9th October, 2020
Hospitality lifeline? Chancellor’s announcement of support for employers in the face of imminent local shutdowns.
The Chancellor has announced new measures for areas of the country affected by stricter lockdown measures.
Businesses that have been forced to close because of local lockdown restrictions will be able to claim up to two-thirds (67%) of their employees’ wages in an extension of the Coronavirus Job Support Scheme. This will only be available when the business cannot operate because of lockdown rules and will be capped at a maximum of £2,100 per month per employee. Employees will need to be furloughed for a minimum of seven consecutive days at any given time and the payments to employers will be made monthly in arrears.
This will begin from 1 November 2020 and will be active for six (6) months. Employers do not need to pay any contribution to the wages of the employee; however, they will be required to pay National Insurance and pension contributions.
In areas where there are no such restrictions, the recently announced Job Support Scheme rules will apply where the employee must work at least one-third (33%) of their normal hours, the government and the employer will then increase those wages to cover up to two-thirds of the ‘lost’ wages for the employee up to a value of 77%.
Increase in business grant
In addition to the support for employees, the Chancellor stated that any business forced to close because of lockdown restrictions will be able to claim an increased grant of up to £3,000 per month, rather than up to £1,500 per three weeks, and they are eligible for payment sooner, after only two weeks of closure rather than three.
The detail of these extensions has yet to be released but further clarification will be provided once more information is available.
If you or your business would like further advice on any of the current government subsidy schemes or any other Employment Law related matter please contact Michael Redston in the Employment team on 01244 405 598 or by email [email protected].
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