Important HR dates for your diary in November and December 2020

1st November 2020 to 31st March 2021

The Coronavirus Job Retention Scheme will run from 1st November to 31st March. The Job Retention Scheme is designed to protect employers and employees who are affected by Covid-19. The option to furlough employees will help keep people employed during the winter months.

9th December 2020

International Anti-Corruption Day:  The United Nations’ International Anti-Corruption Day aims to raise awareness of corruption and what the public can do to fight it.

10th December 2020

Human Rights Day: Human Rights Day recalls the day the General Assembly of the UN adopted and proclaimed the Universal Declaration of Human Rights in 1948. This is the most translated document around the world and is available in over 500 languages.


Case in Focus (Murray & Another v Foyle Meats Ltd) … redundancy, “work of a particular time”

Murray & Another v Foyle Meats Ltd [1999] IRLR 562, HL

What happened?

In Murray v Foyle Meats Ltd, two individuals (M and D) were employed by the company Foyle Meats Ltd (FM). M and D were working as meat plant operatives in a slaughterhouse. Furthermore, their contracts stated that FM could need them to carry out different types of work within the slaughterhouse. However, ultimately, both M and D were made redundant for the reason that “work of a particular kind” had diminished. However, M and D disagreed with this outcome.

The Hearings

Lord Irvine rejected the contract approach, and instead intimated that the straightforward analysis in Murray should assist in all redundancy cases. Additionally, The Lords established that the decline in work, which was the cause of the dismissal, does not have to relate to the work actually carried out by the dismissed employee. Overall, the tribunal concluded that M and D were engaged in “work of a particular kind”. M and D went on to appeal against this decision. However, it was in vain as the House of Lords dismissed their appeal. The House of Lords noted that s.11(2) of the Contracts of Employment and Redundancy Payments Act (Northern Ireland) 1965 had been implemented. As a consequence, the requirement for employees to work in the slaughterhouse had diminished.

Take away points

  • It is essential that all employers have contracts of employment in place for all employees. They need to be up to date and compliant with employment law.
  • The reason for the dismissals in this particular case was that there was a reduction in work of a particular kind and that this reduction in work caused the reduction in staff.

If you would like help putting your employees first or have any HR issues you would like to discuss please contact Laura Reilly on 01522 81 5100.


Ask the Experts

If employees refuse to be placed on furlough can we make them redundant?

Yes, if employees fail to agree to be furloughed, then employers have the option to dismiss by reason of redundancy, provided that the redundancy definitions are met, and a formal process is adhered to. It is important to emphasise the fact that employers should not select employees just because they are unwilling to go onto furlough leave – and that the process for redundancy must follow all the usual employment laws.

The majority of employees realise that furlough is a means to avoiding redundancies, therefore they are likely to agree. The government guidance states that employees are required to give written consent to furlough arrangements, ceasing work or the terms of any part-time working arrangements in place. Employees should also consent to the pay reduction although existing lay off provisions in some contracts may provide partial consent.

Some employers may feel that the predicted long-term effect on their company leads to inevitable closure or rationalisation. Due to this, It may be useful for employers to select employees to furlough using a process similar to redundancy selection. This would consist of using objective criteria, such as a scoring system that looks at skills, productivity, previous appraisals and so on.

Can employees that were made redundant in Autumn 2020 be placed on the extended furlough scheme instead?

Yes, employees  who were made redundant in the weeks that led up to the announcement furlough scheme was being extended can be re-employed and furloughed, as long as they were on the payroll on 23rd September 2020 and have since been made redundant or ceased working for the employer. The employees who were on fixed-term contracts that have expired since 23rd September are eligible to be re-hired and then furloughed. It is not a requirement for employers to rehire and furlough their employees, but they have the option to and if requested by the employee, it needs to be considered.

Employers may decide against re-hiring and furloughing due to a variety of reasons, such as the National Insurance Contributions cost, pension contributions, and the expense of accrued holiday. Also, the employer may be in a process of restructuring and the employees that were made redundant many not be needed post-furlough and the redundancy process would need to be repeated. If the redundancy process was ongoing or subject to an appeal, then employees may also be able to challenge the fairness of selection for redundancy, if furlough was not considered as an alternative.


Webinar – Redundancy – The Good, The Bad and The Ugly

We invite you to join our HR Zoom webinar.  

When: Dec 10, 2020 10:00 – 11:00 AM London  

Proudly hosted by Nicholsons Accountants, this webinar is presented by Laura Reilly – Head of HR and Compliance at Nicholsons Accountants and Dr John McMullen of Spencer West. We will take you through the basics of a fair redundancy procedure, and discuss some of the common pitfalls particularly around selection criteria.

