As of midnight on the 5 November, England was plunged into its second official national lockdown. Expected to remain in place until Wednesday 2 December, the tighter restrictions were brought in as an attempt to mitigate the spread of the coronavirus as we enter the winter months. With cases exponentially rising across the country, Prime Minister Boris Johnson admitted we had 'no alternative' to the lockdown, amid fears that the death toll may even exceed that of the first peak if immediate and extensive measures aren't taken.

So, as we buckle ourselves in for another month of quarantine, many businesses are left wondering how these restrictions will affect them a second time around. And while it seems like the second lockdown might not be quite as restrictive as the first, it still requires thousands of businesses in the UK to dust off their 'closed until further notice' signs and wait in anticipation for further information to be released. So, to clear up any potential confusion, in this article, we're going to run you through what the second lockdown entails, and let you know how it will affect your business, before outlining all the help that is available for you. To help your business thrive, without compromising the safety of your staff and customers.

Lockdown 2: what are the regulations?

The essential premise of the second set of lockdown regulations is that "no person may leave or be outside the place they are living without reasonable excuse". This simply means that we should stay at home and avoid meeting people we do not live with, except for specific purposes. When it comes to the definition of a 'specific purpose', it mainly pertains to carrying out work responsibilities when you cannot do so from home, or taking part in essential activities such as buying food or medicine, accessing critical public services, exercising, or attending school and university. In addition to these primary purposes, if you are fulfilling legal obligations, caring for a vulnerable person, attending a medical appointment, or are visiting people in your support bubble, you are also exempt from having to stay at home.

When it comes to the workforce, the immediate course of action should be to return their working circumstances to that of the first lockdown. Suppose employees started to work from home back in March and have since returned to the office, or entered into flexible modes of working. In that case, it is heavily advised for them to return to remote working - both from a legal standpoint, as well as for the safety of themselves and broader society.

In terms of businesses and venues, in order to reduce social contact, all non-essential businesses are being asked to temporarily close, or to impose new restrictions on how they conduct their services. In contrast, businesses that are deemed as 'essential', are allowed to stay open to the public, but only if they abide by strict COVID-19 secure guidelines.

How do they differ from the first lockdown?

With the newly implemented regulations sounding pretty familiar, you might be wondering how they differ from those imposed during the first lockdown. Well, while they both largely outline the same details, there are some ways in which they vary - with the main differences being in the definition of homeware, and the new ability for the public to use click-and-collect services.

During the first lockdown, the UK government deemed homeware as an essential form of business, and due to so many people being confined indoors, homeware sales witnessed a spike of 70% throughout the spring. However, although Boris Johnson revoked this definition, switching homeware's status to non-essential and subsequently shutting the doors of home and furniture retailers until June, this time around homeware businesses have been deemed non-essential from the get-go. While builders, merchants and building companies can still remain open, this is likely to have a significant effect on retail businesses.

Another difference between the national lockdowns is that this time around, click and collect options will be available for some non-essential retailers. This will allow certain businesses to carry out their operations, while still abiding by government guidelines. However, an exception stipulates that items should be collected 'off the premises', and there is still confusion on whether this suggests that retailers will have to fulfil their online orders offsite, or whether they are able to continue within their closed stores.

What is considered essential?

  • Retail outlets such as food shops, supermarkets, pharmacies, garden centres, off-licences, and building merchants (however, cafes in supermarkets may be asked to temporarily close)
  • Car repair and MOT services, petrol stations, as well as vehicle car businesses will also be able to stay open to support those who travel by car
  • Essential services, such as banks, post offices, in-person loan providers, and building societies
  • State-run public services, such as civil registrations offices, passport and visa services, waste or recycling centres, courts, and probation services
  • A number of food chains such as Greggs, McDonalds and Nando's can operate drive-through or to-go options, as long as seated areas are closed
  • Shared facilities, such as outdoor play spaces, car parks, public toilets, and motorway service services
  • Medical and dental services, like GPs and dentists
  • Pet shops and animal care facilities
  • Storage and distribution centres
  • Shops selling agricultural supplies
  • Dry cleaners and laundrettes
  • Garden centres and hardware stores

What is considered non-essential?

  • Non-essential retail shops, such as clothing and homeware stores, betting shops, electronic shops, market stalls, and vehicle showrooms, among others
  • Hospitality venues including restaurants, cafes, pubs, and bars (unless these venues can provide takeaway options in the hours before 10 pm)
  • Leisure and sports facilities, including gyms, leisure centres, basketball and tennis courts, swimming pools, fitness and dance studios, climbing walls, among others
  • Personal care services such as hair, beauty, tanning and nail salons, spas, as well as tattoo and piercing parlours
  • Entertainment venues like theatres, cinemas, concert halls, galleries, museums and zoos (unless they have outdoor grounds)
  • Community centres, and most places of worship

How is this likely to impact business?

