What does the future of commercial law hold for businesses, especially under a Labour government? We spoke with experts from CWJ, Mayo Wynne Baxter, Doswell Law and Thomson Snell & Passmore to find out
As an employer, understanding your legal responsibilities is crucial, especially in light of a new government and the significant legislative changes on the horizon. By seeking expert guidance from experienced solicitors who specialise in commercial law, SMEs can remain agile in the ever-evolving business landscape, effectively managing risks while seizing new opportunities.
The employment team at Clarkson Wright & Jakes (CWJ), a leading Kent-based law firm serving SMEs across various sectors, has been busy in recent months, responding to a surge in redundancies, especially in the construction and technology sectors. At the same time, the corporate team has been actively engaged in sales and acquisitions as businesses strive to finalise deals ahead of the anticipated Capital Gains Tax increases in the upcoming Labour Budget, while at the other end of the spectrum, recruitment challenges persist, particularly within the professional services sector.
Laura Claridge, partner and head of employment at CWJ, highlights the potential impact of the government’s ‘Make Work Pay Policy’, explaining: “In the King’s Speech in July, an Employment Rights Bill was announced, set to be introduced within the government’s first 100 days. This bill includes pledges to end exploitative zero-hour contracts and make it easier for workers to request a four-day week, alongside promises of certain rights from day one, such as unfair dismissal, parental leave and sick pay.”
The government has committed to consulting with businesses, workers and civic society before implementation, but the details remain unclear. Laura adds: “While the government has stated that probationary periods can still be applied concerning these new ‘day one’ rights, there are reports of internal disagreements on their specifics and duration. It remains to be seen whether these immediate rights will deter businesses from hiring new staff.” She advises that one step that businesses may wish to consider taking at this stage is an internal review of probationary periods to make sure that these are working and fit for purpose.
Practising in the South East, with a focus on Kent, Surrey and Sussex, Mayo Wynne Baxter has built a strong reputation as a leading business law firm. It is particularly experienced in assisting family-owned and owner-managed businesses, providing comprehensive support through its corporate, employment, commercial property and commercial litigation teams across 10 offices in the region.
Although the challenges businesses face can vary by industry, many are grappling with common issues, particularly recruitment difficulties. Daniel Jenking, partner in Mayo Wynne Baxter’s Company and Commercial Law team, identifies: “London has always had an influence on the recruitment market in Kent, Surrey and Sussex, but the rise of remote working has made positions at London-based companies – often offering higher salaries – especially appealing to candidates.” This situation, he observes, is compounded by the ongoing effects of inflation, which, while lower than before, still impacts business operations.
As businesses navigate these challenges, two significant pieces of employment law will come into effect in October 2024, requiring careful preparation. Firstly, a new duty will be imposed on employers to take reasonable steps to prevent sexual harassment in the workplace. Daniel explains: “Failure to comply can result in an increase of up to 25% in compensation awarded by employment tribunals for cases of sexual harassment, which is a serious consideration for employers.”
Secondly, a new regime concerning the allocation of tips will primarily affect businesses in service industries, such as hospitality and retail. Employers will be required to distribute tips fairly among employees, with no deductions allowed. “Payment is required to be made in full no later than the end of the month following the month in which the customer paid the tip,” says Daniel. “Employers that pay qualifying tips more than on an occasional and exceptional basis will need to have a written policy setting out how those tips are dealt with.”
Daniel adds that companies will soon face a new identity verification process introduced by Companies House. This will require those setting up, running, owning or controlling a company in the UK – particularly directors and people with significant control (PSCs) – to verify their identity. “Further details on implementation are expected in the coming months, and businesses should start preparing for these changes,” he advises.
The economic climate has been improving for some time, leading many of Doswell Law’s clients to focus on recruitment rather than redundancies or reorganisations. However, concerns about forthcoming changes to employment law persist. “Business owners cannot be expected to know all of the relevant employment laws,” principal solicitor Henry Doswell notes. “They need ongoing and cost-effective advice and support from expert advisers to ensure that their documentation and employment practices are compliant. This proactive approach puts them in the best position to resolve any employment disputes early and avoid expensive tribunal litigation.”
