Do you know all the regulations and legal restrictions that could cost your small business money? Many don’t.
For example, in December 2018, a Liverpool-based bookshop owner was fined £300 for throwing sweet wrappers in a bin. The local authority enforcer who fined her said she was flouting legislation surrounding business-generated waste, which needs a specific licence describing how it will dispose of rubbish. As the business owner couldn’t provide this, they were fined.
Obscure laws and regulations in the UK
Technically, the Council in question is legally entitled to fine this business owner. However, legislation in the UK surrounding what constitutes business waste versus personal waste is not clear. After a public outcry, on this occasion, the council cancelled the fine. During this process, it became clear that many other business owners in the area had no idea that this regulation exists.
Waste regulations are a great example of the kinds of rules that small businesses might be flouting without realising. Small businesses in the UK are at risk of being fined for breaking laws like this. But, with so many in place in different areas, do you know what could cost your business if you break the rules?
Music in the workplace
If you play music in your workplace, you are in contravention of the small print of the Copyright, Designs and Patents Acts of 1988. This Act says that any business playing music on its premises of any kind for either employees or customers to enjoy are technically hosting a ‘public performance’.
This means licenses are needed from PRS for Music and PPL. These organisations are there to make sure artists are paid when their music is broadcast in any public place. These licenses are less than £100 per year to buy for some businesses but can reach up to thousands of pounds in some circumstances.
PRS does carry out spot checks and takes civil and enforcement action against companies that are playing music without a licence. This can prove much more expensive than purchasing the licence to start with.
Are your vehicles covered?
Any business owner or employee that uses a vehicle for work must have in place the appropriate insurance that covers that specific vehicle for that purpose. This means insurance is needed even if it’s the private vehicle of the owner or an employee. If they use it for business, then it needs to be insured appropriately.
As many as 40% of small businesses affected by this don’t have the right motor insurance, according to research from AXA Insurance. And they’re all vulnerable to potential legal action.
Don’t send marketing material without permission
In 2003, it was made illegal to send direct marketing material via text or email without express permission from the recipient. If your business continues to send material like this without the permission in writing, then you’re breaking the law. And in theory, the recipient can press charges and claim damages from your business.
Is your software licensed?
A third of small businesses say they don’t know what software packages are being used in their workplace, says the Business Software Alliance. This could mean their software isn’t appropriately licensed by its publisher. In the worst-case scenario, this could mean their software is pirated.
Ignorance doesn’t count as a defence against IP (Intellectual Property) regulation. If a small business owner can’t show licenses for the software installed on its work network, then enforcement action can be taken.
Display employee liability insurance certification
Legally, all employers must take out employee liability insurance for at least £5million. This pays out if a worker is injured at your place of business or gets sick due to the work they do for you.
Employers also have a legal obligation to display this employee liability insurance certificate on full view of their workforce. If employees can’t easily and readily access this certificate, you are breaching legislation.
Make sure the smoking ban is enforced
In 2007, the Government outlawed smoking in most public spaces and enclosed places of employment. However, it’s not enough to ban smoking in your building. Business owners must display no-smoking signage that meet the required criteria at every entrance to the premises.
The rules surrounding the notices depend on whether the building is used by only members of the workforce, or also by the public.
Enforce age restrictions properly
For small businesses in the retail space, there are age restrictions in place for cigarettes and alcohol. But there are also restrictions on other products, such as Christmas crackers, which can’t be sold to anyone under the age of 12. Retailers should check every product to ensure they’re complying with age restriction legislation.
James Turner, Managing Director of Turner Little Limited says: “This checklist shows just how many regulations affect small business owners. It’s easy to feel you’re on top of everything in terms of compliance, but it’s worth going through every aspect of your business and double checking.
“Issues such as business waste and software licensing can catch out even the most prepared businesses. Small business in the UK are increasingly forming the backbone of our economy, with almost six million now in existence. Cashflow is a crucial aspect of survival into maturation for start-ups and small businesses and ensuring you don’t get caught out with unnecessary fines is a sensible step to take.”
About Turner Little
Founded in 1998 in Yorkshire, UK, Turner Little is a specialist UK and offshore company formation, banking and corporate services provider. Our services include company formation, UK and offshore banking, asset protection, credit correction, trademarking and trusts. Other services include Internet services, mail forwarding, wills and probate. Turner Little’s vision is to offer the best possible service, together with market leading products.