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The Martlet Partnership LLP has said that recent official figures show that the UK has a problem with encouraging productivity in the workplace.
The latest figures released by the Office for National Statistics shows that UK productivity fell by 1.2 per cent in the last quarter of 2015.
The biggest decline was in the manufacturing sector, where output per hour fell by two per cent. The service sector also experience a decline of 0.7 per cent per hour, yet this figure was still 1.1 per cent higher than a year earlier.
David Macdonald, managing partner at Worthing-based accountant The Martlet Partnership said that productivity is a key element of business growth, but added that businesses across the UK where struggling to improve productivity.
“For the last few years, productivity in the UK has been severely in decline. It is often the case in the businesses that we speak to that workers feel they should be earning more for the work they do,” said David.
“And yet many businesses find it hard to justify increasing wages without demonstrable benefits in productivity, leaving many owners in a Catch 22 situation.”
David added that productivity wasn’t the only sign of a successful business and that other factors had a part to play, but said that some businesses could be doing more to improve processes and the work environment to make employees more productive.
“It is hard to admit it when you’re running a company, but sometimes owners and managers could do with some professional help. This shouldn’t be viewed as an admission of defeat, but more as an investment in future success,” concluded David.
To find out more about The Martlet’s business advice services, please call us.
Worthing-based accountants The Martlet Partnership is reminding businesses that the penalties for not paying the new National Living Wage and the minimum wage have gone up from the start of this month.
Whilst the majority of businesses will have focused on making sure their employees are being paid the correct statutory wage, many may not have realised that failing to do so now carries much harsher penalties than before.
Under the changes that have come into force businesses can now be fined 200 per cent of the total underpayment, while pay reference periods that began before 1 April 2016 will still face the previous 100 per cent penalty.
This means business could be fined between minimum payments of £100 up to a maximum payment of £20,000.
This payment applies to each worker who has been underpaid, not the total payment for all workers.
In the most serious cases of non-compliance with the national minimum wage legislation a business owner may be criminally prosecuted by HM Revenue & Customs (HMRC). The potential penalty on conviction is an unlimited fine.
HMRC has also taken a more active role in recent years of naming and shaming the worst offenders, regardless of their size, which could have a significant impact on a business’s reputation.
David Macdonald, managing partner at The Martlet, said: “I suspect the majority of businesses have prepared their payroll to ensure that workers over the age of 25 are now receiving the new National Living Wage of £7.20 an hour.
“However, there may still be some out there that haven’t done this and it is integral that this is rectified immediately to ensure they are not penalised or prosecuted.
“An effective and carefully managed payroll system can prevent a business ever being penalised and seeking professional advice on setting up such a solution could pay dividends in the long run.”
David added that the National Living Wage is set to go up incrementally to £9 an hour by 2020 and that the national minimum wage for those between the ages of 21 – 24 is also due to go up by 25p to £6.95 this October along with the wages of 18 – 20 which will go from £5.30 to £5.55 per hour.
If you would like assistance with your payroll The Martlet Partnership can help. To find out how, please contact us.
