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A climate of change at the Crossroads Motel; Carlton plans to resurrect TV soap Crossroads from the ashes. Three specialists from law firm Martineau Johnson tell John Duckers what lies in store for the new management and staff.

A big 'under new management' sign will soon be hanging over the Crossroads Motel taking shape in the Kings Oak area of Birmingham.

But what lies in store for the owners and staff responsible for the smooth running of what will become the UK's highest profile hotel?

According to partner Matthew Hansell, the business climate today is much friendlier than it was back in the 80s. In those days the old Crossroads Motel - if Meg had chosen to sell it - would have been subject to 40 per cent capital gains tax, a massive liability by anyone's standards.

With the aim of increasing long-term share ownership, Chancellor Gordon Brown has reduced that liability - provided shares have been held for at least four years - to just ten per cent.

'It is a real entrepreneurs' world now,' said Mr Hansell. 'The climate has changed completely and from the tax point of view this is a very good time to be in business.'

His view is echoed by Yvonne Redfern, Martineau Johnson's director of tax, who said: 'With corporation tax down to as little as ten per cent, and with new Crossroads employees likely to be incentivised by share options schemes which are the most tax-advantaged in the world, things look pretty good for the new business and its employees.

'The downside is that despite everything the Government tells us, we are still one of the most highly regulated economies in the world.'

Crossroads Hotel will have done well to survive the past 12 years, without having gone into receivership at some time.

The industry's crisis peaked about a decade ago, when insolvency practitioners were among the largest hotel operators in Britain, as they kept ailing enterprises afloat while they searched for new owners.

This period saw intense activity on the mergers and acquisitions front.

Having weathered these storms, the new management team will no doubt have made itself familiar with a raft of new legislation, much of which has been imposed on the UK from Brussels.

The Human Rights Act, for example, becomes law in October, and gives employees rights not previously available in England and Wales - such as the right to 'peaceful assembly' and to freedom of expression. Employment law specialist Ian Marshall says this effectively means that employees might be able to demand the right to hold union meetings and the like in company time - even though they disrupt the hotel's day-to-day business.

And provided they follow the proper procedures, they will also have a legal right to blow the whistle on the hotel for breaches of health regulations, or other issues of public concern.

Crossroads will undoubtedly have an Internet presence and will rely heavily on e-mail for instant communications.

This means it must have a code of practice for Internet use banning the downloading of pornographic or sexually explicit material and banning employees from sending offensive or salacious messages to other users, inside or outside the business.

Mr Marshall added: 'The hotel must also decide its policy on dress codes. It may be in breach of sex discrimination laws if it tries to insist that female employees wear skirts and dresses, rather than trousers.'

Said Mr Hansell: 'Although it is a good time to be in business, there is even more red tape now than there was in the 80s, and the hotel's new management will just have to live with it.'

P.S. Benny never found that spanner. Instead he stumbled into a cyber cafe, became hooked on the internet, and made his fortune earlier this year when his sold his www.woollyhat.com website at the height of the market.

Meg took to life on the ocean waves, and is now an entertainer on the cruise ship SS Lunchbox, sailing from Miami.

Noele Gordon and Paul Henry are joined by members of Martineau Johnson solicitors Ian Marshall (seated), Yvonne Redfern and Matthew Hansell. While the Crossroads Motel would have been lucky to survive the past 12 years, the business climate looks brighter for the hotel sector.

Montage / JAMIE JONES

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Staying power: New, profitable world for hotels
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Publication:The Birmingham Post (England)
Date:Sep 22, 2000
Words:680
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