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Ensuring people do not fall through the gaps in the government’s employment support schemes

10 April 2020

Ensuring people do not fall through the gaps in the government’s employment support schemes

On 4th April, the government announced major clarifications to the Coronavirus Job Retention Scheme. These changes included updates to ensure all workers paid through PAYE (including all agency workers) would be eligible for the scheme if their employers used it, as well as all foreign nationals. 

The government also clarified that employers could use the scheme to furlough their workers due to certain personal circumstances, including people who share a household with the shielded group as well as carers & parents, would be eligible.

These are all welcome extensions and clarifications of the scheme’s existing generosity. In a fast changing situation, the data we are getting from our advisers suggests that further gaps in the existing package of support will need addressing.

 Our main recommendations are that the government consider:

  • Making further changes to the Job Retention Scheme’s guidance & rules for people in the shielded group or who need to stay at home with someone in the shielded group. This should:

  1. Make clear (as for parents and carers) that the employer does  not need to otherwise be making that person redundant in order to furlough them.
  2. Give people in these groups, in effect, the right to be furloughed, if their work would otherwise require them to breach public health advice. This could be included as a change to the scheme’s guidance.

  • The government should clarify the scheme guidance to give employers the option of furloughing workers in the ‘increased risk’ group.

  • The Self-Employed Income Support Scheme should be extended to people who have been self employed for less than a year. The government should also confirm it does not intend to add support from the scheme to the list of public funds, so that people without recourse to public funds are not excluded.

Beyond gaps in the existing system, one potential challenge on the horizon is employers making workers redundant and choosing not to put them on the scheme. The government may want to evaluate further contingencies, should the number of workers in this group be significant. We have identified two main contingency routes:

  • Consider giving employers more incentives or obligations to use the scheme. This could include putting more pressure on firms to act, giving workers in certain situations the right to be furloughed or issuing guidance that makes it clear that if an employee is unreasonably refused access to the scheme the dismissal would be unfair.

  • Consider temporarily enhancing our safety net further, both by widening eligibility to the benefits system and ensuring people have enough to make ends meet during this period. This could include relaxing the capital limit rules for claiming Universal Credit, turning advance payments into grants and reviewing the value of key components within Universal Credit like the Standard Allowance and the Local Housing Allowance.