Coronavirus has gone from an illness which was affecting Wuhan Province in China and not something that we were too worried about, to a global pandemic, which is likely to have a profound and lasting impact on our lives for the coming weeks and months.
The purpose of this document is to provide business owners and employers with as much information as we currently have available. The situation is constantly changing and as such, this will be updated as and when more information is released from the Government.
Support announced in the Budget
Certain measures were announced in the Budget to help businesses manage the impact of Coronavirus.
As yet, whilst these have been announced there is understandably no detail of how to claim for the reliefs. As soon as these are detailed, we will update this blog.
In the meantime, the main support packages are:
- Coronavirus Business Interruption Loan Scheme from the British Business Bank. This is effectively the Enterprise Finance Guarantee Scheme rebadged under a different name. The scheme makes it easier for businesses with little or no security to apply for a loan on normal commercial terms. Care needs to be taken to ensure that you are aware of the implications of borrowing the money and giving a personal guarantee. This is not a case of ‘free money’ being available. It is probable that the usual fees that apply to these loans may be reduced or waived. Details of the British Business Bank can be found here.
- Sick Pay for businesses with less than 250 employees. The rate of sick pay is £95.85 per week from 6 April 2020 and this cost is borne by the employer. The government will refund in full the costs of sick pay for 14 days per employee. There is no detail on how this will be delivered, but it is most likely to be managed by employers having the statutory sick pay deducted from their PAYE liability.
- There is a £3,000 cash grant to be made available to the smallest 700,000 businesses. This will be dealt with by local authorities. As yet there is no detail on how to claim for this grant. Details will follow when we have them.
- HMRC have launched a helpline for businesses who are unable to pay their taxes due to the virus. The number to call is 0800 0159 559.
- They will explore the options available such as agreeing a payment plan, relaxing debt collection activities and also cancelling penalties & interest.
- Whilst not covered in the guidance, it would be advisable to have evidence if required, to demonstrate how the inability to pay the taxes is directly linked to the virus. It is likely that some individuals might use this as an opportunity to delay their tax payments regardless of any link to the outbreak.
There are three main scenarios to consider with employees being unable to work, which we will detail with the ways that employers can manage them;
Self-Isolation or Infected
Where an employee has been advised by 111 to self-isolate, or they are actually infected and sick with the virus, they will be entitled to sick pay.
Usually the first three days of sick leave are called waiting days and are unpaid. The Government announced that in the case of Coronavirus, these first three days will be entitled to statutory sick pay.
The employee will need to provide the usual proof of their sickness absence through self-certification.
For employers who are contractually obliged to pay full pay for absences, they will need to consult their contracts of employment.
Employee Not Sick
It is highly probable that there will be instances of employees not wishing to come to work because they are fearful of contracting the virus. It may also be that they need to care for a relative or child.
There is no obligation for the employer to pay staff for this time off. They therefore have the following choices:
- Pay some or all of this time as a goodwill gesture;
- Allow them to take the time as holiday;
- Allow them to take the time as unpaid leave
Flexible Working and Home Working
Due to the unprecedented impact of this virus, it is possible that some employees may be able to work from home if required. It is useful to have a policy in place to ensure that both parties know what the expectations are and what limits are on the scheme.
For example, it might be that they have to self-isolate and offer to work from home rather than take time off sick, but they do not work their usual hours. They might work 30 hours instead of their usual 37.5. It would then be up to the employer how to treat the shortfall, either as sick leave, unpaid leave or discretionary paid leave.
Steps need to be taken to ensure that employees have everything that they need to effectively to their job remotely. Such as providing laptops or writing material for them to use. They also need to be given instruction about the safe storage of information to comply with GDPR rules.
Plan ahead where possible to ensure that the employees can provide as much value and support from their remote workplace.
Employees all need to be treated equally based on their roles and it is essential not to discriminate with the way flexible options are provided.
Employer Closes Premises
Employers have the right to tell employees when they take their holiday. If they foresee that a closure is going to be required, they have to give the employees twice as much notice in relation to the amount of time that they are going to take.
If they close the workplace without notice, they are required to pay the employees.
If the employer needs to temporarily lay off staff or reduce their working hours, they first need to consult their contracts of employment to see if this is covered.
Where this is not in the contract, specific HR advice needs to be sought to explore how this can be achieved. It is possible to get a mutual agreement between the employer and employee to temporarily reduce hours.
Employers cannot legally ask employees not to turn up to work without paying them.
Keep Calm and Carry On
There is going to be a great deal of disruption to business over the coming weeks, but there are ways that businesses can help themselves during this time, by both protecting themselves from the virus and by protecting their trade:
- Where possible, reschedule unnecessary meetings or switch them to Web based or phone meetings;
- Offer customers delivery services where they are unwilling or unable to visit your premises;
- Communicate directly by email or by social media to let customers know that it is business as (close to) usual and what steps are available to support them;
- Keep the workplace cleaner than usual. Regularly wipe down door handles and other surfaces that are regularly touched by multiple people;
- Encourage people to wash their hands before entering your premises if possible or have hand sanitiser gel available close to your premise’s entrance;
- Be aware of employees who are demonstrating symptoms and do not be afraid to suggest they self-isolate;
- Keep your distance from people where possible, up to 2 metres. Don’t shake hands, hug or kiss if you don’t need to;
- If you as the business owner feels ill, stay home. Trying to be a hero and carry on could be very damaging to your whole team.
Above all, stay positive and think outside the box. Thinking or saying ‘I can’t do any of these things’ isn’t the right attitude. If none of these suggestions help, think what you can do to make a difference. Taking positive action is always the best way to keep your spirits up and to impact those around you. As the business owner, you need to lead by example!
We will provide further amendments to this blog as and when information comes available to us.
This blog has been written by CCF Accountancy. If you have specific queries that you think they might be able to help with, please call 01423 567499 or email [email protected]