Hi All, I found these Forums by accident a few days ago, and must admit I'm very impressed with them, so much so I've added them to my favourites file, something I rarely do ops: ops:


In June 2000 I started my own import business, which, believe me was simple enough in itself, but it has been one tremendous learning curve for me.

I did everything right, from the start, registered for Vat, employed accountants to handle the book keeping and tax etc, but unbelieveably the biggest mistake I did, was employing a family member, I'm not writing this advice in the hope of seeking pity or sympathy, but solely to help anyone of you prospective emtreprenaurs from making the same costly mistakes as I have made.


Briefly

In Feb last year my youngest sister needed accomodation for her and her young son (My God Child) both me and my wife openly invited her to come and live with us whilst she found new accomodation (It took 8 weeks) at no time did we charge her a penny in rent or lodgings etc, during her stay she made it obvious that she needed employment

Take Heed



Big Mistake Number 1

I "Created" a vacancy for her on a part time basis for her, agreeing verbally to pay her minimum wage of £4.30 at the time, and pay a further £1.00 ph in her hand, the benefit of this meant she could claim family working tax credit which boosted her wage from £68 pw to £110 pw not forgetting the additional £16 in her hand


Big Mistake Number 2

It became apparant that we were going to have to move into larger premises, so I gave her £1000 worth of Wall Clocks to sell on Ebay, again, this agreement was verbally


Big Mistake Number 3

She was asked if she would like to become full time as from 1st Nov 2003 which she accepted, this offer was made in August 2003, as a way of showing appreciation, I agreed for her Road Tax to be paid for by the company as a "Travelling" Allowance when it became due at the end of Sept.

Big Mistake Number 4

To help her out we also gave a fuel allowance, and a mobile phone after all, she was staying back beyond her contracted hours for 1 hr extra per day. And of course, not forgetting she was my youngest sister.


Big Mistake Number 5

On Oct 6th she came into work and told me she was pregnant, jokingly I said I would have to sack her, this was made as a joke and was accepted as a joke, we agreed verbally that she could stay on a part time basis, and our other sister who by this time had agreed to start on a part time basis, would take on the full time vacancy that had now arisen, as she stated she could no longer work full time.

She duly sent a text to our sister asking if she would like to take on the full time vacancy and Susan replied agreeing to this when she found out Emma was pregnant, but would be staying part time.

Big Mistake Number 6

On Tuesday 7th October, Emma came into the office stating that she could no longer work on a monday, which just happened to be the busiest day, I refused her request for time off as she could not give any reason why she needed every monday off work. We were aware that she was now working part time in a call centre in Gateshead each evening which made us think that the monday off was something to do with the Abbey National job.

I was given the ultimatum of either allowing her every monday off, or she would resign, to me this was a blackmail attempt at trying to get her own way, therefore I simply said, well resign then!

The following friday I was given a letter of resignation that just simply said she was giving 2 weeks notice, this was accepted and left at that.

The following week she walked out of the office for no reason on the thursday and never returned, I put this down to the fact that I would not give in to her DEMANDS

The following week I recieved a letter from a solicitor claiming that I had sacked her for being pregnant, she had told us on the 25th Sept of her pregnancy and we had made life hell for her in a bid to drive her out of her job, obviously it was totally rubbish and we pointed out that on the 27th Sept she had booked a 2 weeks holiday in Ireland for the 19th June 2004, and as this was a drive to Ireland holiday it shows that she was unaware of her pregnancy until early october, after all she did not tell us until 6th october.

Who in their right mind would book a holiday where they have to drive over 300 miles in a car with a 3 week old baby with them?

Anyway, in March this year we were called to an Industrial tribunal which went against us for the following reasons:

A) We had no signed agreement that the clocks were a reward for staying back beyond her contracted hours.

B) We could not produce a contract of employment as she had removed it from the file before leaving

C) We could not produce a written agreement signed by her agreeing to repay the car tax in the event she left the company

D) Because I admitted to jokingly saying I was going to sack her, it was deemed as an admission of guilt, I still maintain to this day that it was a joke and had I wanted to lie about anything I would have denied saying it.

E) Just because agreements are made verbally, they do not stand up in a court of law.


