'retainer' for services during lockdown

[ughseniorschool]

Looking for reasonable thoughts ... we regularly use a pet daycare service to help during the week while husband and I both work full time and have 2 busy children. The service is great - I love knowing dog is having a good day while we cant be with him. The people that work for the service are super friendly and dog seems to really like them. We pay a set amount each month - we agreed to send dog x days per week and we pay even when dog cant go because of sickness, holiday, etc. (I appreciate anyone that will say this is an indulgence - and it is. we are not wealthy but having a happy dog is very important to us so we manage the expense each month.) last month the service sent an email stating they would no longer be providing the service until further notice --- but they would be charging a 25% retainer fee to cover their costs. I am really conflicted about the fee being charged. I understand they have costs to cover - but am also not feeling great about paying indefinitely for a service that we might not use for months and we have our own expenses to manage. I love the service and want them to succeed of course ... just hard to swallow an invoice for essentially nothing.

If I could afford it and wanted to return there after, I would pay it.

I would want them to stay in business.

Collaborate You could offer your cleaner and dog walker a small weekly amount but agree to deduct that from their future earnings? It's then more of a loan to be paid back.
One of my clients is doing this (cleaner) and I'm ridiculously grateful for some income now. It also works in her favour because it works as a retainer and ensures I return to work for her.
(obviously some level of trust needs to be in place).

If they don't qualify for the furlough scheme then I don't think it is unreasonable although I think I'd want to negotiate the amount
To what? They’re already only asking for 25%

Also interesting point about "double charging" eg nurseries demanding full fees and then claiming furlough pay and the free hours.

You do realise that nurseries have been completely screwed by the government - for furloughed workers, they can only claim the percentage of their salary which is equivalent to the percentage of their income which is from parents rather than LAs

So if they turn over £100k a year, 50% LA funding and 50% private income from parents, they can only claim 50% of their pay bill, but have to pay out 80% of staff costs despite being 50% of their income down.

Many nurseries were close to breaking point before this. This change to the guidance which was quietly pushed out a few weeks ago is going to force many to close and make redundancies. If we want childcare settings when we can all go back to work, this is not the right way to go about it. The idea that nurseries could be profiting is mostly nonsense.

Wow... why arent dog walkers working?

They got absolutely HAMMERED for trying to do so by the entirety of the dog industry, when it was unclear as to whether they were allowed to or not. Many of the places they would walk dogs were then shut too..

Many would be putting dogs from multiple houses into vans which whilst crated out, would mean dogs would touch one another, walker touches dog, spread of virus there. Dog walkers cannot walk dogs without touching them.

That left only those walking dogs from single households, which is a premium service, they mostly discovered their insurers would not cover them for continuing to work.

Between that, and clients not needing them because they were at home, clients not affording them because they were broke... lots of walkers just can't work.

Self employed people are still not doing well if they can't work - most of us do not want to go near universal credit as if we DO we will find we lose our WTC as it will be transferred to UC (and is then less money).

Many of us fear that UC will be clawed back because we CAN work... but there isn't any work to be had, as opposed to being sick, or being officially told we can't work.

Lots of people will find the money they do get in June is minimal as being based off profit NOT turnover (EVERYTHING else is based on turnover), over the last three years, new businesses who wouldn't have expected to break even yet, let alone be in profit will recieve nowt.

We aren't getting furloughed, and those of us who went down the LTD company route and are directors are not getting a bean.

It is not easy - if you like and value a service and you know that service provider still has overheads to pay, then seriously consider paying them a retainer.

If you are happy that they may go bust before this ends, or that when it ends they will be too busy to meet your needs.. take your chances.

the government has put in place a furlough scheme for the self employed. They will be entitled to 80% of their profits.

1. Lots of people won't qualify because they weren't trading before 5/4/19.

1. Lots won't qualify because their s/e profits are less than 50% of their total income (i.e. if they did s/e alongside a job or had other taxable income).

1. The support scheme is 80% of PROFITS not income. Many sole traders will continue to have expenses to pay, so their business expenses come out of their 80%, i.e. insurances, vehicle costs, subscriptions, professional fees, business phones, etc.

It's completely different from the 80% furlough scheme for employees who get 80% of their gross wage and will actually be even better off than that because they'll suffer lower deductions for tax, NIC, student loan repayments, etc.

The sole trader business support really has more holes that Swiss cheese, and NO, it's not because people have fiddled in the past - even people who've declared every penny can still end up with next to nothing!

Further to the last message, I'm an accountant. I have close to 100 small business clients. I've just run a query through our tax return database which has resulted in just 13 of those clients being eligible for the sole trader 80% support! So 88% of them don't qualify for a bean!

So please don't presume that the self employed are going to be looked after - the vast majority aren't! If you value their service, you need to do your bit to help them through it or you'll be scrabbling around looking for someone new when lockdown ends!

OP here.

I just want to say thank you to everyone for the civil discussion and lots of good but different opinions. sending hugs to everyone in so many different kinds of challenging situations.

Our financial situation has changed so we do need to prune expenses. It is really hard to decide what to do about the dog service (it is a 10-15 employee business BTW, not just a sole dog walker) - but your views have been helpful. I think we will go ahead and pay the retainer for this month and next and re-evaluate at that point.

The problem is what if you pay this retainer and they go bust, you've lost your money.
Many businesses will go and doggy day care is likely to be as hard hit as childcare.
Several nurseries have closed for good near us.
One dog grooming place I know of.

I think I'd try ringing for a chat and give them chance to explain situation, to make a decision whether its acceptable.

My dog walker never asked but I'm still paying as she's self employed she won't get anything till June. Having struggled financially myself in past, I'd rather help her out.

She's great & has gone out of her way when I've needed, plus hardly any walkers locally worked outside school hours when I need some weekend/evening cover so rather she was available in future.

@vanillandhoney yes I'm a dog walker. We are doing a grand total of three dogs each day, all of whom desperately need us.