Government to pay up to 80% of wages in Coronavirus outbreak:
Chancellor Rishi Sunak has this evening announced unprecedented economic measures to help tackle the ongoing coronavirus crisis.
Here are just some of the main headlines that will impact both employers and employees:
- The government has announced a coronavirus job retention scheme. The scheme will pay grants to companies to cover 80% of the salary of employees kept on by companies but not working, in an effort to try and stop companies from laying off or dismissing employees. This will be capped at a total of £2,500 per month, just above the median income.
- The government is also deferring the next quarter of VAT payments, which means that no businesses will pay VAT until the end of June to help struggling companies stay afloat during these uncertain times.
- For those who are self-employed, self-assessment income payments will be deferred until January 2021 and self-employed workers will be entitled to claim Universal Credit at a rate equivalent to statutory sick pay (SSP). SSP is currently capped at a rate of £94.25 per week for up to 28 weeks.
- The government will also provide a further £1billion to cover 30% of house rental costs for self-employed workers.
- Business interruption loans will be interest free for 12 months rather than 6 months. The loan scheme was introduced to help companies survive the corona crisis and the government previously announced that the loans would be interest free for 6 months, this has now been increased to 12 months.
- Universal Credit allowances will increase £1,000 a year.
We have never seen quite such radical economic measures introduced by a government and will continue to update you as matters unfold and further details of how the job retention scheme will work in practice.
If you have any questions as an employer or an employee in relation to the new measures and how they will affect you, then please contact our Employment Team on 0161 926 9969, email@example.com or follow our employment law-specific Twitter account @HRHeroUK.