With so much information currently circulating regarding COVID-19, it can be difficult to know how best to proceed as a manager or business owner.
With this in mind, we’ve consolidated the UK Government’s most recent advice to business owners, and have put together a guide for putting it into practice using your RotaCloud account.
We recommend bookmarking this post for future reference. Please note that all information is up to date as of 03/02/2021.
Table of ContentsGovernment measures & advice
Government measures & advice
Spring budget guidance
During his Budget statement on 3rd March, Chancellor Rishi Sunak announced a raft of updates and changes to the government's various business support schemes in response to the ongoing COVID-19 crisis.
First of note is that the Coronavirus Job Retention (AKA furlough) scheme will be extended until September 2021, with the government continuing to cover 80% of the wages of staff who are unable to work as a consequence of COVID-19. Support for the self-employed will also continue until September.
The business rates holiday, detailed below, will continue until June this year, allowing businesses to reopen gradually. From June until the end of 2021, business rates will be discounted by two-thirds.
Next, it was announced that a new recovery loan scheme will take the place of bounceback loans (detailed below). The new 'Recovery Loans Scheme' will offer loans from £25,000 to £10 million until the end of 2021, with the government providing lenders with an 80% guarantee on any money borrowed (down from 100% under the Bounceback Loan scheme).
New 'business restart' grants will also be available from April. Business owners in the retail industry will be able to apply for grants of up to £6,000, while those in hospitality can claim up to £18,000.
Finally, the emergency reduced rate of VAT will continue until September for those in the hospitality industry. The rate will then increase to 12.5% between October 2021 until April 2022, at which point it will return to normal.
It was announced on 4th January 2021 that England would be return to a state of lockdown following a large spike in COVID-19 cases due to a reported new strain of the virus. This is expected to last until March at the earliest.
In addition to this, on 5th January, Chancellor Rishi Sunak announced that businesses in the retail, hospitality and leisure sectors were to receive a one-off grant of up to £9,000 in order to help them through the spring. More information about this can be found on the UK Government's website.
Finally, it was confirmed that the Coronavirus Jobs Retention scheme (see below) would continue until the end of April 2021 as previously stated, with all furloughed staff continuing to have 80% of their pay covered by the government.
On 31st October, Prime Minister Boris Johnson announced that, following a rapid increase in new Coronavirus cases, England would be returning to a state of lockdown for one month.
As a result, all but 'essential' businesses in England have been instructed to close from Thursday 5th November.
It was also announced that the Coronavirus Jobs Retention scheme (also known as the Furlough scheme), which was due to come to a close at the end of October, has been extended until April 2021.
The scheme will work in the same way as it did before, but the government will now pay 80% of furloughed employees' wages (up from 60% earlier this month), with employers being asked to pay only pension and National Insurance contributions.
The scheme will be reviewed in January 2021, at which point the government will decide whether employers need to contribute more towards their employees' pay.
Those who are able to can also choose to top up the remaining 20% of their employees' salaries, but this remains optional. Only employees who were previously enrolled in the scheme will be eligible.
The furlough scheme is due to come to an end in March 2021, at which point it's expected to be replaced by the previously announced Job Support scheme, detailed below.
On September 24th and October 22nd, the chancellor announced more measures to help steer the economy through autumn and winter.
The Job Support Scheme: part time
Please note: With the announcement on October 31st that the government's furlough scheme would not be coming to an end as originally planned, the rollout of the Job Support Scheme has been delayed, and it is therefore not currently in operation.
The following information is provide for reference only, and is of course subject to change.
The Job Support Scheme was devised as a sort-of replacement for the Coronavirus Job Retention Scheme (AKA the Furlough scheme) and would run for six months from the 1st of November — but the purpose of the JSS is very different to the furlough scheme.
Instead of aiming to protect as many jobs as possible, the JSS is designed to only protect jobs that are ‘viable’. In other words, employees must be working at least 20% of their usual hours, but aren’t yet working their full hours — perhaps cash flow is still low, or the venue they work at only holds events three days a week.
This scheme applies to areas in all tiers of restrictions.
How it works
Under the scheme, the government and employer both top up the wages of employees who work at least a fifth of their normal hours. For example:
Kathy is contracted to work 40 hours a week, and would usually earn £2,000 a month (gross).
Her employer needs her to work only a fifth of her hours (8 hours) because of reduced business.
- Her usual wage for the hours she actually worked paid by the employer — £400
- Two-thirds of her usual wage from the missing hours (£1066), comprising:
- 5% of the missing wage must be paid by the employer (about £80)
- The remainder will be paid by the government (£986)
That’s £1,446, or about 72% of her usual pay packet.
Who’s the scheme open to?
All small and medium businesses can use the scheme. Large businesses can use it if they can show the pandemic has negatively affected their turnover.
Staff don’t need to have been furloughed previously to qualify for this scheme — as long as they were on payroll on or before the 23rd of September, they can be moved onto the scheme. Each set of working hours must cover at least seven days, after which it can be changed, or employees can be moved off the scheme again. You can’t make staff redundant while you’re claiming a grant under the JSS.
