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The NI changes are going to cost my organisation £1000 per employee

542 replies

flashbac · 01/11/2024 06:41

The NI changes are going to cost my organisation on average £1000 per employee, The lowering of the threshold alone is going to cost around £600 extra per employee.

We are heavily regulated with fixed income. We're a not for profit. Our customers expectations are increasing. We are now most likely going to have to somehow reduce our headcount now, and payrises for April are going to be off the table.

Just shaking my head really. Our employees don't deserve this. Hard to see how this isn't a tax on jobs.

The lowering of the threshold also means employers have to pay for more workers, because part time salaries are now dragged into it.

A lot of people reading this won't care. All I can say is this NI increase will also affect you. just think about Local authorities, childcare providers and other services. Do you think it won't affect your Councils services/tax bills, to give one example?

(I'm not a Tory bot btw, before anyone starts accusing me of being one. I voted Remain, don't support the Tories at all, can't stand Boris and his cronies.)

OP posts:
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Tryingtokeepgoing · 31/12/2024 22:03

BIossomtoes · 31/12/2024 20:53

So individuals bear all the burden, particularly the least wealthy. Yes, great idea. The only one worth considering is CGT, which is in many ways a voluntary tax.

Individuals always bear the burden of any tax rise, it’s simply a matter of whether they do so directly or indirectly.

BIossomtoes · 31/12/2024 20:53

Kitte321 · 31/12/2024 20:28

  • Increase income tax?
  • Increase employee NI?
  • increase CGT?
  • reduce benefit payments

Im not saying I agree with any/all but there many ways to skin a cat.

So individuals bear all the burden, particularly the least wealthy. Yes, great idea. The only one worth considering is CGT, which is in many ways a voluntary tax.

Kitte321 · 31/12/2024 20:28

BIossomtoes · 31/12/2024 20:13

How else can we pay for things is just a red herring. A million and one different ways.

Name a couple of these million and one ways.

  • Increase income tax?
  • Increase employee NI?
  • increase CGT?
  • reduce benefit payments

Im not saying I agree with any/all but there many ways to skin a cat.

BIossomtoes · 31/12/2024 20:13

How else can we pay for things is just a red herring. A million and one different ways.

Name a couple of these million and one ways.

Kitte321 · 31/12/2024 20:03

Exactly my point. “People allege all sorts of things, and they do”. As an employer you could follow an entirely fair process and still find yourself embroiled in costly, time consuming litigation. You have no choice but to pay for legal advice. You have to put forward a defence, particularly for reputation reasons. You can very very rarely get a claimant to cover costs, even when the claim is shown to be baseless. You’ve often spent months trading letters, with lawyers suggesting settlements. These claims are often taken on a ‘no win, no fee’ type arrangement. The only loser is the employer left footing the bill.

This, coupled with the increasing cost of NI makes it very unattractive to the increase employee numbers.

How else can we pay for things is just a red herring. A million and one different ways.

flashbac · 31/12/2024 18:46

Negroany · 31/12/2024 16:41

I was only talking about unfair dismissal, clearly. And I was commenting on the specific case the person I was responding to posted about which didn't say anything about discrimination.
Since I represent employers in tribunals, and have never lost a case, I think I'm pretty aware of what cases can be brought and when.

People can "allege" all sorts of things, and they do. Of course I know ADHD is a disability, and of course it is. But the claimant would have to show that the employer knew or had reason to know they had ADHD (and the respondent can request medical evidence via the tribunal, which an employer cannot usually in the normal course of employment), then show that any dismissal was linked to that or that the disability was the primary reason for the dismissal AND then show that the dismissal was unfair. Contrary to commonly held belief, it's not unreasonable to dismiss someone with a disability, even if the reason for the dismissal is the disability, you just have to do it fairly.

But it's very clear your views are pretty unpleasant, so I won't bother engaging with you again.

And you think an employee running a business has time for all of this? Vexatious or unfounded claims will only increase with day one rights AND tribunals don't have the capacity to hear them in any case.

OP posts:
flashbac · 31/12/2024 18:40

LaineyCee · 31/12/2024 16:55

What’s your alternative suggestion to raise the revenue?

It certainly wouldn't be biting the hand that feeds ie taxing a source of growth.

OP posts:
LaineyCee · 31/12/2024 16:55

What’s your alternative suggestion to raise the revenue?

