BMF policy updates

The challenge continues    


John Newcombby John Newcomb, BMF Managing Director
18 August 2017


Coming just days after the General Election, the theme of our recent Conference, Change Challenge and Opportunity, could hardly have been more appropriate. The feedback from delegates confirmed that the speakers’ thought-provoking presentations continued to resonate as the attendees returned to business back home.  

In times of rapid change, It is more important than ever for the industry to have opportunities like this to come together  to consider not only the issues affecting them today but also those about to come over the horizon.  It will be interesting to see what the talking points are next summer when the industry meets on the stunning shores of Lake Maggiore for the NMBS All Industry Conference 2018.  

Staying on track  

Over the last five years the BMF has developed and implemented a strategy that has seen positive benefits for every sector of the building materials supply industry.  The result has been a surge in membership amongst general and specialist merchants and their suppliers of every size and in every part of the country.  In July, we welcomed our 600th member, swelling our numbers to their highest since 1995.  

This is a significant milestone. As the fourth largest construction trade organisation in the UK our views are increasingly sought by policy makers at every level of government. Our voice is also receiving greater exposure in both mainstream and digital media, helping to build wider understanding of the merchant industry  

As our membership grows we need to ensure that the BMF continues to meet their needs.  The BMF Board is tasked with challenging the status quo and making sure that our strategy is fit for purpose.  BMF board members serve a maximum term of six years and three new directors attended their first board meeting in July, which, coincidentally, met for the first time in Northern Ireland.  As we move forward holding board meetings in our new BMF Regional Centres of Excellence around the UK will help us to keep in touch with the wider BMF membership.  

Our three new directors, Andrew Harrison of Travis Perkins plc, Shanker Patel of Lords Group and Ian Haldane of the Haldane Shiells Group, bring a wide range of experience to the board and their varied backgrounds are in keeping with the BMF’s broad membership. Ian and Shanker have both overseen major growth within family-owned businesses operating in distinct areas.  Andrew has served in senior roles in both a large regional operation and in the UK’s largest merchant business. In his latest role, as Deputy CEO of TP's Plumbing and Heating Division, he will also add to the BMF’s understanding of a fast-growing cohort within our membership.  

Celebrating success  

This year, for the first time, we partnered with the FMB’s Master Builder of the Year Awards, to identify some of the best merchants in the country.  The Master Builder of the Year Awards celebrate the work of small and medium sized builders who have demonstrated excellence both in their standard of work and their customer service.  Similarly, the BMF Builders Merchant Award turns the spotlight on local merchants who have focused on customer service to drive new business growth.   We were delighted with the response and the quality of the entries and along with the FMB, we had a hard task selecting the six regional winners, listed below:  

Midlands                            E H Smith
North                                  Milford Building Supplies
Northern Ireland              Haldane Fisher
South                                  Parker Building Supplies
Scotland                             Beatsons Building Supplies
Wales                                  LBS Builders Merchants  

We wish them all luck as they go forward to the national final.  The overall winner will be announced at an Award Ceremony on 15 September and the BMF will be there, along with the six finalists, to celebrate their success.  

This article appeared in the July/August 2017 edition of Builders' Merchants News
John Newcomb
The challenge continues
The challenge continues. Read John Newcomb's latest column which appeared in BMN July/August 2017. Coming just days after the General Election, the theme of our recent Conference, Change Challenge and Opportunity, could hardly have been more appropr

Prospering in changing times  


John Newcombby John Newcomb, BMF Managing Director
25 June 2017

Nothing is more certain in life than change.  This time last year, the Brexit vote hadn’t happened and David Cameron was still Prime Minister.  Much has changed since then and will continue to do so. I’m writing this in the week that the major political parties publish their election manifestos.  By the time you read it, we will know the colour and shape of our new government.  

Whatever the result, we will continue to press the government of the day to commit to three key policies supported by BMF members, namely  

  • action on air quality, where the last Government’s air quality proposals missed a golden opportunity to modernise the use of larger vehicles in cities 
  • progress towards a custom agreement based on low or zero tariffs after Britain leaves the European Union  
  • a commitment to ensure that the construction industry has skilled people in place to keep Britain building.  

