Red Tape Regulation - October 2012

1. ACTIVE PRACTICE UPDATES OCTOBER 2012
Red Tape Regulation
New business regulations typically come into effect on two
common commencement dates (CCDs) in April and October
each year. Below is our summary of some recent and upcoming
legislation changes from 1 October 2012 that may affect your Business UPDATE
business and your customers.
•
As part of the Red Tape Challenge, the
Government is continuing to review some
An enhanced CRB, or
Changes in key
• An enhanced CRB and a barred
6,500 extensive regulations with a view
checklist for ‘regulated activity’ - this
legislation from
to abolishing or substantially simplifying at
least 3,000 by December 2013. It hopes
will only apply to employees who 1 October 2012:
work in close and unsupervised
the UK will adopt what it calls a more
‘common sense’ approach to business contact with vulnerable groups. Pension auto-enrolment
regulations but as a business, you should Other changes include: Auto-enrolment of all eligible employees is
always remain aware of new or changing being phased in for the largest employers
regulations which may affect you, your • ‘Controlled activity’, covering those
from 1 October 2012. The new rules
employees and your customers. who have less contact with vulnerable
will apply to all existing businesses by 1
groups, will no longer exist.
April 2017. Employers with 120,000
Changes in legislation Employers will not be able to check
or more people in their PAYE scheme will
whether these people are barred,
from 10 September although they may still be eligible for
be the irst to automatically enrol workers
into a qualifying pension scheme. This
2012: a CRB check depending on their role will be followed by businesses with more
• Registration with the Independent than 50,000 members from 1 November
Vetting and Barring Scheme Safeguarding Authority (ISA) and 2012, continuing gradually, until those
continuous monitoring, which has without an existing PAYE scheme will be
In operation since 2009, the Vetting and expected to comply from 1 April 2017.
Barring Scheme is designed to protect been proposed by the original Vetting
unsuitable individuals from working with and Barring Scheme, will not be Earning thresholds will also apply to
children and vulnerable adults, however, introduced those eligible for auto-enrolment, with
since 10 September greater onus has • Police forces will no longer be those earning between the lower £5,564
been placed on the employer. required to provide ‘additional and upper £42,475 thresholds eligible
to join, and those earning £8,105 and
Two levels of enhanced criminal records information’ about applicants to
above automatically enrolled. In addition,
bureau (CRB) will now be required, in employers
employers will have to top up pension
the hope of scaling down paperwork for • Under 16s will not be eligible to be contributions on a workers behalf between
some employers: CRB checked. the lower and upper thresholds, with
18 Hyde Gardens www.plummer-parsons.co.uk
Eastbourne BN21 4PT
01323 431 200 eastbourne@plummer-parsons.co.uk

2. Red Tape Regulation
the amount depending on different factors.
Employees earning less than £5,564 will
Companies transferring from What the future may
be entitled to join the scheme, although their
international accounting hold…
contributions are not required to be topped standards to UK GAAP
up. All employees will have the option to opt An end to health and safety
out of a pension scheme if they wish. Companies that currently prepare their
accounts according to international inspections for some businesses?
standards (IFRS) are now able to change
Business audits and annual April 2013 may see thousands of ‘low
their accounting framework to the Generally
accounts risk’ businesses, such as shops, ofices and
Accepted Accounting Practice in the UK (UK
pubs, exempt from inspections, saving time
GAAP) - the oficial body of UK accounting
Exemption from mandatory audits will be and money for businesses and the Health
standards - providing they have not moved
extended to include small businesses, with and Safety Executive (HSE). Furthermore,
to the UK system in the previous ive years.
the thresholds changing in alignment with businesses may only be held liable for civil
Parent companies that are not required to
accounting thresholds. Smaller irms will not damages in health and safety cases if they
prepare accounts under EU law using IFRS
need to subject their accounts to an audit can be shown to have acted negligently.
will also be able to take advantage of this.
providing they meet two out of the three
following qualifying criteria: Extended ‘settlement
Money laundering
• Fewer than 50 employees agreements’?
• A balance sheet total of no more than The Money Laundering Regulation 2007
requires businesses covered by the A mutual agreement between both employer
£3.26 million
regulations, including accountants, money and employee will make it easier for irms
• A turnover of less than £6.5 million. service businesses and trust or company to dismiss underperforming staff in return for
service providers, to take appropriate a pay-out. This already available for some
In addition, most subsidiary companies
precautionary measures to identify and verify employers, but the criteria may be loosened.
will also be exempt from mandatory audits
the identity of their customers, thus reducing
providing the parent company can guarantee
their liabilities. The new regulations are
the probability of money laundering. A cap on unfair dismissals?
However, amendments aimed at reducing
expected to apply to accounting years A cap on unfair dismissal pay-outs may be
red tape burden and maintaining a hostile
ending on or after 1 October 2012 and introduced, signiicantly reducing the level of
laundering environment will allow greater
may affect around 119,000 businesses. pay-outs.
lexibility to businesses whose compliance
Elsewhere, dormant subsidiary companies will be risked based. Firms will be able to
will also no longer be required to submit rely on the customer due diligence of others Employment tribunals...
annual accounts providing a similar in order to avoid duplicate checks and
Changes to streamline the system are hoped
guarantee. paperwork.
to save money for taxpayers and businesses,
handing more power to judges to dismiss
‘weak’ cases and reducing the number of
These are just a few of the changes regarding employee regulations. Please talk required preliminary hearings.
to us to discuss further changes that may affect your business and employees.