The next phase of government schemes – what next?

The start of August has seen new restrictions for many across the north of England and a pause in the easing of certain lockdown regulations for at least two weeks. With many wild rumours and suggestions of what lockdown might look like next, the planned changes to the Furlough scheme have continued to go ahead.

From August 1st 2020 employers will now have to start taking back financial responsibility for their employees with a staged phasing out of the furlough scheme over the coming months. The stay at home guidelines have also changed from work from home if you can to it is your employers choice if you can continue to work from home.

It has been widely reported today that Charlie Mullins, CEO of national company Pimlico Plumbers has today sacked a number of staff for refusing to come back to work after being taken off the Furlough scheme. As much as an employee does not have the right to refuse a reasonable request, they do have the right to feel safe at work. Employers must ensure they have all the necessary health and safety Covid 19 measures in place and are not asking employees to put themselves at unnecessary risk when they could safely continue to work from home. It is also recommended that managers speak to individuals directly to address their specific concerns, especially those who have up until recently been shielding, and support each employees’ successful return to work.

For those still furloughed away from work the key dates are;

1st August – employees are still paid 80% of their salary up to £2500 per month by the government and their employer may choose to pay the remaining 20%, but employers must now make pension and company national insurance contributions.

1st September – employees will still receive 80% of their salary up to £2500 per month however the government will reduce payments to 70% of their salary with employers paying the final 10% to complete the 80% payment (employers can still choose to pay the remaining 20% of the salary)

1st October – Employees will receive 80% of their salary up to £2500 per month but the government Furlough scheme will be reduced to 60% with employers paying the final 20% (again employers can pay the final 20% if they wish)

This phasing out is with the view that all employees should be able to return to work full time (whether at a company location or working from home) however with the potential second wave of Covid 19 looming, additional financial pressures for employers at a time when general spending is low could bring large amounts of redundancies in all sectors.

At the end of July the government confirmed that the redundancy process and final redundancy payments are not subject to any change due to Coronavirus regulations and that payments should be at 100% of salaries irrespective of whether and employee is on Furlough or not at the time of redundancy. It has also been confirmed that an employee being on Furlough can not be used as a criteria for redundancy.

We are also heading towards the second Self Employment Grant. Claims will start to be made from the 17th August and will follow a similar format to the first grant. At the moment all we know is that if you successfully received the first grant you will be entitled to the second at 70% of your average monthly earnings for three months as long as you can provide evidence that you have continued to suffer detriment due to lockdown.

Unfortunately, as yet there has been no response to various petitions lobbying for support for the estimated three million people who have not qualified for any payments including the recently self employed and directors of limited companies.