Small Business Commissioner up and running

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Here’s a useful article recently published by the FSB, written by Rianda Markram…

Small businesses across the county will be glad to know that the government has launched the much anticipated Small Business Commissioner (SBC) complaints scheme.

Mike Cherry, FSB Chairman has commented on this topic in the past: “The UK is gripped by a poor payments crisis, over 30 per cent of payments to small businesses are late and the average value of each payment is £6,142. This not only impacts on the small business and the owner, it is damaging the wider economy,” he said.

“The small business commissioner is crucial to turning the tide on this late payments culture,” he added.

“We hope then to see clear actions taken to tackle the worst examples of supply chain bullying. Success will be a UK economic culture where a business that does a job promptly, is paid promptly,” he said.

The aim of the scheme is to provide small businesses with an additional means of holding larger businesses to account on outstanding debts. In addition, the Small Business Commissioner will also offer advice and information in relation to payment matters to small businesses. The details of the scheme can found in the Small Business Commissioner (Scope and Scheme) Regulations 2017

Who can use the scheme?

Broadly speaking, the legislation states that a ‘small business’ means a relevant undertaking which has a staff headcount of less than 50, as determined by reference to a specific assessment date or assessment periods.

The requirements

The Regulations require small businesses that want to make use of the service to communicate the complaint to the person against whom it is made, and to give that person a reasonable opportunity to deal with it. However, this is not required where the SBC has taken a view that there is sufficient information that such a communication would have a significant detrimental effect on the commercial interests of the person making the complaint.

Businesses that want to make use of this service should be aware that complaints to the scheme must be made in writing. The Regulations set out the form of the complaint and specify the information that must be included in the complaint.

Time limit

There is also a time limit for presenting complaints to the SBC, which is 12 months in most cases, from the date on which the matter to which the complaint relates took place or started to take place. There are limited circumstances where the this time limit may be extended, for example where the person against whom the complaint is made has given consent to the extension or because of a physical or mental incapacity of the person making the complaint.

Making decisions

The Regulations set out the circumstances in which the SBC may dismiss a complaint and who needs to the notified where this happens.

The SBC will be expected to determine cases by reference to what is fair and reasonable in all the circumstances. The Regulations also set out the factors that the SBC must consider when deciding whether to identify the respondent in a report.

Why it matters

The Small Business Commissioner’s website is now live with useful information on how to deal with unpaid invoices, its procedure and more information on the SBC services.

Small businesses finally have a means to take on larger organisations when it comes to overdue payments.