The government has announced the launch of a new online service to let small and medium-sized employers claim back some coronavirus-related Statutory Sick Pay (SSP).
Originally announced several weeks ago, the government has finally confirmed when the Coronavirus SSP Rebate Scheme is set to be open for applications. The scheme covers staff SSP payments for up to two weeks of sickness absence when the absence is related to the coronavirus outbreak. Any additional, contractual sick pay is not included.
Through use of the scheme, organisations will be able to apply for rebates on SSP paid to staff who were off work due to having coronavirus symptoms on or after 13 March 2020. Rebates will also be available to staff who started ‘shielding’ in line with government guidance on or after 16 April 2020. To be eligible to apply, organisations will need to have had less than 250 members of staff on 28 February 2020.
The Scheme is set to cover any members of staff who were on a PAYE payroll scheme created and started before 28 February 2020. This includes:
full-time employees
part-time employees
employees on agency contracts
employees on flexible or zero-hour contracts.
Furloughed staff are not included as, due to being furloughed, should not be receiving SSP.
Organisations will need to make use of an online portal in order to submit claims. They will need to submit record of all SSP paid to employees that they wish to claim for, but will not need to submit evidence of illness, such as an employee’s fit note. They will also need to have a Government Gateway ID. In order to make the application process simpler, it is expected that alternative methods of applying, without using the online portal, will be announced soon.
As we head towards 26 May, organisations should work out the pay periods they wish to set and how many staff they wish to claim for in each period, alongside the amount of SSP paid. It should be remembered that the weekly rate of SSP is £95.85 as of 6 April 2020. Prior to that date, it was £94.25.
In a statement to the House of Commons, Chancellor Rishi Sunak has confirmed that the Job Retention Scheme is to be extended to the end of October.
Sunak confirmed that, until the end of July, the scheme will continue under its current provisions. From August to the end of October, more flexibility will be added to the scheme in order to assist employees in returning to work. In this period, the following changes will take effect:
Employees will be able to return to work part-time and still benefit from the Scheme
Whilst 80 per cent of wages will still be paid to furloughed staff, the cost will be shared between organisations and the government, as opposed to the government covering the full cost.
Full details on how this will work in practice is expected at the end of May.
The government announced new legislation which outlines that where statutory maternity leave starts on or after 25th April 2020, statutory maternity pay is to be assessed according to the employee’s usual full pay rather than their furlough pay.
It was understood that employees could be furloughed if they were on Maternity leave and that they could continue to receive statutory maternity pay. This policy needed further clarification on how the present COVID-19 retention scheme would interact with the family related leave that was already set in place.
The Statutory Maternity Pay (SMP) entitlement, along with the other family related pay schemes like parental or adoption pay are at present calculated by using the average earnings over an 8 week period. To qualify and to be eligible for SMP or SAP that employees average weekly earnings should be at the minimum equal to the lower earnings limit which is currently set at £120 per week over the 8 week test period. This period and the earnings are also used to determine the earnings-related rate of SMP and SAP for the first 6 weeks.
New legislation has now confirmed that the furloughed workers who are due to take their maternity, paternity, adoption, shared parental or parental bereavement leave after the 25th April will have their pay assessed based on their usual salary or full pay. No reductions are to be implemented from the Coronavirus job retention scheme.
Paul Scully the Business Minister has said “We’re supporting workers and the businesses in a way that the country has never seen before, in response to the unprecedented effects that COVID-19 has caused. The measures set in place are to ensure that those on the job retention scheme should continue to receive the parental leave and statutory pay that they are entitled to”
The changes that have been set in place are to ensure that the employees that intend to take time off for Maternity, Adoption, or bereavement will not lose out on entitlements to their pay as a result of being in furlough.
Companies and organisations will now have to take this into account when they calculate the amount that is payable to the furloughed staff who are due to take this form of leave. This could mean some fast recalculations of the previously worked out pay. They should also remember that the statutory rates for family leave was also increased at the beginning of April with a rise to £151.20 per week or 90% of their average weekly earnings, whichever is lower.