The Good – what a ‘fair’ process looks like, what a tribunal expect from employers as a minimum, minimum timescales to conduct a fair process.

The Bad – consultation which is rushed, doesn’t have the right selection criteria in place or the right people involved in scoring.

The Ugly – when employers use redundancy to disguise another reason for dismissal, and when redundancies are used to get rid of a specific person rather than a position no longer required.

Dr John McMullen is a published author and legal specialist on redundancies. He is an Independent Law Professional, Consultant, Trainer and Writer. He has 25 year’s experience in employment law and lectures widely on a variety of employment law topics, in addition to being the author of a number of articles and books. John is also a member of the Council of ACAS. So he is well placed to answer your questions afterwards in a Q&A session. Did you know that the average award for a successful unfair dismissal claim was £13,704 in the year 1 April 2018 to 31 March 2019 which highlights the need for employers to correctly follow the process.

Register in advance for this webinar:

https://zoom.us/webinar/register/WN_GRVdNt6VQ8SRjm5wWreRDQ 

After registering, you will receive a confirmation email containing information about joining the webinar.

We look forward to seeing you.


“CJRS Extended” Employment and HR FAQ’s

On Saturday the 31st of October 2020, the government announced that the furlough scheme was going to be extended until the 2nd of December 2020.  Employers were in the difficult position of having to consider redundancies to coincide with the end of the furlough scheme.  The scheme was due to be replaced by the Job Support Scheme (’JSS’) which was somewhat less generous.  Effectively, this change in direction puts us back in the same position that we were in during August; the government paying 80% of an employee’s pay (subject to the cap of £2,500) with employers being liable for national insurance and other contributions which would normally be payable.  The scheme will allow employers to fully or flexibly furlough their employees.

Frequently asked questions

Can I put an employee on the scheme who wasn’t eligible for furlough before?

Yes – employers will be able to furlough employees full time or part time, but to be eligible for the grant an employee must have been on an RTI submission made to HMRC before 23.59 on 30 October 2020.  There is no requirement for them to have been furloughed previously.

Can we pay 100%?

If you choose to then yes, but we advise this is clearly documented to employees and they know they are on furlough leave for any hours not worked.  The government scheme can only be claimed against when you are paying 80% of unworked hours as a minimum, it cannot be claimed to off-set any private furlough schemes which may be ongoing between employer and employee.

Can I use furlough to cover notice pay?

This is not yet clear, but there is nothing to suggest you can’t use it for notice period, and this was permitted under the furlough scheme as it was before.  The exception to this is where notice pay is paid as a lump sum – known as pay in lieu of notice.  Furlough payments cannot cover this unless the employee is actually working their notice period.

Can employees take holiday whilst on furlough?

There is nothing to suggest that they can’t – it would appear that the terms of the old scheme still continue to apply.

Is there a minimum period for furloughing an employee?

When claiming the CJRS grant for furloughed hours, employers will need to report and claim for a minimum period of 7 consecutive calendar days.

When can I begin claiming?

It is anticipated that claims can be made from December 2020 but we await further guidance.

What will happen to the job retention bonus?

This is not yet clear, but it is likely that the dates may need to be changed, or the scheme re-evaluated.  This is because it is unlikely that the government will allow qualifying wages to be made from the public purse, and for this to allow employers to claim further public money.  However, this is an educated guess rather than a fact.

Do I have to put this into writing?

Yes, as per previous guidance this will need agreeing in writing – unless you have a lay-off clause which permits you to lay staff off without pay.  This should be kept on file should HMRC choose to audit your business.


Winter Economic Plan (updated)

WINTER ECONOMY PLAN (A recap)

With all of the latest news on support we thought it might be worth re-capping the winter economic plan and updating where we are now. 

Here are the headlines from the Chancellors statement in Parliament today where a series of measures to help jobs and businesses were announced.

NEW JOB SUPPORT SCHEME ANNOUNCED

The job support scheme (JSS) has been put on ice whilst the CJRS is extended during lockdown 2.0. More information here

SELF-EMPLOYED INCOME SUPPORT SCHEME

The SEISS has been updated to take into account lockdown 2.0. More information here

VAT CUT FOR HOSPITALITY SECTOR CONTINUES

The reduction in VAT to 5% for the hospitality and tourism sector will be extended until 31 March 2021.

DEFERRAL OF VAT BILLS

Up to half a million businesses who deferred their VAT bills will be given more breathing space through the New Payment Scheme, which gives them the option to pay back in smaller instalments. Rather than paying a lump sum in full at the end March next year, they will be able to make 11 smaller interest-free payments during the 2021-22 financial year.

