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Operating a beauty business in the COVID-19 pandemic

Posted on 5 February 2021

The UK is currently in its third national lockdown and all non-essential shops and hospitality services, hair and beauty salons, barbershops and spas have been forced to close their doors once again. In this article, we look at what this means for employers and staff, both during this current lockdown and beyond.

What happens to staff when salons and other businesses in the beauty industry are required to close?

Where businesses have been forced to close, employees must not attend work. However, they still remain employed under their existing terms and conditions – which includes an entitlement to pay.

The Coronavirus Job Retention Scheme (CJRS), first introduced in March 2020, is designed to avoid employers being forced to dismiss their staff in order to avoid incurring the costs of continuing to employ them while they are not working. The CJRS enables employers to apply to the Government for a grant equivalent to 80% of their employees' salary costs for those who are furloughed, up to £2,500 per employee, per month. There is currently no obligation on the employer to top up employees' salaries to full pay in order to access the scheme. However, it remains to be seen whether the Government will require employers to gradually contribute more towards employees' pay in the coming months prior to closure of the scheme (which is currently due to end on 30 April 2021). In the meantime, however, it is important to note that employers must obtain the written consent of employees before furloughing them, and before they impose any reduction in pay.

Employers making use of the CJRS should bear in mind that employees on furlough leave cannot provide any services to the employer, or do anything which could in some way increase the business' profits, but employees may still attend training courses, as well as volunteer for other organisations.

A similar scheme, called the Self Employed Income Support Scheme, exists to help self employed people whose business has been affected by the pandemic. This, however, is limited to those whose trading profits did not exceed £50,000 in the 2018/2019 Self Assessment tax return and whose profits at least equalled their non-trading income. The scheme is not available to those who traded through a limited company (but they may be able to treat themselves as employees under the CJRS).

Will claims under the CJRS be public?

From February 2021, HMRC plans to publish information about employers who have made claims under the CJRS for periods starting on or after 1 December 2020, leaving many employers with a choice over whether to continue furlough employees and risk potentially facing adverse publicity.

HMRC are currently in the process of investigating thousands of suspected cases of fraudulent claims under the CJRS, which could result in employers found guilty being forced to repay the sums claimed, plus interest, as well as a penalty of up to 100% of the amounts claimed where deliberate and/or concealed acts are uncovered. It is also understood that HMRC may publish names of any deliberate defaulters, which could result in significant reputational damage to businesses exposed.

What happens to staff when salons and other beauty premises do re-open?

If employees were furloughed, unless agreed otherwise, they should be given reasonable written notice of when they are required to return to work (taking into account any associated requirements necessary such as health and safety consultations, reasonable adjustments and so on), and employees' pay and other conditions should return to normal (i.e. pre-furlough pay).

What about social distancing and health and safety requirements?

Even once lockdown is lifted and hair and beauty services are allowed to resume, it is expected that the pre-existing rules around social distancing will continue to apply for some time, in an effort to keep infection rates at bay.

As employers, salons must therefore take reasonable steps to maintain a safe environment for both staff and customers, so that they do not breach their statutory duties. If they fail to do so, this is a criminal offence and could lead to an unlimited fine. Salons will be required to carry out a COVID-19 risk assessment, which must be regularly updated to reflect any changes in circumstances. The Health and Safety Executive sets out guidance for carrying out a risk assessment here. Salons have a duty to consult their workers (or trade unions, if applicable) to establish what measures and guidelines to put in place, and will need to share the results of the risk assessment with the workforce.

The Government has also issued comprehensive guidance ("Keeping workers and clients safe during COVID-19 in close contact services") to assist close contact businesses, such as hair and beauty salons and barbershops, with keeping staff and clients safe by minimising the risk of transmission of COVID-19. The guidance includes, for example:

  • taking mitigating steps where performing close contact services and unable to socially distance, such as keeping such activities as short as possible, using gloves, increasing frequency of hand washing and surface cleaning, using screens or barriers between clients, wearing visors or goggles, and working back-to-back or side-to-side;
  • staggering arrival, departure and break times of employees, using more than one entry point to the premises to reduce congestion and using floor tape or paint to mark areas and to maintain social distancing wherever possible;
  • spacing appointments in order to avoid overrunning or overlapping and to allow for frequent cleaning of work areas and equipment; and
  • not providing reading materials such as magazines to clients, using disposable gowns for each client, and encouraging staff not to wear their uniforms at home or to and from the workplace, and to wash uniforms immediately after use.

What if staff are sick or need to self-isolate?

Employers who are off sick due to COVID-19 or symptoms are entitled to receive statutory sick pay (SSP) from the first day of sickness. Employers with fewer than 250 employees will be able to reclaim SSP paid in respect of the first 14 days of COVID-19 related sickness absence per employee.

Employees who are self-isolating (whether because they or someone in their household has COVID-19 or COVID-19 symptoms; or they have been told to self-isolate by the NHS) will also be entitled to SSP, providing they are unable to work from home (if they are self-isolating but not unwell and can work from home, they will not be entitled to SSP but their usual pay).

When will businesses in the beauty industry actually re-open?

Whilst the key question on all our minds may be "When will things return to 'normal'?", for now at least, the question at the forefront for businesses in the beauty industry will be focussed on when they can re-open at all.

When the first UK lockdown was lifted, the beauty industry was one of the last to re-open and, even when salons were allowed to re-open in July 2020, beauty treatments in the "highest risk zone" of the face (e.g. facials, eyebrow treatments etc.) were initially still prohibited for a further six weeks.  

If, following this latest lockdown, the beauty industry will once again be the last to open, the Government are likely to face significant public scrutiny. In particular, they are likely to be challenged over, for example, whether such closures or restrictions are disproportionate to the aim of combatting the threat to public health posed by the virus, whether the treatment of the beauty industry is consistent with other activities across other industries, and potentially even whether the fact that such measures are likely to have a disproportionate impact on female business owners may amount to a form of indirect sex discrimination.

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