Husband effectively made redundant by my brother

[ForgotTheBiscuits]

Am I being unreasonable to upset that my brother has allowed his business to fold and left my husband essentially redundant, but brother hasn’t acknowledged the situation and is not booking any work.

My husband has worked as the sole employee of my brother’s business for over a decade. Work used to be steady and kept both my brother’s and my own family afloat.
Work has dropped off a cliff in the last year, and my brother (the business owner) doesn’t seem to be bothered to do anything to remedy the situation and doesn’t care that my family is sliding deeper in to debt and a significantly reduced standard of living. My brother’s wife has a secure job so he seems happy to live on that and essentially pretend that he still has a business.
So my husband has been made redundant but my brother has not declared this (I think he may be in denial).
I know normally an employee would be entitled to redundancy pay, but my brother won’t acknowledge the business is dead or make any moves to resurrect it. I feel he’s stringing my husband along. If my husband gets a new job, that will be the final nail in the coffin of the business, and it seems horrible to demand redundancy pay from family and to force my brother to acknowledge that we are suffering due to his inertia.
Any advice or opinions would be appreciated!

Does your DH not have a tongue in his head to say Hey BIL I notice work is dropping off what's the situation? Or hey BIL I didn't get many call outs the last month (or 2,3,4 ,5 months?) And if he noticed it was dropping off look for another job or maybe your DH is happy to live off your wage the same way you accuse your brother. Perhaps your brother has other forms of income he is pursuing. As neither you nor your DH have actually asked I guess maybe he does.

Never mix business with pleasure….I come from a big family all small businesses and it always turns into a disaster if family are contractors.

Your DH is self employed he is not an employee and never has been. He does work for the business as and when. It’s not your DB’s responsibility to provide his BIL work. Your husband has had ten years to sort his life out and find other work. Your DB should not have to have been doing this to make sure he had a living.

So yes your DH has to now go out and find himself an actual job when he is employed and has a set salary every month to look after his family. And you probably need to also do the same. But your DB has done absolutely nothing wrong here.

Thank you so much for your empathy and wisdom, lots of useful suggestions!

Please delete

Yes your brothers been shit. He’s treated you both badly. But that knowledge doesn’t pay your bills. And your brother is not going to suddenly start to do the right thing by you both. You have let this drag on too long if it’s been a year and you’re getting in debt.

You have to decide what to do now, there are options like:

speak to ACAS - their advice may include legal action against your brother and you have to think whether you’d be willing to do this.

try and get a loan to buy the business

get a new job - during the pandemic my brother lost his well paid job and worked stacking shelves, delivering parcels etc, minimum wage is better than no wage and if your husband is hard working he’ll be able to work his way up if he picks large companies with space for progression.
jobs like delivering parcels can also be contracted day to day so it wouldn’t necessarily mean your husband could never work for your brother again.

What type of contract does your DH have? You’ve referred to him as a loyal employee, but also said he’s paid per job, and both of those things can’t be true. If he’s paid per job, is he contracting? You’ve said his tax and NI is fine - is he paying that?

That’s really important to determine what options you’ve got now. It’s complicated by it being your brother, but there are still processes and protocols.

Support for new businesses is very slim now. It’s worth enquiring but in most areas, there isn’t low interest loans anymore. Some areas have small grants but it’s usually a grand or two, if that.

What is your husbands actual status ?

Does he have a contract of employment with the business ? If so then he should have contractual and statutory rights surely.

Anyway, all of this to me is one of the reasons why keeping business and family apart is a good idea.

You describe it as your husband being a subcontractor, not an employee. So no redundancy would be owed. It seems odd that your husband hasn't brought up that he isn't being given any work by your brother. Is your brother using another contractor instead? Why can't your husband do the jobs on his own? Does he not have the skills your brother has? Was he more of an assistant?

Could he upskill and offer to buy your brother's business or start up on his own?

Is your husband classed as a sub contractor, so self employed? If so, there is nothing that can be done. You mention that work started drying up a year ago, so he had an idea that it would fold. I'd suggest looking for any job for now, and look for a better one later on. He could go to night school, to get qualified in something.

@ForgotTheBiscuits My husband left school at 13 what country do you live in????

I am sorry, that was uncalled for and couldn’t delete or edit.

I was offended by your suggestion that my husband hasn’t ‘sorted his life out’. The job could not be done with one person, so for all these years, to all intents and purposes thus far, DH has been employed by my DB. He could not have done it without without my DH. Now DB is sick of it but doesn’t call it.
I have sacrificed my own career so that my husband could work with DB. I took a shitty part time job after DC1 was 18months, to allow DH to be free to work, for the benefit of both families. I would have applied for full time graduate jobs otherwise and would be in a very different situation now.

years, to all intents and purposes thus far, DH has been employed by my DB

it sounds like it’s been treated as if he was an employee, but legally he’s been a contractor, albeit one who has only worked for one employer… so HMRC may not consider him a contractor.

Anyway, he’s functioned as an employee for a long time, and now your DB is treating him as a consultant again and has just stopped looking for work; so there’s nothing for your DH to do, and nothing legally owed to him. Which means you and your DH are regretting all the time you’ve put into growing the business; and the opportunities you’ve missed to prioritise it.

