More firms hire migrant workers
By Jonathan Moules
FT.com
Published: November 7 2008 18:05 | Last updated: November 7 2008
18:05
The number of small businesses employing migrant workers has more than doubled in the past two years, according to research commissioned by accountancy firm Tenon.
Interviews with more than 1,000 senior managers found that 48 per cent of small businesses now employ non-UK nationals. A similar survey of 600 small business directors in 2006 found that only 21 per cent employed migrant workers.
Although many migrant workers have returned to their native lands in recent months, business owners said they may still need to make more job cuts.
Lambert Brothers Haulage employs seven Polish people as part of its 140-strong workforce, largely because of the shortage of heavy goods vehicle drivers available in the UK.
However, Clive Watkins, managing director, said only one of the Polish workers he has hired has left the company and some had brought wives and children over to settle in the UK.
The growth in use of migrant workers may also be limited. Some 30 per cent of Tenons survey sample said they had no intention of employing foreign workers in the future.
The Federation of Small Businesses said many of its members did not employ non-UK nationals because of the red tape involved.
Under the new system for employing people from outside the European Economic Area and Switzerland, any migrant applying for a non-executive position must be sponsored by a UK-based employer.
Those who do not follow the rules could be fined up to 10,000.
Employment bill in final stages
Legislation to simplify the current workplace dispute resolution procedures, saving businesses an estimated 175m over a year, reached its final stages in parliament this week.
The Employment Bill, which will repeal regulations introduced in 2004, had its third reading in the House of Commons on Tuesday. The new system is set to come into force next April.
The changes to be introduced include powers for tribunals to raise or lower awards by 25 per cent if parties fail to comply with a revised code on discipline and grievance.
The bill will also increase penalties for breaking the law, increasing the maximum penalty for underpayment of the minimum wage from a 5,000 fine to an unlimited amount.
It will also strengthen the investigative powers of the Employment Agency Standards Inspectorate, handing it greater scope to access financial information to check whether a complaint is an isolated instance or an example of more widespread abuse.
FSB appoints professor
The Federation of Small Businesses has appointed a professor in entrepreneurship to champion its 215,000 members and help policy-
makers understand the difficulties facing many small businesses.
Alistair Anderson, professor and director of the Centre for Entrepreneurship at Aberdeen Business School within Robert Gordon University, was selected following a competitive tendering process. He said: My advice to entrepreneurs and small firm owners in the current climate is, dont be overwhelmed, take practical steps. The last thing small businesses should do is cut prices through panic.
In a recent survey of 8,600 FSB members, 49 per cent said they were under threat of losing their home or everything they owned if their business folded.
Share options a good reward
Smaller companies trying to reward key staff in the face of cash shortages should consider Enterprise Management Incentives.
EMIs are share options that can be granted by independent companies with fewer than 250 employees and gross assets of less than 30m. Unlike cash or other forms of reward, any future growth in the value of the option shares is free of income tax.
According to the Employee Share Ownership Plan (ESOP) Centre, a lobbying group, EMIs are the most favourable tax- saving opportunity currently available to employees of smaller businesses.
They are also beneficial to company shareholders as the business can claim relief from corporation tax for the amount of gains realised by the employee.
Options are most often granted as rights to subscribe for new shares to be exercised when the company is sold or floated.
The ESOP Centre provides an advice line and forum at www.emisphere.co.uk.
