Sage One Payroll has been created to help firms with 15 or less employees to pay staff quickly and accurately. It contains a number of features that save entrepreneurs valuable time, including:

• Automatic recording and updating of P11 records;
• Retrospective correction facility that means if a mistake has been made with pay earlier in the year it is easy to correct and ensures employees are compensated in the current pay run;
• Ability to export data for payroll year-end reports directly to HMRC website, eliminating the need to re-enter data.

Because the software integrates with Sage One Accounts, it helps provide a real time perspective on a business’ cash flow and can automatically make the information available to your accountant.

Chris Stonehouse, head of Sage Online, commented: “Sage has a fantastic pedigree within the payroll software space and this expertise has helped shape and inform our first SaaS payroll product. We also spent a lot of time consulting with small businesses and their insights fed into every element from the design to the language used, enabling us to create what we believe is one of the industry’s most user-friendly pieces of software for processing the pay run.”

Costing £5 per month for up to 5 employees, £10 per month for up to 10 employees and £15 per month for up to 15 employees, Sage One Payroll is one of the best value for money payroll software packages available. Until July 2012 it is available to businesses for free.

New statistics into the barriers small businesses face when starting-up show that 27 per cent of small businesses found it difficult to find suitably skilled staff. With unemployment at 2.62 million and youth unemployment more than a million and set to rise next week, this is a worrying figure.

Respondents to the FSB ‘Voice of Small Business’ Survey Panel also said that they found regulation requirements onerous (47 per cent) and had difficulty securing finance (34 per cent) at start-up.

These figures come as the FSB and APPSBG are launching an inquiry with Iain Duncan Smith, Secretary of State for Work and Pensions, into entrepreneurship to see how these barriers can be removed. With 95 per cent of private sector businesses employing less than 20 members of staff, the inquiry will look at how these firms can be encouraged to take on staff and how budding entrepreneurs can be supported in setting up their own business against a backdrop of uncertain economic times.

The Government has introduced a raft of new measures aimed at supporting entrepreneurs, however, the FSB’s ‘Voice of Small Business’ Index shows that employment intentions and business confidence has dropped. For small businesses looking to grow, there are still fundamental problems with hiring skilled staff, regulations and access to finance.

The FSB is calling on the Government to:

• Reinstate the graduate internship scheme to give graduates the opportunity to acquire the skills they need for starting and running a business
• Prioritise enterprise education by putting it in the statutory curriculum
• Take on the Independent Commission on Banking’s recommendations to create more competition in the banking sector
• Extending Work Trials to the first day someone signs on to Jobseekers Allowance to help create 46,000 more jobs
• Reduce the flow of regulation and tackle the stock of existing regulations

John Walker, national chairman, Federation of Small Businesses, said:

“Challenges posed to entrepreneurs will always vary, but we know from our members that common issues at start-up stage include, finding suitably skilled staff, complex regulation and access to finance. And coming up against these at the very beginning of their entrepreneurial career can prevent them from growing. With the private sector being relied on to drive economic recovery, these barriers need to be removed – budding entrepreneurs should be supported in setting-up in business, and existing businesses should be encouraged to innovate, take on staff and grow. This inquiry into entrepreneurship will cover a raft of issues and working with the Government, we hope that these issues can be put to bed once and for all.”

Brian Binley MP, chairman of the Small Business APPG, said:

“We hear from small businesses time-and-time again that they are finding it difficult to get staff with the skills necessary to run their businesses. Small and medium sized businesses and entrepreneurs are expected to be driving economic growth in support of Britain’s recovery but they are finding it difficult to get the right people to help them in that task. I am hopeful that this inquiry will go some way to addressing the challenges of rising youth unemployment and the skills crisis we have thanks to the legacy left by the previous government.

“I know that John Hayes, the Skills Minister, is working hard to bridge the skills gap which is especially important to the precision engineering companies in my own constituency of Northampton. However, John Hayes’s work is being hampered by the poor performance in our primary and secondary schools, especially with regard to literacy and numeracy and whilst Michael Gove, the Education Secretary, is pulling out all the stops there is still a lot to do. Our review will be looking at ways of improving those basic skills as well as the more advanced skills required to meet industry’s needs.”

Sage Employee Benefits offers small business owners the opportunity to provide benefits packages including medical, life insurance, income protection, pensions, travel and dental insurance. Provided via Mercer’s mercer-elect solution, the service harnesses Mercer’s strong relationships within the insured benefits market developed from its work with multi-nationals. The proposition is designed to give SMEs – looking to provide cover for up to 100 employees – access to competitive rates and leading benefits normally only available to larger organisations.

