BCLP Retail Insight: The Week That Was Vol. 3

Masks Mandatory in Shops from 24 July

The Government has confirmed that from Friday 24 July customers will be required to wear face coverings in shops. Unless exempt, shoppers who do not wear a face covering could be issued with a £100 fine (reduced to £50 if paid within 14 days). Shop assistants will be exempt (albeit retailers may still require them to wear face coverings), as will children under 11 and those with certain disabilities. It has also been suggested that the rules will not apply to takeaway food outlets although the Government is expected to clarify this in the coming days.

Retailers will need to consider how they will react to customers trying to shop without a face covering: will masks be sold or provided for free upon entry? If they aren’t offered then the new regulations could be a barrier to increasing the number of shoppers in store. The Government has not set out any mandatory signage, but signs providing a reminder to wear a face covering on entry may reassure and remind customers that the rules are followed within the store.

A key question for retailers is whether the new face covering rules make customers feel safer or discourage them from returning to bricks and mortar shopping locations? Whilst surveys have indicated that much of the UK population is now accustomed to leaving home with a face covering, uncertainty over the safety of making trips to stores may continue to push increasing numbers of customers to look online. Indeed, although UK retail sales have now returned to growth this has been driven by a surge in online spending during the COVID-19 crisis.

Eat Out to Help Out Scheme Launched

Following the re-opening of restaurants and pubs on 4 July, the Government’s new Business and Planning Bill aims to help these businesses trade outside more easily. The Government has now added further incentive for the public to begin visiting restaurants and cafes again, by launching the Eat Out to Help Out scheme. It is likely that the 50% discount (capped at £10 per head) will be taken up by restaurant chains and cafes situated in retail locations – will this help to draw customers back to the high street? Click here to read about the details of the scheme.

VAT Cut to 5% for the Hospitality Industry

The Government’s package of measures, intended to stimulate economic recovery as lockdown measurers are eased, also included a VAT cut to 5% for a six month period from 15 July 2020. The cut applies to the hospitality industry, including restaurants and cinemas that may be trading in retail locations, and it is hoped that the reduction will increase consumer spending whilst decreasing potential job losses in the sector. Please click here for further information on the VAT cut, as well as discussion on the SDLT saving announced for residential property that the Government announced at the same time.

Latest Update to the Coronavirus Job Retention Scheme: Job Retention Bonus

With the Coronavirus Job Retention Scheme (CJRS) set to conclude at the end of October 2020, the Government has also announced measures to try to prevent large scale redundancies once furlough payments end. The measures announced include a job retention bonus to incentivise employers to bring furloughed workers back to work, a kickstart scheme to provide new jobs to 16-24 year olds who are on Universal Credit and funding for apprentices and trainees. Retail businesses were among those to claim the most furlough payments under the CJRS and as such retailers will have to decide on how to re-introduce their workforce in October and whether redundancies will need to be made. Please click here for the key takeaways for employers regarding these announcements.  

British Property Federation Publishes COVID-19 Recovery Roadmap

The British Property Federation (BPF) has launched its COVID-19 recovery roadmap Building a Shared Recovery, with the goal of helping the real estate sector deliver the private sector investment that will be essential to support the Government's ambitious investment plans and its 'levelling up' agenda.

The BPF has described its recovery roadmap as ‘an holistic framework with immediate and longer-term policy suggestions - to feed into both the Chancellor's recovery measures in July and the Autumn Statement later this year - to better support investor-developers, the construction sector, and businesses and communities across the UK’. The roadmap acknowledges the impact that the COVID-19 pandemic has had on the retail sector and responds by suggesting a comprehensive package of support. This includes a temporary relaxation of Sunday trading hours with the view to spreading football over a longer period to help retailers maintain social distancing, a furloughed space grant scheme to provide funding for businesses forced to close during the COVID-19 crisis to cover their property costs, and a ‘high street’ use class in order to allow retailers to move between typical high street use classes without needing to apply for planning permission.

The roadmap also sets out a plan for a ‘transformation’ of town centres, which may be welcomed by bricks and mortar retailers competing against online stores. The plan asks the government to prioritise its review of business rates and in the long term calls for business rates discounts for energy efficient properties. The plan also promotes Town Centre Investment Zones (TCIZs), recognising that the recovery of town centres requires fiscal, regulatory and planning policies to work in tandem. You can read the Building a Shared Recovery plan in full here.

Please do get in touch with the BCLP Retail Team if you have any queries regarding the topics raised in this bulletin. This bulletin was co-written with Trainee Solicitor Jack Pepper.