Negroany · 31/12/2024 16:41

Kitte321 · 30/12/2024 16:35

Again, you’re wrong. Do you often comment on things you know nothing about? There are certain protected characteristics that allow a person day 1 rights already.
For instance, ADHD is now considered a disability. You could be terminating someone with ADHD for an entirely unrelated reason but have discrimination alleged.

I was only talking about unfair dismissal, clearly. And I was commenting on the specific case the person I was responding to posted about which didn't say anything about discrimination.
Since I represent employers in tribunals, and have never lost a case, I think I'm pretty aware of what cases can be brought and when.

People can "allege" all sorts of things, and they do. Of course I know ADHD is a disability, and of course it is. But the claimant would have to show that the employer knew or had reason to know they had ADHD (and the respondent can request medical evidence via the tribunal, which an employer cannot usually in the normal course of employment), then show that any dismissal was linked to that or that the disability was the primary reason for the dismissal AND then show that the dismissal was unfair. Contrary to commonly held belief, it's not unreasonable to dismiss someone with a disability, even if the reason for the dismissal is the disability, you just have to do it fairly.

But it's very clear your views are pretty unpleasant, so I won't bother engaging with you again.

Kitte321 · 30/12/2024 16:35

Negroany · 30/12/2024 16:08

If the person was there under two years they cannot file an unfair dismissal complaint (currently) so there must be more to it. If they have (and the tribunal doesn't always tip it out immediately) then the legal advisors can simply write to the tribunal pointing out that the qualifying period has not been met and therefore the tribunal has no jurisdiction to hear the complaint and it must be dismissed.

I write these letters all the time.

It should cost c£100 for your lawyers to do that letter.

On this subject though, I do think tribunals need some sort of triage system. Anyone can bring any claim really. It can be frustrating. I had one recently where she was trying to demand £10k (it was very obviously an attempt at extortion, as the £10k wasn't based on anything) for "discrimination" but gave no examples of it, and she had only worked eight days (two hours a day) in total, so for us to have done everything she claimed would have been miraculous.
We had to submit a defence, go to a pre hearing etc, for it to be thrown out because of her lack of claim, but had we taken external support obviously that would have had a cost to it.

Again, you’re wrong. Do you often comment on things you know nothing about? There are certain protected characteristics that allow a person day 1 rights already.
For instance, ADHD is now considered a disability. You could be terminating someone with ADHD for an entirely unrelated reason but have discrimination alleged.

Kitte321 · 30/12/2024 16:31

Negroany · 30/12/2024 15:38

If people can't follow a simple process to dismiss someone fairly they shouldn't be employing people. (By the way 'OMBs' by definition don't employ people, because they are one man bands)

It is simple. Yes, it can take some time. But that's FAIR! That's what makes it fair. Giving people time and opportunity to improve.

I can see from the replies here that people actually do think it's OK to just sack people. I can think of no reason at all why dismissing someone without a decent process should ever be allowable. I think we've become blind to what is common decency due to having had this two year period where unfair dismissal didn't count. I think once we culturally get our heads around it, we'll realize it's absolutely the right thing to do.

I never said any recruitment process would be 100% successful every time, but again, I think employers have got lazy. I KNOW they have, I see it all the time - take someone "temp to perm", no process, just use the "temp" part instead of a decent process, then just terminate if they don't like them. I'm old enough to remember before we had the two year qualifying and firms didn't do that then. It's absolutely no way for society to behave.

Firstly, an OMB is an ‘owner managed business’. Of course, it can bloody well employ people 🤦‍♀️.

We shall just have to agree to disagree about the ‘decency’ angle. I strongly disagree and we have moved far too far towards employee protection with little regard for the employer.

What you can’t seem to comprehend though is that the cost and time now involved in the recruitment and induction process means significant barriers (both in cost and man power) now exist that didn’t before. If you think that’s a positive thing for job seekers you are (again) mistaken.

devilsadvocate77 · 30/12/2024 16:23

Negroany · 30/12/2024 16:08

If the person was there under two years they cannot file an unfair dismissal complaint (currently) so there must be more to it. If they have (and the tribunal doesn't always tip it out immediately) then the legal advisors can simply write to the tribunal pointing out that the qualifying period has not been met and therefore the tribunal has no jurisdiction to hear the complaint and it must be dismissed.

I write these letters all the time.

It should cost c£100 for your lawyers to do that letter.

