Essential Business choosing to close?

KeeliBennett

Hi,
We have a garage (MOT & Servicing, Bodywork, Auto Electrics), we are classed as an essential business & so we are currently open. We have two employees (not including the two Directors) who both have young families. Ideally we would like them to both be at home at this time. Because they have just increased MOT's by six months we obviously wont be as busy. Apparently we still have to stay open to help keep vehicles on the road. If we CHOOSE to close , can we furlough our two guys? Will we be able to claim the 80% for them when essentially we are supposed to stay open? There is so much info out there its getting confusing!!

Thank you for your time.

neilmcl

Who's telling you that you "have" to stay open. It's your business, it's your choice. Again it's your choice whether you want to furlough your employees or not.

unforeseen

Garages can only stay open for essential repairs. So that takes out routine servicing and most of the other stuff

Jeremy535897

neilmcl said:

Who's telling you that you "have" to stay open. It's your business, it's your choice. Again it's your choice whether you want to furlough your employees or not.

True. But I assume you also want to stay open, but can't afford to pay both employees? You could apply to the coronavirus job retention scheme and furlough one of them, which seems a bit unfair as one will get at least 80% of their wage for sitting at home, whilst the other has to work full time. As I assume you have a good relationship with the employees, you could explain that you can only afford to pay one of them, and let them choose either to work part time for 50% each, or accept one has to work and one has to be furloughed.

sharpe106

The scheme is meant to be to help companies survive and carry on paying employees instead of laying them off. It is not meant to be so that companies can just shut and hibernate for a few months as they would prefer to be at home. The chances are you will get the money in the short term but I would not be surprised if in the future the government looks back at companies that claimed the money to see if they actually needed to or if they abused the system.

 

If this goes on for a few months and you have shut how do you plan on paying your bills? Another thing to think about before shutting. If you shut down your customers that need urgent work doing will go elsewhere and may not come back again.

 

7Phil

KeeliBennett said:

Will we be able to claim the 80% for them when essentially we are supposed to stay open? There is so much info out there its getting confusing!!

I see you have a mixed responses, even in this post but I think the general consensus is the same. Stay running if you can.

You do provide an "essential" service, even if this is not immediately obvious. Many key workers will now be more reliant on their cars to get to work, in isolation, and because of the loss of regular public transport services this is so much more vital. They will need their cars running. But we do not know the % of your trade (essential maintenance versus optional work) plus where you are located and what demand you have. That's what will make the difference for you. If you have no customers then you gotta shut up shop.

What impact COVID-19 has on your business will depend on the books. If you foresee that you need to go into full on furlough just to keep your business viable then that's what you need to do.
I'd probably check with an accountant regarding advice if you went down this route purely to keep your records straight.

Oh - If you can keep running and you know you are providing a service that people need but it's not great for the business then I appeal to you. Please do what you can and play whatever role you can within the community that helps.

BobQ

Jeremy535897 said:

neilmcl said:

Who's telling you that you "have" to stay open. It's your business, it's your choice. Again it's your choice whether you want to furlough your employees or not.

True. But I assume you also want to stay open, but can't afford to pay both employees? You could apply to the coronavirus job retention scheme and furlough one of them, which seems a bit unfair as one will get at least 80% of their wage for sitting at home, whilst the other has to work full time. As I assume you have a good relationship with the employees, you could explain that you can only afford to pay one of them, and let them choose either to work part time for 50% each, or accept one has to work and one has to be furloughed.

Not sure that the scheme allows people to work part time if the job was full time

selina2000

unforeseen said:

Garages can only stay open for essential repairs. So that takes out routine servicing and most of the other stuff

Not sure what you mean. Are you suggesting garages are not allowed to carry out any preventative maintenance of vehicles such as changing the oil, but have to wait for the engine to sieze up and then can work on it.???

I see no restrictions on the type of work garages can carry out in government guidance.
It sees garages as a whole as an essential service provider, and therefore allowed to operate.

In the same way supermarkets are allowed to open, and continue to sell the clothes lines they offer, whereas clothes shops must close.
 

Jeremy535897

You misunderstand me I think BobQ . I said (perhaps not clearly enough) if you only had enough work and money for one of the two employees, I can think of two options:
1. Furlough one who stays at home on 80% under the scheme and pay the other 100% for a full time job
2. Forget the scheme and pay each 50% for half the hours 
Both options are likely to require amendment to contracts of employment.

HornetSaver

Can I just go on the record in distancing myself from previous responses.

My personal take on it would be, try to stay open a bit longer - perhaps engage the guys to see if one of them would like to use some leave. Use the fact that you're overstaffed to do a good deep clean and to take extra precautions even if this means that work being done is done more slowly. I think you are in a relatively good situation in that it's unambiguous that you are able to stay open, therefore you're in a position that many other businesses aren't - you're able to wait for the detail of the proposals on furlough and for other types of support.

justwhat

unforeseen said:

Garages can only stay open for essential repairs. So that takes out routine servicing and most of the other stuff

Please listen and spread the word , because at this moment in time .this attitude is causing more damage than good. Most electrical goods can still be bought online. And many other things .All deliveries are still being made. Transport and logistics are all still going on.
Most manufacturing is still going on. 
You can stay in your house and still be supplied with most things you normally buy and use.