SYLO | Beyond HR. are pleased to provide you with our third quarterly employment law update for 2020.

Below you will find a summary of the latest key updates and developments, through to September 2020. A longer quarterly update than usual given COVID-19 is continuing to dominate our communications with you and, will continue to be a key topic in this update. As we have seen during the past six months, advice can change rapidly. As we are writing this update, the Government have announced further measures likely to be in place through the next six months including that office workers who can work effectively from home should do so over the winter.  In addition, the new Job Support Scheme, which will replace the CJRS (Furlough Scheme) effective 1st November. Further details can be found below.

Should you wish to discuss any of the topics highlighted and the impact and requirements on your business, please don’t hesitate to Contact Us.

1) COVID-19

COVID-Secure Working (for those unable to work effectively from home)

The government has recently updated its guidance on working safely during the COVID-19 pandemic in different types of workplaces in England. The key changes include:

  • A new checklist on the Covid-Secure working guidance of priority actions for employers to take. These include risk assessments, cleaning, face coverings, social distancing, ventilation, test and trace records, and turning away anyone with symptoms of COVID-19.
  • Amendments to the Test and Trace guidance to state that employers ‘must’ keep records of staff and contractors’ working patterns for a period of 21 days (whereas previously it only advised that employers ‘should’ do so) and the introduction of financial penalties for non-compliance which will come into force on 18th September.
  • For some industries, registration for Track and Trace, including displaying an official QR code poster, becomes mandatory on 24th September.

It is worth refreshing yourself on the updated requirements for your particular industry/sector and ensuring that you have all the necessary measures in place.

https://www.gov.uk/guidance/working–safely–during–coronavirus–covid–19

Coronavirus Job Retention Scheme (CJRS)

The CJRS or ‘furlough’ scheme is due to end on 31st October

From 1st September employers were required to pay 10 percent of the employee’s wages (as well as employer NIC’s and pension contributions) with the government paying the additional 70 percent.

From 1st October, the governments contribution will reduce to 60 percent of the employee’s wages and employers will need to pay the remaining 20 percent to make up the 80 percent total.

Under the CJRS legislation, HMRC has the power to recover amounts of CJRS grants that have been incorrectly claimed, and if notification was not made of this, there could also be penalties.

Given the changes in guidance and the complexity of the rules, many employers may have made some technical mistakes in applying for grants under the scheme, particularly given the need to operate at speed.

It would therefore be prudent to review the amounts claimed and to make sure that any problems or errors are identified and corrected. Reviewing this and ensuring that any points on which the operation of the rules is unclear have been properly addressed should also help to protect against penalties.

If you have overclaimed a CJRS grant and have not repaid it, you need to tell HMRC this, ideally within the ‘notification period’ which ends on (the later of):

  • 90 days after the relevant grant was received (if this was in excess of the correct amount);
  • 90 days after the date circumstances changed so that you were no longer entitled to the CJRS grant; or
  • On 20th October 2020

HMRC have made clear that disclosure of innocent errors should not result in penalties provided the amounts are duly repaid, but that they will seek penalties for overclaims known to be incorrect.

When checking any grants received pay attention to:

  • The use in the Scheme of calendar days not working days where the claim is for a part of a period
  • Activities undertaken by an employee while on furlough (particularly if the employee is also a shareholder or Company Director)
  • Holiday and bank holiday pay and arrangements
  • Interplay between family/sick leave and furlough
  • Identifying which element of pay constituted ‘regular payments’ when calculating how much to claim.
  • Problems caused by the fact that until 5 June it wasn’t possible to correct errors for a previous period’s claim in the next claim.

New Job Support Scheme

A useful visual is included below giving an overview of the new Job Support Scheme, which is replacing the Furlough scheme from 1st November until 30 April 2021. The devil is always in the detail, so we have also included some key points in relation to the scheme rules.

Key Highlights:

  • The Government will pay a third of hours not worked, up to a cap of £697.92 per month, with the employer also contributing a third. Employers will not have the option to top this up.
  • Employers using the Job Support Scheme will also be able to claim the Job Retention Bonus of £1000 per employee still in employment as at 31 January 2021 and earning at least £520 per month between 1 November 2020 and 31 January 2021.
  • All employers with a UK bank account and UK PAYE schemes can claim the grant. Neither the employer nor the employee needs to have previously used the Coronavirus Job Retention Scheme. It is assumed but has not been confirmed that ‘employee’ has the same wide definition as the current CJRS.
  • There will be no financial assessment test for SMEs to access the scheme. The expectation is that large employers using the Job Support Scheme will not be making capital distributions, such as dividend payments or share buybacks, whilst accessing the grant.
  • Employees must be on an employer’s PAYE payroll on or before 23 September 2020. This means a Real Time Information (RTI) submission notifying payment to that employee to HMRC must have been made on or before 23 September 2020.
  • For the first three months of the scheme the employee must work at least 33% of their usual hours. After 3 months, the Government will consider whether to increase this minimum hours threshold.
  • Employees will be able to join and come off the scheme and do not have to be working the same pattern each month, but each short-time working arrangement must cover a minimum period of seven days.
  • Grant payments will be made in arrears, reimbursing the employer for the Government’s contribution. The grant will not cover Class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer.
  • Employers cannot top up their employees’ wages above the two-thirds contribution to hours not worked at their own expense.
  • Employees cannot be made redundant or put on notice of redundancy during the period within which their employer is claiming the grant for that employee.
  • Employers will be able to make a claim online through UK from December 2020 on a monthly basis and grants will be payable in arrears after payment to the employee has been made and that payment has been reported to HMRC via an RTI return.
  • Employers must agree the new short-time working arrangements with their staff, make any changes to the employment contract by agreement (assuming they do not have a short term/lay off clause in their contract already), and notify the employee in writing. This agreement must be made available to HMRC on request.