By now we may also be clearer on the type of Brexit we are heading towards, which will inevitably bring about more change. I am a great believer that out of change and challenge comes opportunity and I’m sure that this is a message that delegates at this month’s BMF Conference in Budapest will hear repeated by our speakers.  

Successful businesses are the ones that can adopt and adapt to change and use it as a vehicle to improve their business performance.  They are also the businesses that are in touch with every facet of their industry.  Having a strong trade body at the centre of that industry is equally important, and the BMF has a clearly defined strategy that places the needs of our members at the heart of our business.  

Supporting our members 

As we look to the future, BMF members will be able to tap into 5 core benefits in key business areas.  

The first is training, in particular the launch of our new Apprenticeship Training Agency, which is set to triple the number of Apprenticeship in the Merchant sector by 2020.  

The second focuses on the development of digital technology and the trade’s continuous thirst for instant information. Here we are driving through the launch of our new Member Engagement system and increasing the number of training courses and forums focusing on digitisation in the merchant sector.  

The third is the provision of accurate market data. Adding to our established BMBI monthly sales data, we will be launching a new forecasting model to provide a more accurate view of the industry's future.  

The fourth core benefit is the continuation of our many networking events, not only Conference and Members Day but also smaller-scale product category and job specific forums that bring suppliers and merchants together to form ever closer working relationships.  

Finally, we are adding value to our merchant members’ business by driving builders, plumbers, installers and decorators to their branches through the new BMF App and through advertising programmes with key strategic partners such as the FMB, the NFRC and the CIPHE. 

Strong partnerships  

The BMF looks for strategic partners to support its work and benefit members. Our latest agreement is with the Institute of Builders Merchants (IoBM). The aims of the two organisations are well aligned. While the BMF represents merchant and supplier companies, the IOBM represents the individuals whose skills and professionalism help make those companies succeed.  Our new strategic partnership will see the two bodies working together more closely to develop the professionalism of the industry.  

The IoBM will promote learning and development across the builders merchants sector, ensure the availability of suitable training and continue to fund training for deserving individuals in support of their personal development. Wherever possible, that training will be provided by the BMF and the IoBM will independently accredit the BMF’s training courses. Applications for IoBM funding will now be open to employees from all BMF member companies, both merchant and supplier  

While the two bodies will operate as separate entities, the BMF will support and promote the IoBM, offering Affiliate membership free of charge to all BMF member company employees.

For the health and wealth of our industry, the dual support of a relevant and progressive trade body and a strong professional institute promoting lifelong learning will offer a great way forward.     
                

This article appeared in the June 2017 edition of Builders' Merchants News

John Newcomb
Prospering in changing times
Prospering in changing times. John NewcombNothing is more certain in life than change. This time last year, the Brexit vote hadn’t happened and David Cameron was still Prime Minister. Much has changed since then and will continue to do so. I’m w

The National Minimum Wage Act 1998 and National Living Wage 2016  


In the April 2016 edition of “Business News”, the BMF told its members:      


National Living Wage comes into force   The new mandatory National Living Wage has come into force, requiring employers to pay workers aged 25 and over at least £7.20 an hour. It is expected to give 1.3 million workers an immediate pay rise.          

In the Summer 2016 edition of “One Voice” the BMF published a 1½ page article on the NMW and NLW:  



Rewarding your staff: The National Living Wage  

The arrival of the new National Living Wage has been widely trailed in newspaper, television and radio adverts. But in the weeks since it became law, hidden consequences have begun to emerge.  

Several high-street businesses have been pilloried by press and politicians when changes they made to staff terms and conditions became public. It began when a whistleblower at B&Q leaked a letter to “The Times”. In it, management is alleged to have threatened to dismiss staff unless they sign a new, less-generous contract. Brett Amphlett, BMF Policy & Public Affairs Manager, discusses the main issues for merchants:  

In his July 2015 Budget, the Chancellor of the Exchequer announced he would legislate to impose a new National Living Wage, over and above the National Minimum Wage. As the name suggests, it is all about living standards and aims to boost the pay of entry-level workers. It is part of complex, but concerted, moves by the Conservatives to reconfigure the system of welfare and benefits payments and business taxation and tax credits.  

Rates and eligibility  

The key determinant is the age of your staff: If they are under 25, you must pay the National Minimum Wage.  If they are aged 25 and over, you must pay the National Living Wage.  

