Are you planning to give up your business and retire?

Maybe you are thinking of selling the company or simply shutting up shop and retiring, but in either case, if you employ people there are some costs you need to factor into your plan.

Closing your business

If you want to close the business, any employee who has worked for you for more than two years would be entitled to statutory redundancy pay. This is based on their wage and length of service.

This, of course, can be a significant cost and might well have a bearing on whether you decide to close or sell the business (if you believe it has a market value).

Other than not replacing staff when they leave there is little you can do to avoid these liabilities.

If you are worried your business cannot meet the redundancy payments required, you could potentially argue the business is insolvent. Our insolvency team can advise you.

Selling your business

If you employ people and wish to sell your business you will need to follow the TUPE regulations. These apply to all businesses operating in the UK, regardless of size or activity.

TUPE basically safeguards the rights of transferring employees and requires you to disclose fully to the purchaser whom they will be employing and what their liabilities will be.

It is a complex and potentially quite costly process with harsh penalties for getting it wrong. You should absolutely take advice and factor the likely costs into your plans, including asking price.

What to do now

You cannot avoid these costs but you can mitigate them if you plan ahead and run your business accordingly.

Every situation is different and generally involves thinking beyond simply the employment issues involved. As part of a broad-based commercial law firm we can certainly give you the advice you need.

If you would like to discuss TUPE or any aspect of buying, selling and running your business, please get in touch.


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Director of a Groundworks and civil engineering business, June 2018

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Seller of a healthcare business, January 2019

"Over the years, I have developed a great trust in my working relationship with Mike Dyer, Head of Commercial Law at Verisona. One of the things I value most is that he is always at the end of a phone. On the rare occasions he is unavailable, his secretary is always well informed and very helpful. Through Mike, I have met many other members of Verisona and, just like in the recruitment industry, they understand the importance of being treated like an individual. They make me feel valued and important to both them and their business. At Verisona, you always deal with real people who you know and are in a position to help. Most importantly, Verisona delivers. We recently had an urgent situation regarding the restrictive covenants of new members of staff. Employment specialist Susan Ball came in on a day off to listen to us, dissect and analyse the situation, and translate what we wanted to achieve into the best possible legal language and solution. This is just one example of the calm, efficient professionalism I have come to value from Verisona over the years. Verisona has a refreshing approach to the law. They are there when we need them, always easy to talk to, go out of their way to make sure that we understand what they are doing for us and why, and always get the best results".

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