As measures increase and the government announces new legislation daily, we have put together some helpful advice around the main topics companies are looking to us for assistance. The government have announced measures to help organisations to continue to pay employees wages during the COVID-19 crisis.
The measures include a “Coronavirus Job Retention Scheme” for employees. To qualify for this, employers need to;
- designate their employees as “furloughed workers” (to “furlough” employees means to put them on a paid leave of absence)
- notify the employees of this change
- submit “furloughed workers” information to HMRC through an online portal
HMRC will issue grants to cover 80% of the wages of “furloughed workers”, subject to a maximum salary of £2500 per month. HMRC are currently setting up the portal, and a system for reimbursement as existing systems do not exist to make payments to employers.
The Coronavirus Job Retention Scheme should be used as an alternative to laying staff off where possible. We expected that this scheme would apply to the wages for anyone on the PAYE scheme, including casual staff. This scheme is valid from 1st March 2020 for three months with the scope to extend this period.
General Update – Monday 30.03.20
- Furloughed employees may carry out voluntary work during their furlough period
- Employees can be furloughed more than once under the scheme subject to each period of furlough being for the three-week minimum
- Current guidance does not require employers to provide any evidence in support of their claim for a refund of furlough pay.
However, as HMRC retains the right to audit all aspects of these claims after they have been paid, we recommend that you;
- retain some sort of record of why employees were furloughed
- record and retain details of how the 80% you reclaim is calculated
- retain copies of communications with employees regarding their furlough arrangements
Holiday Entitlement and Furlough
Three key pieces of information have come to light in relation to holidays in the last couple of days;
- employees will continue to accrue holiday entitlement while they are furloughed – although no official Government confirmation has been received, the CBI has said that they are aware that this is the case
- the Government has announced it is going to change the rules around holidays to allow employees to carry over holiday entitlement into the next two holiday years – further details to follow
- employees cannot take annual leave whilst they are furloughed so any holiday booked for the furlough period needs to be carried forward for when employees are at work
Employers will need to manage the issue of holiday entitlement and furlough leave to ensure large amounts of holiday entitlement do not accrue and cause operational problems when employees return to work. Employers should be aware that subject to certain notice requirements, they can tell employees when to take their holiday entitlement. If you want further details of how this operates, please contact us.
Statutory Sick Pay (SSP)
With effect from Friday, 13th March 2020 employees who have been advised to self-isolate even though they are not unwell are entitled to be paid SSP.
The government have announced other planned changes to SSP, but we are waiting for further details of these so currently, normal SSP arrangements remain in place.
The planned changes are;
- removing the three days “waiting” period and paying SSP from day one.
- allowing 111 to issue sick notes instead of employees needing to visit their GP to obtain one
- repaying employers with less than 250 employees up to two weeks SSP paid to employees absent due to COVID-19
We will let you know of new developments as they are announced but currently you need to;
- keep a record of all COVID-19 related sickness absence and payments made
- apply the existing rules regarding SSP pay and documentation – all employees can self-certify for seven days and then should provide medical evidence of their incapacity for work The weekly rate of SSP increases from £94.25 to £95.85 on 6th April.
- If an employee can’t work
- If an employee is too ill to work, whatever the reason, your normal rules on sick leave and pay should apply.
Working from home
- If you decide to require employees to work from home to reduce the risk of contracting the virus, they are entitled to their usual pay and benefits.
Time off to look after others
Employees are also entitled to take a reasonable period of unpaid time off work to care for dependents due to unexpected events or in emergencies. An employee taking time off to look after their children when a school has closed, or to care for an elderly relative when a carer is unavailable, has the statutory right to take a reasonable period of unpaid time off work.
This should be sufficient time to make alternative arrangements but in reality, it is often to provide the care themselves. An employer should not discipline or dismiss an employee who takes this form of leave without seeking advice.
Where an employee has been advised to self-isolate, they are entitled to receive SSP. You may agree that they are able to work effectively from home in which case they should be paid their normal pay and benefits.
The employee won’t attend work.
Where an employee refuses to attend work because they are frightened of becoming infected either at work or on the commute to work, this is an unauthorised absence.
In principle, an employer could take disciplinary action against an employee who refused to attend work, but you should consider their circumstances before doing so. You should take into account things like any underlying health condition which may make them more concerned. Ideally, you could reach some agreement with the employee such as them taking a holiday or simply agreeing to a period of unpaid leave. If the employee’s stance is unreasonable, then seek advice about what action you can take.
Employees Holiday Plans
You can ask employees about their holiday plans to enable you to assess any risks when they return to work.
Temporary Closure/Lay Offs
If it becomes necessary to close or lay off some of your employees, if you have a layoff or short term working clause in the employment contract, this should cover the situation. If not, employees should be on full pay and benefits.
If this situation arises, contact us for some advice to discuss your options.