Workforce Planning

Many businesses have been either directly or indirectly impacted by the Coronavirus pandemic. In some cases, they may be at a point that they need to consider making changes to the size and scope of their workforce in order to sustain and secure their future. Each business is unique, and it is important that you carefully consider all options, and where possible, aim to minimise the risk of redundancies. Our HR Advisory and Business Strategy team are on hand to talk through your circumstances and offer you expert guidance and support on these complex matters, so please don’t hesitate to get in touch.

2) Brexit

Brexit is very much back on the agenda and in the media given the transition period end date is just over 3 months away. Whilst negotiations continue as to whether a deal can be struck, employers can continue to prepare by ensuring that where they employ staff from EU or EEA countries or Switzerland, that they are encouraged to apply for pre-settled or settled status as soon as possible and ideally before 31st December 2020. Whilst it’s the responsibility of the individual and not the employer to make an application to the EU Settlement Scheme, it is advised that employers be pro-active in checking in with any employees who may be affected that they have taken action on this as this could affect their continuous employment.

What is the pre-settled status?

If you do not have 5 years’ continuous residence when you apply, you’ll usually get pre-settled status. You must have started living in the UK by 31 December 2020 (or by the date the UK leaves the EU without a deal). You can then apply to change this to settled status once you’ve got 5 years’ continuous residence.

What is settled status?

Settled status can be applied for once you have 5 years continuous residence in the UK. This is not automatically given and must be applied for.

If the UK leaves the EU with a deal then Settled Status guarantees your right to reside in the UK after 30 June 2021, which is the end of the six month grace period (after the 31 December 2020 deadline for applications to be submitted).

If the UK leaves without a deal, then there is no six- month grace period and you must apply by 31December 2020.

If you are an EU citizen and you want to continue to live and work in the UK, to have the same access to benefits, public services and healthcare, the right to study and rent accommodation after 31 December 2020, you will need this new status regardless of any current agreement you have to stay in the UK.

Further information can be found on the GOV.UK website or by following this link https://www.gov.uk/settled–status–eu–citizens–families

As it currently stands, employers can continue to accept the passports and national identity cards of EU citizens as evidence of their right to work up until 30 June 2021.

Going forward, the government has indicated a preference to introduce a points-based immigration system post-Brexit. More on that in future updates however further information can be found here https://www.gov.uk/government/publications/uk–points–based–immigration–system–employerinformation/the–uks–points–based–immigration–system–an–introduction–for–employers

3) Diversity and Inclusion

We will all have been aware of the strides made to address equality, diversity and inclusion issues both within the workplace but also within society at large over the past number of years. Particularly so in recent weeks, due to tragic events, there has been a real focus on racial equality. It has prompted many businesses to take a deeper look into the diversity of their workforces and to look to make positive changes to address and challenge their approach, practices and policies.

We have been working closely with a number of clients with a focus on how businesses can embed D&I into business strategy and company values. Alongside this, coaching teams on unconscious bias, to ensure that working practices and policies are fully inclusive and which seek to attract and retain a diverse workforce.

If this is something you would like to explore further, please do get in touch; enquiries@syloassociates.co.uk

4) Chancellor’s Plan for Jobs

During the summer, the Chancellor announced a package of measures to support jobs including:

Job Retention Bonus

As part of the plan to support jobs, a Job Retention Bonus will be introduced to help employers retain furloughed workers. UK Employers will receive a one-off bonus of £1,000 for each furloughed employee who is still employed as of 31 January 2021.

Kickstart Scheme

A new £2 billion Kickstart Scheme is being launched to create hundreds of thousands of new, fully subsidised jobs for young people across the country. Those aged 16-24, claiming Universal Credit and at risk of long-term unemployment, will be eligible. Funding available for each six-month job placement will cover 100% of the National Minimum Wage for 25 hours a week – and employers will be able to top this wage up.

Apprenticeships

Businesses will be given £2,000 for each new apprentice they hire under the age of 25. This is in addition to the existing £1,000 payment the Government already provides for new 16-18-year-old apprentices and those aged under 25 with an Education, Health and Care Plan.

And finally……

As a valued client, we would like to continue to keep you updated on key topics which we feel would be of interest to you and your business, for example COVID-19 implications for employers, details of our online training programmes and our quarterly Employment Law round-up. Should you not wish to receive these updates then please let us know.

We would like to take this opportunity to thank you for your continued support in what has been a challenging year so far for us all. Keep safe and well.