £12,000 per week for food, wet and accommodation but need to furlough employees. When we start up again, turnover may be as low as £6,000 per week. Therefore do we: A) Furlough everybody? Do a phased return and will furloughing allow this, eg, continue paying 80% till business levels return? B) Furlough only key employees knowing that business levels will be about 50% of levels before closure – on start-up? Finish any surplus staff?

It’s just that people say furlough everyone, it won’t cost you anything but let’s not fool ourselves, turnover levels on start-up will not be the same as they were and cash flow will be tight.

Also if we open our rooms up to key workers as they are in a separate block to help the cause, will this effect grants and furlough support.

Kate Nicholls, CEO of UKHospitality, says:

We now have an FAQ document on our website, which is the best place to direct people to.

The immediate decisions around furlough are to protect your staff and your business during the full closure period. The furlough scheme will run for at least three months and then Government will take a view on how it will proceed going forward and it may be that there will be a period of overlap between you starting to trade and the furlough scheme ending.

The minimum period of time you can furlough staff is three weeks and you can take a view on that going forward in light of your trading decision. However, if you want staff to work, they cannot be furloughed and even staff working part-time or reduced hours will fall outside the scheme.

Charlotte Jackson, associate solicitor at Gannons Solictors, says:

This is more of a commercial decision rather than a legal one. What we can say is that the Government has issued guidance on what is required for employees to qualify, including (but not limited to) staff being unable to work during furlough periods (staff can undertake volunteer work and training while on furlough, as long as they do not provide services or make any revenue for the employer) and that staff must be furloughed for at least three weeks to qualify.

They have confirmed it is temporary but not given any timescales to it. See the current guidance here, https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme.

Please note that the above response is a general overview without knowledge of the specific circumstances in this case. Further, there is no law governing these temporary measures at this stage and the guidance is frequently changing and updating. If you would like more specific advice to your circumstances, please do get in touch with us and we can take some formal instructions.

30 March, 14.59 – Gannons Solicitors deals with a few questions here and many more will be answered at its live stream, beginning at 3pm today. Click here for details.

Charlotte Jackson, associate solicitor at Gannons Solictors, gives her advice: 

How do I work out wages for furloughed workers with irregular hours?

Please note, if you are to furlough staff you must get the employee’s agreement prior to doing so. When calculating hours you can claim for the higher of (i) the same month's earning from the previous year (eg, earnings from March 2019); or (ii) average monthly earnings in the 2019-20 tax year. If they have less than 12 months of service, it would be an average of the employee’s monthly earnings since they started.

Please note that the above response is a general overview without knowledge of the specific circumstances in this case. Further, there is no law governing these temporary measures at this stage and the guidance is frequently changing and updating. If you would like more specific advice to your circumstances, please do get in touch with us and we can take some formal instructions.

With the minimum wage going up next week, do we increase wages?

There has been no guidance on this point, at this stage we can only assume that, if the national minimum wage is increased and your staff are under that threshold, you are required to increase your staff’s wage accordingly.

Again, please note that the above response is a general overview without knowledge of the specific circumstances in this case. Further, there is no law governing these temporary measures at this stage and the guidance is frequently changing and updating. If you would like more specific advice to your circumstances, please do get in touch with us and we can take some formal instructions.

If staff from a restaurant and bar are put on furlough to receive 80% pay, what happens if they work some part-time hours for either their employer or a new employer ?

Please note, if you are to furlough staff you must get the employee’s agreement prior to doing so. Staff must be furloughed for a minimum period of three weeks to be eligible. If you put a member of staff on furlough and then ask them to work, you will not be able to claim their 80% pay Staff can undertake volunteer work and training while on furlough, as long as they do not provides services or make any revenue for the employer.

Staff can only be eligible under the scheme if they were on the payroll before 28 February 2020, they would therefore not qualify if they are working for a new employer.

Again, please note that the above response is a general overview without knowledge of the specific circumstances in this case. Further, there is no law governing these temporary measures at this stage and the guidance is frequently changing and updating. If you would like more specific advice to your circumstances, please do get in touch with us and we can take some formal instructions.