“Whilst most employers understand the significance of offering a benefits package, SMEs still have concerns regarding costs and the time required for administration. That’s why Mercer and Sage launched Sage Employee Benefits with mercer-elect. Designed with small business owners in mind from day one, it makes bespoke benefit packages simple to roll out and easy to manage at an affordable price,” explained Matthew Forrest, head of services, Small Business Division, Sage UK.

The Sage Employee Benefits solution simplifies the administration associated with running a benefits scheme by providing a secure online portal, which both employers and employees can access via their PC anytime they need information. The ‘anytime access’ helps free up entrepreneurs’ time allowing them to spend more time focusing on running their business.

Users of the service also benefit from access to Mercer’s teams of specialist advisors who provide expert guidance and insight on the latest legislation and market developments. This is all aimed at ensuring that SMEs are getting the most value from their packages.

“To think that employee benefits packages are the exclusive preserve of big business is simply wrong. When the changes brought about by the Pensions Act 2008 start to come into effect from next year, employer provision and contribution to pensions will switch from ‘nice-to–have’ to legal necessity for all organisations over the next few years,” commented Simon Griffiths, principal at Mercer. “At a time when pay rises, if they occur at all, are below the rate of inflation, employees are placing great value on the other benefits that their employers provide. We’re very pleased to be working with Sage and making the type of benefit that multinational employees enjoy as standard, available to the small business community.

Long term sickness absence does not affect the smallest of businesses frequently, but when it does it has a big impact and the costs can be high. The FSB’s ‘Voice of Small Business’ survey panel shows that on average small businesses only experience 2.4 days sickness absence per employee each year – much lower than the national average 7.7 days per employee – 25 per cent said that they experienced no sickness absence at all and 81 per cent said that they were not at all affected by long-term sickness absence.

However, in the last 12 months sickness absence cost firms on average £1,500, but for nine per cent it cost more than £5,000. So it is important that the Government does more to help with the costs of sickness absence in the smallest firms.

Currently, some small businesses can feel confused by the Percentage Threshold Scheme – the current system used to calculate how much SSP an employer can claim back. This means that many small businesses either have to spend time doing difficult calculations or they have to spend money on buying in help.

With 40 per cent of small business employers claiming that dealing with holiday entitlement and sickness absence was one of the most difficult aspects of employment law, the FSB believes that recovery needs to be simplified so micro firms can reclaim all SSP costs more easily to stop them from being hampered at such a difficult time.

The FSB is calling on the Government to introduce a small employer’s relief for all firms with an annual National Insurance Contributions bill of less than £45,000 to recover SSP. This relief would be like that used for reclaiming statutory maternity pay and would use the same calculations. As a result, it would ease the administrative burden, as well as helping businesses manage sickness absence better.

Small firms care about their staff and want to invest in their health where they can. However, Government must understand the pressures small firms are under, and that this is one pressure among many. This needs to be recognised within the soon to be published independent review into sickness absence.

It will also need to recognise that small firms are not able to cope with an increase in the burden of responsibility or an increase in regulation, but that by better supporting small businesses, they could be able to improve the way that they manage sickness absence.

The Government should look at improving the way the Fit Note is used by making it electronic and increasing the training that GPs are given on how to use it.

Small businesses also need better access to free occupational health advice either through GPs or via the national occupational health phone line to make this issue easier to manage.

John Walker, national chairman, Federation of Small Businesses, said:

“Small firms act like a tight knit family and value the contribution their staff bring to the business. And research shows that staff in smaller firms are more often committed and loyal. But sickness absence is one of the most complex pieces of employment law they have to deal with. It can also be costly with small businesses paying around £1,500 over the past 12months. The Government must provide a small employers relief for statutory sick pay in the same way they do for statutory maternity pay so those small businesses that experience a member of staff on long-term sickness absence, are not hampered and are given the support they need.”

Today’s decision will see the qualification period for the right to claim unfair dismissal extended from one to two years. This will come into force on 1 April 2012. This is the latest development in the Government’s workplace reforms which aim to increase business confidence to take on more workers.

Changes to the unfair dismissal rules follow the ‘Resolving Workplace Disputes’ consultation published in January this year which also proposed measures to encourage early resolution of disputes, the speeding up of the tribunal process and measures to tackle weak and vexatious claims.

These combined proposals should see the number of unfair dismissal claims drop by around 2000 a year.

Business Secretary Vince Cable said: “The priority of this government is to increase growth in our economy. We have one of the most flexible labour markets in the world but there is more we can do to give British business the confidence it needs to create more jobs and support the wider economy to grow.

“Businesses tell us that unfair dismissal rules are a major barrier to taking on more people. So today we have announced that only after working for the same employer for two years can an employee bring an unfair dismissal claim.”

