Open letter to the government
I have a background in operational HR, and now work for a very successful company. We started in typical entrepreneurial fashion on the back of a credit card, no available bank finance and a lot of hard work after hours, before we got to the point of realising we had a serious business. We’re an employee benefits company, so we talk to a lot of employers of all sizes and in diverse industries, public, private and not-for-profit. We directly employ 73 people, lots in jobs that many larger organisations offshore or outsource. We’re profitable, still work really hard and are committed to the innovation and design of our product. That’s my credentials for suggesting 5 small but valuable, no-cost things the government could do to help the working world along. You’ve said a lot about reducing business red-tape so if you’re looking for a place to start, I hope this helps.
1 Let parents choose their childcare provider. You might think you already do this with tax- efficient childcare vouchers, but to qualify for the tax relief, the childcare provider must (broadly) be registered with Ofsted. So for parents who use a nursery or registered childminder, that’s fine but a working parent can’t nominate a relative (not even the child’s other parent) as their carer. How barmy is that? So remove the tax break from higher rate taxpayers completely – not just reduce it as per the current proposals – and extend the scheme to any designated carer for basic rate taxpayers. Must be just about cost neutral in tax terms and would have real benefits in other areas, far more useful than extended maternity pay.
2 Share responsibility for the DDA. The Disability Discrimination Act is a far-reaching piece of legislation and maybe some of its consequences were not foreseen. For employers, the wording is badly drafted and subsequent amendments haven’t helped, making it hard to understand and easy to be frightened. If the Act insisted an employee who considered themselves to be disabled within the meaning of the Act had to tell the employer the nature of the disability and any reasonable adjustments (and if I’e lost you here, you begin to see how tricky the DDA is for employers), then everyone would have a better idea of how to proceed. At the moment, the law places duties on employers who ‘ought reasonably to have known‘. Isn’t it reasonable just to expect an employee to tell you what the disability is and what you can do to help?
3 Lighten up on long service awards. 20 years service, £50 in vouchers tax free. How about extending it down to 10 years and £100 or 5 years and £50? For many employers, it would be really nice to reward medium length service without P11Ds or PSAs. There wouldn’t be much, if any, loss of tax revenue because HMRC’s time will be freed up by not having to process returns from those employers that already kick in long service awards earlier. So loosen the limit, just a little.
4 Define ‘trivial’. In terms of taxing a benefit in kind, HMRC teases employers and employees with the notion that some benefits may be so trivial as not to be worthy of mention on a P11D. Employer provided tea and coffee seems to be one, and presumably the odd biscuit as well. Much time and angst is expended by employers trying to work out if a benefit is ‘trivial’, and many of these consult their tax office with the resultant waste of resources there. Haven’t tax policy makers got better things to do than police a few quid a year? And can the amount it costs to consider and rule on these cases possibly be justified by the tax revenue (because frequently there will be none) raised as a result? HMRC should stop being coy and define ‘trivial’. Let me help out. I would suggest that ‘trivial’ means up to £25 a year per employee per benefit, and you can have a maximum of 3, clearly identified. They aren’t cumulative (so you can’t have £75 on one benefit).
5 Broaden your horizons about what flexible working and work-life balance means. Employers are pushed in to being the new nanny state. Successive ministers from multiple departments want us to manage stress, facilitate caring, get people fit and the rest. Most of this many employers do anyway, and some of us resent the implication that we don’t do enough. But work-life balance shouldn’t be all about parents or women. As just one idea, what about encouraging employers to give employees time off to give blood (and if you could overhaul the waiting times at donation points, that would be an excellent thing) by allowing a £10 tax-free voucher reward. The UK imports blood so increasing donations must save money, and it’s a great way for the employer to contribute to the CSR agenda at minimal cost. There are lots more areas in which a more imaginative, inclusive and cost- neutral approach to working lifestyles could be more relevant to many more employees than at present.
That’s a starter on low-risk, high reward employment matters. If you want ideas for policy, I’d be happy to help.
Asperity’s Operations Director and HR professional for 20+ years