On this subject though, I do think tribunals need some sort of triage system. Anyone can bring any claim really. It can be frustrating. I had one recently where she was trying to demand £10k (it was very obviously an attempt at extortion, as the £10k wasn't based on anything) for "discrimination" but gave no examples of it, and she had only worked eight days (two hours a day) in total, so for us to have done everything she claimed would have been miraculous.
We had to submit a defence, go to a pre hearing etc, for it to be thrown out because of her lack of claim, but had we taken external support obviously that would have had a cost to it.

Yes I think she was there for just over 2 years. Shame they didn't just sack her before as she was really difficult and rude to other staff and making lots of mistakes but never wanting to take onboard any constructive feedback.

In fact, she sounds very similar to the story you quote above. She clearly has got away with it previously (some were with mid-sized firms that probably thought it wasn't worth the hassle). This case is completely groundless and the examples she has quoted, when pressed, were laughable.
But still he has to submit a defence, go the pre- hearing etc like you described. They expect it to be thrown out, of course, but a lot of 'thinking space' devoted to it and wasted hours.

It also seems bonkers that someone can do this multiple times without it having any bearing on subsequent claims. You can be a serial claimer if you have no morals, and, sadly seems there are plenty of those about.

Negroany · 30/12/2024 16:08

devilsadvocate77 · 30/12/2024 15:51

@Ozgirl76 Have a feelling @HotTopicsWithImogen is being slightly sarcastic in their comments?

The fact is that some (and I wager not an insignificant number) of tribunals are brought forward when there really wasn't a case to answer.

My relative, a fabulous employer where staff stay for 30-40 years (very, very low turnover) had an office person join. They stupidly didn't check references or rather, they asked but the lady said it would be difficult and she seemed nice so they settled for that.

She then kept being difficult socially with the rest of the team (at that point they had hired other newbies too who settled) and kept making serious mistakes. She had numerous development talks and chats but she didn't change her approach or attitude. So they said, sorry will have to let you go.

She then files a complaint that she was dismissed unfairly. They followed all the correct procedures, on top had legal advice. Relative been told they definitely don't have a case to answer for.

Still this is taking up a lot of time on behalf of the staff and especially my relative as the small business owner. The case kept being delayed so it's kept on his mind. He said he understands why some small business owners pays up but he's adamant he won't - even though taking up time/money - on principle as they didn't do anything wrong.

Turns out this lady has filed multiple such complaints but these are not considered by the tribunal or at least not until it goes to court.

Very frustrating!

Business owners are not always the 'bad' ones.

Edited

If the person was there under two years they cannot file an unfair dismissal complaint (currently) so there must be more to it. If they have (and the tribunal doesn't always tip it out immediately) then the legal advisors can simply write to the tribunal pointing out that the qualifying period has not been met and therefore the tribunal has no jurisdiction to hear the complaint and it must be dismissed.

I write these letters all the time.

It should cost c£100 for your lawyers to do that letter.

On this subject though, I do think tribunals need some sort of triage system. Anyone can bring any claim really. It can be frustrating. I had one recently where she was trying to demand £10k (it was very obviously an attempt at extortion, as the £10k wasn't based on anything) for "discrimination" but gave no examples of it, and she had only worked eight days (two hours a day) in total, so for us to have done everything she claimed would have been miraculous.
We had to submit a defence, go to a pre hearing etc, for it to be thrown out because of her lack of claim, but had we taken external support obviously that would have had a cost to it.

devilsadvocate77 · 30/12/2024 15:51

Ozgirl76 · 27/12/2024 20:43

Not really @HotTopicsWithImogen - this is totally normal for people running small businesses in the U.K. You take the rough with the smooth.

@Ozgirl76 Have a feelling @HotTopicsWithImogen is being slightly sarcastic in their comments?

The fact is that some (and I wager not an insignificant number) of tribunals are brought forward when there really wasn't a case to answer.

My relative, a fabulous employer where staff stay for 30-40 years (very, very low turnover) had an office person join. They stupidly didn't check references or rather, they asked but the lady said it would be difficult and she seemed nice so they settled for that.

She then kept being difficult socially with the rest of the team (at that point they had hired other newbies too who settled) and kept making serious mistakes. She had numerous development talks and chats but she didn't change her approach or attitude. So they said, sorry will have to let you go.

She then files a complaint that she was dismissed unfairly. They followed all the correct procedures, on top had legal advice. Relative been told they definitely don't have a case to answer for.

Still this is taking up a lot of time on behalf of the staff and especially my relative as the small business owner. The case kept being delayed so it's kept on his mind. He said he understands why some small business owners pays up but he's adamant he won't - even though taking up time/money - on principle as they didn't do anything wrong.