Could you please advise does the new job retention scheme mean that the employer must initially physically pay the 80% of the employee’s wages and then get reimbursed from the Government later?

This has not been determined, the latest guidance has confirmed that an online portal is being created for making claims but has not determined whether employer’s are required to pay their staff and be reimbursed in the mean time.

Please note, if you are to furlough staff you must get the employee’s agreement prior to doing so, if you do choose to furlough staff and wait for the online portal regarding payment, you will also need to agree this with the employee beforehand.

Again, please note that the above response is a general overview without knowledge of the specific circumstances in this case. Further, there is no law governing these temporary measures at this stage and the guidance is frequently changing and updating. If you would like more specific advice to your circumstances, please do get in touch with us and we can take some formal instructions.

30 March, 14.50 – Don’t forget the live discussion today at 3pm from Gannons Solicitors on the furlough scheme. Click here to go to the site.

30 March, 11.22 – UKHospitality has some advice for Craig Thatcher 

Can you please help? My pub has a rateable value of £15,000; the council is saying I am only entitled to £10,000 using its guidance notes. The information online, however, says I should be eligible for the £25,000, we do not get rural or small businesses rates relief. 

UKHospitality answers: The Government grant scheme for hospitality businesses provides two levels of grant – one for premises that are subject to small business rates relief or those that have a rateable value of up to £15,000 and the other for premises with a rateable value of between £15,000 and £51,000. Note that the £10,000 grant is available for those with an RV of up to £15,000.

The reason for the difference in amount is that premises in the lower-banded scheme will already be receiving enhanced business rates support. Providing you are not already receiving a discount from the council (premises with a rateable value of between £12,000 and £15,000 receive tapered discount and support already) and your rateable value is above £15k then you should receive the higher grant.

You should contact your council and your local MP if you feel you have been wrongly placed in the lower category.

30 March, 11.07 – UKHosptality gives Jonathan Armstrong, licensee of the Old Neighbourhood Inn, Chalford Hill, Gloucestershire, guidance on his set on questions

We run a pub and would like some info on the 80% Government payment for staff and how we should treat them.

Most of my staff are not working and I have been told to furlough them. Is this the correct way to go?

UKHospitality answers: Yes, this is the correct step to take now. The Government has published detailed guidance on which staff can be furloughed and how the scheme will operate. If your staff are not working and will not be working, you should consult with them now about moving on to furlough and confirm with them how you propose to treat the furlough period and confirm the proportion of salary they will receive, any changes to pension and whether holiday will be accrued during this period.

The Government will provide a grant covering 80% of wages, up to a maximum of £2500 per calendar month and employer national insurance contributions (NICs) and employer minimum pension contributions. You are required to pass the wages to your employees and may choose to top up.

I am due to do my next payroll tomorrow. Do I pay them 80% of their normal wages or nothing?

You should reach agreement with your employees before making any changes to their wages.

How will we apply to Government for the 80%?

The Government will shortly release details of the online portal through which you will make your application for the Coronavirus Jobs Retention Scheme and this should be payable end of April.

Will the 80% from the Government be paid to the employer or employee?

HMRC will release the grant to the employer but this must be paid to the employee through the payroll and HMRC will audit the PAYE system after the scheme closes to ensure that this has happened.

When can we expect this money to start appearing?

The scheme will start operating end of April.

Will the money have to be paid back to the Government in which case we will be paying double?

The money will be paid to the employee and the Government will also cover the costs of your employer NIC and employer minimum pension contribution.

30 March, 11.01 – Live discussion today at 3pm from Gannons Solicitors on the furlough scheme

Catherine Gannon, founder of Gannons Solicitors, said:

With the recent guidance now issued from the Government, employers can now move forward with placing employees on the furlough scheme and claiming the grant of up 80%. Employers will need agreement from employees – please visit our website for more details on the shape of the typical agreement you will need. Sadly, not everyone is eligible – details of what it takes to qualify are summarised for you.

