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September 2008

Equipment Leasing

There are many companies in existence who are in the business of providing equipment, ranging from door entry systems and tills to CCTV cameras, screens and projectors and even major air conditioning work to clubs on lease arrangements.

The information supplied by these companies often looks attractive and the sales personnel employed are mostly smart and personable. However, the fact is that most offers, whilst at a glance might appear good value, ultimately involve complex leasing contracts which run for many years and sometimes incorporate automatic renewable terms in the event of cancellation notices not being provided by clubs within a specified time slot.

Leasing works on a hire purchase system and equipment will never ultimately belong to the club. In almost every case, companies selling the equipment use a separate finance company which actually owns the equipment and it is this finance company which a club will deal with if there are problem with either the equipment or the lease.

Therefore, when problems occur, the companies which sell the equipment to clubs no longer wish to be involved and clubs are left defend themselves against finance companies which are always quick to threaten legal action in an aggressive manner, introducing additional financial penalties which add further financial costs and often anxiety to club officers.

Some clubs have ended up paying in the region of £23,000 for a simple door entry system and, in one case, a club calculated that £48,000 had been spent over ten years on a door entry system which was no longer being used. In each case, the leasing contracts were legally binding and left no escape route for the clubs concerned. I strongly advise clubs not to enter into leasing arrangements for such equipment, however plausible the offers may appear to be.

Glossy brochures and smart-talking salesmen cannot hide the fact that clubs would be better off buying the advertised equipment outright (with perhaps an additional simple maintenance agreement), or borrowing the money from a bank to purchase outright what is required.

All clubs with such agreements in place should re-examine the contracts they have entered into and make careful notes as to when cancellation notices should be made. Also, avoid agreeing to offers of upgrading lease equipment already in place as these invariably create new contract terms.


Minimum Wage – New Rates

National Minimum Wage (NMW) applies to nearly all employees and sets hourly rates. The employer must maintain records of hours worked and payments made. The employee may request inspection of these records and ask for a copy of them. The rates set are based on the recommendations of the independent Low Pay Commission and they change on 1st October each year.

Current NMW rates from 1st October 2008-10-16
Workers aged twenty-two and over - £5.74/hour
Workers aged eighteen to twenty-one - £4.77/hour
Workers aged sixteen and seventeen - £3.53/hour
Accommodation offset - £4.46/day (£31.22 per week)