Chancellor announces furlough bonus scheme and more in Summer Statement

“Stand by workers and we’ll stand by you”

Whilst working from home, my daily TV schedule consists of tons of Judge Judy, border patrol programmes and Can’t Pay Take It Away (great show). But yesterday, like many others, I was glued to the live stream from the House of Commons as Chancellor Rishi Sunak unveiled a plethora of announcements that are aimed at stimulating the festering sore that is the UK economy after a global pandemic and nationwide lockdown.

And let me tell you, it’s a lot. Rishi has clearly been listening and a lot of his rhetoric and policy announced in the Summer Statement addressed those whose jobs and futures have been affected the most, in particular young people (16-24) and the hospitality sector. Unemployment rates and redundancies are on the rise with the tapering off of the Coronavirus Job Retention Scheme and these measures are to try and help employees stay in work and help employers to enable them to do so, with the Chancellor stating: “stand by workers and we’ll stand by you”.

So what’s been announced? While there was an abundance of big news, such as the temporary writing off of stamp duty under £500,000 and a £2bn “green homes grants” to make more homes energy efficient, in this blog I will focus mainly on the points that apply to employees and employers.

• The first major announcement, following on from the Job Retention Scheme which was a lifeline for millions of people in the UK, the next phase is the Job Retention Bonus Scheme. This bonus of £1,000 will be given to an employer for each member of staff they bring back from furlough. To stop people taking the mick and chancing their arm, the employee must be employed from once they’re taken back to at least January 2021 of next year. The employee must also be earning at least £535 per month for this period.
• A kickstart scheme was then unveiled with the aim to, you guessed it, kickstart job creation for young people as under 25s are 2.5 times more likely to suffer job loss as a result of Covid-19. The government has pledged £2bn to fund hundreds of thousands of jobs for 16-25 year olds whereby they will pay the wages of new, young employees for 6 months. There is no cap on the number of young people that can be hired under this scheme.
• To boost apprenticeships, which have a 91% successful retention rate, businesses who create positions for new apprentices will be given a bonus of £2,000 for each apprentice under the age of 25 and £1,500 for those over 25. The bonus scheme is available for employees who apply between August 2020 and January 2021.
• Work coach numbers positions in Job Centres will be doubled and guidance counsellor positions will be boosted also with the aim of helping people find jobs.
• To help the hospitality sector, a temporary cut to VAT on food, accommodation and attractions has been announced that cuts VAT from 20% to 5%.
• The Chancellor also announced the introduction of “eat out to help out” vouchers that give diners 50% off their meals out from Mondays to Wednesday with a maximum discount of £10 per person for the month of August only.
  

So there you have it. While these measures are most welcome and certainly very creative (Rishi gets an A for effort) there are still major concerns not being addressed and it feels a little like putting a plaster on an arrow wound as the economy slowly bleeds out. We need this sort of energy not just now, but for the next couple of years as we come to terms with all of this.

So personally, I will take my butt to a half-price meal and enjoy every bite whilst I silently reserve judgement on it all and wait to see what happens.

Posted byAoibheann ByrneinCoronavirus

5 Principles To Help Protect Your Employees During COVID-19

More and more businesses are reopening at last. This is very good news for the economy as a whole, but also for business owners and their staff that depend on them. However, the shift brings with it some concern surrounding the responsibilities employers now face in regard to how they protect their employees during a public health pandemic. This unchartered territory raises a lot of questions about what employers need to be doing differently, and how they can do it effectively.

Luckily enough, the Government has produced a series of guidance documents which provide information on the appropriate steps that employers should be taking to protect employees from COVID-19.

There are currently 12 separate guidance documents, each one focused on specific industries or other categories. They are:

• Close contact services
• Construction and other outdoor work
• Factories, plants and warehouses
• Heritage locations
• Hotels and other guest accommodation
• Labs and research facilities
• Offices and contact centres
• Other people’s homes
• Restaurants, pubs, bars and takeaway services
• Shops and branches
• Vehicles
• The visitor economy

Many businesses will find that at least two of these categories are applicable to their business. For example, an employer may operate an office and a factory or warehouse. This will mean that some employers may need to work from more than one of the guides.

5 Principles of Protecting Employees

Regardless of what industry you are in, there are 5 principles that employers should be following to protect employees as they come back to work.

