On the evening of Friday 20 March, 2020, the Chancellor of the Exchequer announced further unprecedented measures to help individuals and businesses cope with the financial strain caused by the coronavirus.
The new measures include:
The Coronavirus Job Retention Scheme: all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during the crisis. If an employee is unable to work due to the coronavirus pandemic, the government will pay up to 80% of their gross salary (up to £2,500 per month).
This measure is initially open for three months and the Chancellor of the Exchequer has confirmed it will be extended if necessary. This salary subsidy will be backdated to 1 March 2020 which means that it will also apply to businesses who have already had to lay-off employees due to the coronavirus pandemic, so long as those employees are brought back into the business.
Employers will need to:
1. Designate affected employees as ‘furloughed workers’ and notify employees of this change (existing employment law applies and changing the status of an employee may be subject to negotiation); and
2. Contact HMRC through a new online portal that will be set up and submit information about the employees who have been furloughed.
The government hopes that the first payments will be made to employers by the end of April 2020. This measure is aimed at protecting jobs and avoiding mass unemployment.
*The information set out in this article is correct at the date of publication (23 March, 2020). The effect of coronavirus on businesses is a fast-changing area and so it is important to obtain legal advice to ensure you are properly protected. Find out more about the latest Government support for employees.
If you have any questions regarding the impact of the Coronavirus upon your business or are seeking up-to-date legal advice, contact Alice Toop on 01202 294 566 or email AliceToop@steeleraymond.co.uk.
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