Alex Kleanthous will take you through a live discussion on what this all means based on “what we know so far”. The date is Monday 30 March 2020 @ 3pm. Please visit the website to reserve your place. I hope you can make the event. I am sure it will clear some of your questions and leave you feeling on firmer ground.

30 March, 9.54 – FAQs from Diageo’s on-trade hotline:

How do I manage cash flows to keep my business afloat?

How should I be managing cash flow? I’ve got no cash in the bank – so what should I do?

The Government has made grants available that are being administered by local authorities. We are aware that some people have already started receiving letters from their local authorities with details and instructions on how to access these. So check your email inbox, junk mail and physical mailbox for these letters.

The grant will be between £10,000 and £25,000 dependent on the rateable value of your premises. If this won’t be sufficient, you also have the opportunity to access an interest free loan for 12 months via the CBILS (Coronavirus Business Interruption Loan Scheme), where you can access up to £5m from one of the providers indicated on the British Business Bank website. Please contact one of the providers to discuss this option.

I’m keen to participate in the Job Retention Scheme but I have no cash, so how do I pay people (and then get reimbursed later)?

Funds from the grants may become available before the furlough payments which should help your cash flow and there is also support available in the form of business interruption loans. However, you should consider affordability as these are loans that you will need to pay back.

If I borrow money, how am I going to pay it back?

The important thing here is to only borrow what you will be able to pay back once normal trading resumes. The loans are being issued by funding providers based on what would be manageable for you before the impact of Covid-19 on your business. Another thing to consider is that you will be reimbursed the money you are paying to your employees, so any money you borrow for this purpose, will be paid to you by HMRC which you can, in turn, pay back to the lender.

How long will it take for the grant money to come through?

We do not have a definite date for this as these could vary depending on your local authority. However, we are aware that the first letters have already been sent to businesses so we expect payments to begin soon.

Am I doing everything I need to do in order to access the Government support that’s available?

How can I speed up the processes to access grants and loans?

There isn’t really anything for you to do at this moment in time, in relation to grants. Make sure that you are checking email inboxes (including spam inboxes) and physical mailboxes and be responsive to the letters from your local authority.

With regards to the Coronavirus Job Retention Scheme, make sure that you have had conversations with your employees about the fact that they are being placed in furlough, so that this has been done ahead of the online portal from HMRC going live (this is expected to happen in the second half of April, with first payments being issued before the end of April).

It feels like there is a lack of detail regarding the support that’s available and this is causing me a lot of stress... 

We appreciate that the situation will be causing stress and anxiety because you do not know exactly when things will be received or if there is something that you should be doing, and there is a tendency to want to call the relevant authorities (HMRC and local Authority).

We have set up this line to provide information and details. You can call us to check if there is anything specific that you should be doing or to get further details on any measures that you hear about.

I want to do right by the people in my business… what should I be doing to support them?

How do we calculate the hours for furloughed employees?

This is 80% of their salary if they are full-time salaried workers. For those that are on irregular hours, the guidance indicates that you should calculate their average monthly earnings over the time that they have been working for you, or over the past 52 weeks.

I feel so helpless and guilty towards my employees, many of whom are single mums and students with bills to pay.

It’s very admirable and evident that you care about your people so much and want to do right by them. At the moment, the only thing you can do is to keep an open dialogue with them and make sure that you keep them well informed of what is going on from your perspective.

Explain to them your constraints and the things that you are doing. Place them in furlough, if you intend on retaining them as employees, and let them know that you will pay them 80% of their salary, which you will be reimbursed by HMRC.

Explain that once you receive the grant or loan, you will be making payments. You are not obliged to pay 100% of their pay, so if you cannot afford to pay them the extra 20%, then explain this and let them know that they can apply for extra support through the welfare system if 80% leaves them in financial difficulty. It’s a difficult time for everybody and you can only do what you can do.

Additional comments:

Emma McClarkin, chief executive of the British Beer & Pub Association, said:

The Government is giving our sector a helping hand through this difficult period, but how to get that help – whether it be salary support for staff or business rates cuts and grants – isn’t immediately obvious. I urge publicans looking for more information on the support available to them to use the Diageo and Grant Thornton helpline.

