Half a million North West SMEs may be entitled to compensation

Almost half a million SMEs in the North West will qualify for new financial compensation payments if any of their staff are called up for service, under new legislation coming into force today.

The new regulations – The Reserve Forces (Payments to Employers and Partners) Regulations 2014 – will entitle SMEs to claim up to £500 per month for each full month a reservist is absent from work, protecting the business from losses through absenteeism.

The new monthly compensation is in addition to expenses in respect of additional costs incurred while replacing a military reservist, which are covered to a maximum of £110 per day.

Michael Ball, employment partner in the Manchester team of top 50, national law firm, Gateley, said: “This new regulation protects small and medium employers from losing money through reduced productivity if they employ a military reservist who is then called up for duty. Across the North West, this represents 480,000 businesses which now benefit from an additional layer of financial protection.

“Employers could – until now – find themselves out of pocket if a staff member is called up for prolonged periods of time, thus impacting on the financial success of their business.

“The Reserve Forces Regulations are a good first step in the right direction. It’s encouraging to see the Government placing emphasis on protecting small businesses that employ military reservists and who, through no fault of their own, can find themselves operating at a reduced staff level while their employee is working with the armed forces,” he added.

Military reservists can be called up for duty for up to 12 months at a time and can serve anywhere in the world. There are around 3,600 military reservists in the North West.

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