It also sounds like your DH might struggle to find similarly paid work? Because of a lack of qualifications; and you not having the money to start up yourself. Would your DB maybe consider passing the business to you? Or could you pay him off over time? If he’s essentially discarded it, he may be open to letting it go. Do check that it’s healthy and properly registered though, and that it’s got no debt etc. Also think about how you’d manage the second person - if you also use a contractor to avoid the fees and responsibilities associated with an employee, you need to be much more careful to make sure they are legally a contractor. If you need them to be available at a moments notice; you need to be sure the business can cope with your DHs salary plus the employees. Did your DB take a salary, or has he lived off his wife’s salary while trying to make the business work?

Well, contract work is precarious at the best of times. It's unfortunate, but a lot of small businesses haven't recovered from covid. It is stressful but now is not the time for woe Is me. Your husband needs to make a plan and fast. Either take over the business £5k isn't that much in the grand scheme of things if he thinks he can make it successful. Or look into re training. Lots of funding is available right now. The first priority should be getting a job.any job so you don't slip further into debt.

Hi. I’m sorry you are struggling.
You and your dh obviously believe he was an employee. There is a possibility that this was not legally the case though.
If you are an employee your employer will have been giving you payslips showing how much paye and national insurance they have been paying on your behalf. You always get your money after tax and are entitled to holiday pay, sick pay and redundancy pay.
Otherwise ,as others have said your db may have been treating your dh as though he is self employed. In this case, they would just agree an amount per job and your brother would pay it to your dh like he would pay any supplier. So this time it is your husband who has to tell HMRC in advance that he is self employed and your husband is responsible for completing a self assessment to HMRC every year after which he pays all his tax and national insurance himself.
It is every individuals responsibility to take care of their tax affairs. It is not enough to say for example that you thought you were an employee, you thought your tax was paid. Nor is it ok for your db to have paid your brother regularly without checking with HMRC that he is not legally an employee.
So you have 3 scenarios -

1. db has been paying dhs tax and ni, dh was considered on a zero hours contract, but may be entitled to holiday pay or some redundancy pay (I don’t know about redundancy and zero hours contracts)
2. db has not been paying dhs tax and ni and has been treating dh as self employed. Dh should have completed a tax return every year and paid HMRC himself. DH cannot do anything at this stage and is not entitled to redundancy pay.
3. db has been paying dh and neither of them has paid HMRC. Dh is not registered as self employed by HMRC. This is problematic because it’s illegal and 10 years of unpaid tax plus fines will be a lot of money and your dh won’t have paid years towards his pension. If you don’t know you can check your husbands NI or tax record online. Oneof your posts suggests dh has been dealing with his own tax affairs, so scenario 2. If it is scenario 3, you need to speak to dh and db urgently because your dh and your brother are in very murky water legally.

i think it is very sad that you can’t clear the air with your brother about this , and simply ask if he has any ideas how dh can carry some of the business forward. It may well be that dh has to search for employment on his own I’m afraid. It must be worrying for you. I’m sorry.

I’d be looking for work as soon as the jobs stopped coming in from your DB. And now both of you should be looking for work as sounds like your DB will never shell out redundancy money.

F

Have we established if legally he’s a contracted employee, or just a freelance/contractor?

Can you tell us what kind of job he does OP? We might be able to help with some more specific advice.

You are doing the OP absolutely no favours here. Why are you sporting her delusion that her husband is an employee, with all the accompanying rights? He isn’t. He is at best a contractor - and given that it appears to be a case of “he works if work is available”, he probably doesn’t even have the protection that comes with that. We don’t even know if he actually ever signed any kind of terms. In legal terms, he could be considered just a casual worker.

Why, when there hasn’t been any work for months, has he not looked elsewhere? If he’s only paid when there is work, he isn’t an employee; he has the freedom to take on other work, unless he’s signed some sort of retainer to make sure he’s available as and when. Being a contractor or casual worker may mean you have little protection, but it also means you have the freedom to pursue more lucrative opportunities. Why hasn’t he?

It would make much more sense for the OP’s husband to crack on with getting another job and stop wasting time hoping he’ll get more work, or any redundancy money, from his BIL. Neither of these are coming.

What is the 5K training needed to do the job? Would it be feasible for your husband to try and get the money to do the training (I know it’s a lot of money, but the future gain would be huge).

Is your husband actually qualified and legally able to do the work he is doing now, or is it that he can do the work but doesn’t have the correct qualifications? Taking over the business would be the perfect solution but obviously if this is a trade and he doesn’t have the qualifications it’s a no go. If this is the case perhaps it explains why your brother doesn’t want to carry on with the arrangement.

Your husband sounds capable of doing more than a minimum wage job, maybe now is the time to get some paper qualifications if that is what is holding him back.

Sod the family business. If its trade skill get you dh to set up on his own. See if he can negotiate what he needs from your brother to sell him what he needs to run the jobs on his own I.e. particular tools etc he may not have. You need to be proactive now and not reactive.

Can he offer to take it over?

Would your brother be interested in trying to rescue the business by sorting out the IT and sourcing new customers? Could he offer to do this in return for joint ownership?

OP you've been asked numerous times but don't seem to answer. Is your husband self-employed - ie does he submit a self-assessment return and pay his tax and national insurance himself - or is he paid a wage by your brother where his tax and NI is deducted from his wages before he receives it. It's very important that you clarify this as only then can other people advise you properly. I am an accountant but I can't help you if you don't give the correct information.