Over recent days, there have been further government announcements which affect employers and employees. The key points to note from the announcements are set out below:
1. The introduction of the Job Support Scheme (JSS)
As you know, the Furlough scheme is coming to an end on 31st October 2020. The ending of this scheme brings with it the likelihood of a substantial number of redundancies as employers have to decide whether the job (or number of employees carrying out the job) is viable (so the employees can be brought back to work), or alternatively, whether redundancy is required.
The JSS will run from 1 November 2020 and will be in place for 6 months.
The JSS scheme is very different from the current furlough scheme and it is understood that the JSS will operate as follows:
- An employee will need to work and be paid for at least one-third of their normal hours (33%) by the employer.
- For the employee’s remaining hours (67%):
- one-third (22%) will have to be paid for by the employer;
- one-third (22%) will be paid by government;
- the remaining one-third is unpaid.
- The level of the payment from the government will be calculated based on the employee’s usual salary, up to a maximum of £697.92 per month.
- An employee could, therefore, receive at least 77% of their pay (subject to the maximum payment from the government), whilst only working 33% of their time.
- Employers will be reimbursed in arrears for the government contribution.
- Unlike the furlough scheme, the JSS will not be available for employees who have been given notice of redundancy i.e. an employee’s notice cannot run at the same time as a claim under the JSS.
- All SMEs will be eligible. Larger businesses will only be eligible if their turnover has fallen during the pandemic and the government expects that they will not issue dividends (or other capital payments) while using the JSS.
- All employers can potentially access the JSS (subject to qualification) and the employer does not have to have used the furlough scheme.
- Employers who retain furloughed staff on shorter hours will still be able to claim under both the JSS and the Jobs Retention Bonus.
Further guidance on the JSS will be published in due course.
Whilst we acknowledge that further help from the government was required to prevent a cliff-edge for employers this scheme, unfortunately, requires employers to pay employees at least one third of their wages for the time worked, plus a further third (22%) for the time when they are not working, plus pension contributions and National Insurance contributions (employer).
The furlough scheme for October requires the employer to pay up to 20% of salary plus pensions contributions and employer National Insurance contributions only. Under the furlough scheme, the employee can receive up to 80% of their wages from the government, subject to the monthly cap or if the employee is on flexible furlough, the difference between working hours and non-working hours can be claimed, subject to the monthly cap.
If an employer is struggling financially, therefore, the new scheme may not be quite as helpful as first thought and perhaps employers would be better placed to agree directly with the employees a short time working agreement or reduced hours, as an alternative to making redundancies. In this scenario, the employer would only be required to pay the employee for the time actually worked. Of course, this would result in the employee receiving less pay but will also cost the employer less too.
2. Requirement to self-isolate
New regulations have been made which came into force at midnight on Sunday 27th September 2020 in England.
The regulations set out mandatory periods for self-isolation, and a duty to notify the Secretary of State of the names of people in the same household as anyone who has tested positive for Covid-19.
It is now an offence for an employer to knowingly permit an employee or worker (including agency workers) to attend any place, other than where the individual is self-isolating where there has been a positive test. This includes individuals who are required to self-isolate because they live with someone who has tested positive.
As such, if an employer knows a worker has tested positive (or lives with someone who has tested positive), that employer is now responsible for stopping the worker from attending work (unless they can work from home). Any employer which fails to do so will face a fine, starting at £1,000.
There is also an obligation on the worker to tell their employer that they are self-isolating.
Any individual who breaches self-isolation will, normally, commit a separate criminal offence.
3. Return to working from home
The Prime Minister has advised employers that, where possible, workers should be working from home.
This is frustrating for many employers, particularly those who have just spent a considerable amount of time and effort making the workplace “COVID Secure” after following the Government’s previous advice. However, as an employer, consulting your employees is important to determine whether they are happy working from the workplace or whether they would prefer to work from home. Where employees cannot work from home, it continues as business as usual, subject to COVID Secure provisions being in place.
Clinically vulnerable individuals can continue to attend the workplace if it is COVID Secure, although where possible, they should work from home
4. Ongoing childcare issues
Some employees are still having difficulties with childcare, for example, where children are sent home from school or nursery due to positive cases. Employees are entitled to time off for dependents to allow them time to find alternative (childcare/dependants’ care) arrangements.
Please also bear in mind that, the employee may have to self-isolate themselves of course (see above).
In terms of payment for time off/self-isolation, employees may, if they have COVID symptoms or are in a household with others who have COVID symptoms, be entitled to SSP (or company sick pay), which in some instances, can be reclaimed from the government. SSP is also payable where an employee has been told to self-isolate as a result of track and trace. SSP is payable from day 1 and there is no 3 day wait where it is COVID related.
Employees could also choose to take annual leave or a period of unpaid leave (subject to agreement). For those who choose to take annual leave, they would be entitled to normal pay for such absence.
Employees who are on certain benefits can also claim a £500 one-off payment from the government. They have to provide evidence confirming the requirement to self-isolate and also a letter from their employer.
5. Use of face masks
New regulations came into force on 24th September 2020 requiring staff working in hospitality and retail to wear face masks.
6. Self-Employment Income Support Scheme (SEISS)
For those currently eligible for SEISS and who continue to actively trade but face reduced demand, there will be an initial taxable grant worth 20% of average monthly trading profits, up to a total of £1,875, covering the period from November 2020 to the end of January 2021.
It is also anticipated that a further grant, will be available for the period from February to the end of April 2021, the total amount of which will be confirmed nearer the time.