Winter Economy Plan - What you need to know

Winter Economy Plan - What you need to know

  • Date: Thursday 24th September 2020
  • PDF: Download

Speaking to Parliament on the 24 September 2020, Chancellor Rishi Sunak unveiled the government’s Winter Economy Plan, which includes measures to support employers and the self-employed, during this ongoing crisis.

As we all know, the Coronavirus Job Retention Scheme ends at the end of October, and we have all been anxious to hear what comes next.

The message the government is sending is clear: we will continue to support you, but only if the job the person holds is viable.

Currently, many continue to hold roles on furlough leave, in businesses that may not require those jobs in the future.

The advice is now that those employees (and employers) should take stock and make alternative, sustainable plans for the future. In other words: move on. If you are in this situation, please contact your HR consultant, who can provide advice on restructures and redundancy.

For those who are employing staff in their old capacity, but are struggling to provide full hours at present, the Job Support Scheme can provide relief.

This new initiative helps employers meet the cost of employment, while encouraging employees to work as many hours as they can.

In principle, the employee’s wages will be split:

Part 1 – Paid work. The employer pays for the hours the employee works.

Part 2 – Unpaid hours. The government, the employer and the employee will shoulder 1/3 each.

For example:

An employee is on a 40-hour contract.

The employer can only provide 10 hours of work and pays for those 10 hours.

The remaining 30 hours are split into thirds:

10 hours – paid at normal rate by the employer

10 hours – paid at normal rate by the government

10 hours – unpaid

job support scheme

All employers can use the scheme, even if they have not previously used the furlough scheme. In order to qualify, an employee must work at least 33% of their usual hours.

The scheme opens from 01st November 2020 and we are still awaiting further details on how employers can apply.

We will send you an update as soon as we can, but do also continue to visit over the coming days.

Source: Manuela Grossmann     

Bookmark and Share

Return to listings