While the government proclaims it is doing everything it can to protect jobs and the economy while saving lives, many are certain that the implementation of harsher restrictions will spell disaster for thousands of businesses across the country. Among them is the British entrepreneur and chairman of the private equity house Risk Capital, who stated that the 'damage to confidence, entrepreneurs, investors, the destruction of jobs, unemployment and the social and welfare costs are immense', when quizzed about the economic impact of a second lockdown. This sentiment is also echoed by a wide range of business owners across the country that have been forced to temporarily shut up shop and put their livelihoods on hold, pending further instructions from the government.

The sectors of business that will inevitably be hit the hardest from the second national lockdown are that of retail, hospitality, and travel- which collectively make up around 15% of the UK's GDP. The timing of the lockdown poses a particularly damaging threat to the retail industry, as the gear up to Christmas is typically when the sector turns most of its profit. However, the hospitality industry doesn't look to be in much greater stead. Since most bars, restaurants and cafes across the country have already been suffering from significant losses throughout most of 2020, many fear that a second lockdown may add another nail in the coffin for struggling businesses within the service industry.

In addition to the apparent impact these new set of guidelines will have on the retail, hospitality, and travel industries, it's very possible that businesses across completely unrelated sectors will also feel a significant impact. The immense growth of the government's deficit, alongside the notable drop in tax revenues that has resulted from so much of the workforce going back on furlough, both lay down the foundations for economically turbulent times ahead. However, despite the inevitable dip in the economy that lockdown 2.0 will cause, many experts (including Paul Dales, a chief economist at Capital Economics) believe it's highly unlikely that UK businesses will be hit as hard as they were during the first lockdown.

But for those businesses lucky enough to stay operating through November, here are the best ways to make sure you're sticking to the government-mandated guidelines.

How do you safely keep your business open?

In order to abide by the government guidelines and to ensure the safety and trust of your staff and customers, all essential businesses need to take the precautions necessary to completely covid-proof their operations. As we settle into a second lockdown, most businesses should be pretty clued up on the dos and don'ts of operating under stricter regulations. However, here's some extra guidance; a few ways to reduce the risk of infection in your business.

Practice social distancing, whenever possible

It is extremely important to practice social distancing within the workplace whenever it is possible. Under the current guidelines, it is recommended that workers maintain a distance of 2m from each other if possible, and 1m when risk mitigation is in place. In businesses serving clients, waiting rooms that cannot facilitate social distancing should be closed, and distance should be maintained throughout all areas of your business; not just the areas that are open to members of the public, and if workers absolutely must be in close proximity to one another, a method to lower the level of risk is to implement a pairing system, to keep contact as low as possible.

Limit numbers and have a capacity

The size of your particular business or venue will determine the number of customers that are allowed in your space at a given time. If you're running a small business, it's particularly important you limit the number of people entering at once. If you are running a hall or hire space, a risk assessment should be carried out to determine the maximum capacity and make sure you are acting in agreement with the current guidelines and to ensure that most possible risks have been identified.

Stock up on all necessary PPE

In addition to social distancing, your business must maintain high levels of personal protective equipment. Obviously, face masks are required under current guidelines, but to mitigate the risks even further, protective facial shields are even better at lowering rates of infection. Furthermore, especially for businesses in the service industry, it's essential to wear gloves where possible, to keep skin-to-skin contact to a minimum.

Signpost well and stick to the rules

Using signs or markings that introduce one-way systems is a great way to limit the flow of people on your premises, and of keeping unnecessary contact to a minimum. It's helpful to do this in both areas only open to the public and staff only places, particularly at any entrance or exit points.

Also, as a business, it is your obligation to understand and abide by the rules that are set by the government. Aside from being liable to be fined if you are caught breaching any government-issued regulations, as a business owner, you would also be responsible for putting the lives of your team and customers in danger. For these reasons, it is critical that your business stick to the most up-to-date guidelines, and only conduct the services that are deemed appropriate and safe by the government.

For more information on how to keep your workers and customers safe during the pandemic, read this government-issued guidance on how to lower the risk of infection in workplaces.

What help is out there for businesses that need to close?

Updated furlough scheme

Due to the onset of the second national lockdown, the Coronavirus Job Retention Scheme that was previously listed to end in October has been announced to remain open until March the 31st 2021.

