Heavy snow costs region £50m

BUSINESSES across the North West could have lost as much as £50m as a direct result of absenteeism resulting from yesterday’s heavy snowfall.

Thousands of employees were unable to get into work as major arterial routes ground to a halt with many bus operators cancelling services.

Both Manchester and Liverpool Airports cancelled flights yesterday morning with passengers being advised to contact airlines for further information.

The Knutsford-based Forum of Private Business (FPB) has calculated that while the cost of employee absenteeism to this region yesterday will be between £25m and £50m, the national figure will be ‘well in excess’ of £230m.

It calculated the figures using information including the daily GDP figure, anticipated vehicle breakdown levels from the AA, average salaries and official data reflecting an expected fall in retail sales.

Tom Parry, The FPB’s research manager, said: “Employees make businesses grow and losing key staff because of the weather, even for just a day, is very damaging, particularly in the current economic climate.

“It is important that employers put in place contingency plans for these occasions and that these plans comply with employment law.

“For example, home working might be seen as a solution – obviously not for manufacturers and retailers – but business owners should be aware that it is their responsibility to ensure that employees’ houses meet health and safety standards.”

The Federation of Small Businesses put the cost to the economy from lost taxes and productivity closer to £600m.

A survey carried out by Manchester-based accountants Grant Thornton found that one in five workers failed to make it into the office yesterday as a direct result of the weather.

David Grundy, managing partner of Grant Thornton, in Manchester, said that a further 25% arrived late as a direct result of transport disruption.

He said: “Last year, it was estimated that a week-long snow storm caused the economy to suffer a massive £1.26bn loss – so even a 24 hour snow storm will have a huge financial impact.
 
“The closure of Manchester and Liverpool John Lennon airports could cost hundreds of thousands of pounds alone.

“The amount of money lost due to people being snowed in and failing to arrive at the office or go out to spend their money in the region’s shops, restaurants and leisure attractions will cause a further significant dent to the region’s coffers.”

Mike Burns, an employment law partner at solicitors DLA Piper, said that the freezing conditions were the last thing needed by the region’s businesses struggling to cope during tough economic times.

He said: “Generally speaking, the onus is on employees to get to work, even in inclement weather conditions – if employees fail to turn up for work, an employer is under no legal obligation to pay them.

“However, the needs of the business must be weighed against the safety of its employees. Staff should not feel forced to come to work if they feel that it is unsafe to do so and should have the option to take the time as leave or to work from home. 

“With many schools and nurseries closing some employees will also have the right to take “emergency” unpaid leave to care for dependents. 

“If the business chooses to deduct pay it will inevitably have a negative impact on morale, particularly if employees have made an effort to get to work, and the administrative burden of calculating the loss of pay may outweigh the potential benefit.”

Among the companies to benefit from yesterday’s heavy snowfall was Merseyside-based IT specialist, The PC Support Group, which received ‘a massive increase in’ calls from people wanting advice on mobile and remote technology.

Managing director Phil Bird said: “Companies could find themselves in real financial trouble as the snow continues to prevent employees getting into the office.

“We have experienced a 300 per cent increase in calls from companies seeking to make arrangements for staff to work from home in case they are snowed in.”

And the Knutsford-based Federation of Petroleum Suppliers – which represents 370 domestic heating oil suppliers – said that its members had witnessed a 40% increase in trade.

Spokesman Rod Prowse said: “It had been a mild autumn and then, at the start of December it started to get cold – but nothing like what it has been this last few days.

“Millions of pounds worth of orders for heating oil have been placed over the past two weeks at a time when the suppliers need that business.”