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Euro Projects Recruitment Business Leaders Zoom Call 6th July Summary - Overcoming Stress for Bosses!

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Stephen Brown

Euro Projects Recruitment Business Leaders Zoom Call

For Manufacturing, Engineering, Technology, Transportation & Logistics Professionals

Self-Care & Resilience for Leaders in Crisis

Summary of Key Points: 6th July 2020

Covid-19 & Business Update

Stephen Brown from Euro Projects Recruitment

Welcome to our 16th week of hosting this Zoom Call. As always we begin by bringing you what we know and hope to hear from UK Government:

  • £1.57bn support package has been announced for the arts sector – Significant to see the first sector specific support package released.
  • Rishi Sunak will make an announcement on Wednesday with further support measure for the economy, including: which is likely to include removing stamp duty up to £500k to stimulate the housing market and potentially a voucher scheme of £500 per adult to spend on hard hit business sectors. Also being expected:
  • New job creation scheme for work placements with a £1000 subsidy is being mentioned.
  • Jobs coaches in Job Centres
  • Additional wage subsidies (Germany and France running their furlough scheme for up to a year).
  • Even with easing of lockdown, only 53% of the hospitality sector opened up this weekend and those businesses that did were only operating at70% capacity.
  • We are on the border of Leicester and got a stark reminder of how Covid-19 is likely to continue to affect us all, as the rest of England was released from lockdown at the weekend, Leicester returned to key worker travel only into the City and Leicester people were confined with police enforcing lock down rules and fines.
  • Leicester will be a lesson to the rest of the UK on what it can expect, with track and trace now being used to focus lockdowns at a local level with Government strategy looking towards ‘Micro-Lockdowns’ which could be at business level or street level.
  • Question arises how will firms affected be local lockdowns be supported?

 

Furlough Update  - Helen Dyke from Irwin Mitchell

Last Friday the government published its third Treasury Directive relating to the furlough scheme. Put simply, the rules are confusing. Here’s a summary of the key points to note:

Notice pay and furlough grants

  • New guidance explains the purpose of CJRS as follows: “Integral to the purpose of CJRS is that the amounts paid to an employer pursuant to a CJRS claim are used by the employer to continue the employment of employees in respect of whom the CJRS claim is made ….”
  • Unfortunately, the wording differs from the original version and we’ve already received some enquiries from clients worried that they can’t use furlough payments to pay an employee’s notice period. This is particularly important as many clients are starting to think about redundancies now ahead of the scheme closing on 31 October. Our view is that if the government means to restrict employers in this way it should have said so. We don’t think the position has changed and it could just be clumsy drafting. For example, the updated guidance for employees says that “Your employer can still make you redundant while you’re on furlough or afterwards. Your rights as an employee are not affected by being on furlough, including redundancy rights.” - Our advice - therefore remains valid.

Written agreements

  • You may recall that when the first Treasury Direction was published, it suggested that there had to be a written agreement in place before anyone could be furloughed – rather than just a written record of it. That issue was clarified in subsequent guidance. This time the Direction requires the parties to have reached an agreement (either individually or via a collective agreement) which sets out the main terms under which they will not do any work or will not work their usual hours. The agreement has to be entered into before the arrangement takes place and should be either made in writing or confirmed in writing.
  • Evidence of that written confirmation must be kept until at least 30 June 2025.
  • Our precedent flexible furlough agreement requires the employee to sign and return a copy of the agreement.

Qualifying employees

  • Only employees who have been furloughed for a three week period between 1 March and 30 June can be furloughed from 1 July. However, there are two exceptions to this:
  1. People returning from most family related leave periods
  2. Reservists on service.

In both cases the individual must have been employed and included on their employer’s PAYE system by 19 March.

Limits on numbers of people that can be furloughed

  • From 1 July, the numbers of employees you can furlough in any period can't exceed the maximum numbers of employees you claimed for under the old scheme - although you don't include returning parents in this calculation.
  • This may create some difficulties for employers who have already put in place rotating furlough patterns. For example, if you have divided your 200 strong workforce into two groups of 100 each and rotate them on three weekly furlough, you won't be able to put all 200 workers on flexible furlough so that everyone works half a week.

Duration of furlough

  • From 1 July, you'll be able to bring back previously furloughed employees for any amount of time and on any pattern of work and claim a grant for the hours not worked. For example, if your employee normally works five days a week and you only need them in work for two, you can furlough them for the remaining three days. If business picks up, you might want them to work for three days and be furloughed for two. If you can't bring staff back to work for some of their hours, you can continue to furlough them for all of their hours.
  • The last date anyone could be furloughed for the first time was Wednesday 10 June. If you furloughed any employee on that date, you'll be able to move them onto the new scheme immediately from 1 July.
  • Anyone who has been re-furloughed after 10 June must complete three weeks furlough before they can move onto flexible furlough even if this extends beyond 1 July.