1. Risk Assessment

You must carry out a COVID-19 Risk Assessment. In completing your risk assessment you will be looking to identify what work activities might cause transmission of the virus, the likelihood of such a transmission, who is likely to be at risk and formulate a plan to minimise this risk. Once completed, it will be important that you share the results of your risk assessment with staff and staff representatives and make it easily available to them anytime. The BrightPay Connect employee app is perfectly suited to this.

2. Working From Home

Employers need to take all reasonable steps to continue to allow employees to work from home. As an employer, you should allow someone to work from home even if you wouldn't in normal circumstances have agreed to a request for remote working. If it is at all possible for the work to be done in an effective way, even if it's not ideal, even if there are some tasks that can't be done, employers should be doing everything they can to facilitate remote working for the foreseeable future.

3. Workplace Hygiene

Where it is not possible for employees to work from home and they are coming into the workplace, employers will need to put in place appropriate cleaning, handwashing and hygiene procedures. Suggestions put forward in the guidance include:

• Providing hand sanitizers in the workplace
• Frequently cleaning and disinfecting regularly touched surfaces
• Encourage people to follow the guidance on hand washing and hygiene

4. Social Distancing

You will also need to ensure that social distancing of 2 metres is in place wherever possible. This will require lots of signage and established one-way systems. Consider placing tape on floors to mark out 2 meter boundaries, make sure that rest areas are appropriately cordoned off so that people aren't encouraged to sit too close together, and limit the number of employees allowed in common areas, such as a staff kitchen, at a time. 

5. Personal Protective Equipment

Of course there are going to be some jobs where social distancing can’t be achieved. In these situations, additional steps should be taken to manage the transmission risk via the use of personal protective equipment. These steps may include the use of gloves, face masks, perspex guards and staggering start/break times.

Internal Communications

As mentioned earlier, once you have completed your risk assessment and you have decided on the preventative measures you are taking, it will be important that you communicate these changes effectively with your employees and your employee representatives or union representatives.

• It is advisable that you put in place COVID-19 Safe Working Policy. This will clearly communicate to workers what steps you have taken to help prevent the spread of infection and it will also set out any responsibilities workers have. 
• You should also consider holding a Return to The Workplace Induction in which you go through this new policy in detail and in person to ensure that everyone fully understands the changes being made. 
• Sending out a Returning to The Workplace Staff Survey before your employees return will help you to identify any concerns they feel about coming back to work and potential gaps in your policy that need to be addressed. 

Make Sure Your Business Is Compliant With Our Free Webinar

The BrightPay team are holding regular webinars to share with you all news relating to HMRC updates, what employers need to know and how you can make sure you’re complying with best practices at all times. Click here to watch our previous COVID-19 webinars on-demand, where we cover everything from important COVID-19 payroll updates to return to work government policies and more.

Posted bySarah TyrrellinCoronavirus

Flexible Furlough - Employees Returning to Work Part-Time

The Coronavirus Job Retention Scheme is changing to support businesses as the economy is carefully reopened. Before July, employees that were placed on furlough could not undertake work for you. Originally, the scheme was only for employees who were not working, and while on furlough, an employee could not undertake work for or on behalf of the organisation.

From 1st July, businesses have the flexibility to bring furloughed employees back to work for any amount of time and any shift pattern, while still being able to claim under the CJRS for hours not worked. This new flexibility will help businesses with reopening and help boost the economy.

The government will continue to pay 80% of furloughed employees wages for any normal hours they do not work, up until the end of August, but the employer will have to pay employees for the hours they do work. For example, if a furloughed worker returns to work for two days per week, they would need to be paid as normal by their employer for these two days, while the government would cover the other three days.

Employers will decide the hours and shift patterns their employees will work on their return, and so employees can work as much or as little as the business needs, with no minimum time that they can furlough staff for.

Any working hours arrangement agreed between a business and their employee must cover at least one week and be confirmed to the employee in writing. You must keep a written record of the agreement for five years and keep records of how many hours your employees work and the number of hours they are furloughed (i.e. not working).

If employees are unable to return to work, or employers do not have work for them to do, they can remain fully furloughed and the employer can continue to claim the grant for their full hours under the existing rules.

From 1st July, employers will only be able to claim for employees who have previously been furloughed for at least 3 consecutive weeks any time between 1st March 2020 and 30th June 2020. An exception to this is where an employee is returning from statutory parental leave after 10th June and meets the qualifying criteria to be furloughed for the first time.

Where an employee is flexibly furloughed, employers will be required to submit data on the usual hours an employee would be expected to work in a claim period, the employee’s actual hours worked, and the number of furloughed hours for each claim period.