SELF-ASSESSMENT TAXPAYERS – TIME TO PAY EXTENSION

Approximately 11 million self-assessment taxpayers will be able to benefit from a separate additional 12-month extension from HMRC on the “Time to Pay” self-service facility, meaning payments deferred from July 2020, and those due in January 2021, will now not need to be paid until January 2022.

BOUNCE BACK LOANS – FLEXIBILITY GIVEN TO PAY BACK AMOUNTS BORROWED

More than a million businesses who took out a Bounce Back Loan will get more repayment time through a new Pay as You Grow flexible repayment system.

This includes extending the length of the loan from six years to ten, which will cut monthly repayments by nearly half. Interest-only periods of up to six months and payment holidays will also be available to businesses.

The Government also intends to give Coronavirus Business Interruption Loan Scheme lenders the ability to extend the length of loans from a maximum of six years to ten years if it will help businesses to repay the loan.

The chancellor also announced an extension in applications for the government’s coronavirus loan schemes until the end of November. This has now been extended to the end of January 2021. 


National Lockdown – Extension to the Coronavirus Job Retention Scheme, Self Employed Support Scheme, Business support loans and Business Support Update 

(updated 5/11/2020)

The Government has extended the Coronavirus Job Retention Scheme (CJRS) following the announcement of new Coronavirus restrictions in England from Thursday 5 November 2020 to Wednesday 2 December 2020, which will require many businesses to close.

It has also confirmed that those businesses that are required to close will be eligible for business grants of up to £3,000 a month, introduced originally for closed businesses in areas of ‘Very High’ Coronavirus restrictions under the three-tier system.

Meanwhile, the mortgage payment holiday scheme that had been due to end on Saturday 31 October 2020 has been extended so that borrowers impacted by Coronavirus will be able to access a six-month repayment holiday.

Businesses forced to close 

The categories of businesses forced to close under the new restrictions are near-identical to those required to close following the initial announcement of ‘Stay at Home’ measures on 23 March 2020, with some limited differences.

The Government has confirmed that the following businesses will be required to close from Thursday 5 November to Wednesday 2 December 2020:

  • all non-essential retail, including, but not limited to clothing and electronics stores, vehicle showrooms, travel agents, betting shops, auction houses, tailors, car washes, tobacco and vape shops.
  • indoor and outdoor leisure facilities such as bowling alleys, leisure centres and gyms, sports facilities including swimming pools, golf courses and driving ranges, dance studios, stables and riding centres, soft play facilities, climbing walls and climbing centres, archery and shooting ranges, water and theme parks,
  • entertainment venues such as theatres, concert halls, cinemas, museums and galleries, casinos, adult gaming centres and arcades, bingo halls, bowling alleys, concert halls, zoos and other animal attractions, botanical gardens;
  • personal care facilities such as hair, beauty and nail salons, tattoo parlours, spas, massage parlours, body and skin piercing services, non-medical acupuncture, and tanning salons.

Supermarkets, food shops, garden centres and a limited group of other retailers that sell ‘essential’ goods and services will be able to remain open if they follow COVID-secure guidelines.

Meanwhile, ‘non-essential’ retailers will be able to open for click-and-collect and delivery only.

As was the case during the original ‘Stay at Home’ measures, hospitality businesses, including pubs, bars and restaurants that are required to close may provide takeaway and delivery services. However, in contrast to the previous measures, under the new restrictions, hospitality venues will not be able to provide takeaway’sor alcohol.

Accommodation venues will only be able to remain open for people who have to travel for work and for a limited number of other exemptions.

Coronavirus Job Retention Scheme (CJRS) Extension 

The Coronavirus Job Retention Scheme (CJRS) has been extended, just hours before it had been due to close to be replaced by the new Job Support Scheme. Just when business owners were planning based on this new announcements were made on 5.11.2020

The Government had only confirmed that the CJRS would be extended to 2 December at the end of October in response to the new lockdown restrictions, but it has already taken the unprecedented step of extending it further until the end of March for all parts of the UK.

As before, eligible employees will receive 80 per cent of their usual salary for hours not worked, up to a maximum of £2,500 per month.

Businesses will also continue to have the flexibility to use the scheme for employees for any amount of time and shift pattern, including furloughing them full-time if required. (Flexible furlough)

Employers will only be required to contribute for any hours worked and pay National Insurance and employer pension contributions for hours not worked.

The extended CJRS will operate along the same lines as the previous scheme and businesses will be able to claim either shortly before, during or after running payroll.

Claims for November can be made from 8am Wednesday 11 November but must be submitted to HMRC by no later than 14 December 2020.

The Government has said that claims relating to each subsequent month should be submitted by day 14 of the following month. This will ensure prompt payment following the end of the month.

