Budget 2020. Key points for employers and employees

On 11 March 2020 Sajid Javid announced several measures aimed at protecting businesses and employees against the impact of Coronavirus. The key points were:

Sick Pay and Coronavirus

Statutory Sick Pay (SSP) will be available from the first day of absence to anyone self-isolating due to the outbreak of Coronavirus. Previously SSP was not available until day 4 of a sick absence. The Chancellor also announced that small businesses employing less than 250 people will be eligible to receive a government rebate for statutory sick pay. The rebate is limited to 14 days SSP per employee. The Government estimates this will benefit 2 million businesses.

IR35

The Government confirmed that changes to the IR35 regulations will take effect from 6 April 2020. The main changes are:

  • The person paying the intermediary (the “Fee Payer”) becomes responsible for paying tax and NICs. This responsibility currently lies with the intermediary.
  • The client becomes responsible for determining employment status via an SDS (Status Determination Statement). Responsibility for determining status currently lies with the intermediary.
  • The client will have to pass on the SDS to the individual and the Fee Payer. Any failure to do so will make the client responsible for tax and NICs.

Gig Economy

The Chancellor announced that the Government will make it quicker and easier for self-employed people and those working in the gig economy to access benefits. Contributory employment and support allowance (ESA) can now be claimed from day 1, instead of day 8. The Government will also remove the minimum income for universal credit and people will no longer have to physically attend a job centre. Instead they will be able to access the service by phone of online.

Other announcements for employers and employees

  • The threshold for which employees and those self-employed will pay National Insurance Contributions rises from £8,632 to £9,500.
  • The Government is increasing the Employment Allowance from £3,000 to £4,000. According to the Government, this means 65,000 businesses will no longer have to pay any NIC and roughly 500,000 businesses are expected to benefit.
  • The Enterprise Management Incentives (EMI) Scheme will be reviewed as the Government aims to ensure the scheme provides support for companies with high growth in recruiting.
  • Business rates for leisure, retail and hospitality businesses with a rateable value of £51,000 or less will be abolished for this year only.
  • Pubs in England with a rateable value below £100,000 will have their business rates discounted by £5,000 for this year only.

For expert advice on aspects of commercial law, please contact Laura Kurowski at our Huddersfield office or Andrew Crabtree and James Bell at our Halifax office.

For specialist advice about employment law matters, please contact James Hodgson or Maureen Cawthorn at our Halifax office.

 

Contact our experts for further advice

View profile for Laura KurowskiLaura Kurowski, View profile for Andrew CrabtreeAndrew Crabtree, View profile for James BellJames Bell, View profile for James HodgsonJames Hodgson, View profile for Maureen CawthornMaureen Cawthorn

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.