Don’t forget — this is entirely separate to the furlough scheme. The £1,000 bonus for keeping furloughed staff employed through to January is still policy, and will still apply.
Job Support Scheme: enforced closures
In tier 3 areas, where businesses are forced to close, government pays 67% of wages in affected businesses, for affected employees, and the employer doesn't pay any.
Bounce Back Loans (detailed below)have been extended from six years to ten years, significantly cutting monthly repayments. Lenders of Business Interruption Loans can also extend the length of loans to 10 years.
Businesses can now apply for these loans until the end of November, and can choose to make interest-only repayments (or where necessary suspend them entirely) for up to six months, without it affecting credit ratings.
VAT cut extended
The emergency cut in VAT to 15% in hospitality and tourism has been extended until 31st March 2021.
Old guidance (pre-September 2020)
Coronavirus Job Retention Scheme
In an unprecedented move, the UK Government announced that it would provide financial support to all UK employers, enabling them to retain staff whom they may otherwise have had to let go due to the impact of the coronavirus crisis.
The scheme, known as the Coronavirus Job Retention Scheme, and to many simply as the 'furlough scheme', allows UK employers to apply for the government to reimburse them to the value of 80% of furloughed employees’ salaries (up to the value of £2,500 per month).
The furlough scheme runs until March 2021 (previously October, then December).
The scheme is now closed to new entrants. You can only furlough staff who were furloughed for at least a three-week period starting no later than the 10th of June.
You can still claim 80% of furloughed staff's wages during June and July.
From August, employers must pay pension and NI contributions.
In September, 70% of wages (up to a cap of £2,190) were paid by the government – employers had to pay 10%.
In October, only 60% of furloughed employees' wages (up to a cap of £1,875) were paid by the government – employers had to pay 20%.
The scheme was due to close in November, but has since been extended to December.
From July, furloughed staff can return to work on a part-time basis. You can specify any hours or shift times, and you'll have to pay the full amount of wages for hours worked. The government will then pay the normal amount of furlough pay for the difference between their new hours and their pre-furlough hours.
If Bob is contracted to work 200 hours a month for £2,000, when he is furloughed he receives 80% of his pay via the government's scheme: £1,600.
Bob's employer wants him to return part-time for 100 hours a month under the flexible furlough scheme. Now, Bob will be paid:
- For 100 hours of work, paid by the employer: £1,000 (half of £2,000)
- 100 hours under the furlough scheme: £800 (80% of £1,000)
For a total of £1,800.
Coronavirus Job Retention Scheme - old guidance
Who’s eligible for the scheme?
The Coronavirus Job Retention Scheme is open to all UK employers, but your staff will need to be on PAYE in order to claim the grant for their wages.
The scheme is open to businesses, charities, recruitment agencies (agency workers paid through PAYE), and public authorities.
How do I make a claim for support?
To claim this support from the government, employers will need to:
- Designate affected employees as ‘furloughed workers’. A furlough is basically just a leave of absence. Although any staff you designate as furloughed won’t actually be coming into work, they’ll remain under your employ and on your payroll under the exact same conditions as before. Following the Government's announcement of the Coronavirus Job Retention Scheme, we've added a new leave-type option to RotaCloud to allow managers to mark furloughed staff as such. Visit our Help Centre for more info.
- Tell your employees about this change. There needs to be a clear record of this, but an email clearly telling the employee that they are on a furlough (and from what date) should suffice for now.
- Inform HMRC. Next, you’ll need to send the information about your furloughed employees over to HMRC. You’ll need to tell them things like the employee’s name, National Insurance number, the date they were furloughed, and their earnings.
What calculations do I need to make to claim?
For full- and part-time workers:
Take each employee’s actual salary before tax, as of 19th March 2020, to calculate the 80% you'll be reimbursed.
For staff whose pay varies:
If the employee has been employed for a full 12 months prior to the claim, you can claim for either:
- the same month’s earning from the previous year, or
- the average monthly earnings from the 2019-20 tax year
whichever is higher.
If the employee has been employed for less than a year, you can claim for an average of their monthly earnings since they started work.
If the employee only started in February 2020, use a pro-rata for their earnings so far to claim.
You'll also be asked to provide:
- your ePAYE reference number
- the number of employees being furloughed
- the claim period (start & end date)
- amount claimed
- your bank account number & sort code
- your contact name
- your phone number
Bear in mind that the minimum an employee can be furloughed for is three weeks.
When can I submit a claim?
The HMRC portal went live on the 20th of April. Visit the Coronavirus Job Retention Scheme website to make a claim. You'll need your 12-digit Government Gateway ID to log in to HMRC's site.
Reclaim statutory sick pay (SSP)
If your business had fewer than 250 employees on 28th February 2020, you can reclaim up to two weeks’ SSP per eligible employee who has been absent from work because of COVID-19.