Otherwise known as the 'furlough scheme', the income system was designed by the government to provide support to employers, by enabling them to cover employees' salaries, thus protecting them from redundancy. In the first phase that ended in June, the scheme covered 80% of the employee's wages, with this being reduced to 55% in the second phase, which lasted from June to October.

Previously planned to end in October, the Coronavirus Job Retention Scheme will now remain open until 31 March 2021, due to the onset of the second national lockdown. Under this new extension, flexible furloughing of staff will be allowed, in addition to more traditional full-time furloughing. Additionally, in light of current events, the amount that employers receive to cover employee salary has increased from 55% back to the original 80% (up to a cap of £2,500 per person each month).

The 5-month extension was designed to protect millions of jobs throughout what is expected to be quite a difficult winter for millions of employees, as well as small business owners. However, despite the extensive measures that have now been taken, many still fear that the scheme hasn't gone far enough to prevent mass lay-offs across the country.

You are eligible to apply if your business has a UK bank account and a UK PAYE scheme. However, if your organisation is already publicly funded, the government does not expect you to take advantage of the scheme.

For more information on the scheme, as well as details on how to apply, visit the UGOV site here.

Local Restrictions Support Grant

In addition to the furlough scheme, for businesses in England that have been forced to close throughout this second lockdown, the Local Restrictions Support Grant (LRSG) has been designed to help tide you through this difficult time. The grant supports businesses who were open as usual before the second lockdown but was since required to close for at least three weeks. It is exclusively reserved for businesses that pay business rates on their premises - however, local councils may also provide business funding for those who aren't required to pay these rates.

For more information on eligibility criteria, and details on how to apply, learn more about the grant here.

Greater protection for the self-employed

For all the sole traders out there, help is also available to those who are self-employed throughout the November lockdown. The Self-Employed Income Support Scheme (SEISS) offers up four taxable government grants for small limited businesses and self-employed individuals. Although the first two have now come to an end, the third, which covers November to January, is set to open on the 30th of November. This grant will provide up to £2,500 each month to each applicant, with it covering 80% of an individual's average monthly trading profits.

You're likely to be eligible for this grant if you had access to the first two sets of self-employed grants. However, a new stipulation is that you must declare that your business has experienced reduced demand due to the coronavirus pandemic. Unfortunately, this means that you are unable to make this claim if you are unable to work due to shielding or self-isolating in order to avoid coming into contact with the virus.

For more information on what this grant extension covers, as well as the eligibility criteria, visit the UGOV site here.

Extension of government-backed loan schemes

If you fall short of the eligibility criteria of government-run grants, or if they don't entirely cover the needs of your business - there are other promising options available. The deadline on government-backed loan schemes like the Bounce Back Loan Scheme (BBLS) and the Coronavirus Business Interruption Loan Scheme (CBILS) has been postponed from the 30th of November to the end of January 2021. This gives thousands of small-medium sized businesses across the UK more time to access this form of financial support to help tide themselves through until regulations are lifted.

Government-backed loan schemes differ from grants that are provided by the government because they work through private lenders, and the business aims to repay as much of the loan as possible. The reason they are advantageous in comparison with other types of business loans is because they are subsidised by the government, which means that lenders are able to offer up loans with significantly lower interest rates than usual.

The Bounce Back Loan Scheme is targeted towards smaller businesses that are looking to borrow slightly less sizable amounts of capital. Specifically, the BBLS allows small businesses to borrow between £2000, up to 25% of their turnover, with the maximum amount totalling £50,000. Since the government guaranteed 100% of the loan, there aren't any interest rates to pay for the first year, and they only increase to 2.5% after the first 12 months. You're eligible for the grant if your business is based in the UK, was established before March 2020, and is able to prove that it's been adversely affected by the coronavirus pandemic.

In comparison, the Coronavirus Business Interruption Loan Scheme is focused on providing support to slightly larger businesses who are suffering from the effects of Covid-19. CBILS offers up to £5 million to businesses that fit their eligibility criteria, and (because the loan is government-backed), the borrower is also exempt from paying any extra fees during the first year of the loan. To be able to apply, your business needs to have an annual turnover of less than £45 million, and (similarly to the Bounce Back Loan), you need to prove that your business was economically impacted by the Covid-19 pandemic.

Luckily, it’s quick and easy to apply to government-backed loans. Here at MarketFinance, we make the process as fuss-free as possible, and we have a friendly customer service team to guide you along every step of the way. We're a 100% trusted, government-backed lender, we don't charge any unnecessary fees, and we always ensure that you, the client, are getting the absolute best deal possible.

For more information on the government-backed loans, as well as information on how to apply, just visit our page here.