In July of 2017 Matthew Taylor published a report into modern working practices and stated that numerous changes were needed to improve the productivity of employees. In December 2018 the government responded with the “Good Work Plan” this promised developments to the law over the course of the next few years. In particular this month, April 2020. However, due to numerous worries like the Brexit and the Coronavirus outbreak companies have put the changes on the back burner. Never the less, today on the 6th April the new laws have still come into effect.
From today the following laws apply:
Changes to written contracts of employment April 6th 2020
Several changes have been introduced to the right to receive a written statement of the main terms (SMT) The document will list all of the employees key terms of employment, this will include their pay and annual leave entitlements. Up until today organisations were given 2 months to give this to a new employee. The grace period that existed from today has been removed. This means that the SMT will now have to be given to the employee from the first day of their employment.
Not only this, more details now will have to be stipulated in the SMT these are as follows:
Details of training provisions and requirements.
Terms and conditions that relate to work have also been extended to cover the terms that relate to normal hours of work, the days of the week that the employee will be required to work and if these will vary.
Terms related to paid leave such as family friendly leave.
All details of other employee benefits, such as benefits in kind or financial benefits.
Terms relating to probationary periods including those in relation to length and conditions.
Employers now also have to provide and SMT to their “workers” as well as all of their employees, this includes employees on a zero hour contract and casual workers.
National Minimum Wage increase April 6th 2020
The rates are for the National Minimum Wage. The rates change every April. The New rates below:
Holiday pay changes April 6th 2020
From the 6th April 2020 companies will now have to use a period of 52 weeks when calculating holiday pay to work out the average opposed to the previous period of 12 weeks.
This will be used to calculate holiday pay for employees who work irregular hours. The new calculation will balance out peaks and troughs of working hours throughout the year.
Parental bereavement leave
As of today, the 6th April 2020 all eligible employees will be allowed to take 2 weeks leave if they suffer either a stillbirth after 24 weeks into their pregnancy or a child under the age of 18 dies. This right is implemented from day one of employment and employees are entitled to take these in one single block of 2 weeks or two separate blocks of 1 week leave. Employees will have up to 56 weeks following the bereavement to take this leave.
Agency workers
As of today the “Swedish derogation model” contracts given to agency workers are banned. The contracts were used as a legal loophole to avoid paying agency workers the same basic pay as their direct recruits at the company after 12 weeks of being assigned. Anyone who is at present engaged on one of these contracts will be entitled to a statement to explain the effect of the ban on their pay. This will need to be given out no later than the 30th April 2020.
All agency workers will also now be entitled to a key facts sheet before agreeing to any terms which they will be undertaking work. This will include the minimum rate of pay, any deductions that could be expected from their pay and the type of contract the agency worker will be given.
On March 20th the government announced plans for financial help to ease the strain on organisations and retain employees for an extended period of time. This is called the job retention scheme, as of now not much information has been given as to how it’s going to work. Here’s what we do know though!
What is the Job Retention Scheme?
The job retention scheme involves the organisation placing their employees on what the call “furlough” the term is foreign to the United Kingdom and we believe it originates from the USA. In a nutshell this means you place an employee on a temporary leave of absence, they do not have to work and receive no pay but are brought back in to work when needed.
Companies that do this will be given a grant from the Government that will cover 80% of the employees wages up to a maximum of £2500 per person per month.
What companies is the job retention scheme available to?
The retention scheme is available to all companies and organisations there are no restrictions.
How do I get the government grant to pay staff wages?
You will first need to choose which of your employees are going to be furloughed and then submit their details to the HMRC with details of the employees earnings. You will then receive the grant to cover 80% of the employees wages. We are waiting for more information from the government about the online portal that is to be used to submit these details along with other information that may be required from you.
