Business Support FAQ

Be careful. There’s no such thing as a ‘standard contract’ in these circumstances. At the very least, read through it extremely carefully and make sure that you understand exactly what you are signing up to. It is strongly advisable that you speak to a solicitor and get some initial advice before you sign anything or hand over any money. Try to find a solicitor who is experienced in handling business sales and purchases. Remember that business selling agents in these circumstances act on behalf of the seller of the business. It is not their job to make sure that the buyer is properly advised. I’ve had reports of prospective buyers being put under a lot of pressure to sign these types of contracts on the basis that it is the only way to proceed. Usually it’s not. Getting proper advice at this stage can be the key to avoiding expensive mistakes.

Hang on. Entering into a lease of a commercial premises is usually a serious commitment. Are you sure that you understand all of the terms and, equally important, what is not included? Again, it is strongly advisable to get some proper advice at this stage to make sure that your interests are protected. If you are taking over a lease in the middle of its term it may well be that it is difficult to change any of those terms, but at the very least you should be comfortable that you know what they mean and their potential consequences.

As far as costs are concerned, this is another point to be negotiated. It is likely that the landlord will expect his costs to be paid but there is no reason why those should necessarily be paid by you. Perhaps the seller will agree to pay half of them?

The best place to start is to check whether your contracts of employment or staff handbook contain a social media policy. A policy sets out what is acceptable behaviour and what is not when it comes to social media, including Facebook and Twitter. You should make it clear that the policy covers your employees’ personal use of social media, not just business use. It should also explain the consequences of breaching the policy which may include disciplinary action and, in the most serious cases, dismissal.

If you do not have a social media policy, you can still take action against the employee though it might not be quite so clear cut. Either way, if the Company’s reputation could have been damaged, other employees offended or harassed, or if confidential information has been disclosed, you should carry out a disciplinary investigation. If there is enough evidence, you can then take disciplinary action against the employee. You must ensure that you follow a fair process, which will include inviting the employee to a meeting (with a companion) and giving them an opportunity to state their case before you reach a decision. You should also offer the employee a right of appeal.

In one recent case, a Tribunal decided that it was fair to dismiss an employee who had made distasteful sexual comments about a female colleague on Facebook. The employee argued that the comments he made were a joke and that he had not intended to harass his colleague but the Tribunal agreed with the employer that it was gross misconduct. The employee also tried to argue that his employer had violated his human rights to respect for private life and freedom of expression. Interestingly however, the Tribunal said that, by putting the comments on Facebook, he had made them public and therefore he could no longer consider them to be private.

In order to avoid such situations, our advice is to ensure you have a clear policy to set boundaries for the use of social media by your employees, whether for business or personal use. Without such a policy, your employees may believe that what they post or blog in their own time has nothing to do with work. With a policy in place, you can expect fewer problems, and be in a stronger position to deal with any problems that do crop up.

The hard and fast answer to this question is ‘no’. Before signing a Settlement Agreement, an employee should not just receive legal advice, but independent legal advice. When talking about independence in this context, it means that the legal advice that a solicitor gives to an employee should not be influenced by any connections he/she may have with the employer. For example, if a solicitor has a business relationship with an employer, the solicitor may feel pressurised into giving advice which may have differed if it had not been for the business relationship. To avoid this situation, the employee should be given the opportunity to use a solicitor of his/her choosing. As such, employers should be aware of this and should not restrict the employee’s choice.

Even if an employee doesn’t have a contract of employment, you can still include provisions in the Settlement Agreement restricting an employee’s actions after he/she leaves the business. You may want to restrict the employee from divulging confidential information or you may wish to restrict the employee from working for competitors in a particular area. As long as you are protecting the interests of your business and the restrictions are reasonable, these can be included and enforced in a Settlement Agreement. Once the employee has signed the agreement, these restrictions will be legally binding on him/her in the same way as if they were included in a contract of employment. So, if the employee then divulges confidential information or works for a competitor, you will be able to take legal action against him/her.

Try if possible to sort it out with your business partner. It might be worth asking someone else to attend a meeting as a neutral person to listen to what you both have to say. Your accountant or solicitor may be willing to do that for you. If the business has traded successfully for ten years, it’s certainly worth making every effort to find a solution.

If a solution can’t be found then the next stage would be to check whether there are any written documents that set out what should happen in these circumstances. These are often called partnership agreements or, if your business trades as a limited company, shareholders’ agreements.

A shareholders’ agreement is a written agreement which in smaller companies usually involves all the shareholders as owners of the business. There are no set rules as to what is included but typical topics are setting out what would happen in the event of a ‘deadlock’ situation, and dealing with a situation where someone wants to leave the company. Clearly such an agreement would be helpful in your current situation. However, if you don’t have one, all is not necessarily lost.

If the problem can’t be resolved, then this is the right time to see a solicitor for some initial advice. Many solicitors will offer a free initial appointment so it’s worth taking advantage of that offer! Try to find a solicitor with experience of dealing with this type of problem.

Be careful that this isn’t a false economy. A shareholders’ agreement made between business owners is a very important document. It’s important that you both consider carefully what you want your agreement to achieve, that the terms of the drafted agreement reflect those wishes and that ultimately the agreement will work as you both intend. A template format can be dangerous in these circumstances and I would advise you to think very carefully before going down this route. Getting the right advice at the right time can be crucial and can potentially avoid unnecessary problems in the future. In these circumstances it really can be worth speaking to a solicitor who specialises in providing advice to businesses. Many solicitors will be happy to give some free initial advice and if you decide to ask them to draw up the paperwork, you should not be frightened to ask for a fixed fee for doing the work. For a relatively straightforward agreement it might well be cheaper than you think. It’s usually worth getting this type of important documentation properly drafted by a specialist solicitor. Not only should you benefit from professional guidance to ensure that you get the agreement that you want but if things do go wrong, you’ll be covered by the solicitor’s professional indemnity insurance.

Although getting a shareholders’ agreement prepared by a solicitor will incur some costs, these costs will almost always be cheaper than having to sort out problems at a later date, possibly when the relationship with your business partner may be under more strain.

This really depends on what it says in her employment contract or staff handbook. Is there a sickness absence policy that states what someone must do in the event of sickness e.g. do they have to provide a sick note? Do they have to ring work on their first day of sickness? If they simply return from holiday and make such a claim without following your normal sickness policy (without a good excuse) then in most cases it would be reasonable not to allow them to re-take the holiday.

This highlights how important it is to have a comprehensive sickness policy applicable to all your employees. For example, there is no reason why you should not require employees to provide a sick note at their own expense covering each day of pre-booked holiday in respect of which they want to re-take holiday at a later date.

Yes, if you do not have a sickness policy. However, it also depends on whether you simply pay the minimum Statutory Sick Pay (SSP) or whether you pay full pay during sickness absences. If you pay SSP only then employees will have to decide whether they want to ring in sick whilst on holiday and accept that they will not get paid (or at the most SSP) or take it as holiday pay and receive normal pay. Don’t forget, under the SSP scheme, the first 3 days are classed as waiting days and are not eligible for pay of any kind. This would put a lot of people off claiming them as sick days. However, if you pay full pay during sickness absences, your employees will have a different choice. In most cases, they will decide to call in and convert their holiday to sick leave, therefore protecting their holiday entitlement.