COVID19 THE JOB RETENTION SCHEME AND YOUR BUSINESS

COVID-19, THE JOB RETENTION SCHEME AND YOUR BUSINESS LIVE WEBINAR: 10: 00 AM, FRIDAY 3 APRIL 2020 PRESENTED BY: TRACEY WATTS PARTNER OF ALBERT GOODMAN & KATE GARDNER, PARTNER OF CLARKE WILLMOTT

COVID-19, JRS & YOUR BUSINESS Format of webinar: • CV Job Retention Scheme • What is it? • Who can claim? • What pay? • Examples • Personal Service Companies (“PSC”) • Kate Gardner – employment law aspects and the furlough process • Q&A/Chat support from Michael Evans – Head of AG Payroll Team

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) • Significant package • Taxable grant to cover wage costs • Lower of 80% of wage costs & £ 2, 500 • Plus Employer’s NIC and basic pension costs • Backdated to 1 March • Initially for 3 months to 31 May

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) Who can claim? • The employer Regardless of: • Size • Sector

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) Conditions • UK Payroll – 28/02/20 • UK bank account • In order to avoid redundancies or where staff would otherwise be laid off • Claim in respect of “furloughed” employees only

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) Who is covered? • Employees at 28/02/20 – no new starters post or leavers pre • Full or part time workers • Zero contracts • Agency workers on your payroll • Apprentices? • Off payroll workers?

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) Who is covered? (cont) • Furloughed workers – no services/generation of income • Not reduced hours/pay • Minimum 3 weeks at a time – dip in and out • Not currently on SSP/unpaid leave pre 28/02/20

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) How do you claim? • New portal – April – agent access? • Funding gap? • • • Business Interruptions Loan Scheme VAT payment deferral Time To Pay arrangements for other taxes and PAYE July POA Pay employees later? FPS no later than payment date

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) Details • e. PAYE reference number • Bank details • Claim period ( 1 x 3 weeks) • Employee details • Claim amount • Name and contact details • HMRC audit

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) What is the process? • Selection – fair and documented (discrimination/equality rules) • Contract changes? • Written agreement of changes • HR/legal advice and support • Calculate reduced pay – change in contractual pay • Top up? • Claim grant back (1 claim x 3 weeks)

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) What pay? • Full or part time – salary @ 28/02/20 • Variable hours – higher of: o wages in same period in 2019; and o average of last 12 months • Excludes bonuses, commissions or other fees • Overtime? • Gross x 80%, capped at £ 2, 500 – the new ‘normal gross’ • Run through RTI in same way, on new normal gross • Claim the wages costs back + Er’s NIC + basic 3% Er’s pension contribution

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) Example 1

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) Example 2 • • Sally, zero hours Laid off 1 March 2020 – nil pay for month March 2019, pay was £ 1, 200 Average pay to end of February 2020 was £ 1, 667 • Take the higher

COVID-19, JRS AND YOUR BUSINESS Job Retention Scheme (“JRS”) Example 2

COVID-19, JRS AND YOUR BUSINESS Rights under furlough? • NMW not applicable • SSP • SMP – basic entitlement remains, but if top up, top up is covered under JRS • Same for contractual adoption/paternity leave or shared parental pay • Can’t take holiday?

COVID-19, JRS AND YOUR BUSINESS Rights under furlough? • Can’t work • Volunteer/community work • Accruing holiday? • Possible 2 year c/fwd? • Impact on business and working employees? • Accrue other benefits and continuous service rights (redundancy)

COVID-19, JRS AND YOUR BUSINESS Personal Service Companies (“PSC”) • Director duties • Minimal salary (£ 8, 628) + dividends • Salary at 28/02/20 – what is it? • Employment Allowance interaction – state aid • Off payrolling?

COVID-19, JRS AND YOUR BUSINESS Personal Service Companies (“PSC”) • Contingent workers – encouraged throughout public sector • Includes PSC • More generous: • Sick/self isolate/closure of offices – 1 March, 80%/£ 2, 500, 3 months • Childcare – 7 days • Excludes Apprenticeship Levy, Er’s NIC, holiday – pay at normal rates • Suppliers’ margins adjusted • Discourage workplace attendance • Timesheets

COVID-19 JRS AND YOUR BUSINESS Kate Gardner – Partner in Employment and HR Team at Clarke Willmott

COVID-19, JRS AND YOUR BUSINESS QUESTIONS & ANSWERS