Rishi Sunak the Chancellor state that he hopes the first instalment of grants will be paid out to companies by the end of April 2020 and they are to be backdated to the 1st March 2020. At the moment we know that the scheme will run for 3 months with the room to be extended if needed and the coronavirus pandemic continues.
Which of my employees can be furloughed?
In most cases any of your employees can be placed on furlough. As long as they are on PAYE. The guidance states that the ability to place your employee on furlough depends on the employee contract. It is highly unlikely that your employee contracts have furlough clauses in them, however they may have the right to lay-off employees on no pay for a temporary period.
The only difference is that employees that are on layoff will get statutory guarantee pay (SGP) whereas the furloughed employees will receive the 80% of their wages. SGP is £29 per day up to a maximum of 5 days in a rolling 13 week term, this rises to £30 from the 6th of April. Furlough is a much more favourable option for employees.
If the employee contracts do not contain unpaid layoff clauses you can ask your employee to agree to be furloughed. 80% of their wages may not be as promising as full pay but it is better than making them redundant. In the wake of this COVID19 pandemic it may also be a better deal for your employees that are at present struggling with their childcare arrangements.
What if I have already laid-off some employees?
If you have done this it’s not too late to get in touch with your employees and ask them to agree to change their status from being laid off to being furloughed. This would be a simple process and involved changing their pay from zero to 80 percent of their wages, providing they haven’t already got alternative employment.
Do I need to pick certain employees?
It is totally your choice as to who you furlough. If you are not placing your whole work force on furlough you should choose wisely with careful consideration. It may be assumed that the best options are the employees in the high risk category and forcing them on to a furlough agreement without talking to them first, this could end up in a discrimination claim from your employees that claim they were forced because of their age, disability or even a pregnancy. Check out our legal implications of Coronavirus post for more information.
We believe you should ask for volunteers initially and any volunteers that come forward in the high risk category should be chose first. There is not at present a maximum number or a minimum of employees that can be furloughed.
Do I have to make up the missing 20% of the furloughed employees wages?
This is voluntary and down to you as a company to decide there is no requirement to do so.
How will the 80 per cent be calculated from a zero hour contract employee?
The Government have not given any insight to this just yet but the Chancellor stated that his intention was to try and cover as broad a group of employees as possible.
Emergency legislation promised by the Government on extending sick pay has now been passed.
The Statutory Sick Pay (Coronavirus) (Suspension of Waiting Days and General Amendment) Regulations 2020 came into force on 28 March 2020.
These Regulations remove the need for employees to serve three waiting days before they become eligible for statutory sick pay meaning that it is now payable from day one, rather than day four, where the reason for the absence is coronavirus sickness or self-isolation. The Regulations include a back-dating provision, so that any periods of incapacity which started on or after 13 March 2020 will no longer serve waiting days.
Other eligibility criteria have not changed, meaning that workers still need to earn at least the lower earnings limit on average, which is currently £118 per week but will increase to £120 per week from 6th April 2020.
In addition, the Working Time Regulations 1998 have been amended to allow for more flexibility when dealing with annual leave remaining in this leave year. Due to circumstances, workers may struggle to take their remaining entitlement before the end of the leave year. This may be because:
they’re self-isolating or are too sick to take holiday before the end of their leave year
they’ve been temporarily sent home as there’s no work (‘laid off’ or ‘put on furlough’)
they’ve had to continue working and could not take paid holiday
The Regulations now give workers a statutory right to carry leave over into the next two leave years after this one. This only applies to the first 4 weeks of leave under the Regulations (Regulation 13 leave). The other 1.6 weeks of statutory minimum leave is already capable of being carried over to the next leave year with agreement from the employer and the new laws do not change this. This means that all statutory minimum annual leave accrued in this leave year is now capable of being carried over, in the following way:
4 weeks (legal entitlement to be carried over to next two leave years)
1.6 weeks (employers can agree that this be carried over to the next leave year)
The rules on pay in lieu of untaken annual leave have also been amended so that, when employment terminates, the holiday pay payable will include anything carried over and not taken due to the coronavirus carry over. The law still does not allow pay in lieu of statutory minimum entitlement at any time other than termination.
