In the wake of the extraordinary closures across the country in the government’s bid to contain coronavirus, we’ve gathered practical tips for businesses operating in this period of uncertainty where the landscape is changing by the day.
Unprecedented intervention packages
As new measures are being unveiled daily to flatten the curve and alleviate the pressure placed on the NHS from coronavirus, on Friday the Chancellor outlined vital lines of support for companies. Rishi Sunak outlined a business bailout package worth £350bn to help firms cope with the lockdown.
The government is set to pay the wages of millions of workers across the UK up to £2,500 per month to shield them from the immediate economic crash experienced in the wake of the coronavirus outbreak.
On Friday, restaurants, pubs, clubs, gyms and theatres were told to close overnight, with an estimated one million jobs in the hospitality industry alone placed at risk. The UK government announced plans to incentivise companies to not make mass redundancies where possible.
Employers urged not to cut jobs
In the wake of closures mandated around the country, job losses have already started to happen. Schools shutting, parents having to work more flexibly and self-isolation is also putting more pressure on organisations that rely on staff coming in, compounding the risk of job losses around the country.
The most recent support measures unveiled to stem job losses and support the economically vulnerable:
- Employers will be able to access grants by the end of April from the HMRC to enable them to keep paying staff. This will enable the government to cover 80 per cent of gross wages in the private sector, which will be backdated to March. The scheme is predicted to last three months to avoid mass redundancies.
- Classifying workers as ‘furloughed’ so that they are kept on employer payrolls rather than being laid off will enable employers to access the Coronavirus Job Retention Scheme and obtain a grant of up to 80 per cent of the wage for the month, up to £2,500.
- Businesses with fewer than 250 employees are able to claim back two weeks of Statutory Sick Pay (SSP) from the government for staff affected by coronavirus.
- A £500m fund to support economically vulnerable people will be allocated to the local authorities by the government.
- Universal Credit will be increased by £20 per week and can be applied for over the phone/online.
- The Working Tax Credit will also increase by £20 per week on top of the planned annual uprating.
- Rent costs can be supported through Universal Credit and increased Local Housing Allowance rates.
- Self-employed people can access Universal Credit in full at a rate equivalent to SSP for employed people as the ‘minimum income floor’ has been removed.
- The five million self-employed people will have “quicker and easier” access to benefits if they experience a sudden drop in income.
Uncertainty will persist
The focus is being placed firmly on the individual and what each and every one of us can do to stop the spread. Stringent expectations for society to work from home where possible and not congregate have led to the government amending sick pay rules so that SSP can be accessed from day one, instead of day four, and delaying tax liabilities for the self-employed to promote self-isolation and social distancing in this period.
Questions need to be resolved for whether additional support will be given by the government for the self-employed and those who are on zero hours contracts for loss of earnings; but the Chancellor is expected to announce further support for the self-employed today. The extent of sick pay each individual will be entitled to access above the minimum payments of SSP is a question for the employer, as this varies from company to company. Read more from acas about the responsibility of employers to ensure their employees health and safety whilst working from home which some will be considering for the first time.
Duty of care in a collective national effort
As each employer struggles with the changing circumstances daily, employers are looking to be as creative as possible with the strategies they set in place to retain their people during what is an incredibly difficult time globally.
Diversifying strategies, such as Leon turning their restaurants into shops, high street cafés offering takeaway only and restaurants running home delivery services are all valuable ways to simultaneously uphold social distancing and protect jobs. Meanwhile, staff taking voluntary redundancies and reducing working hours can further help to sustain jobs over this period and alleviate pressures on employers’ pay budgets.
As Mr Sunak said that the government is setting in place a “national effort to protect jobs”. Everyone should consider their role in the coming months and support each other. We truly agree that this is a “generation-defining moment”, where individual acts of kindness and support for one another are critical and will define how you are perceived as an employer when you look back at this tumultuous period.
If we can do anything at all to provide clarification and support about the options open to you in supporting your people in the circumstances, get in touch.