Justin Rix, partner at Grant Thornton UK LLP, said:

We are proud to be partnering with Diageo to support publicans through this uncertain and challenging time. Through this resource our aim is to help businesses across the industry access information, reassurance and guidance to make the most of the Government support available to them.

Melissa Wisdom, on-trade director, Great Britain, Diageo said:

We know the next few weeks pose challenges and uncertainties for all working in the licensed trade. We want to make sure that where there is Government support available, our customers are empowered to make the most of it. Working with Grant Thornton, we will make information and support available, on the phone and by email, to help you access the measures announced by the Government.

27 March, 15.29 – Ashley Wilsey asks: I am still unclear whether our hourly employees will be entitled to claim 80% of their salary on the job retention scheme? And do the employees apply directly to HMRC for their pay or do we pay them and claim from the Government? 

Also, my husband and I are directors of the limited liability partnership (LLP), which owns our pub and we both derive the total of our salaries from the pub’s earnings. Are we entitled to 80% of our regular income?  

Lastly, our rateable value is £19,500, so we should be eligible for the grant scheme, but again I cannot find details. I have called Wiltshire Council and they told me to speak to someone else, a Swindon agency that I have been waiting for a phone call now for over two days. How can we access these funds to stay afloat? Will we be entitled to the full £25,000? And will the funds be specified for specific purposes or will it be up to our discretion? 

We have answers from two of our advisory board members:

Robert Hayton, head of UK business rates at the real estate adviser Altus Group, says: 

Different schemes apply in Wales and Scotland where rates are devolved but this is the position in England:

The Retail, Hospitality and Leisure Grant Fund (RHLGF) provides businesses in these sectors with a cash grant of up to £25,000 per property.

Businesses in these sectors with a property that have a rateable value of £15,000 and under will receive a grant of £10,000.

Businesses in these sectors with a property that have a rateable value of between £15,000 and £51,000 will receive a grant of £25,000.

Under the Small Business Grants Fund (SBGF), all businesses in receipt of small business rates relief and rural rates relief in the business rates system will be eligible for a payment of £10,000.

The Government has indicated that EU state aid limits of €800,000 (£715,500) will apply to this grant funding.

You are eligible for the grants if:

  • Your business is based in England
  • Your business is in the retail, hospitality and/or leisure sector
  • Your business receives small business rates relief and/or rural rates relief

Properties that will benefit from RHLGF will be occupied that are wholly or mainly being used:

  • As shops, restaurants, cafes, drinking establishments, cinemas and live music venues
  • For assembly and leisure
  • As hotels, guest and boarding premises and self-catering accommodation

You do not need to do anything. You will be written to you if you meet the eligibility criteria for this grant.

Once paid, it is for the ratepayer to determine how best to use the grant funding. 

Further detailed guidance is available here administering the business grant schemes.

And Kate Nicholls, chief executive of trade body UKHospitality, says: 

The Government announced that a new scheme to be operated by HMRC will be made available to support workers who would otherwise facing losing their jobs due to Coronavirus disruption. This will see all workers – including those on variable hours contracts – receiving up to 80% of their salary, capped at £2,500 per month. Details of furloughed workers will be uploaded by employers through a new online portal and payments will be made by HMRC through the payroll by late April.

There is no additional information as yet but formal Government guidance on how the scheme will operate is expected to be published imminently – there are FAQs and an overview of the scheme available through UKHospitality at https://www.ukhospitality.org.uk/page/coronavirus.

The questions that you raise have been posed by UKHospitality in discussions with No 10, BEIS and Treasury and we hope to have definitive answers shortly.

26 March, 17.20 – John Ellis, licensee of the Crown Inn and the Elephant & Castle, both in Shropshire, asks: Pubs have paid out lots for licences to trade that we aren’t allowed to use at the moment. I’ve successfully applied for a credit from PRS/PPL for music played in pubs. They still insist on 30 days’ notice (which I think is a bit mean in the current circumstances) but the sooner you apply, the sooner your claim is settled. I've also asked my local council about a refund on the Government-enforced suspension of my alcohol licence and am waiting to hear back. Does anyone have any other thoughts about other refunds we could be demanding? 