If you claim in advance and your employee works for more hours than you agreed, then you’ll have to pay some of the grant back to HMRC. This means that you should not claim until you have certainty about the number of hours your employees are working during the claim period.

Interested in finding out more about the new changes to the Coronavirus Job Retention Scheme? Watch our webinar on-demand where we discuss flexible furlough, the wind-down of the scheme and changes to making a CJRS claim.

Posted byRachel HynesinCoronavirus

Customer Update: July 2020

Welcome to BrightPay's July update. Our most important news this month include:

• Timeline - Furlough scheme to wind-down gradually

• Flexible Furlough - Employees Returning to Work Part-Time

• Chancellor to grant “draconian” powers to reclaim millions in Covid-19 support payments

• Calculating a flexibly furloughed employee's 'usual hours'

Changes to the CJRS & Furloughing Employees

The Coronavirus Job Retention Scheme has been hugely popular and will continue to support jobs until the end of October. However, from 1st July, there will be many changes to the scheme. Here we've put together a summary of some of the key points in relation to flexible furlough, phasing out of the scheme and changes to making a claim.

Read more

CJRS calculations have changed in BrightPay from version 20.5 onwards

COVID-19 Webinar - Did you miss it? Watch on-demand now

During our most recent webinar, we looked at upcoming changes to the Coronavirus Job Retention Scheme. We also examined five principles that employers should be following to protect employees as they come back to work. Don't miss out - watch it back anytime.

Watch now

Posted byRachel HynesinCustomer Update

CJRS calculations have changed in BrightPay from version 20.5 onwards

When guidance for the Coronavirus Job Retention Scheme (CJRS) was first published in April 2020, HMRC did not provide comprehensive instructions on how to calculate the amounts for every scenario. Like other software providers, we were left to make certain assumptions with very little time for development.

One such scenario for which no official guidance was initially provided by HMRC was the handling of pay reference periods that are only partly encapsulated by a CJRS claim period (e.g. the week ending 3 May in a claim for 1–31 May).

BrightPay's initial handling of this scenario was to ignore the pay reference period start and end dates, and work solely from the pay date, i.e. if a pay date was encapsulated by a claim period, then BrightPay would include the full amount in the claim, regardless of whether the pay reference period start and end dates were fully or partially within the claim period. This reasoning is consistent with other payroll calculations (e.g. that for average weekly earnings for statutory pay), and was deemed adequate by HMRC in our communications with them.

Later, HMRC published new guidance on how to handle part pay reference periods that involved apportioning the pay by the number of encapsulated days in a claim period. For example, if an employee was paid £500 for the week ending 3 May, then the new guidance stated that only £500 ÷ 7 × 3 (£214.29) should be accounted for in a claim for 1–31 May (with the other 4 days in a previous claim).

At first, there was no urgency to update BrightPay, as claim period dates were flexible anyway, and as long as claim period dates were selected that aligned with the pay reference period dates (including the pay date), everything worked out.

But from July 2020, things are changing again.

From July 2020 onwards, to support flexible furlough, HMRC require that claim dates are strictly within a single calendar month. And so to meet this new obligation, we have had no choice but to change the CJRS calculation in BrightPay 20.5 to work the updated way, splitting pay reference periods where required and apportioning them by the number of days, regardless of pay date. (BrightPay 20.5 also supports flexible furlough, as well as the updated rules and rates for August, September and October.)

For many of our customers, this calculation change will not make a difference. But those who pay in lieu (e.g. a July pay date for June payroll), or those for whom an already submitted claim period ending 30 June did not actually cover all of June's earnings, will need to check and ensure that all reclaimable amounts are accounted for and submitted to HMRC prior to making July claims. Going forward, depending on the pay schedule and CJRS claim dates, it may also be necessary to finalise pay periods further in advance of when they would normally be finalised, to ensure that amounts from the beginning of such periods are picked up in a CJRS claim.

CJRS 2.0 - What you need to know

The Coronavirus Job Retention Scheme has been hugely popular and, according to recent statistics, over 1.1 million employers had furloughed employees in 9.2 million jobs and claimed more than £23 billion in grants. The CJRS scheme will continue to support jobs until the end of October, however, from 1st July, there will be many changes to the scheme. Here we've put together a summary of some of the key points to note.

Flexible Furlough

To date, employees that were placed on furlough could not undertake work for you. Originally, the scheme was only for employees who were not working, and while on furlough, an employee could not undertake work for or on behalf of the organisation. However, from 1st July, employers will be able to bring furloughed workers back to work on a part-time basis while still being able to claim under the CJRS for hours not worked.

