Our Solution Partner Moore Thompson Chartered Accountants tell us:
Many businesses will be struggling with a variety of issues due to the impact of the Coronavirus outbreak, but a key consideration for many will be employment costs and staff safety.
The Government has taken significant steps to help businesses protect jobs by introducing measures that seek to subsidise wages and provide refunds for those on sick pay as a result of the virus.
Coronavirus Job Retention Scheme
The Chancellor has announced a scheme to reimburse up to 80 per cent of the cost of the wages of ‘furloughed workers’ up to £2,500 per employee per month.
This scheme will initially run for three months from 1 March 2020 and will be backdated. The Scheme will be administered by HMRC and all UK businesses and charities will be eligible.
HM Revenue & Customs (HMRC) has now published detailed guidance for operation of the Coronavirus Job Retention Scheme, which confirms that:
- The scheme applies only to workers who were on the payroll on 28 February 2020;
- Workers made redundant since 28 February 2020 can be included in the scheme, if you agree to take them back on; and
- The scheme covers full-time and part-time employees, employees on agency contacts and employees on flexible or zero-hour contracts.
[Read the guidance for employers on the HMRC website]
[Read the guidance for employees on the HMRC website]
If businesses are unable to wait until the scheme is fully implemented then they may wish to seek immediate financial assistance via the Coronavirus Business Interruption Loan Scheme to support cash flow in the meantime.
Statutory Sick Pay (SSP)
Anyone who contracts Coronavirus, or who is required to self-isolate under the Government’s current guidance may be entitled to statutory sick pay (SSP).
Only qualifying employees, whose average weekly earnings are above £118 are entitled to SSP. SSP is paid at a rate of £94.25 per week.
Full details of the new measures can also be found on our COVID-19 Business Support Hub.
The Government has provided further advice to employees, which can be found by clicking here.
Contractual Sick Pay
It may be necessary to pay additional sick pay in circumstances where this is provided for in a contract of employment, in the employee handbook, or even where it is usual practice to do so.