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Chancellor announces Plan for Jobs to help Businesses

Posted by Davenport Solicitors Team on July 9, 2020 in Employment Law

Chancellor, Rishi Sunak announced a plan for jobs on 8 July 2020. We set out some of the key highlights.

  • Furlough will not be extended: although it seems attractive, it will be worse for the economy to extend it. So, it will end in October 2020.
  • A new policy has been introduced to reward and incentivise employers who successfully bring furloughed staff back – a new Jobs Retention Bonus. As an employer, if you bring someone who was furloughed and you continuously employ them through to January 2021, the Government will pay you a £1000 bonus per employee. Employees cannot be returning for the sake of it. They must be doing “decent” work. For businesses to get this bonus, the employee must be paid at least £520 on average, in each month from November 2020 to January 2021, the equivalent of the lower earnings limit in National Insurance. Bonus will be paid for all furloughed employees.
  • The Kickstart scheme: A new programme to give young people the best possible chance of getting on and getting a job. The Kickstart Scheme will directly pay employers to create new jobs for any 16 to 24-year-old at risk of long-term unemployment. These will be new jobs – with the funding conditional on the firm proving these jobs are additional. These will be decent jobs – with a minimum of 25 hours per week paid at least the National Minimum Wage and good quality jobs, with employers providing Kickstarters with training and support to find a permanent job. If employers meet these conditions, the Government will pay young people’s wages for six months, plus an amount to cover overheads. That means, for a 24-year-old, the grant will be around £6,500. Employers can apply to be part of the scheme from next month, with the first Kickstarters in their new jobs this autumn. There will be no cap on the number of places available.
  • Traineeships: The Government will pay employers £1,000 to take on new trainees, with triple the number of places.
  • For the next six months, the Government will pay employers to create new apprenticeships. The Government will pay businesses to hire young apprentices, with a new payment of £2,000 per apprentice.
  • Bonus for businesses to hire apprentices aged 25 and over, with a payment of £1,500.
  • Measures for the hospitality sector announced:
    • All the following and more will see VAT reduced from next Wednesday until 12 January 2021, from 20% to 5%: accommodation and attractions; eat-in or hot takeaway food from restaurants, cafes and pubs; accommodation in hotels, B&Bs, campsites and caravan sites; attractions like cinemas, theme parks and zoos.
    • For the month of August 2020, the Government will give everyone in the country an Eat Out to Help Out discount. Meals eaten at any participating business, Monday to Wednesday, will be 50% off, up to a maximum discount of £10 per head for everyone, including children. Businesses will need to register and can do so through a simple website, open next Monday. Each week in August, businesses can then claim the money back, with the funds in their bank account within 5 working days.

Should you have any questions on furlough, bringing employees back or any employment/HR related matter please contact us.

The material contained on this website contains general information only and does not constitute legal or other professional advice and should not be relied upon as such. While every care has been taken in the preparation of the information on this site, readers are advised to seek specific legal advice in relation to any decision or course of action.



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