• The government will continue to pay 80% of furloughed employees wages for any normal hours they do not work, up until the end of August, but the employer will have to pay employees for the hours they do work, e.g. if a furloughed worker returns to work for two days per week, they would need to be paid as normal by their employer for these two days, while the government would cover the other three days.

• From 1st July, employers will only be able to claim for employees who have previously been furloughed for at least 3 consecutive weeks any time between 1st March 2020 and 30th June 2020. An exception to this is where an employee is returning from statutory parental leave after 10th June 2020 and meets the qualifying criteria to be furloughed for the first time.

• Employers will decide the hours and shift patterns their employees will work on their return, and so employees can work as much or as little as the business needs, with no minimum time that they can furlough staff for.

• If employees are unable to return to work, or employers do not have work for them to do, they can remain fully furloughed and the employer can continue to claim the grant for their full hours under the existing rules.

Furlough Scheme Wind-Down

From August 2020, the level of grant will be reduced each month. Employers will have to start contributing to the wage costs of paying their furloughed staff, and this employer contribution will gradually increase in September and October.

• In August, the government will continue to pay 80% of wages up to a cap of £2,500, but employers will be required to pay employer National Insurance contributions and employer pension contributions. For the average claim, this represents 5% of the gross employment costs that they would have incurred if the employee had not been furloughed. 

• For September, the government will pay 70% of wages up to a cap of £2,187.50 for the hours the employee does not work. Employers will need to pay employer NI contributions and employer pension contributions plus 10% of wages to make up 80% of the total, up to a cap of £2,500.

• In October, the government will pay 60% of wages up to a cap of £1,875 for the hours the employee does not work. Employers will need to pay employer NI contributions and employer pension contributions plus 20% of wages to make up 80% of the total, up to a cap of £2,500.

• After 31st October, the government contributions will finish and the scheme will come to an end.

Making a Claim

In line with the above changes to the Coronavirus Job Retention Scheme, there are also changes to the way employers need to make a claim.

• Employers will have until 31‌‌st July to make any claims in respect of the period to 30‌‌th June. Claims for periods after 30th June can only be made from 1st July.

• Claim periods starting on or after 1st July 2020 must start and end within the same calendar month. Therefore, pay periods which span two calendar months must be broken down into two separate claims. This is to accommodate the fact that the scheme is changing from month to month.

• It is possible to make more than one claim in each month, but each claim must be for a minimum period of at least 7 days. The only exception to this is if you are claiming for the first few days or the last few days in a month, known as 'orphan days'. In this instance, a claim period can be shorter than 7 days.

• The number of employees you can claim for in any claim period from 1st July 2020 cannot exceed the maximum number of employees you claimed for in any single claim before 30th June 2020. An exception to this is where an employee is returning from statutory parental leave after 10th June.

• When claiming for employees who are flexibly furloughed, employers are required to submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked. Therefore, you should not claim until you are sure of the exact number of hours they will have worked during the claim period.

Interested in finding out more about the new changes to the Coronavirus Job Retention Scheme? Watch our webinar on-demand where we discuss flexible furlough, the wind-down of the scheme and changes to making a CJRS claim.

Posted byRachel HynesinCoronavirus

The Road to COVID-19 Recovery - Return to Work Safety Policies

Join us on 11th June for a free COVID-19 webinar

This webinar will examine key facts & updated guidance on COVID-19 payroll impacts. Understand what the lockdown easing will mean for your business as you reopen and what COVID-19 safety policies you need to introduce.

Free Webinar: Register Now

Part 1: Important COVID-19 Payroll Updates

In recent months, HMRC have introduced COVID-19 Government schemes to help keep paying employees with a number of important updates being rolled out. The government has announced the first steps to ease the coronavirus restrictions with a roadmap in place for lockdown measures to be slowly lifted. Understand how to adapt your payroll processes to accommodate for the schemes and subsequent updates.

Agenda

• The Coronavirus Job Retention Scheme - A Quick Recap
• How BrightPay’s CJRS Claim Report works
• COVID-19 Related Statutory Sick Pay & The SSP Rebate Scheme
• Managing Annual Leave during COVID-19

Part 2: Return to Work Safely Protocol

The UK government has set out a roadmap for lifting further restrictions and opening more businesses and venues, but this plan is dependent on successfully controlling the spread of the virus. Employers should stay safe in public spaces and workplaces by following 'COVID-19 secure' guidelines.