Claim periods

  • Employers have to submit their claim for any periods of furlough up to 30 June by 31 July.
  • They also have to make separate claims to cover furlough days in different months, even where employees have been furloughed continuously. This reflects the stepping down of the CJRS contribution each month and prevents HMRC from having to apply different rates of support within the same grant.
  • From 1 July, the minimum claim period is seven or more consecutive days, except where you are claiming for the first few of last few days in a month (referred to as ‘orphan’ days) and you have already claimed for the period ending immediately before it. But there’s an exception where the claim period is a week or more.
  • Remember: you must include all furloughed staff in one claim even if they are paid at different times.

Flexible furlough and usual hours

  • Unless someone is being furloughed for all of their contracted hours, the formula for calculating the furlough grant is complicated.
  • You will have to determine if someone is working fixed hours first to be able to determine what is meant by usual hours.
  • Please note. The reference salary of a fixed rate employee is the amount they received in the salary period ending on or before 19 March. For all other employees, the reference salary is the higher of their average monthly pay in the tax year 2019/20 or the amount they received in the corresponding calendar period the previous year.
  • The Direction doesn’t address the issue of pay increases – or more likely – decreases that may have been agreed prior to 19 March. This suggests that employers must continue to apply ‘old’ rates the calculations and may mean that some employees on flexible furlough can be financially better off for working fewer hours than those who are on short-time working.

TUPE

  • Employers can claim for employees of a previous business who have transferred to it after 28 February, if either the TUPE or PAYE business succession rules apply to the change in ownership. It appears that this means that the scheme only applies where there is a “business transfer” under TUPE, but the HMRC helpline said their view was that service provision changes are covered. We recommend that you take legal advice
  • If the employees transferred after 10 June, you can still make a claim provided the employees were furloughed by their old employer for at least 3 consecutive weeks between 1 March 2020 and 30 June. In these circumstances, the maximum number of employees that you can claim for will be increased by the number of transferring employees that the old employer furloughed, subject to the old employer’s maximum cap.

Employer contributions

  • Employees must continue to receive up to 80% of their salary for any hours they are on furlough. Employers can’t reduce this even when the furlough grant decreases.

By way of a reminder:

  • From August, employers will have to meet the PAYE, NI and pension contributions of furloughed staff.
  • From September, employers will have to pay 10% of the furloughed pay – HMRC will pay a maximum of £2,187.50 per month
  • From October, employers will have to contribute 20% of the furloughed pay – HMRC will pay a maximum of £1,875.00 per month.

Helen Dyke, Senior Associate Solicitor, Irwin Mitchell LLP

DDI: 0121 214 5242

Mobile: 07435966985

 

Self-Care & Resilience for Leaders in Crisis

Stephen Brown from Euro Projects Recruitment - For many Business Leaders the last 16 weeks have been a relentless barrage of challenges to keep our business operational, we’ve dealt with, to name a few:

  • Remote working
  • Changes to working practices
  • Covid-security
  • Furloughing
  • Shielding employees
  • Redundancies
  • Employee engagement
  • Cyber security
  • Pivoting into new markets
  • Supply chain issues
  • Capacity planning
  • Cash flow problems
  • Sick Pay
  • CBIL’s, Bounceback Loans
  • Employee Mental Health
  • Our own Mental Health

The words I am hearing from Business Leaders are “overwhelm”, “relentless”, “uncertainty”, “frustration” and “anxiety”, so to help us overcome some of these feelings and to help prepare us for what lies ahead, we are delighted to introduce Frances Walker, Executive Mindset Coach

Frances is calling in from Huntsville, Alamaba USA where she is a Certified Mind-set and Business Coach affiliated to a number of trade and community bodies.

Previous Career Highlights include: Lead Mindset Coach for The Powerful Living Experience, which was named “One of the Top 3 Personal Development Events for Entrepreneurs in the US" by INC. Magazine.

WATCH IT HERE: https://www.youtube.com/watch?v=sbyZGI8Qww0

Frances’ process is super simple. She provides what I call "Concierge Coaching".

The process starts with a simple connection to her at franceswalker1107@gmail.com, after which you receive a link to her personal calendar. You can then start a conversation about your unique challenges and she will design a coaching program around your unique schedule and life demands. 

 

If you haven’t already downloaded your FREE copy; Euro Projects Recruitment is also delighted to bring you - This practical guide to reviving your business, bringing together contributions from a range of business experts who have been involved in the Business Leaders Zoom calls.

To download your free copy click here:

Euro Projects Recruitment, supporting you and your business until you are ready to recruit again

T: +44 (0)1530 833 825 │ Website: www.europrojects.co.uk

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