National Minimum Wage (NMW)  

There are four hourly rates in law and they are increased annually on 1 October for all staff. Today, BMF members ought to be paying:  

  • 16 to 17-year old rate = £3.87
  • Youth Development Rate for those aged 18-20 = £5.30
  • Adult Rate for those aged 21-24 = £6.70
  • Apprentice Rate = £3.30  

The Apprentice Rate applies to:  

  • all apprentices in their first year and
  • 16 to 18-year olds in any year of the apprenticeship.  

Otherwise, apprentices are entitled to the rate that relates to their age. If you provide staff accommodation, it can be taken into account at a daily rate of £5.35. These hourly rates will rise again on 1 October in line with above-inflation increases announced in the March 2016 Budget.  

National Living Wage (NLW)  

The Government has introduced a new hourly rate for all full and part-time staff aged 25 and over. The National Living Wage with effect from 1 April 2016, at a starting rate of £7.20. It is, in effect, a 50p premium on the NMW Adult Rate and is now the top rate of the five statutory rates. Over time, ministers will ratchet the NLW up every April so that it reaches over £9 by 2020 - in other words, a legally-enforceable 6% year-on-year pay increase.  

Annual uprating is due to be aligned in April 2017 because at present, NMW increases occur in October, whereas NLW occur in April. This is sensible, but it means that until next April, there are different dates for increases, depending on staff age.  

Enforcement  

The Conservatives are determined to see through these changes that were in the General Election Manifesto. The HMRC will enforce rates more vigorously than before, with harsher penalties. Employers found guilty:  

  • will have to pay arrears owed, plus a penalty, up to a maximum penalty of £20,000 per worker
  • are likely to be disqualified from being a company director for 15 years
  • will automatically be ‘named and shamed’ by the Government.  

HMRC’s enforcement budget is being doubled and a new team established to bring criminal prosecutions against firms that do not pay the correct rate. Given other policies like protecting the term ‘apprenticeship’ from misuse by dodgy training providers and the Apprenticeships Levy, the HMRC is bound to focus on enforcing rates and rules for apprentices. NB: after apprentices aged 24+ finish their first year, they become entitled to the National Living Wage (£7.20), not the Apprentice Rate (£3.30).  

The Minimum Wage was flagship Labour Party policy at the 1997 General Election and became law in April 1999. The Conservatives have now gone further and ministers have begun a complex set of policy, tax and regulatory changes (all at the same time) to boost productivity. Mr Osborne wants to correct an anomaly where taxpayers subsidise employers who pay low wages.  

To offset the impact, the Chancellor is exempting small firms from National Insurance Contributions and cutting Corporation Tax to 17% by April 2020. Mr Osborne argues that higher wages lead to greater spending that would ultimately lead to the creation of more jobs in the wider economy. But others are not so sure. The Office for Budget Responsibility warns of the hidden cost of ‘wage spill-over’. This is where employers have to boost other staff wages to maintain pay bands - especially if they have no choice, for example, if set out in employment contracts.  

A furore caused by businesses that withdrew benefits like Sunday and Bank Holiday pay, overtime, and time off in lieu for unsociable hours has erupted at Westminster. A 130,000-strong petition calling for B&Q to ditch its changes led to a House of Commons’ debate. MPs revealed tactics used by firms to lessen the impact by clawing back allowances or premiums.  

The Government is taking a firm line and is putting pressure on companies. On ITV, the Chancellor warned that by cutting perks, firms are not acting in the spirit of the law and they should abide by their responsibilities. Replying to the debate, Business Minister Nick Boles urged MPs to tell him of firms not upholding the spirit of the law, so ministers can embarrass employers and apply pressure so they live up to their legal obligations.  

To conclude, the BMF has no problem with the National Living Wage. The last BMF Remuneration Survey showed that average wages for merchants’ staff are £16,000- 20,000 pa. For managers, salaries go up to £30,000 or beyond. BMF members tend to offer better terms and conditions than DIY retailers. When the B&Q leak broke, the BMF wrote to “The Times” to give a more balanced view of our supply chain. We emphasised that BMF merchants have a much bigger share of the market than B&Q – approximately 4,500 outlets compared to their 750 stores.  

