The government have rolled out packages of help for businesses. This is blog is not to repeat the information that the government have provided but to clarify the main points for businesses owners because in a state of anxiety it is easy to miss vital points within a large volume of information.
Here I deal with – The Coronavirus Job Retention Scheme
‘You can claim a grant from HMRC to cover wages for a furloughed employee, equal to the lower of 80% of an employee’s regular salary or £2,500 per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on paying those wages’
- The government will fund 80% of employees wages back dated to 1/3/2020 if they are laid off due to Business Interruption due to Coronavirus.
- They must have been on your payroll since February 2020.
- They must agree with you that they will join the scheme.
- They must not work while on the scheme.
- If you have reduced your employees pay and/or hours due to coronavirus interruption they will not be eligible for the scheme.
- The scheme covers all employees even if they are on zero hours contracts.
- The 80% will be calculated on actual salary as of February 2020 for regular salaried employees. Commissions and bonuses are excluded from the calculation.
- For variable paid employees the 80% calculation does seem fair and the detail can be found at the link below.
- The scheme will be available for application from the end of April 2020.
- Sage payroll facilitates applying for the scheme and for those whose payroll software providers don’t support it, the government will provide a portal.
- You should seek advice on whether any changes need to be made to employee’s contracts.
Please now carefully read https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme#work-out-what-you-can-claim. No responsibility is taken by the author for the interpretation of the information provided and your actions on doing so.
If you’re self employed you can find out more in my blog dedicated to self employed here.