UK Government Agrees to Pay Employees’ Wages

Orrick - Employment Law and Litigation
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Orrick - Global Employment Law Group

The UK Government has said they will step in and pay up to 80% of wages subject to a cap of £2500 per month for any employee who is not working but kept on payroll, rather than made redundant.  This is intended as an incentive to keep people in work and means that if an employer is considering redundancies or unpaid sabbaticals because its employees have no work due to the impact of the coronavirus, then provided these employees are kept on payroll instead, companies of all sizes will be able to apply to HMRC for these grants to keep paying their employees.  According to the Chancellor, Rishi Sunak, the system should be up and running in a matter of weeks and be fully operational by the end of April.

The Chancellor said, “Today I can announce that for the first time in our history the government is going to step in and pay people’s wages,”

The detailed guidance has not yet been published but full updates will follow.

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