New work-place legislation is only round the corner warns ACCA
Businesses need to prepare now for the introduction of new legislation which will come into effect on 1 October, advises ACCA (the Association of Chartered Certified Accountants).
John Davies, head of business law at ACCA says: “October 1 represents the second key date of 2008 for the introduction of new business legislation, under the Government’s system of storing up new workplace measures for release just twice a year”.
The key points of the legislation coming into effect in October are as follows:
1. Company law
There will be a new minimum age (16) for service as a company director.
A limited company may not act as the sole director of another limited company – although it can still act if there is another director who is a human being.
The rules regarding disclosure of trading information by companies (on stationery and websites) change. There is a new entitlement, for the benefit of companies in multi-occupancy premises, for company names to be displayed on an electronic screen, as long as each company name is visible for at least 15 continuous seconds in every three minutes.
Private companies will no longer have to go to court to gain approval for a reduction of their capital. In future, they can choose instead to pass a special resolution of shareholders and get the directors to make a declaration of solvency to the effect that the company will still be able to pay its debts over the next 12 months.
Again in the case of private companies only, annual returns made up to 1 October or after will not be required to disclose the addresses of the company’s shareholders.
2. National Minimum Wage
The standard rate goes up to £5.73 an hour. The rate for those aged 18 to 21 rises to £4.77 and, in the case of 16 – 17 year olds, to £3.53.
3. Consumer credit
All businesses licensed by the OFT will be required to provide borrowers with much more information about their accounts, such as an annual statement and regular notices when consumers fall into arrears or incur a default sum. Debt administration service providers and credit information (repair) service providers will need a consumer credit licence as these services will become regulated by the OFT.
New rules to protect consumers in respect of doorstep selling are also coming in on 1 October. Currently, consumers have a seven day cooling off period and cancellation rights when they agree to buy goods or services worth more than £35 from a trader during an unsolicited visit to their home. These rights are extended. They will cover contracts that are made during both solicited and unsolicited visits by traders. The regulations will apply to all contracts with a total payment of more than £35 and they will set the cooling off period to a minimum of seven calendar days. The regulations also require cancellation rights to be clearly and prominently displayed in any written contract or provided in writing if there is no written contract.
4. Estate Agents
All estate agents that deal in residential property will be required to belong to an independent approved ombudsman scheme which will determine disputes between estate agents and buyers or sellers of residential property. Estate agents that fail to join an approved scheme will be subject to a £1,000 penalty charge, which can be repeated if necessary, and will ultimately be banned from carrying out estate agency work if they refuse to join a scheme.
Businesses should also note that female employees whose expected week of childbirth begins on or after 5 October 2008 will enjoy the same contractual benefits during additional maternity leave as they enjoy during ordinary maternity leave.
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Notes to Editors
1. ACCA is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. We have 325,606 students and 122,426 members in 170 countries worldwide.
2. ACCA believes that globalisation of business requires one set of reporting standards. We favour principles-based, not rules-based standards, which is why we support the worldwide implementation of IFRS.
3. ACCA believes that tax systems should be transparent, simplified, fair and certain.
4. Complying with regulations affects SMEs disproportionately, which is why ACCA urges governments and standard setters to ‘think small first'’.
For further information please contact:
Sharon Garfinkel, ACCA UK phone: +44 (0)20 7059 5788 e mail: sharon.garfinkel@uk.accaglobal.com