Many will be breathing a sigh of relief after a year long delay has been announced to the roll-out of the private sector off-payroll rules.
This controversial change has been postponed as response to the Coronavirus.
In the House of Commons yesterday, Steve Barclay, the chief secretary to the Treasury, said that the IR35 changes that were due to come into force at the start of April 2020 are to be pushed back for a year and begin in April 2021. “This is a response to the ongoing threat of Covid-19 as a way of helping businesses and individuals” he said.
He also added that it was not to be confused with a cancellation and that the Government will remain committed to reintroducing the policy to ensure that people working like employees, in their own limited companies, pay the same tax as those who are employed directly.
Long before the postponement was announced, employers, recruiters and freelance groups had been calling for a delay, so it comes as a welcomed announcement.
The CEO of Morson Group, Ged Mason said that the delay has come at a “Poignant time” for UK industry. He said “Many businesses that rely on flexible talent and contractor populations will take a sigh of relief”
IR35 states that if a contractor is to carry out the same work, or similar work to a permanent staff member, the employer is required to take income tax and NI contributions like they were an employee. The new legislation was introduced to make sure that workers that undertake similar roles are paying the same tax amounts regardless of whether they were an employee or a contractor.
The changes will shift the responsibility of assessing which of the contractors come under this category to employers. These changes have applied to the public sector employers since 2017.
Head of the legal services department at Brookson Group, Matt Fryer, said “The delay will allow businesses that have not yet prepared for the change, more time to take action” “Hopefully some of the businesses that have implemented knee-jerk blanket bans on contractors will now have the time to reconsider this as their strategy for ensuring access to flexible expertise.”
He also added that employers should now have a clearer understanding and guidance from the HMRC than when the initial date for the rollout was set. ” Those end hirers that have invested in getting IR35 right are going to be well prepared for April 2021 and can now use this next year to consider how to accommodate for roles currently thought to be inside the regulations of IR35.
“We would advise businesses that do work with contractors to build IR35 compliance into their planning for the next financial year. Bearing in mind that it has taken many companies 6 months to prepare for the initial deadline”
Chief executive of the FCSA, Julie Kermode has said the delay would enable businesses to focus more on the immediate complexities of responding to the Coronavirus. Which is priority. ” I very much hope that some detailed analysis of the wider implications of this reform can be undertaken in the next few months in order to establish whether or not it should be scrapped entirely.”
The operations director at APSCo said “Many companies have already spent a large amount of their time and effort preparing and planning for the changes” “Nonetheless, many in the staffing and recruitment sector will welcome the change” “Now’s not the time to make flexible labour more expensive or the hiring of contingent labour more difficult, when our sector is facing unprecedented times.”
She also added that the delay could kick start the hiring of remote workers who operate through personal service companies, noting that some employers have had to put a blanket ban on using contractors as their response to the changes in IR35.
Andy Chamberlain the director of policy at IPSE also welcomed the delay. He said it was a “sensible step” to limit damage to self employed. “It’s right and responsible to delay the changes during the coronavirus, this will reduce the strain and income loss for self-employed businesses”
Chamberlain called on the government to do more to protect the income of the contractors. He said “They must create an emergency income protection fund to keep the UK’s crucial self employed businesses afloat”
On 23 June 2016 the UK voted to leave the European Union. A majority of the population voted to Leave, rather than Remain, triggering the start of preparations for the UK withdrawing.
The governments commitment to protecting workers rights following Brexit was reiterated by The Prime Minister using the 2016 Queen’s Speech.
Whilst it is not yet clear what changes there may be to employment law, or when any changes will happen, it is almost certain that there will be some changes. One area that we know will see change is the rights of EU nationals to work in the UK.
