[ad_1]
1. What is the licensing scheme?
It’s officially called the Coronavirus Job Retention Scheme and it was launched in March. It allows employers to fire workers but then claim a cash grant of up to 80% of their wages, with a limit of £ 2,500 per month. The money is claimed by the company and distributed to the staff, so people do not have to do anything themselves. Some employers choose to make up the 20% difference, others do not.
2. How many people are there in the scheme?
Huge numbers: The government revealed on Tuesday that the plan is currently paying about 7.5 million employees, a quarter of Britain’s private sector workforce. It has been used by 935,000 companies.
3. How is it changing?
It is extending for another four months, until the end of October 2020, but with a series of changes. Crucially, the 80% rate is withheld, crushing concerns that Chancellor Rishi Sunak would cut the government contribution to 60%.
The big change, which will take effect in early August, is that workers will be able to return to their part-time jobs. At this time, companies must choose between putting staff on full leave, where they don’t work at all, or keeping them on full pay. Starting in August, workers without permission will be able to return to part-time work and employers will be asked to pay their staff wages without permission.
The government said it is also exploring ways that people can receive additional training or learn new skills while suspended and their employer receives money from the government.
4. What does it mean for employers?
The 80% pay level will be maintained, but companies will have to start contributing to part-time returning staff. There are currently no details of what companies will be asked to pay, but employers may have to pay 20% of their suspended employees’ wages, while the government pays the remaining 60%.
The chancellor said: “We will ask employers to start sharing with the government the cost of paying wages.”
In its official advice, the Treasury said: “The employer payments will replace the contribution the government is currently making, ensuring that staff continue to receive 80% of their salary, up to £ 2,500 per month.”
Employer groups welcomed the agreement, but said they needed more details. Mike Cherry of the Small Business Federation said: “We expect more details on the contributions that will be required from small employers after July. We need to make sure those obligations are affordable for the many companies that have had no income for months but still have fixed costs to worry about. ”
5. What does it mean for workers?
This deal paves the way for workers to begin a partial return to employment and probably means that employers will be less likely to be permanently unemployed in the coming weeks. But there is still another 10 weeks to go until the part-time scheme begins, and in the meantime, some employers may still decide to do deep layoffs. In that case, the employee will have to apply for a universal credit.
6. I am autonomous. Are you offering me something?
The government said there will be no changes to the scheme until July. You are currently offering self-employed people a taxable grant based on their previous monthly earnings in the past three years, worth up to 80% of earnings and a limit of £ 2,500 per month. To be eligible, you must have annual “earnings” (self-employment income) of less than £ 50,000 a year, according to HMRC.
The plan has been criticized for leaving some groups of independent workers without a safety net.
7. How much will it cost?
The Institute for Fiscal Studies estimates that the likely cost over the entire period from March to July will be around £ 60 billion, or £ 12 billion a month.
The German scheme, called KurzarbeitIt is expected to cost at least € 40 billion. It currently covers 10 million workers and is among the most generous, paying up to 67% of net wages lost due to shorter hours, up to a maximum of € 6,700 per month for employees with children, and 60% for those without children. Unlike the British scheme, German companies can allow staff to work part time, reducing the cost.
In France, more than 12 million are covered by a scheme called Partial chimney It has cost € 26 billion so far. It offers 70% of salary at up to € 6,927 gross per month. Employees with minimum wages (SMIC) receive 100%. As with the German scheme, companies can claim only part of a worker’s salary and many do, limiting the cost for the finance ministry.
Ireland’s temporary wage subsidy scheme is supporting 450,000 workers. Since May 4, the plan has become more generous, paying an 85% grant up to € 21,400. Like the UK scheme, it forces plaintiffs to stay home and not work, but the Irish government has signaled that will change.