Based in Ashford, Kent, Doswell Law specialises in HR and employment law. Henry states: “Our main focus for our business clients is protection from costly and time-consuming disputes. Most of our business clients employ us on a retainer basis. This means they will always be up to date with their contracts and procedures, and we are always available to advise on any tricky or urgent employment issues.”
The firm also offers HR consultancy services to ensure that its clients’ HR objectives and needs are met. These services include preparing employment documentation such as contracts and staff handbooks, establishing HR frameworks for SMEs without dedicated HR personnel, and supporting client companies with employee relations issues while collaborating on culture, engagement and change management.
Doswell Law has been supporting clients by ensuring their employment documentation remains current and compliant. Recently, Henry has been fielding numerous inquiries regarding the government’s commitment to strengthening workers’ rights, particularly concerning the right to claim unfair dismissal after a short probationary period. He explains: “Our clients are worried that these changes will effectively remove or limit probationary periods, which would hinder their ability to properly assess new recruits and could make it much more expensive to dismiss underperforming staff.”
Henry anticipates receiving more clarity on the government’s plans soon, which were initially outlined in the ‘Employment Rights Green Paper: A New Deal for Working People’. This information will enable Doswell Law to assist clients in navigating potentially significant changes to employment law and protect their businesses from future claims.
Kent-based Thomson Snell & Passmore has many years of experience serving the South East and is believed to be one of the oldest law firms still in operation worldwide. Sebastian Jones, a partner in the Commercial team, explains: “We pride ourselves on offering practical legal advice combined with expert business insight to help our clients adapt and thrive in the face of change. The firm has been supporting families and businesses since 1570, providing a comprehensive range of services across corporate and commercial law, dispute resolution, real estate, employment, family law, residential conveyancing, estate planning and more. I head up our commercial offering, assisting clients with complex contractual, commercial, and trading issues.”
In recent months, Thomson Snell & Passmore has successfully steered clients through large-scale corporate transactions, representing both buyers and sellers in complex deals. The firm has also supported companies focused on workplace safety, reflecting its commitment to businesses making a meaningful impact on society. Sebastian explains that the team have provided vital legal support to care homes, helping them navigate the complex regulatory landscape they face, as well as advising global leaders in technology and entertainment and clients across the food and beverage, agricultural and education sectors. “This diverse portfolio underscores our ability to provide tailored, expert legal advice across a broad range of industries,” he states.
The business landscape for SMEs in the South East is dynamic and complex, presenting both opportunities and challenges. As it evolves – shaped by Brexit, international affairs, cybersecurity concerns, rapid advancements in AI and a new UK government – businesses must remain agile and well-informed.
When it comes to valuable legal advice, Sebastian underscores the importance of proactive management and strategic foresight. “We cannot overstate the importance of prioritising compliance,” he says. “Staying informed about regulatory requirements and ensuring that business practices align with current laws is vital.” Protecting intellectual property is equally critical as ideas and innovations often represent a company’s most valuable assets. “Securing patents, trademarks and copyrights can safeguard your competitive advantage and enhance your company’s valuation,” adds Sebastian.
The team at Thomson Snell & Passmore identify robust contracts as another cornerstone of sound business practice. “All business relationships should be governed by clear, comprehensive agreements,” Sebastian explains. “Well-drafted contracts prevent misunderstandings and protect your interests.” Above all, he advises business owners to seek legal counsel early, stating: “This preventative approach can help identify potential legal pitfalls before they become costly disputes.”
So, there you have it – the specialists have spoken. Seeking expert legal support isn’t just advisable; it’s essential. With the complexities of evolving regulations and the need for strategic foresight, having trusted legal advisors can safeguard your business, mitigate risks and position you for sustainable growth.
