Christmas Payroll Tips

Christmas Payroll Tips

Christmas Payroll is one you may need to give some extra thought to. Regardless of the holiday season, you need to pay your staff. And with extra public holidays there are a few things to watch out for. Here are some tips to help you along. Allow for Christmas and New Year bank processing. Check with your bank what their arrangements are for transaction processing over Christmas. For instance, here is how Commbank handle things:

Christmas Day & Boxing Day processing - Transfers made before 6pm on Friday 23 December 2016 (Sydney/Melbourne time) should get to the recipient's account by Thursday 29 December 2016 (this can depend on how long the other institution takes to process the transaction).

Transfers made between 6pm on Friday 23 December (Sydney/Melbourne time) and 6pm Wednesday 28 December 2016 should be credited to the recipient's account by Friday 30 December 2016.

New Year's Day processing - Transfers made by 6pm Sydney / Melbourne time Friday 30 December 2016 should be credited to the recipient's account by Wednesday 4 January 2017. Transfers made between 6pm Friday 30 December 2016 and 6pm Tuesday 3 January 2017 should be credited to the recipient's account by Thursday 5 January 2017.

Once you know how your bank will do things, you might need to make some adjustments to your pay cycle in order to ensure your staff is paid on time. For example, you might decide to bring forward your Christmas Payroll dates so as to avoid the Christmas banking holidays. Let your staff know what to expect, if needed.

Get people's pay right. When calculating your christmas payroll, make sure that your staff is paid correctly for holiday pay and leave loading (if applicable). If staff will be working on Public Holidays check ahead to  the penalty rates right. You can check the correct rates on the Fair Work Ombudsman's web site.

Plan your rosters. It's worth putting a bit of time and effort into planning your staff rosters for the Christmas and New Year period. Think about which staff would be best for particular shifts so you control your costs but have reliable staff rostered and can still deliver good customer service. The least cost staff may not be the best option if you want to make the most of busy trading days over the holidays.

Emergency Contacts. Especially if you are using technology (rostering systems, accounting software etc), be sure you have details of who to contact in case of a problem over the Christmas period. Make a note of any altered hours for helpdesks, and be sure to have their contact details somewhere easy to access.

You can find more tips for how to manage the Christmas Holiday season here.

Franchise Fit Outs

Following is a guest post on the topic of Franchise Fit Outs by Peter McLaughlin, who is a lawyer experienced in franchising, and a member of FAN. One of the advantages of buying into a franchise is the ability for a franchisee to leverage from an established and successful business. In order to maximise the effect of the franchise system, those franchises that operate from retail premises such as a shop should have the same look and feel across all stores, highlighting the replication of a singular brand and product.

The Franchise Agreement will usually contain a provision as to whether the franchisor or the franchisee will fit out the shop to achieve this cohesive, predetermined look.

Fit Out by Franchisee

Where the franchisee is required to coordinate the fit out of their own shop, they must ensure that this is carried out in accordance with the franchisor’s specifications. A Fit Out Manual will usually exist outlining the franchisor’s precise requirements. Often a franchisor will also advise of an approved shopfitter that knows the brand and business and is recommended to carry out the work.

The final fit out must usually obtain the franchisor’s approval and pass a final inspection prior to commencing operation of the franchise. Franchisees are recommended to read the Franchise Agreement carefully to understand what is required of them in this process.

Fit Out by Franchisor

Alternatively, the franchisor may assert that they will co-ordinate the fit out on the franchisee’s behalf. In this circumstance franchisees should ensure that they are involved in the process and check that the quotes of the shopfitter are reasonable.

It is also common for franchisors to supply a “turnkey” package. This is when the franchisor grants the franchise, supplies a fully fitted out shop and turns over the keys to the franchisee to operate, all in return for the payment of a fixed amount.

What Happens in the Event of Relocation?