Turns out this lady has filed multiple such complaints but these are not considered by the tribunal or at least not until it goes to court.

Very frustrating!

Business owners are not always the 'bad' ones.

Negroany · 30/12/2024 15:38

Kitte321 · 28/12/2024 11:59

Course there is. This is so naive. Just behave reasonably? In order to run a ‘fair’ (as defined by employment law) process it takes time, resource, and often external advice. Most OMB’s/smaller SME’s don’t have HR teams and in house legal resource. Nor the time required.
Even the most robust recruitment process will not be 100% successful from a retention perspective, particularly when hiring graduate/un proven staff.
In the real world the two year provision protected both parties and removes the barrier to recruit.

Im not taking about unfair dismissal- protected characteristics already infer day 1 rights.

If people can't follow a simple process to dismiss someone fairly they shouldn't be employing people. (By the way 'OMBs' by definition don't employ people, because they are one man bands)

It is simple. Yes, it can take some time. But that's FAIR! That's what makes it fair. Giving people time and opportunity to improve.

I can see from the replies here that people actually do think it's OK to just sack people. I can think of no reason at all why dismissing someone without a decent process should ever be allowable. I think we've become blind to what is common decency due to having had this two year period where unfair dismissal didn't count. I think once we culturally get our heads around it, we'll realize it's absolutely the right thing to do.

I never said any recruitment process would be 100% successful every time, but again, I think employers have got lazy. I KNOW they have, I see it all the time - take someone "temp to perm", no process, just use the "temp" part instead of a decent process, then just terminate if they don't like them. I'm old enough to remember before we had the two year qualifying and firms didn't do that then. It's absolutely no way for society to behave.

financiallyiliterate · 30/12/2024 08:39

Aduvetday · 29/12/2024 19:22

Your username - even spelt incorrectly is appropriate.

ha ha.... Aduvetday? Pot n kettle.

From another thread @caringcarer

A majority of UK businesses expect a positive start to 2025, according to two economic confidence surveys which show managers planning for growth after a challenging period for the economy.
About 70% of UK businesses expect their turnover to increase over the next year, up from 62% in December 2023. Meanwhile, 73% are confident of greater profitability, according to research from Lloyds bank.

Hann-Ju Ho, a senior economist at Lloyds, said:* *“It is exciting to see that businesses have ambitious plans for next year and are confident of growth. Overall, businesses have responded well to the changing external environment. While the economic outlook has been challenging, the steps firms are taking to grow should put them in a strong position for success in 2025.”

I'll get ready for more denial
.

caringcarer · 30/12/2024 02:03

Of course it's a tax on jobs. Many organisations will halt recruitment or make redundancies. Some sectors will be hit more than others. Hospitality is complaining it will be hit. The NMW is also going up over £1 per hour which will also stifle growth. I don't think RR knows much about how to create economic growth. Growth brings on more revenue and allows the government to spend on public services. RR has done the opposite of going for growth with her autumn statement so the economy is now in a downturn. Labour always overspend very quickly and wreck economic growth. Then they have to tax more again. It's a downwards spiral. RR is creating conditions to lead us into a recession.

DogInATent · 30/12/2024 01:18

Paul2023 · 29/12/2024 21:22

Bottoms line is we have too big a public sector, including the NHS and too many people dependent on welfare . I include pensioners, but obviously that’s not their fault.

We have too many people reliant on the state.

Whats the solution ? Because taxing working people and businesses seems the only way to make up for the shortfalls? Something needs to give.

They need to take make our civil service smaller, and get rid of NHS management and admin jobs for a start.

Getting rid of NHS management and admin is the dumbest idea possible. Expecting frontline staff to provide admin and support roles and manage operations is absolutely guaranteed to drive inefficiency to the maximum.

BIossomtoes · 29/12/2024 21:52

Paul2023 · 29/12/2024 21:22

Bottoms line is we have too big a public sector, including the NHS and too many people dependent on welfare . I include pensioners, but obviously that’s not their fault.

We have too many people reliant on the state.

Whats the solution ? Because taxing working people and businesses seems the only way to make up for the shortfalls? Something needs to give.

They need to take make our civil service smaller, and get rid of NHS management and admin jobs for a start.

The NHS is undermanaged.

