Every major legal change from 2018 small business owners need to know
Karen Holden, founder of A City Law Firm, guides small business owners through each major legal and regulatory change from 2018, from GDPR to payslip changes.
With 2018 nearly coming to an end, companies in the UK will have seen a number of changes which will have directly affected them in some way. We also note, from experience, that not everyone is compliant with the new rules and are gambling the odds on who gets fined or investigated first, before companies start to react, which is a risky strategy!
The following is a brief overview of five legal changes which companies and employers should know about from 2018.
This was one of the substantive changes that came about this year affecting all small and large businesses and charities. Brexit or not, the government made it clear at the outset that GDPR will be adopted and it has. 25 May saw GDPR come into force along with the Data Protection Act 2018 which also received royal assent.
The audit, training, deletion, consideration and legal strategies that have been deployed have almost crippled some small businesses, been ignored by others and distracted many who have tried to get this right.
Data protection has now catapulted itself onto the scene and is forcing companies of all sizes to rethink their processes and data handling procedures. Failure to be compliant or those who face breaches could be looking at hefty fines and in some cases prosecutions. You need robust policies, staff training, a contract audit and clear structures and processes in place.
An article published in the Independent, dated 28 August 2018, reported that data breach complaints had increased by 160% since the GDPR came into force. This staggering statistic does not come as a surprise, given the amount of media attention and government campaigns on the subject. It has raised awareness among individuals, giving them more power to control how their data is used and hold businesses to account for their actions.
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One area where there has been a consumer rights change is credit card surcharges and a new law banned any company from charging an additional fee for the consumer using a credit card. Previously, the law allowed companies to levy a surcharge that would reflect the extra costs they faced for processing card payments.
The impact of this had first seen some companies refuse to accept credit card payments however this also had an impact on their customers who wished to pay by card. Instead, companies used other means of covering the costs which also saw a slight increase in their prices for goods and services or large administration fees.
The larger companies were better equipped to absorb this loss however for the smaller companies, it proved to be a balancing exercise between the interest of the business and customer expectations. It is also very difficult to address professional services, who often took their costs and third-party fees, which they now, of course, cannot do if they are left short due to credit card charges. Check your invoices and contracts to ensure you are compliant with these rules and remove all hidden fees.
National Living Wage
2018 saw the increase of the National Living Wage go up to 7.83, an increase of 4.4% on the previous year. This came as welcome news for adults over the age of 25 and it affected millions. The Lord Chancellor in his recent budget announcement declared that this will again look to be increased to 8.21.
Although it has again come as welcome news to some 2.4m people, smaller companies have to consider their own plans to meet this obligation. Most small firms will probably have to look to reduce their profits margins. Failure to do so will risk them being exposed to penalties for failing to meet their obligations. Contracts, recruitment and pay need to be at the forth front of employers reviews this year.
Karen Holden is an award-winning solicitor and founder of A City Law Firm (ACLF), the go-to lawyers for entrepreneurs, startups, scale-ups, those seeking investment. In addition to being very successful lawyers for businesses , ICOs and family law, ACLF are now the UK's leading LGBT law firm and surrogacy specialists. Karen is a regular media commentator, panellist and event speaker.