As we continue to deal with the ongoing fallout from the coronavirus pandemic, the CIPD continues to collate and publish updated resources to support the people profession
As we come to terms with the fact that COVID-19 will be with us into the immediate future, both organisation practices and government supports are being updated to take account of this new reality and its economic impact. Job support measures will stay in place for now and be tapered off between now and April 2021 to bring payments in line with existing social welfare levels. Government advice on international travel is still not to travel abroad, despite the existence of a green list, and employers should clarify their policy on the requirement for movement restrictions following non-essential travel outside Ireland.
Temporary Wage Subsidy Scheme (TWSS)
Under the wage subsidy scheme, employers do not have to lay off employees, but receive a subsidy to be able to retain them. The individuals remain as employees and the normal employment contractual conditions and benefits will apply. Even if there is no work, employees will be at their employer’s disposal, and will need to be directed as to whether or not they are required to work.
Under the stimulus plan announced by the government in July 2020, the TWSS will be replaced by an Employment Wage Support Scheme. Employers whose turnover has fallen 30 per cent receive a flat-rate subsidy of up to €203 per week per employee. The scheme has also expanded, and additional employees such as seasonal staff, and newer firms are also eligible.
The current scheme is in place until 31 August, and the start date of the new scheme has not been announced. It is expected to support around 350,000 jobs into the new year. By July 2020 more than 63,500 employers and an estimated 400,000 employees have been directly supported by the TWSS.
How does TWSS operate?
Under the current TWSS an eligible employer will be supported by up to 70% of an employee’s take home income up to a maximum weekly tax-free payment of €410 (i.e. 70% of take home weekly income of €38,000 per annum). For those earning less than €412 per week, a subsidy of up to 85% may be made.
The scheme will provide support on incomes up to €76,000 or twice average earnings. It will be capped at net €350 for incomes between €38,000 and €76,000. The employer is expected to make best efforts to maintain as close to 100% of normal income as possible for the subsidised period. There will be severe penalties for any abuse of the scheme.
Detailed guidelines have been provided by the Revenue Commissioners. Income tax and USC will not be applied to the subsidy payment through payroll but will be due in the current tax year.
The names of all employers in the scheme will be published on Revenue’s website once the scheme has expired. It is important to read the technical guidance from Revenue on the detailed operation of this scheme.
What are the implications?
Employers retain responsibility for the employment relationship so have to consider employees from a health and safety, management and operations perspective. Social distancing, other protective measures and working from home measures should be implemented.
Employees need to be informed of the potential tax implications of being on the scheme, as a tax liability for the year is likely to be accruing.
COVID-19 Pandemic Unemployment Payment (PUP)
The COVID-19 Pandemic Unemployment Payment (PUP), the weekly payment available to employees and the self-employed who lost their job due to the COVID-19 pandemic crisis, has been extended until 1 April 2021 under the government’s jobs stimulus plan. At the peak of the crisis in May 2020, 598,000 people were claiming the PUP, and that figure had fallen to 313,000 in July 2020 as the economy gradually re-opened.
Applications for this payment will be accepted until 17 September 2020, and payments will be gradually reduced based on the pre-pandemic earnings of the claimant to come in line with Jobseekers Benefit of €203 per week.
PUP rates will change on 17 September 2020, 1 February 2021 and 1 April 2021, related to the previous income of the individual.
Until 17 September 2020, the PUP payment is paid at two rates:
- For a person previously earning €200 per week or more - the rate of the PUP payment is €350 per week
- For a person previously earning less than €200 per week – the payment is €203 per week, which is the same as the primary rate of Jobseeker's Benefit
- For previous earnings of less than €200 per week - the rate will be €203 per week
- For previous earnings between €200 and €300 per week - the rate will be €250 per week
- For previous earnings over €300 per week – payment will be €300 per week
- Those who earned €200-€300 pre-pandemic will move from the €250 PUP rate to Jobseekers' Benefit of €203
- Those who previously earned over €300 will receive a PUP payment of €250
Back to work support measures
- 10,000 additional places on work placement and experience schemes available for those unemployed for over 6 months
- 12,500 additional places funded through the Training Support Grant for short term skills training
- 35,000 additional places in further and higher education. These will be delivered through a variety of measures including Skills to Compete Initiative (SOLAS), Skillnet, Springboard+ and the Human Capital Initiative, as well as through additional undergraduate and postgraduate provision in the Higher Educational Institutions
- the Apprenticeship Incentivisation Scheme will provide a €2,000 payment to support employers to take on new apprenticeships in 2020
- a Retrofit Skills Training Initiative will support future expansion of the National Retrofitting Programme
- 8,000 recruitment subsidies under the JobsPlus scheme. Subsidies of up to €7,500 over two years will be available for employers to hire someone under the age of 30 who is on the Live Register or the Pandemic Unemployment Payment
- the capacity of the Public Employment Service will be increased to support jobseekers through job search advice and assistance, including through contracted services such as JobClubs, JobPath and Local Employment Services
- the Back to Work Enterprise Allowance and Back to Education Allowance will be extended to people currently in receipt of the Pandemic Unemployment Payment
- 3,000 additional places will be funded on State Employment schemes such as Community Employment and Tús
Travel and the green list
The Bike to Work Scheme is being extended and will include a limit of €1,500 on ebikes.
Government advice on international travel has not changed – it is not to travel abroad. The production of a green list of countries has caused confusion. Employers need to clarify the situation for employees based on the need to protect public and workforce health. and the consequences on any non-essential travel abroad
- Requiring all employees making any plans to travel abroad, apart from Northern Ireland, to inform the employer of their plans, for the purpose of protecting public health and the workforce
- Requiring all employees who are returning from non-essential travel outside Ireland, apart from Northern Ireland to restrict their movements for 14 days. This is in line with government advice, despite the existence of a green list
- Inform employees that they must apply under normal leave and absence policies for the additional period, for example as annual or unpaid leave
- Remote working is not acceptable as restricted movement. It normally does not cover all employees and all individuals need to be treated fairly in these circumstances.
If you have other queries about COVID-19 not covered above, please contact the CIPD member employment law helpline on 1800 812 603 or visit the Community pages
We know that our members and customers are facing challenging times and we are here to help you. Due to a high number of calls we apologise that your wait time may be longer than usual. We appreciate your patience and will connect you to an expert adviser as soon as we can.
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