With pressures in NHS growing, it is vital that clinical staff can do their role and not be overburdened with administrative and operational business. Recent research by Institute for Public Policy Research suggested that the healthcare sector is under-managed, and this increases the burden of bureaucracy that falls on frontline professionals. They also found clinical staff needed managers to do the ‘managing’, freeing them up to do the ‘caring’.
Supporting this, we know the following:

Finding hope: The final report of the IPPR health and care workforce assembly | IPPR

The Institute for Public Policy Research (IPPR) is an independent charity working towards a fairer, greener, and more prosperous society.

https://www.ippr.org/research/publications/finding-hope

Paul2023 · 29/12/2024 21:22

Bottoms line is we have too big a public sector, including the NHS and too many people dependent on welfare . I include pensioners, but obviously that’s not their fault.

We have too many people reliant on the state.

Whats the solution ? Because taxing working people and businesses seems the only way to make up for the shortfalls? Something needs to give.

They need to take make our civil service smaller, and get rid of NHS management and admin jobs for a start.

Aduvetday · 29/12/2024 19:22

financiallyiliterate · 29/12/2024 14:56

Q3 revised growth is 0% thats not shrinking, however much you want it to be, even if Q4 growth is negative, its still not a recession, which we did have 12 months ago.

London, still worlds no2 Financial centre, despite a Tory led Brexit, which has cost and will cost the economy 100s of billions.

Your username - even spelt incorrectly is appropriate.

financiallyiliterate · 29/12/2024 15:00

BIossomtoes · 29/12/2024 11:58

There’s a section of non Labour voters (they get upset if you call them Tories) who are intent on talking the country down and are willing the government to fail for some reason. Given the God awful state we’re in (which certainly didn’t happen in six months) most sane people would want success, regardless of the colour of the government that achieved it.

Yes, Tories want the country/Labour to fail, then they can get on with what they've been doing for the last 14 years and before that in 80s and 90s, of wrecking the UK and selling it off.

There is not a single public service, or a privatised service, that is doing better now than it was in 2010, indeed all are far worse.

So what exactly do Tory supporters want to go back too?

financiallyiliterate · 29/12/2024 14:56

Aduvetday · 29/12/2024 12:07

Erm yes it is. The reports are all out there…

Q3 revised growth is 0% thats not shrinking, however much you want it to be, even if Q4 growth is negative, its still not a recession, which we did have 12 months ago.

London, still worlds no2 Financial centre, despite a Tory led Brexit, which has cost and will cost the economy 100s of billions.

Papyrophile · 29/12/2024 14:52

Not quite our area of expertise, RomingGnome!

RoamingGnome · 29/12/2024 14:34

Papyrophile · 28/12/2024 20:55

There is lots of manufacturing left, but some is like ours. Our tiny SME is a bespoke remanufacturer of heat transfer technology. If you have a large capital asset, like a ship or a factory or a hotel or a hospital or a power station, it almost certainly needs to add or lose heat somewhere in its structure or manufacturing system. A cruise liner has to deliver a hot shower when the paying passenger wants one. So we are asked to clean, test, maintain or rebuild and often improve the efficiency of legacy systems. Many OEMs went under, or were bought out in the late 80s and early 90s when the margins were very tight, so we manufacture bits of kit to replace worn out items to pattern. We do one-off jobs remaking parts made by companies that have long gone, using skills that owe more to history than technology and that are being lost with each year as the old salty dogs retire.

@Blossomtoes asked me why we haven't sold the business so DH can retire? We have been trying for several years, but commercial teams are not keen on businesses where demand cannot be created by marketing. Our customers find their way to us, usually by word of mouth. And hiring a new MD really isn't easy because the work comes from all over in chunky projects rather than mass-manufacturing a widget that can be sold in a neat box for Amazon to deliver; we build a crate to ship. Finding someone with the engineering knowledge to understand the task, spec it, price it and find the materials, then oversee the work to the deadline who also has the commercial nous to make it pay has been uphill. We trained someone for five years, only for them to say they didn't want the sleepless nights when the business went quiet, or to go without a salary in those months. 2024 has been a very difficult year for 11 months, and for some reason December trading is off the scale busy.

Any chance you can sort out the CalMac ferry emergency slides? New obsolete parts needed! Asking for a friend...

https://www.bbc.co.uk/news/articles/cq62j3z682lo

The MV Isle of Mull ferry pictured in the water near Oban

CalMac cuts passenger numbers over ferry's safety check failure

The ferry operator has been forced to cut passengers numbers on its MV Isle of Mull vessel0 to 45 after it failed a safety check.

https://www.bbc.co.uk/news/articles/cq62j3z682lo