Most site-based Franchise Agreements allow for a franchisee to conduct business only at a specified location. The agreement should however make provision for the situation where the premises are destroyed, rendered unfit or if the lease expires or is terminated without fault on the part of the franchisee. The agreement would usually allow a franchisee to relocate, but will also impose conditions on that relocation.

What Should I Do?

Whether you are a franchisor or a franchisee, the key to benefiting both parties and getting the shop fit out right is clear communication.

Franchisees should ensure you read your Franchise Agreement thoroughly and understand what is required of you in regards to your shop’s fit out.

Franchisors should be open and very clear in regards to your fit out standards to avoid any confusion or misrepresentation of your brand.

For any assistance regarding the drafting or reading of Franchise Agreements please contact Peter McLaughlin on 3852 5055 or at peterm@redchip.com.au.

Wendys Master Franchisor

In July 2015 there was media coverage of Wendy's in connection with a company that previously owned the master franchise in Australia being placed into Voluntary Administration. Following is an article which sheds some light on the situation. It has been written by Shabnam Amirbeaggi who is a liquidator and insolvency expert. Shabnam is  a member of the Franchise Accountants Network and a Managing Partner at Crouch Amirbeaggi.

For those who may have heard a rumour about Wendys being in trouble, it’s not quite as dramatic as it may first sound. Yes it’s true, the company that originally owned the master franchise has been placed into voluntary administration, but Wendys as a brand will live on to see another day.

Wendys master franchisor, established in 1979 in South Australia, sold its brand about 12 months ago to a Singapore based company, Supatreats Australia. Since then franchisees have been negotiating a new agreement with the new franchisor.

Franchise agreements are not usually drafted to cater for the franchisors’ insolvency; and are more often than not drafted with clauses to deal with the franchisees’ possible financial demise. Consequently, it is likely that the franchisees who haven’t reached an agreement with Supatreats Australia are facing possible closure of their stores as they will no longer be able to trade under the Wendys brand. If they fail to sign up with the new master franchisor, the franchisees livelihood will be determined by their ability to cover the costs associated with de-identifying the business and continuing to operate independently, or if possible converting to a like-minded franchise – all of which are subject to the landlord’s consent and ability to negotiate new lease terms where applicable.

FAN members with a franchisee clients should bear in mind that even whilst the franchisee’s business might be going strong, the franchisee needs to be comfortable with the financial strength of the franchisor.

Franchise Territory - Know your Boundaries

This is a guest post from Peter McLaughlin, a franchise lawyer and member of The Franchise Accountants Network.  The nature of territory rights is always a hot topic for prospective franchisees. Many people want an exclusive or protected area to operate their business in return for paying the upfront franchise fee. So the question often asked is - what rights do I have to a territory under my franchise agreement?

Is the territory exclusive or non-exclusive?

You may be granted exclusive rights for a territory or only the right to operate at a specified location (like a shop in a shopping centre). If your rights are exclusive for a territory there will generally be conditions attached – usually in the nature of minimum performance requirements. If the territory rights are to be exclusive the agreement should prevent both the franchisor and other franchisees prevented from operating in your territory.

Some franchise systems have no territory protection, meaning other franchisees can open close by.

Other terminology is sometimes used in franchise agreements such as marketing area or first right of refusal area. These terms can all have different meanings and implications for the franchisee. Even "exclusive territories" are not always exclusive, depending on how the franchise agreement has been drafted.

Seek advice if you're not sure

It is important to understand the nature of any territory rights that are given to you and any conditions or restrictions that apply. This involves understanding not only the franchise agreement but the commercial considerations about how the business operates, and what type of territory rights are appropriate.

How we can help

We regularly work with franchisees before they enter into franchise agreements, and also during the course of the agreement where disputes or uncertainty arise regarding their rights under the franchise agreement. Contact Peter McLaughlin at redchip lawyers on 07 3223 6100 or email PeterM@redchip.com.au  to discuss how we can help you.