With the emergence from lockdown becoming clearer, businesses will need to start to put plans and COVID-19 policies in place for their employees to go back to the workplace safely. It is advisable for all workplaces to adapt their workplace HR policies, procedures and practices to comply with the COVID-19 related safety guidelines.

Unable to attend?

If you are unable to attend the webinar at the specified time, simply register for the webinar anyway and we will send you the recording afterwards. You can also click here to view more webinar dates.

Posted byRachel HynesinCoronavirus

Advisory Fuel Rates updated from 1st June 2020

HMRC has issued details regarding the latest Advisory Fuel Rates for company cars. From the 1st June 2020 employers may use the old rates or new rates for one month. Employers are under no obligation to make supplementary payments to reflect the new rates but can do so if they wish. Hybrid cars are treated as either petrol or diesel cars for this purpose for the fuel rates.

The rates are as below:

For fully electric cars the Advisory Electricity Rate is 4 pence per mile. But electricity is not a fuel for car fuel benefit purposes.

Click here to see all details per HMRC

Posted byDebbie ClarkeinPayroll

Customer Update: June 2020

Welcome to BrightPay's June update. Our most important news this month include:

• Unemployment set to skyrocket despite the Coronavirus Job Retention Scheme

• Furlough scheme extended until October

• Claim Guidance for Coronavirus Statutory Sick Pay Claim

• Self-employment income support scheme is rolled out

Free Webinar: Important COVID-19 Payroll Updates & Return to Work Safety Policies

The government has announced the first steps to ease the coronavirus restrictions with a roadmap in place for lockdown measures to be slowly lifted. Understand how to adapt your payroll processes to accommodate for the schemes and subsequent updates.

Register Here - Limited Places

Furlough Scheme available until 31st of October

Return to Work Safety Policies

Coronavirus Job Retention Scheme - Claim Report in BrightPay

Posted byKaren BennettinCustomer Update

How to Choose the Right Payroll Software for Your Accountancy Practice

It can be challenging to settle on the right payroll software for your business when there is so much to choose from. Here are some key points we feel must be considered when looking for excellent payroll software:

• Batch processing - For an accountancy firm, batch processing is a must. The time-saving involved in running payroll procedures in a batch cannot be understated. 

• Pricing - Pricing is a crucial factor to consider. The price doesn't have to be "cheap", but it should certainly be reflective of the value of the product. If it's also affordable on top of that, bonus. 

• Delegating work - What if your payroll software allowed your employees to log in directly to it and request things like annual leave, or to access their payroll data? And what if employees could access a "self-service" section of the payroll software where they could download their payslips? The more your payroll software can delegate work, the more time you'll have on your hands. And time is money.

• Auto-enrollment - Under the new pension laws, finding a pension scheme that matches all the required criteria can be challenging. Great payroll software should facilitate this procedure, integrating with NEST to provide easy auto-enrolment into qualifying pension schemes. 

• Connects to accounting software - Your payroll software should connect to your cloud accounting software such as QuickBooks, FreeAgent, Xero and others. This way, the payroll journal is reflected in your accounts. 

• Excellent support - Excellent support could be said to be the make or break of high-grade payroll software. Too many software companies have come onto the scene blazing, only to fail because their support was not good enough. Support should be handled by knowledgeable people who understand the product and can also communicate clearly with potentially frustrated clients. 

• Secure - Security of payroll data is crucial to stay in compliance with data privacy laws. Saving payroll data on the cloud might be "convenient", but it also means that anybody with access to your password can access all your staff's personal data. The choice between cloud-based software and desktop software is always won hands-down by desktop software. 

• Recognition - The HMRC should recognise the payroll software. Failing to use HMRC-recognised software might lead to you having to run the payroll entirely manually! There are strict rules for running payroll, and plenty to remember. If the HMRC has not recognised a payroll software, be wary. 

• Awards - Awards are not vital when choosing payroll software, but they certainly make the choice sweeter! Awards from external bodies show that the software company has achieved standards higher than its peers, and that these standards have been independently verified. The more prestigious the award, and the more often it has been won, the better chances you have that the software will deliver more than what you need. Awards also prove that the team behind the software knows what it's doing. 

• Always getting better - The best payroll software should get better every year. This not only adds value to your business but also inspires confidence in the company behind it. It shows that the product is continuously being worked on, that it is not stagnant. If the product is continually improving, your ROI as far as that software goes will also improve.
  
  

Written by Guest Blogger: Pearl Chartered Accountants