No-one fully knows what the impact will be in relation to pay, productivity and employment. The Government admits it is likely to mean job losses. The National Living Wage will raise the pay of entry-level workers to (as yet) untested levels. One aspect is certain: if you already pay over the legal minimum, the NLW will catch up with you. Higher pay you offer today will be eroded over time and no longer act as a premium to retain or recruit staff. For more information, please go to www.gov.uk/national-minimum-wage or www.livingwage.gov.uk.                     


The official HM Government webpage that gives statutory guidance to employers is at: https://www.gov.uk/national-minimum-wage  
The National Living Wage
The National Minimum Wage Act 1998 and National Living Wage 2016

The Bribery Act 2010


The Bribery Act 2010In the April 2011 edition of “Business News”, the BMF told members:  


Bribery Act 2010

The Bribery Act comes into force on 1 July 2011. A Briefing '10 Things Every Employer Should Know About the Bribery Act 2010' was prepared by the BMF's Employment Adviser and is available from brett.amphlett@bmf.org.uk.


Click here for the official HM Government webpage that gives statutory guidance to employers.
The Bribery Act 2010
The Bribery Act 2010 | Guidance to help commercial organisations prevent bribery

Does the Modern Slavery Act 2015 affect your building materials business?

Modern Slavery Act 2015In the February 2016 edition of “Business News”, the BMF told members:


Modern Slavery Act 2015 – does it affect your business?

BMF’s employment lawyers Halborns outline the new requirements of the Modern Slavery Act 2015

What do I need to know about the Modern Slavery Act 2015? (MSA)
If you turnover £36M or more you must publish an annual statement of the steps your business is taking to ensure human trafficking and slavery is not present in your business or supply chains. As you’d expect, detailed definitions of the offences of slavery and human trafficking are set out in the MSA but essentially amount to forcing people to work or travel against their will.

How do I comply with the requirements?
There is no law on the exact wording that the statement should take. It should include:
1. Details about your supply chains;
2. What steps you have taken to check whether slavery and human trafficking has tainted your business or supply chains;
3. Which areas of your business or supply chains might be at risk of slavery or human trafficking (if any), and any steps you have taken to assess and manage those risks (and whether they have been effective);
4. Any training you have provided to your team to ensure that slavery and human trafficking is identified and dealt with.

When do I have to publish a statement by?
Any business with a financial year end on or after 31 March 2016 must publish the statement within six months of the end that financial year, and then annually from then onwards.

What happens if I don’t comply?
You can be forced to comply by the Secretary of State through court proceedings.

The BMF advises those members who were interested in advice on the Modern Slavery Act contact either Halborns direct on 0115 718 0333 or via the legal helpline on 0870 420 7373. Halborns will talk you through the process and explain the requirements of the Act.

Halborns will issue you with a document that explained this and would enable you to draft your own statement based on a structure set out in the document. Halborns will need to charge a nominal fee for doing so of £100 + VAT a time. This would both be to cover costs in giving the telephone advice and to reflect the fact that the member would be relying on Halborns professional indemnity insurance   


In the November 2016 edition of “Timber Forum News”, the BMF told members: 

BMF & TTF launch guides to the Modern Slavery Act 
The Builders Merchant Federation and the Timber Trade Federation have produced member guides to the Modern Slavery Act. 

The Modern Slavery Act 2015 came into effect last year and aims to improve law enforcement and transparency on slavery and human trafficking. It is a major concern for goods with long, international supply chains. 

The Act requires commercial organisations - which have a turnover equal to or larger than £36M - to describe the steps they have taken to ensure that slavery and labour exploitation are not taking place in any part of their supply chain or in any part of their own business. This must be published in an annual statement.

It is important to note that timber certification schemes and the TTF’s due diligence framework (RPP) already include provisions to address Modern Slavery through the adherence to international labour laws and declarations. 

The BMF’s employment lawyers Halborns can assist you with drafting your statement and ensuring you comply with the legislation. Contact Halborns for further guidance at info@halborns.com.  For any queries you can also contact Owen Walton - TF Communications and Research Executive - at owalton@ttf.co.uk   

Click here for the official HM Government statutory guidance to employers.
Modern Slavery Act 2015
Does the Modern Slavery Act 2015 affect your building materials business?
An Act to make provision about slavery, servitude and forced or compulsory labour and about human trafficking, including provision for the protection of victims; to make provision for an Independent Anti-slavery Commissioner