A key part of the Government’s growth strategy is to create the conditions which allow businesses, particularly SMEs, to grow and expand by reducing regulation and maintaining a flexible and dynamic labour market.

Over the past 18 months, the Government has started a fundamental Employment Law Review to ensure that it is fit for purpose, that it properly balances the needs of employers and employees, and provides the competitive environment required for businesses to thrive.

For the next three weeks the Red Tape Challenge will focus on more than 160 different cross-Government employment related regulations that businesses have to deal with in all areas of the workplace.

The campaign asks for a variety of suggestions about how regulations can be improved, simplified or even abolished, whilst also ensuring that the current standard of employment rights for employees are maintained. Examples of regulations which Government is seeking views on include the rules on collective redundancies, employment agencies, immigration checks, the National Minimum Wage and statutory sick pay, to make sure they are fit for purpose and easier for businesses to understand.

For the next three weeks the Red Tape Challenge will focus on more than 160 different cross-Government employment related regulations that businesses have to deal with in all areas of the workplace.

The campaign asks for a variety of suggestions about how regulations can be improved, simplified or even abolished, whilst also ensuring that the current standard of employment rights for employees are maintained. Examples of regulations Government is seeking views on include the rules on collective redundancies, employment agencies, immigration checks, the National Minimum Wage and statutory sick pay, to make sure they are fit for purpose and easier for businesses to understand.

Business Minister David Willetts said: “Businesses regularly tell us that the burden of regulation is too high. So today we are giving them a chance to tell us exactly which rules they think need to be reformed. The Government is committed to growth and the Red Tape Challenge is one way to make sure that we are getting out of the way and letting businesses do what they do best – taking people on and boosting the economy.”

Employment Relations Minister Edward Davey said:

“We often hear from businesses that employment related regulation holds them back from growing their firms and employing more people. Whether it is the filling out of endless forms when you hire your first member of staff, the complexities of letting somebody go, or simply manage staff on a day-to-day basis, we want to review these regulations with the aim of giving business more confidence in employing people and creating more jobs.

“We are determined to tackle unnecessary, burdensome red tape that harms job creation and means employers spend less time running their business. But this does not mean this will result in a watering down of employee rights. Today we are launching a real debate with employers and employees, to listen to their thoughts and act on what regulations can be simplified, merged and abolished. This is your time to get involved and have your say on your employment law bugbears.”

Group Chief Executive of Bio Group and Sector champion for the employment law theme Steve Sharratt OBE said:

“In business we often feel our voice is not heard in Whitehall, yet I think this is a real opportunity for SMEs to impact on Government thinking and policy on employment regulation. Let’s see what business can do in making a difference, by saying loudly and clearly what is good and bad in the current regulations, what is effective and what is frankly ridiculous and how business believes regulation can be made shorter and simpler.”

The Government will publish the results of the employment related law Red Tape Challenge theme later this year. A discussion paper, entitled ‘Flexible, effective, fair: Promoting economic growth through a strong and efficient labour market,’ has also been published today. This paper sets out the principles that are guiding our approach to reform of the labour market framework along with a number of thematic questions.

John Walker

Small firms would employ new staff if the Government reduced National Insurance Contributions (NICs), new figures from the Federation of Small Businesses (FSB) confirm.

Businesses continue to be stifled by challenges that affected them during the recession, including late payments from other firms and a lack of finance from the banks, which forced many small firms to close. Despite tentative economic growth, many small firms say these issues continue to prevent them from taking on staff. While FSB members have said they are supportive of the Government’s plans to cut the deficit, policies such as cutting NICs have to be at the heart of plans for growth.

The FSB’s ‘Voice of Small Business’ survey, with more than 1,700 respondents, showed that insufficient work and uncertainty over contracts (37 per cent), the state of the economy (33 per cent), cash-flow (31 per cent) and access to finance as well as the cost of credit (16 per cent) are preventing them from employing.

With 2.46 million people out of work, the FSB believes that it is crucial that the Government provides incentives to help small businesses to take on staff and tackle unemployment.

According to the survey, ensuring invoices are paid within 20 days would encourage 17 per cent of small businesses to take on staff.

Most significantly, nearly a third (31 per cent) of respondents said that reducing NICs payments for the first six months of employment would encourage them to take on more staff, and 11 per cent said extending the NICs holiday scheme would be an incentive.

The Government introduced a NICs holiday for start-ups that take on up to 10 employees in 2010, but the FSB believes this does not go far enough. The FSB is urging the Government to extend the NICs holiday to existing firms with up to four members of staff that take on up to three new employees.

The FSB is also calling on the Government to help small businesses employ more apprentices and interns: 29 per cent of respondents said increased support would encourage them to take these on.