It’s really important, therefore, to maintain accurate records of absences, and differentiate between COVID-19 related sickness, and non-COVID-19 related sickness. More about this below.
Bounce Back loans
On 27th April, the government announced a new form of support for SMEs – the Bounce Back Loan scheme.
Launched on 4th May, qualifying businesses can borrow between £2,000 and £50,000 (or up to 25% of turnover)– and the government guarantees 100% of the loan.
Payment terms last for up to six years. During the first 12 months of the loan, no fees, interest, or repayments will be due.
The government sees this scheme as an easier way for smaller businesses to obtain finance, with only a simple form to fill in and no "forward-looking tests of business viability".
One thing to note: you can't apply for a Bounce Back loan if you've already got a business interruption loan (see below) – but if the interruption loan's value is less than £50,000, you can transfer it to a Bounce Back loan to gain all its benefits.
Business interruption loans
If short term cash flow issues are a concern, you might be able to apply for a Coronavirus Business Interruption Loan. These provide up to £5 million of partially government-backed loans to small and medium businesses. You can learn more about the scheme at the British Business Bank website.
All VAT payments will automatically be deferred by three months. Many small businesses in England, especially those in retail, hospitality and leisure will see business rate cuts and even grants. Your local authority will apply these measures automatically.
If you are struggling with your tax bill, the government’s Time to Pay service can help you arrange a new payment plan.
It’s really important that you record different types of absence accurately, particularly in the current climate.
Here are some of the types of leave you might want to record:
Furlough: A (usually unpaid) temporary absence (see above). This is a new term in UK employment.
Sick leave: Statutory sick pay (SSP) usually applies from the fourth day of a period of sickness. However, if employees are self-isolating due to COVID-19, they can receive SSP from the first day of their absence.
Dependency leave (e.g. childcare). Usually unpaid.
Lay-offs: Where you ask employees to stay at home or take unpaid leave because there isn’t enough work for them. If you don’t pay staff (or offer reduced pay) during lay-offs, this should be outlined in employment contracts.
Short-time working: Like lay-offs, but with reduced hours.
Redundancy: Permanently dismissing an employee because you no longer need them to do their job.
The measures introduced by the government reduce the need for lay-offs, short-time working, and redundancies. Instead, furloughing staff may be more appropriate.
If you use RotaCloud, you can differentiate between many types of leave when you enter it into the software. You can also add comments to further separate normal sick leave and COVID-19-related sick leave. You can then gather this information in reports for each employee.
Communicating with staff
If working remotely is new to your business, it can take some adjustment — but with today’s technology it’s easier than ever to adapt. Many businesses used cloud-based email services, file storage, HR software, and so on — which make working from home easier than ever.
Even if your team can’t work from home, it’s important to keep them up to date on what’s happening at the business. Make sure all employees know which channel to expect important announcements to come through: it could be WhatsApp, email, or a Slack channel.
Remember: if you use RotaCloud, you can send out email memos across the entire company or a subset of employees. You can also add notes to individual shifts or days, so everyone’s on the same page even when they’re working remotely.
How do I mark an employee as furloughed in RotaCloud?
We've added 'furlough' as a new Leave type. Check out the Product Updates page in your RotaCloud account or visit the Help Centre for more info.
Can I furlough everyone?
Yes, you can. Though it should be worth noting that furloughing staff who you don’t need to furlough might complicate matters further down the line, depending on the Government's application process. Remember that furloughed employees aren't allowed to work for your business at all while they're furloughed.
Can I furlough staff on a rota basis?
Yes, you can change which staff are furloughed but the minimum furlough time is three weeks. If you wanted to furlough staff on a rota basis, you could, for example, furlough 50% of staff for three weeks and then furlough the other 50% of staff for the three weeks after that.
This approach will seem fairer to many employees, and could help boost morale.
What if I’ve already had to let staff go?
The Coronavirus Job Retention Scheme will allow claims to be backdated as early as 1st March 2020. This means that, if you’ve already had to let staff go as a result of the virus prior to this announcement from the Government, they’ll still be eligible.
How you approach this is down to you — if you’ve already started doing the paperwork, you’ll need to reinstate the employee in order to enter them into the reimbursement scheme.
How long is the Coronavirus Job Retention Scheme running for?
The Coronavirus Job Retention Scheme will run until October 2020 (we'll update this article with an exact date once it's been given by the UK government).
How do I send memos in RotaCloud?
Click the paper aeroplane in the top-right of RotaCloud. Visit our Help Centre for a complete guide.
Are the RotaCloud support team still available?
Absolutely! The whole RotaCloud team is currently working from home, but our support hours remain unchanged: Monday–Friday, 8am–5pm UK time.
We’ll be updating this post regularly, so check back soon for new announcements. We will also be using this space to provide practical tips and advice for RotaCloud users — showing them how to utilise the tools, features, and reports within RotaCloud to make the process of claiming support from the government during this difficult time a little bit easier.
In the meantime, take care of yourselves, and remember that we’re here to help if you have any questions or concerns about your RotaCloud account.