An earlier version of this article first appeared in the June edition of The Caterer
Whatever happens next will be very different, now is the time to precision plan your opening.
Significant changes to lockdown restrictions for hospitality businesses have emerged from Whitehall and July 4th is now ringing in all of our ears. What happens next will be unique and your business will need to be ready to succeed in the new world your clients and suppliers are emerging in to.
As a business owner or manager this next phase should be used wisely to prepare your property, business, and employees for reopening. Your watch words should be timing and caution. Consider the following:
- You are going to incur significant costs to reopen and you will be doing so in an uncertain market, normal revenue is potentially a long way off. Be cautious with your forecasts.
- Do your risk assessments – and implement appropriate steps and strategies accordingly. This is a key part of the opening up.
- Given the uncertainty you should expect now is the time to access good value government and private finance to provide a safety net.
- Your supply lines are absolutely crucial to your success so now is the time to start conversations and negotiations. We recommend that you carefully document everything so as to be in the best position if a dispute arises.
Contact: Jessica Nugent, Partner, Corporate & Commercial
- Your employees may be furloughed, they will have concerns about returning to work and their working practices will need to be different when they return taking into account social distancing. Remember that although they can't work, furloughing doesn't mean you can't communicate or provide training. Consider devising a staff communication and training plan and use technology to kick it off now.
- You may need to adjust your headcount and to ask your people to do different jobs and tasks in new circumstances. Consider the appointments and skills you may need, and any changes to your existing employees contracts. Bear in mind the number of employees affected by potential changes and whether collective consultation obligations are triggered.
- Now is the time to realign your employees' contracts so you have the flexibility you need to support your business.
Contact: Clare Gilroy-Scott, Partner, Employment
- Communication with you landlord is crucial to a successful and hopefully collaborative relationship, don't change your approach now. Aggressive landlords should be reported to one of the industry's representative bodies: UK Hospitality, Hospitality Union or the Night Time Industries Association.
- Maintain a dialogue with your insurers,
- Regular security checks should already be in place and you will not want a break in or squatters to derail your carefully timed reopening; consider investing in greater protection if you haven't done so yet.
Contact: Chris Barkley, Senior Associate, Real Estate
Don't forget that customers came to your establishment to enjoy themselves and relax, that wont change when they return, they will just have extra anxieties. The buzzword is "friction points", consider the following moments that may cause stress:
- Client arrival and reception
- Setting tables and ordering
- Delivery drivers
- The bill
Some of these areas may have tech-based solutions to help you reduce friction and manage anxiety for clients and staff.
Now, and in the preparation for re-opening, keep up your communications with customers through whichever channels work best for you. Energies expended on this will undoubtedly bear fruit.
Your data obligations
- You may wish to test returning employees for signs of the virus, this will involve processing personal data, bringing into play our data protection laws. The data relates to health so it's classified as special category personal data with even higher levels of protection. Fortunately the Information Commissioners Office has issued some helpful guidance on this very subject. They remind us that data protection law does not prevent employers from taking the necessary steps to keep their staff and customers safe but it does require them to be responsible with people's personal data and ensure it is handled with care.
- The legal basis of such processing would be the employer's legitimate interests, buttressed by its health and safety obligations. In order to meet accountability requirements, the ICO recommends that the employer carries out a data protection impact assessment (DPIA) before embarking on such a scheme – a helpful template for this is available on the ICO's site. If you are considering ongoing monitoring measures such as temperature checks or thermal cameras – these would need to be both proportionate and justified.
- Clearly you need to be transparent with your staff by explaining what is being collected and how, and what will be shared. You will need to keep a list of those testing positive and may well have to share those names with colleagues. Care is needed and you should only maintain the minimum amount of information required for the purpose: the ICO gives the example of data concerning underlying conditions as not being relevant or appropriate for these purposes.
- Beware too that the accuracy of the data may depreciate over time, especially once infected staff have recovered.
Contact: Paul Herbert, Partner, TMT
Peter Backman, analyst and commentator for the foodservice industry, added:
"We can make assumptions, but the future remains an unknown, which in turn makes it very difficult to plan. With restaurant openings likely to be phased, operators need to think about the long game as well as the short term – there's a huge amount to consider. Adaptability is the watchword for the future, and we have seen that operators that have been able to pivot their businesses through the crisis have given themselves a solid platform to build on. The key for all operators will be to remain agile with a flexible approach based on the twin pillars of efficient use of resources and meeting customer needs. Consumer confidence, having taken an unimaginable hit, especially on matters of health and safety, is likely to take some considerable time to return. Operators will have to proceed carefully and be prepared swiftly to change tack and evolve their business models."
A final point. It is now clear that reopening will be slow and gradual and people will resurface slowly, footfall will mirror this reality and any business plans should reflect this. Be honest and ask yourself if your establishment is better suited to a quick return or do you need buzz and footfall to be profitable?
Further Information about our specialist Hospitality & Leisure legal team based in London
Please contact any member of the team if you have any questions relating to the reopening of your restaurant, cafe or pub on July 4th.
We have acted for clients in the hospitality & leisure sector for many years and we have gained valuable insight into the legal issues that our clients face.
Specialist lawyers from across the firm's practice groups advise a wide range of hospitality & leisure clients on both transactional activities and operational issues.
Transactional activities – acquisitions, disposals and investments
The members of the hospitality & leisure team are experienced in advising hospitality & leisure companies on sales and acquisitions of businesses, whether as a single asset or a large portfolio. The involvement of a multi-disciplinary team of lawyers ensures our clients have the benefit of specialist sector knowledge covering all aspects of the transaction.
Our licensing team can advise on all aspects of licensing for our hospitality & leisure sector clients from the grant of premises licences and their variation through to licensing disputes. Our licensing team's goal is to minimise the sometimes bewildering maze of licensing requirements to enable our clients to focus on running their business.
We advise on operating leases, franchise agreements, venue hire agreements, management agreements, supply contracts, joint ventures, distribution agreements and intellectual property protection and disputes. Our real estate team handle numerous rent reviews and service charge issues for leisure clients.
Our hospitality & leisure HR team are experienced in helping clients manage day to day HR issues such as discrimination, zero hours contracts, TUPE and termination, national minimum wage, and working time regulations.
Health and Safety
In view of the potential liabilities faced by our leisure clients, our health and safety team regularly advise owners and managers on risk mitigation and corporate and personal responsibilities.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.