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Sarah King from Excello Law advises on the schemes and guidance issued by the Government to help employers through the COVID-19 pandemic.
Employers have been struggling to survive the COVID-19 pandemic. The Government has launched several schemes to help businesses and has been issuing regular guidance, which is often updated in line with experience on the ground, but it can be difficult to navigate it all. Sarah King from Excello Law gives some legal advice on the latest developments and what they mean for employers and employees.
The most significant measure has been the furlough scheme. On the first day that the HMRC portal went live for employers to claim the payments from the Government over 140,000 businesses submitted claims. The scheme provides employers who furlough their staff with a grant that covers 80% of wages up to £2,500 a month. It is not means tested which has led to criticism in the press that wealthy employers are misusing the scheme.
If a person’s employment contract gives employers the right to lay off or short-time employees, they can notify them (with consultation) that they are designated as furloughed. Employees cannot designate themselves. If there is no contractual provision, the employee will need to agree, which requires more consultation.
Employers must submit information online as to which employees have been furloughed and HMRC then reimburses them. To be eligible, government guidance states that working during furlough time for the employer who furloughed them is not allowed. The system is open to abuse, so record keeping is essential. HMRC may audit such claims later and are checking submissions against their records now.
To deal with Statutory Sick Pay (SSP), the Government passed The Health Protection (Coronavirus) Regulations 2020, which confirms that those who self-isolate because they receive a written notice from NHS 111 (and not just doctors) are deemed to be incapable of work and entitled to sick pay. Employees can self-certify for the first seven days.
SSP for Covid-19 applies from day one. Small and medium sized businesses with fewer than 250 staff are reimbursed for the first 14 days. Those living in the same household as someone with symptoms are also eligible for SSP since they are self-isolating. However, if they live with someone who is designated as vulnerable (shielding) and receive a letter telling them to stay at home for 12 weeks, they are not entitled to be off work.
If the employee is the vulnerable person, they are entitled to SSP and should be off work. The guidance further suggests it is possible to furlough a shielding employee instead, but not while they are on sick leave. Anyone choosing not to come to work because they are worried, who does not have a written notice, is not entitled to SSP. The self-employed do not get SSP either, but can claim Universal Credit instead. Meanwhile, those on sick leave (signed off or self-isolating) cannot be furloughed until the end of that period.
Home working and school closures are affecting millions of people. Children must remain at home unless their parent is a key worker. Employers who consider their staff to be key workers must communicate that to them, although this may not apply to everyone. For employees who cannot come in because they are looking after their children, or are not really working from home, this is time off unpaid unless they are furloughed.
If employees work from home, managers should have a frank discussion as to what can be done from home and whether their pay should reduce accordingly, depending on their working hours, or whether furlough leave can be used instead.
If an employer decides to close a site or factory because of Covid-19, they must pay employees since they were ready and willing to work unless they furlough them. If work can be undertaken at home, the employer can request that every employee does so. Otherwise, employees still get paid. When sites close because of insufficient work, the employer must consider whether workers can be put on short-time working and/or lay off within their contract of employment, or whether furlough should apply.
The next issues facing employers are how to get people back to work at the end of furlough and how to manage the health and safety concerns, including social distancing which could be here for sometime yet.
Sarah King is a specialist in employment lawyer at Excello Law.