“Throughout the recession, we all heard the struggles small firms faced as many had to shut up shop because they were being paid late, and couldn’t access finance from the banks, leaving their cash-flow in a volatile position. While our members have told us the situation has improved slightly, these same issues are now preventing small firms from taking on staff – crucial if the country’s small firms are going to help to secure and promote recovery.

“It is not only imperative that the Government creates an environment for job creation, but that the banks lend to small firms and businesses are paid on time, to give small firms the confidence they need to grow their business and employ.”

The new ‘Workplace Pension in a Box’ has been developed in partnership with HSBC and has agreed service standards, which have been specifically designed for businesses with fewer than 20 employees. It is a simple, plug-and-play pension scheme, which is easy to administer and will be used to meet the employer’s pension reform duties.

The new pension solution comes at a time of wide-ranging reform to pension provision in the UK. From October 2012, phased in by size of firm based on number of employees, employers will have to automatically enroll eligible staff into a pension scheme. Business owners will have to pay a minimum percentage of an employee’s salary into the company scheme.

However, a majority of SMEs are concerned about the potential financial implications of government plans to overhaul pension provisions, a new survey has indicated.  Research conducted by the Association of Consulting Actuaries (ACA) found that 53 per cent of the 404 SMEs polled believed the reforms will “significantly add to costs”, while 29 per cent said they may cut pension contributions as a result.

David Taylor, managing director of Towergate Financial, said: “We know that small firms do not feel confident in choosing a pension scheme because of its complicated nature and costs. So we have developed with HSBC a simple and cost effective solution, our ‘Workplace Pension in a Box’, which will enable SMEs to be ahead of the new legislative changes which will also help with their budgetary planning. Acting now is also a positive move for staff who will be reassured that their employer is making plans for their pension provision.”

Rob Pearce, head of workplace retirement services, HSBC, adds, “Many employers and their advisers want to offer a pension which meets and exceeds the minimum standards of NEST. A lot of emphasis is placed on larger schemes, but we have developed with Towergate Financial an ideal solution that meets the requirements of NEST and the demands of the SME market.

“HSBC is committed to helping individuals prepare for their futures and we will continue to work in partnership with corporate advisers to put in place the right solutions for employers and their employees.”

Total Reward Statements will be offered alongside group personal pensions and give employees an online personal statement of their benefits package including salary, bonus, pension, medical insurance, health screening, life and critical illness insurance, car allowance and holiday.

The launch underlines Aviva’s strength in the workplace savings market. The technology is provided by Staffcare, an award-winning employee benefits software company that licenses its technology to many of the UK’s leading employee benefit consultants and corporate advisers.

Paul Goodwin, head of pensions marketing at Aviva, said: “Aviva research shows that companies’ employees want to view and manage their benefits in one place. Aviva’s Total Reward Statement is ideal for employees because it enables them to understand and manage their workplace benefits. For example, people are more likely to save into a work pension if they can see how much it is worth and how much it grows each year.

“It’s also good news for employers because it helps with staff retention and can make it simpler to communicate the benefits offered by the whole staff benefits package. We expect the workplace savings market to grow fast over the next few years, and it’s one in which Aviva will play a leading role.”

Total Reward Statements will be offered alongside group personal pensions. They will carry individual companies’ branding and give staff a personal statement of their benefits package including salary, bonus, pension, medical insurance, health screening, life and critical illness insurance, car allowance and holiday.

Information is presented in graphical format so that employees can see a consolidated reward statement and have access to more information including benefit descriptions, booklets, and application forms if required.

The technology is provided by Staffcare, an award-winning employee benefits softwarecompany that licenses its technology to many of the UK’s leading employee benefit consultants and corporate advisers.

Paul Goodwin, head of pensions marketing at Aviva, said:

“Aviva’s Total Reward Statement is ideal for employees because it enables them to better understand the value of their workplace benefits; the advantage for employers is that it improves staff engagement. An increasing number of employers are using Total Reward Statements and entering the workplace savings market. We expect that this will be a growing market over the next few years, and one in which Aviva will play a leading role.”

Phil Hollingdale, Staffcare’s founder and CEO, said:

“We are seeing an increasing demand for our software as companies seek to improve their return on the money they spend on staff benefits by raising employee awareness and appreciation through online total reward statements. Many companies recognise that they could do a better job of communicating benefits to employees and old methods of communication such as printed handbooks and face-to-face meetings do not meet the demands of today’s internet-savvy employees who are used to information on demand.

“Many leading employee benefit consultants and corporate advisers have already embraced our software. Aviva is the first product provider to license our software and we are excited to be working with them.”