Lisa Sharkey, of licensed solicitors Poppleston Allen says: 

We are aware the Government is being lobbied in relation to suspension of the following licensing-related fees:

  • Premises licence fees
  • Pavement licence fees
  • Gaming machine permit/notification fees
  • Late-night levy fees
  • Marriage licence fees
  • Special treatment licence fees

Watch this space for more news as we get it.

26 March, 13.28 – Robert Wells asks: I am chairman of a social club just outside Cambridge and have two questions. Can we do takeaway food (subject to customer/staff distancing) and must it be for members only or can we open it up to our community?

We have answers from two of our advisory board members:

Lisa Sharkey, of licensed solicitors Poppleston Allen says: 

In relation to food, provided there is no condition on the club premises certificate prohibiting such sales, clubs can offer take away and delivery to members and non-members between 5am and 11pm. Any non-members collecting the food must not access any licensed activities (namely, alcohol and entertainment), which should not be happening at the moment in any event. 

The club should also check its rules for any restrictions upon non-members entering the premises even when licensable activities are not taking place. If there is any such restriction, they should perhaps arrange with the person to hand over the food at the front door or deliver it to them.

Off-sales of alcohol to members would not be permitted due to the fact the certificate permitting on-sales of alcohol, generally, is not in operation by virtue of the Government regulations requiring clubs not to sell alcohol to its members.

After 11pm, the sale of hot food and hot drinks would have to be restricted to members only. 

Rules on distancing and no consumption of food while waiting must be observed.

And the Association of Conservative Clubs says: 

We do not have much guidance on this subject at the moment. In theory, clubs could certainly offer takeaway food service to everyone, not just their members.

The alcohol point is more nuanced, again, in theory, this could be offered but just to members. We understand that club licences have not been formally suspended so they remain in effect if an off-trade sale can be made to members.

At the moment, as long common sense is used, the club should be OK. I would, therefore, suggest if they want to, they should focus on the takeaway food and not offer off-trade alcohol sales, which may just encourage members to stand outside drinking.

25 March, 12.26 – Mark Higgs asks: Has anyone heard if there will be any grants for pubs over the £51,000 rateable value?

Robert Hayton of real estate adviser Altus Group says:

Guidance on the grant funding scheme was issued yesterday (Tuesday 24 March) by the Department for Business, Energy & Industrial Strategy for England while the Welsh government’s finance minister confirmed its devolved arrangements.

In England, £25,000 will be available for those retail, leisure and hospitality properties with a rateable value within the £15,001 to £51,000 banding, while in Wales, it is within the £12,001 to £51,000 banding, ie, those outside the scope of small business rates relief (SBRR). For those within the scope of SBRR, the grants will be £10,000. The grants are available upon a per-property-basis rather than per business.

The Government has termed the scheme as being for “small business” but, in reality, given the qualifying threshold is for all retail, leisure and hospitality premises with a rateable value of less than £51,000, it is simply aimed at small properties only. 

This scheme is far from perfect. For example, businesses with a large property estate can claim the grant for each and every property below the qualifying threshold up to a maximum of €800,000 (£728,000) given the temporary framework for EU state aid because the UK is still in transition. That said, medium-sized properties, just above the rateable value threshold, run by independents for example, as things stand, will receive nothing. The grants are not, therefore, targeted nor based upon need.

In England and Wales, there are 16,036 pubs that fall within SBRR and are now entitled to grants of £10,000 while there are 15,891 pubs eligible for grants of £25,000 subject to EU state aid limits.

Sadly, 9,136 pubs above the qualifying threshold of £51,000 in rateable value won’t receive any grant funding as things currently stand.

25 March, 10.56 – Ruth asks: I understand we can offer takeaways from our pub but we are in a tiny village with a very limited number of customers so our numbers would not be able to cover the wages and costs of production. If we don’t offer this service, our chef is able to be paid at the 80% of his current salary – so it’s a conundrum? Can this be clarified?

