BUSINESS NEWS Elman Wall hosts Covid-19 business advice webinar. Ian Taylor reports


Wratten suggests eight-week period for airline refunds


The Business Travel Association (BTA) is lobbying the Department for Transport (DfT) and Iata to set a realistic deadline for cancelled- flight refunds. BTA chief executive Clive


Wratten said: “Corporates want their money back. Clients of our members are awaiting £200 million in [airline] refunds. “Many airlines have switched off


[automated] GDS refunds, meaning there is a 20-30 week wait.” He told an Elman Wall Covid-19


webinar: “We can’t afford airlines to disappear, so a way forward needs to be agreed. Perhaps we could agree eight weeks. We’re talking to


Clive Wratten


the DfT and the aviation sector. Iata shares the view that we should have consistency on refunds.” Wratten added: “It is very


difficult for airlines, with consumers pressing for refunds.” But he warned: “There will be casualties all around.”


Insolvency expert predicts wave of business failures later in the year


Government support schemes have prevented most businesses failing so far, but insolvency practitioners expect a wave of collapses later this year. Mark Supperstone, managing


partner at business advisory firm ReSolve, said: “There are a lot less failures at present than there were pre-lockdown. Businesses are managing to claim under the furlough scheme and able to apply for loans. Companies are mothballing and creditors allowing them to make arrangements [on debt repayments]. “But there will be a big problem


come the end of summer when the lockdown ends and creditors ask for payments,” Supperstone told an Elman Wall Covid-19 webinar.


Approval for government-backed


loans to businesses from banks is finally coming through, according to Elman Wall head of audit Ian Palmer, who said: “There was a slow start to these schemes. But we’re seeing a lot of applications being approved now and offered on terms that are acceptable whereas at the start the terms were not acceptable to businesses.” However, Palmer said: “We’re not


yet seeing the cash come in. The banks need to speed that up.” And he warned: “We’re seeing a lot of businesses taking loans to pay refunds, so there is a shift from one liability to another. If you’re using a loan to stay alive, not to reorganise your balance sheet, there could be problems down the line.”


‘Jobs at risk when furlough ends’


Employment lawyers warn there could be redundancies across the sector as the government’s employee furlough scheme ends. Rebecca Thornley-Gibson, travel


employment lawyer and partner at law firm DMH Stallard, said: “A lot of companies are thinking about redundancy now.” The government introduced the


Job Retention Scheme to pay 80% of furloughed employees’ wages up to £2,500 a month from March and recently extended the scheme to the end of June. It’s estimated 140,000 UK companies have furloughed four million staff, including many in travel. Thornley-Gibson said: “The


whole spirit of the furlough scheme was to prevent redundancies, but there is nothing in the scheme that expressly rules out redundancies of furloughed employees.” She forecast companies


considering more than 100 job losses travelweekly.co.uk


If firms are looking at 100-plus redundancies when furlough ends, [the notice period] is going to hit mid-May


would be likely to issue redundancy notices soon, suggesting redundancy notice periods could begin while staff are on furlough and “redundancy payments be included as part of furlough wage costs”. Thornley-Gibson told an Elman


Wall Covid-19 webinar: “More than 100 redundancies require a 45-day consultation. So if businesses are looking at redundancies when furlough ends, [the notice period] is going to hit in mid-May.” Elman Wall HR specialist


Claire Steiner agreed, saying: “Furlough was brought in to try


to avoid redundancies, but some businesses are beginning to look at redundancies.” She warned: “If you are, be


careful you follow the [legal] process – that you have a fair reason for redundancies, that you go through a ‘fair’ process and you have the right consultation. You can’t just think about those on furlough for redundancy.” Steiner noted: “Don’t try to wing


it. Take advice, because the advice may change on redundancy notice while on furlough.” Thornley-Gibson added:


“During a redundancy notice period you should pay 100% of normal remuneration, not 80% as under furlough.” The same applies to holidays, she


said: “Staff can take holidays without breaking the furlough scheme, but they have to be paid their full pay on holiday and on bank holidays.”


7 MAY 2020 Rebecca Thornley-Gibson 33


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