UK Chancellor outlines further support for employers in response to COVID-19



Today, the Chancellor unveiled the UK government's Plan for Jobs 2020. The aim of this plan is to prevent the mass unemployment which many fear will be a consequence of the COVID-19 pandemic – especially as the furlough scheme draws to an end. The proposals likely to feature in headlines include a cut in VAT for the hospitality sector and government-subsidised meals in restaurants. 

However, a number of important measures to support employers have also been announced:

  • Job Retention Bonus: By now, everyone knows the Coronavirus Job Retention Scheme (CJRS) will end in October. To support businesses which have made use of the scheme, the government will pay UK employers a one-off bonus of £1,000 for each employee they have furloughed and then retain in continuous employment from the end of the CJRS through to the end of January 2021 (provided the employee earns at least £520 each month). Further details of the bonus arrangements will be announced at the end of the month and payments will be made from February 2021.
  • Kickstart scheme: The government has announced a £2 billion scheme for those aged 16-24 on universal credit and at risk of long-term unemployment. The fund will be used to create six-month work placements and will cover the relevant minimum wage for 25 hours per week along with National Insurance and employer auto-enrolment contributions. This will apply throughout Great Britain (i.e. not Northern Ireland).
  • Traineeships: An additional £111 million of funding will be provided for work placements and traineeships in England. These will again be aimed at those aged 16-24. The government will also pay employers £1,000 for each trainee they offer work experience.
  • Apprenticeships: Between 1 August 2020 and 31 January 2021, the government will pay employers in England £2,000 for each new apprentice they hire aged under 25 and £1,500 for each apprentice aged over 25.

Further information on these and other policies outlined by the Chancellor today can be found on the HM Treasury Plan for Jobs 2020 page. The bold action being taken by the government will be welcomed by many, particularly the focus on young people. It is hoped that further detail on these measures will soon be released so that businesses can make fully informed employment decisions.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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