Barry Turner, senior lecturer in Company Law & Corporate Governance at the University of Lincoln says: 

When it comes to the situation regarding hospitality and leisure workers continuing to work producing takeaway food, they will not be designated as furloughed and will, therefore, not be eligible to be paid the job retention scheme payment of 80% of normal salary.

I am unsure how keeping a takeaway-only service operational would be tenable for most businesses but it is dependent on how much of a pub’s income is generated by this as opposed to its on-sales.  

25 March, 09.21 – Russ Taylor asks: Still unclear with regards to the takeaway issue. Can a purely wet-led pub or brewery taproom offer a takeaway service without food offering? Can our local pubs that had been offering beer takeouts still continue or can our brewery taproom still offer take away fresh and bottle beer but with no food available (with no on-site drinking and the usual distance rules applied)?

Lisa Sharkey, managing partner at licensed solicitors Poppleston Allen says:

Pubs with off-sales authorised can offer takeaways and deliveries subject to any conditions on their licence. They should also have in place appropriate age checks both at the point of ordering (for example, over the phone) and also on delivery/handover. They must also have regard to the Government’s guidance issued last night (Tuesday 24 March):

This article in The Morning Advertiser also gives guidance. 

25 March, 08.56 – What is ‘furlough’ and how do I claim 80% of staff salary? 

Catherine Gannon, founder of Gannons Solicitors, says:

The general premise from an employment law perspective is that if staff are working, they should be paid in accordance with their employment contracts.

The Government is discussing measures to reimburse up to 80% of ‘furloughed’ workers wage costs up to a total cap of £2,500 per month. We do know HMRC intends to set up a portal for information regarding furloughed workers. Unfortunately, we don’t at the moment have a clear view on what ‘furloughed’ employees will mean.

The non-legal definition of furlough is a leave of absence, but we do not have the definition under these circumstances, eg, will staff be able to work when able to or from home, will it include pensions, etc?

We are continuing to review the position daily and once we have some guidance from HMRC on the parameters of what it means to be ‘furloughed’, we will produce a note. In the meantime, the Government’s guidance is set out on its website.

24 March, 10.25 – Daniel King asks: If rents are set on fair maintainable trade (FMT), after this crisis the FMT will be next to nothing – so will rent, rates, Sky, BT, PRS for Music and all the other bills that are impacted by turnover be reviewed?

Robert Hayton, head of UK business rates at the real estate adviser Altus Group, says:

The Rating Lists (Valuation Date) (England) Order 2018 No. 553 establishes 1 April 2019 as the day by reference to which all non-domestic properties must be valued for the purposes of new local and central non-domestic rating lists when they are next compiled in England. 

Further, last week, the Government introduced primary legislation in the House of Lords to bring forward the next revaluation of business rates to 1 April 2021.

Therefore, as things currently stand, the Government’s intent is for the next revaluation cycle to start next year and to set rateable values based upon the facts of fair maintainable trade on a material date almost a year before coronavirus adversely affected trade, which will now be an artificially high level. 

Given the economic impact of Covid-19, particularly upon the licensed trade, we believe this is now wholly inappropriate. 

We intend to lobby Government to keep the revaluation as originally scheduled in 2022 but to change the 2018 order requiring rateable values to have a new material date of 1 April 2021. 

The crisis will, hopefully, be well and truly behind us then and we will have a fuller picture of its financial implication upon trade while allowing time to restore confidence for people to visit licensed properties again. 

With the rates holiday during 2020-21, this seems preferable and will certainly benefit the hospitality, leisure and retail sectors with lower bills during the life of the next cycle if it were to start in 2022.

We take the view that during unprecedented times, unprecedented measures are required to help business. 

Related news

Accessing support for staff pay during Covid-19 crisis

Accessing support for staff pay during Covid-19 crisis

By Gary Lloyd

As the news keeps rolling out around Government support for business owners during the Covid-19 pandemic, it can be hard to keep track of the latest updates while understanding exactly what you need to do to access support.