The date when the UK is expected to leave the EU (originally the 29 March 2019) was delayed to 31 October 2019. However, this was since delayed again until 31 January 2020, and, on this date, the UK officially left the EU.
Although a withdrawal agreement was successfully negotiated and passed by both the UK and EU Parliament, a transition period is now in place until December 2020 to work out future trade agreements with the EU. Although an extension of this period could potentially happen if necessary, Prime Minister Boris Johnson affirmed in the 2019 General Election that no further extensions to the Brexit process would occur.
Brexit and the coronavirus
There has been no confirmation as yet as to if the 2020 coronavirus outbreak will serve to delay the Brexit transitional period, which is set to end on December 31 2020. However, negotiations between the UK and the EU have been pushed back as all countries work to respond to the developing coronavirus situation, which I currently priority.
Right to work checks will remain the same after Brexit
Until 1 January 2021, the Home Office has confirmed that right to work checks on EU and EEA nationals will continue as normal, under the processes laid out within the prevention of illegal working guidance published in January 2019.
There will be no requirement on organisations to differentiate between those citizens who were resident in the UK before, or after, the date of the exit. Instead, the normal documentary or online right to work checks can be carried out.
At present there seems to be a high possibility of a Covid-19 pandemic in the United Kingdom. Infection rates could be seen to rise to nearly 60% of the population, with 25% suffering from more severe symptoms and 2% will require treatment.
If the Cornavirus spreads like suspected it will have a number of knock on effects, transport, schools, working patterns and more.
As an employer it would be irresponsible to presume that these predictions are exaggerated because we have survived other high-profile diseases and they haven’t spread like we thought they may. Now is the time to take sensible precautions and to prepare yourself for the worst. This could protect you from financial losses and claims in the future.
Your obligations
Contracts of employment contain obligations for you to take care of the health and safety of all of your employees.
Any breaches of these obligations could potentially lead to constructive dismissal claims and employee resignations.
As an employer you also have to follow a common law duty that states you have to take reasonable care of the health and safety of your employees. This includes providing them with a safe place of work.
If the damage was easily foreseeable your employee could bring a personal injury claim against you.
As a business you are subject to a similar obligation found under the Health & Safety at work act(1974) any breaches of this could lead to a criminal prosecution against you.
So it is imperative that you plan and prepare for what could be ahead.
Am I allowed to discipline or dismiss someone who is not ill but is refusing to come to work?
Dependent on the circumstances, yes. First you must take into account any existing conditions that may contribute to irrational or increased anxiety issues.
Do I have to still pay my employee if this happens?
It may well be a good idea for you to do so as the employee has rights to contractual sick pay. However, if the employee is not ill this does not apply. As previously mentioned though, if the employee is suffering from anxiety about the current threat of coronavirus, then they are entitled to the sick pay.
What should I do if my employee comes to work after being in contact with a person infected with the Coronavirus?
To begin with you should make sure that there are clear instructions that staff should not do this and that they should contact you via telephone if they believe they have been in contact with an infected person.
If any of your employees ignore this instruction then you can ask them to go home or to work from home. It is a possibility that you may have to pay your employee should this occur.
Should I impose new safety rules on staff? Do I need to talk to them about the new rules?
If the number of confirmed cases continue to rise as quickly as it has then there will be a duty for you to do so. Even now some would argue that as an employer you have a responsibility to impose these new safety rules.
It’s good practice to consult with all of your management team withing your organisation and to consider your specific needs and operations.
What if my employee chooses to ignore new rules?
If this situation arises then you may be in a position to take disciplinary action. Dependent on the specific circumstances a warning should be implemented first.
Can I adjust working hours to reduce the number of my employees at work at the same time?
Perhaps a good precaution to take if you believe it may reduce a risk of the staff becoming infected. You should however consult with the staff first.
Can I lay people off work or reduce their hours if my revenue becomes affected?
Dependent on if you have stipulated this already in your employee contracts. A well worded disaster recovery plan may give you this right.