Importantly, neither the employer nor the employee needs to have previously claimed or have been claimed for under CJRS to claim the extended CJRS, as long as other eligibility criteria are met.

Employers are permitted to claim for any for employees who were employed and on their PAYE payroll on 30 October 2020.

This means the employer must have made a PAYE Real Time Information (RTI) submission to HMRC between 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.

The Government has also confirmed that employees that were employed and on the payroll on 23 September 2020 who were made redundant or stopped working afterwards can be re-employed and claimed for.

However, the employer must have made an RTI submission to HMRC from 20 March 2020 to 23 September 2020, notifying a payment of earnings for those employees.

The Chancellor said that the extended CJRS would be reviewed in January, at which point the contributions made by the employer to the scheme may be adjusted.

The extension of the CJRS means that the introduction of the JSS Open and JSS Closed on 1 November has been postponed until the CJRS closes.

Job retention Bonus (Scrapped!) 

(5.11.2020) The Government will not pay the Job Retention Bonus (JRB) in February as planned and has instead said that it will “redeploy a retention incentive at the appropriate time”.

The JRB was originally intended to encourage employers to keep people in work until the end of January. However, with the CJRS now extended until March, the Chancellor said the goals of this policy no longer apply.

This is disappointing for business owners who are now trading again (albeit many on a reduced basis) who had planned for this to come into cash flow in February.

Business Grants 

Businesses that are required to close under the new England-wide restrictions and which are in the business rates system will be able to claim grants of between £667 and £1,500 for each two-week period they are required to remain closed.

The arrangements are the same as those in place for businesses in areas of ‘Very High’ (Tier Three) Coronavirus restrictions through the Local Restrictions Support Grant.

The new grants will pay £667, £1,000 or £1,500 for each two-week period a business is required to shut.

Businesses with rateable values of £15,000 or less will receive £667, those with rateable values of £15,000 to £51,000 will receive £1,000 and those with rateable values of more than £51,000 will receive £1,500.

The scheme will be administered by Local Authorities, with £1.1 billion of funding being distributed on the basis of £20 per head to help them support businesses more broadly.

This scheme applies to England only. However, the Devolved Administrations will receive equivalent funding to distribute as they see fit.

Mortgage Payment Holidays 

Following the introduction of the new Coronavirus restrictions in England, the Government has confirmed that mortgage payment holidays will still be available to borrowers impacted by Coronavirus. The scheme had been due to end on 31 October 2020.

Borrowers affected by Coronavirus will be entitled to a six-month mortgage payment holiday. Those that have already benefitted from a mortgage payment holiday will be able to top this up to six months without a record being made on their credit file.

Further details of the scheme are expected imminently.

Government extends Self-Employment Income Support Scheme (SEISS) 

The Government had already announced an extension to the SEISS under its plan for local lockdowns, which would ensure that self-employed workers would receive two more grants between November 2020 and April 2021. There had been confusion as to how this scheme would run and this was clarified and updated when the Chancellor announced amendments to the scheme on 5.11.2020.

In a similar vein to the CJRS extension, the Government will take further steps to help the self-employed by increasing the contribution under the SEISS from 55 per cent to 80 per cent over the next three months.

This is the second time that the third round of SEISS grant funding has been increased after the scheme itself was extended for a further six months.

Under the latest change, those eligible for the SEISS grant will be able to claim 80 per cent of three months’ average trading profits, paid out in a single instalment, which will be capped at £7,500.

HM Revenue & Customs (HMRC) has announced it will pay this more generous grant sooner than expected and “in good time for Christmas”. This is thanks to an earlier change, which brings the application period forward by two weeks so that people can submit their claim for the grant from 30 November.

The Government has already announced that there will be a fourth SEISS grant covering February to April. The Government will set out further details, including the level, of the fourth grant in due course.

Government-backed loan schemes 

Businesses had already been given an additional month to make an application for the Bounce Back Loan, Coronavirus Business Interruption Loan, Coronavirus Large Business Interruption Loan and Future Fund schemes, allowing them to submit by 30 November 2020.

However, in recognition of the additional financial support that some businesses may require, the Government will now extend the loan application window until 31 January 2021.

Businesses that wish to make an application are encouraged to begin applications soon to ensure they have sufficient time to prepare and submit the required information.

Businesses who applied and drew loans under the bounce back loan scheme but didn’t take the full loan available can apply for a top up. This will be available from 9 November. The maximum loan was the higher of £50,000 or 25% of turnover.

So for example if your business had turnover of £100,000 you would have been eligible for a loan to a maximum of £25,000. If you took a loan of £15,000 you could apply for a top up of £10,000.


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