So Beware

My personal advice is, never ever ever make verbal agreements despite it being family members, ALWAYS get signed agreements and TAKE THEM HOME do not leave them where the agreeing person can remove them for their own benefit.

I Did'nt do any of the above and it cost my company £5312.58p in compensation, needless to say we no longer have anything to do with her and as far as I'm concerned she no longer exists.


If anything in life Please just take heed of the above :wink: :wink:

Are you glad you got that off your chest now :-)

Just wanted you to know some body read it...

Ian.

Lol Back in May when she was awarded the money I honestly went Bollistic, however, time is passing by and I'm looking at the positive things I can do.

If the above advice prevents just one more person from falling into the same trap as me, then it's all been worth it 8) 8)

It's okay anyone sitting reading it and saying that it would not happen to them as their family is different, believe me, we were a very close family, the youngest who wants a life of Riley without having to work hard to get the money to put her in the life style she wants. Now the full family is split, and I'm talking about 7 kids and 2 parents, she saw me as an easy target and I had failed to do everything correctly, something she took advantage of.

2 years ago, if I'd visited a fortune teller who would have predicted this event I would of laughed at them, so with the help of todays trip and slip solicitors who act on no win no fee they weigh up the situation and push for compensation, after all, thats a nice income for them.

One thing I forgot to point out above, If an employer wins the case, they cannot claim costs against the claimant, and yet, it would cost you around £2,000 to defend the action, I personally represented myself, had I engaged a solicitor, things may have been different but who knows?

Had I had representation and still lost thats another £2,000 to add to the total.

They were pushing for £25,000 the maximum amount they could claim but luckily we were told that their case issues only warranted the minimum payout of £5,000

Yes I'm very P'd off but as I say, if it prevents just one more person suffering what I suffered it will all be worth it in the end. 8)

If your going to run your own family business, dont do the same as me and just ignore things because it's family ops: ops: ops:

Very good Read!

Shocking really, how a family member could do that. Amazing how low some will sink for money.

Thanks Davey!

Ps. Your other post on you importing was really useful and i leart alot!

According to the wife I'm a wealth of knowledge Lol :roll: :roll: :roll:

But if anyone wants advice on anything in particular I'll certainly do my best to share what I know about that topic (Business related only of course)

I'm pretty much self taught at everything just by reading books etc, and openly admit to my mistakes, after all nobody is perfect, not bad for someone who hated school and spent more time skiving off than attending ops: ops: ops:

Same goes for employing friends, however well you think you know them!!!

Davey - I know exactly how you feel, however, look on the bright side:

1. It could have been a lot more than £5000
2. You have gained a wealth of experience from this and probably grown more resilient as a result - and resiliance is one of the most important characteristics of people who are good in business.

My father unexpectedly died of heart failure at the age of 58 and I had to immediatly take over the business (age 22) and undo what was an enourmous mess. When I look back at some of the stupid things I did and the money I lost it still makes me annoyed even 7 years down the road.

However it was the best learning curve and experience that I could have hoped for.

I think that that critical lesson from your experience is

1 as you have already mentioned - writing writing writing - the 3 W's
2. Do not employ family, and if you do get everything in writing twice!

Matt

Totally agree with you Matt, the knowledge learned is proving invaluable and along with being able to pass on the knowledge in itself is worthwhile.

A good thing (Possibly) that has come out of it was Shine TV (Part of the Rupert Murdoch Group) spending 5 hours at our premises recording an interview for a program on Sky One in the New year called Secret Britain, which points out the hidden bits of business troubles that the general public dont realise exist, hence the title Secret Britain.

Hopefully the Timer we hold the rights to etc, will gain a lot of publicity throughout Europe so it's possibly a good thing, and one of the reasons I agreed to do the program giving my side of the trouble.

I regularly recieve calls from Channel Four who want me to appear on a program they are making in which they use a mediator to resolve family issues Lol, needless to say, I aint prepared to sit in the same room as Emma let alone across a table with some damn pyschologist by her side

Because of the case recieving so much publicity, the Police are now investigating Emma for Perjury, so there's not a lot I can say at present, although I stated publicly to the Police I dont want the £5300 back as it's dirty money now, it can go to Charity where some organisation can put it to good use.

I still employ another Sister who has really suffered through all this, but, at least things are getting back to normal within the business.