We’ve Got the Budget Covid.

Although not mentioned in the budget, it was announced on 17 March 2020 that the extension of IR35 to the private sector has been delayed by a year to 6 April 2021. Uncertainty as a result of “the ongoing spread of Covid-19” was the reason given. This is welcome news for those businesses and contractors to whom the issue is relevant.

The Chancellor of the Exchequer, Rishi Sunak, delivered the Spring Budget on 11 March 2020. There were a number of employment related announcements, but the focus appeared to be on the immediate need to contain the COVID-19 outbreak.

Although temporary, the following changes to the statutory sick pay (SSP) regime should be noted:

  • SSP will be paid from the first day of sickness absence, instead of the fourth day, for employees with COVID-19 or those who have had to self-isolate, in accordance with Government guidance.
  • Measures have been announced to extend SSP to individuals who are unable to work because they have been advised to self-isolate and those who are caring for others within the same household, who display symptoms of the virus and have been told to self-isolate.
  • Provided the eligibility criteria are satisfied, employers with fewer than 250 employees on 28 February 2020 will be able to reclaim SSP paid for the first 14 days of an employee’s sickness absence related to the virus.
  • SSP will not cover self-employed people or individuals whose earnings are below the Lower Earnings Limit of £118 per week, but they will be able to make a claim for Universal Credit or Contributory Employment and Support Allowance more easily.

Individuals who are advised to self-isolate for COVID-19 will also soon be able to obtain an alternative to the fit note to cover that period of absence by contacting NHS 111, rather than visiting a doctor.

In addition to the above, the following key long-term employment measures were also announced:  

  • National Living Wage (NLW): The Government will attempt to extend the NLW to workers aged 21 and over by 2024, provided economic conditions allow for that. It is expected that the NLW will increase to £10.50 an hour in 2024 and it is hoped the NLW will reach two-thirds of median earnings by then. Further information on National Minimum Wage hourly rates, including the new rates for April 2020, can be found here.
  • Neonatal Leave and Pay: The Government has announced that it will introduce a new statutory entitlement to neonatal leave and pay for employees whose new-borns must spend an extended period of time in neonatal care. Those employees will be entitled to up to 12 weeks’ paid leave, although a date has not been provided for the introduction of this new right.
  • Carers’ Leave: The Government have plans to consult on introducing a new form of statutory leave for employees with unpaid caring responsibilities, for example for a family member or dependants. No timescale has been given for the introduction of carers’ leave.

Other long term employment measures include extensions to the scope of welfare counselling provided by employers and considerations as to how to provide appropriate support for self-employed parents. More information on the 2020 Budget can be found here.

The contents of this article are intended as guidance for readers. It can be no substitute for specific advice. Consequently we cannot accept responsibility for this information, errors or matters affected by subsequent changes in the law, or the content of any website referred to in this article. © Mundays LLP.


Coronavirus Job Retention Scheme and Furlough Leave
27th March, 2020

The Government announced on 20 March 2020 that the state will subsidise employers to pay 80% of the wages of staff who are placed on “furlough” leave but remain employed,…

A note from Neale Andrews
27th March, 2020

These are perhaps some of the most challenging circumstances we have faced as a firm in our 60 year history. We are doing absolutely everything we can to protect our…

Combatting Covid-19 for Commercial Tenants
26th March, 2020

The pandemic is causing huge socioeconomic repercussions and the UK commercial property sector is not immune. So what is going to happen to property-overheads or running costs of commercial premises…

Certainty in uncertain times
25th March, 2020

In this current period of lockdown Michael Brierley discusses whether it's possible to correctly execute a Will without witnesses "present" to witness the signature. The answer, dating back to an…